Strategic thinking in leadership means using a long-term, whole-system view to set direction for a team, make clear trade-offs and build that thinking into others. Research by Schoemaker, Krupp and Howland identifies six skills strategic leaders need: the abilities to anticipate, challenge, interpret, decide, align and learn.
Thinking strategically on your own is one skill. Getting a whole team to think and act strategically is another, and it is the one leaders are judged on. This guide focuses on that second skill: the habits strategic leaders use, how they make room for strategic thinking in busy teams, how they make decisions under uncertainty and how they turn their thinking into direction that others can act on. If you want the general definition and the individual skill first, start with my guide to strategic thinking.
What does strategic thinking in leadership mean?
Strategic thinking in leadership means using a long-term, whole-system view to set direction for others, make the trade-offs that follow from it, and build the same thinking into the team. An individual strategic thinker asks "what should I do?" A strategic leader asks "where should we go, what will we stop doing, and how do I help everyone here think this way too?"
The difference matters because leaders multiply their thinking through other people. A brilliant strategic insight that stays in the leader's head achieves nothing.
What skills do strategic leaders need?
The most practical framework comes from Paul Schoemaker, Steve Krupp and Samantha Howland. Drawing on research at the Wharton School and work with more than 20,000 executives, their 2013 Harvard Business Review article "Strategic Leadership: The Essential Skills" identified six abilities. They also found that strength in one does not easily make up for weakness in another, so leaders need all six.
| Skill | What it means for a leader | A team habit that builds it |
|---|---|---|
| Anticipate | Spot ambiguous signals of change before rivals do | A standing "what's changing?" slot in monthly meetings |
| Challenge | Question your own and others' assumptions; encourage dissent | Assign someone to argue the opposite case on big decisions |
| Interpret | Make sense of complex, conflicting information | Ask the team for three explanations of a surprising result, not one |
| Decide | Make tough calls with incomplete information and clear criteria | Agree decision criteria before discussing options |
| Align | Find common ground and get buy-in from stakeholders with different interests | Map stakeholders early using Mendelow's matrix |
| Learn | Encourage honest reflection on successes and failures | Short reviews after every major project, with no blame |
What is the difference between a strategic and a tactical leader?
| Behaviour | Tactical leader | Strategic leader |
|---|---|---|
| Opening question | "What needs doing this week?" | "What are we trying to achieve and why?" |
| Use of time | Mostly firefighting and approvals | Protected time for thinking, scanning and coaching |
| Priorities | Everything is urgent | A short list, with explicit "not now" items |
| Decisions | Made case by case | Made against agreed criteria linked to strategy |
| Team meetings | Status updates | Status plus discussion of risks, trends and options |
| Communication | Instructions | Context, then instructions |
| Developing people | Teaches tasks | Teaches judgement |
| Success measure | Targets met | Targets met and the team better positioned for next year |
Most leaders need both modes. The problem is getting stuck in tactical mode. For a deeper treatment, see strategic vs operational leadership and strategy vs tactics.
What habits do strategically minded leaders have?
1. They protect thinking time
Strategic thinking does not happen in 15-minute gaps between meetings. Effective leaders block regular time, often a couple of hours a week, and treat it as seriously as a client meeting. In my own experience, the leaders I have seen grow fastest into senior roles were the ones who stopped filling every hour.
2. They give context before instructions
Instead of "redo the forecast by Friday", a strategic leader says "the board is worried about cash in Q3 because of the new contract terms; redo the forecast by Friday with a downside case." The context lets people make better decisions without asking.
3. They keep a "stop doing" list
Strategy is about choices. Richard Rumelt, in a McKinsey Quarterly article on bad strategy, warns against long lists of objectives with no focus. Strategic leaders regularly ask their team what they should stop, and they act on the answers.
4. They separate the urgent from the important
They triage requests visibly, explaining why some work will wait. This models prioritisation for the team.
5. They invite challenge
They ask "what am I missing?" and reward people who disagree constructively. Teams quickly learn whether dissent is welcome.
6. They connect the team to the bigger picture
They share what is happening at board or organisation level, so the team understands how its work fits the strategy.
How do you build strategic thinking in your team?
Leaders cannot do all the strategic thinking themselves. These five practices spread it through the team:
- Write a one-paragraph team strategy. Use David Collis and Michael Rukstad's three parts from "Can You Say What Your Strategy Is?": objective, scope and advantage. Agree it with the team and refer back to it when prioritising.
- Run premortems on major projects. Gary Klein's premortem asks the team to imagine a project has failed and explain why. It gives quieter team members permission to raise risks.
- Rotate a "horizon scanner". Each month, a different team member brings one external trend and explains what it might mean for the team.
- Ask "what would you do?" before giving your answer. This develops judgement and often produces better ideas.
- Debrief decisions, not just outcomes. A good decision can have a bad outcome through bad luck. Reviewing how decisions were made builds strategic judgement over time.
How do strategic leaders make decisions under uncertainty?
- Set criteria first. Agree what a good option looks like before debating options. The suitability, acceptability and feasibility test is a strong starting point.
- Generate at least three options. Two options usually means a false choice between "do it" and "do not".
- Distinguish reversible from irreversible decisions. Move fast on decisions you can undo; slow down on those you cannot.
- Use scenarios for big bets. Ask how each option performs in good, bad and surprising futures.
- Decide, then commit. Once a decision is made, a strategic leader backs it publicly while watching for signs it needs revisiting.
What are examples of strategic thinking in leadership?
A finance director reshapes the team's role
A finance director notices that the business increasingly asks finance for insight, not just numbers. Rather than hiring more accountants for reporting, she automates routine reconciliations and retrains two team members as business partners for sales and operations. She explains the change in terms of the company's growth strategy, not cost-cutting, and the team embraces it.
