describe how strategic leaders influence each element of the learning system.

STRATEGIC LEADERSHIP AND ORGANIZATIONAL LEARNING

Adopting the strategic leadership perspective, we develop a theoretical model of the impact of CEO and top manager leadership styles and practices on organizational learning. We take a fine-grained look at the processes and levels of organizational learning to describe how strategic leaders influence each element of the learning system. Researchers have implicitly assumed transformational leadership approaches to organizational learning. We challenge this conventional wisdom by highlighting the value of transactional leadership as well. Organizational learning has been proposed as a fundamental strategic process and the only sustainable competitive advantage of the future (DeGeus, 1988). Unfortunately, despite the growing interest in the topic, researchers have said little specifically about the role of CEOs and top management teams in implementing organizational learning in their firms. Yet strategic leadership theorists (Hambrick & Mason, 1984) assert that top managers are crucial to firm outcomes because of the decisions they are empowered to make and because, “ultimately, they account for what happens to the organization” (Hambrick, 1989: 5). Although there is an implicit assumption that strategic leaders are the guiding force behind organizational learning (La¨ hteenma¨ ki, Toivonen, & Mattila, 2001), researchers have not delineated the specific behaviors and mechanisms through which leaders impact learning. While large budgets are being expended on training, databases, and new “learning departments” (Stewart, 1998), CEOs and top executives lack guidance on how their actions facilitate or hinder learning. Strategic leadership and organizational learning have largely remained disconnected fields of inquiry (Crossan & Hulland, 2002). We address this gap in the literature by integrating strategic leadership theory and organizational learning. Specifically, we address the question: What is the impact of top management leadership style (transformational and transactional) on organizational learning? Building on current theories of transformational and transactional leadership (Bass, 1985, 1998) and on the 4I framework of organizational learning (Crossan, Lane, & White, 1999), we develop a theoretical model and a set of propositions to address this research question, and we describe specific behaviors and practices of strategic leaders that either facilitate or hinder organizational learning. We seek to contribute to the organizational learning and strategic leadership fields by linking two developed streams of research that have not been connected previously. In doing so, we make explicit how strategic leaders impact learning. We take a fine-grained look at the processes and levels of organizational learning to describe how strategic leaders influence each of the elements of the learning system. In particular, we note that researchers have implicitly assumed transformational leadership approaches to organizational learning, and we challenge this conventional wisdom by highlighting the value of transactional leadership as well. In addition, we introduce internal and external contingency factors that influence top managers’ choice of leadership style and the type of learning emphasized. Our integrative approach provides a fresh perspective on transformational and transactional leadership from which we generate research propositions that have not We thank the editor, Devereaux Jennings, and the anonymous reviewers for their insightful and constructive contributions to this paper. Academy of Management Review 2004, Vol. 29, No. 2, 222–240. 222 been considered previously. We also seek to contribute to management practice through consideration of specific leadership requirements, responsibilities, and challenges associated with organizational learning. We begin with the theoretical context and an outline of the conceptual models in which we anchor this paper. We then develop an integrating framework to describe and clarify the relationship between strategic leadership and organizational learning. Finally, we present implications for theory and practice.