A head of sales chooses not to chase every deal
A head of sales sees that the most profitable customers are mid-sized firms in two sectors. He asks the team to stop pursuing very large tenders that tie up months of effort with low win rates. Short-term pipeline falls; within a year, margin and win rate rise. The choice to say no was the strategic act.
A practice manager invites challenge
Before a big investment in new software, a practice manager asks the most sceptical team member to lead a premortem. The team identifies a training gap that would have derailed the rollout, and the plan is changed before money is spent.
Why do leaders struggle to think strategically?
- They were promoted for operational excellence and keep doing what made them successful.
- Their calendar is set by others, leaving no unscheduled time.
- They feel they must have the answers, so they avoid open discussions where they might look uncertain.
- Their organisation rewards short-term results more than long-term positioning.
- They confuse planning with thinking. Henry Mintzberg made this point in his 1994 HBR article "The Fall and Rise of Strategic Planning": formal planning processes cannot produce strategy on their own.
How does leadership style affect strategic thinking in teams?
Style matters. Daniel Goleman's research in "Leadership That Gets Results" found the visionary (authoritative) style had the most positive effect on working climate, partly because it gives people clarity about direction while leaving them freedom over how to get there. That combination is exactly what strategic thinking needs. A pacesetting or coercive leader, by contrast, tends to shut down the discussion and challenge that strategic thinking depends on. See my guide to types of leadership for a full comparison.
How does strategic thinking change at board level?
At board level, strategic thinking shifts from creating strategy to testing it. Non-executive directors are expected to challenge management's proposals constructively, ask whether the strategy fits the organisation's risk appetite, and check that stakeholders' interests have been considered. The six skills still apply, but "challenge" and "align" dominate. A board that simply approves whatever management presents is not thinking strategically, however senior its members are. The ACCA SBL syllabus links this closely to governance, which is why the board's role in strategy appears in so many exam scenarios.
A 30-day plan to lead more strategically
| Week | Focus | Actions |
|---|---|---|
| 1 | Make space | Block two hours of weekly thinking time; list your recurring meetings and drop or delegate one |
| 2 | Clarify direction | Draft a one-paragraph team strategy (objective, scope, advantage); test it with two team members and your manager |
| 3 | Focus | Ask the team what to stop doing; agree at least two items and announce them |
| 4 | Build the habit in others | Add a 10-minute "what's changing?" slot to your team meeting; run a premortem on your next significant project |
At the end of the month, ask your team one question: "Do you understand our priorities better than you did four weeks ago?" Their answer is the best measure of whether your strategic thinking has reached them.
Where can I learn more?
Strategic leaders need a working knowledge of the core strategy, governance and leadership models. My book, Becoming A Strategic Business Leader, is a concise guide to those models, originally written for the ACCA SBL exam and useful for any manager. Chapters 1 to 4 cover strategic planning, analysis, performance and choice; Chapter 8 covers leadership; Chapter 19 covers managing change. You can read the first three chapters free. For the wider role, see strategic leadership.
Bottom line
Strategic thinking in leadership is not just thinking big; it is setting a clear direction, making trade-offs visible and building the same thinking into your team. Schoemaker and colleagues' six skills (anticipate, challenge, interpret, decide, align, learn) are a useful checklist. Protect time to think, give context before instructions, invite challenge, keep a stop-doing list, and judge yourself not only on this year's targets but on how well your team is positioned for next year.
FAQs
Why is strategic thinking important in leadership?
Leaders set direction for other people, so their thinking is multiplied across the team. Strategic thinking helps leaders choose the right priorities, spot risks and opportunities early, make better decisions under uncertainty and explain to their teams why the work matters. Without it, teams can work very hard while the organisation drifts away from what customers need.
What are the six skills of strategic leadership?
Schoemaker, Krupp and Howland's 2013 Harvard Business Review article identified six: anticipate (spot signals of change early), challenge (question assumptions), interpret (make sense of complex information), decide (make tough calls with incomplete data), align (build buy-in among stakeholders) and learn (reflect honestly on successes and failures). They argued leaders need all six together.
How can a leader develop strategic thinking in their team?
Share context, not just instructions; write a short team strategy covering objective, scope and advantage; run premortems before major projects; rotate a team member to bring external trends each month; ask people what they would do before giving your view; and review how decisions were made, not only how they turned out.
What is the difference between a strategic leader and a tactical leader?
A tactical leader focuses on getting this week's work done through instructions and approvals. A strategic leader also asks what the team is trying to achieve and why, keeps a short priority list, makes decisions against agreed criteria, protects time for thinking and coaching, and develops judgement in others. Most leaders need both, but many get stuck in tactical mode.
How do I show strategic thinking as a manager?
Link your team's work to the organisation's goals, explain trade-offs you have made, raise risks and opportunities before others notice them, propose options rather than problems, and stop low-value work. In meetings, ask questions about the longer term and the wider effects of decisions. Senior leaders notice managers who think beyond their own area.
Sources
- Schoemaker, P.J.H., Krupp, S. and Howland, S. (2013) Strategic Leadership: The Essential Skills, Harvard Business Review
- Collis, D.J. and Rukstad, M.G. (2008) Can You Say What Your Strategy Is? Harvard Business Review
- Klein, G. (2007) Performing a Project Premortem, Harvard Business Review
- Mintzberg, H. (1994) The Fall and Rise of Strategic Planning, Harvard Business Review
- Goleman, D. (2000) Leadership That Gets Results, Harvard Business Review
- Rumelt, R. (2011) The perils of bad strategy, McKinsey Quarterly