This document summarizes a dissertation proposal on evaluating strategic leadership practices and their impact on organizational performance in Pakistan's small and medium enterprises. The proposal outlines the background, aims, objectives, and organization of the dissertation research. Specifically, it will examine current strategic leadership practices in pharmaceutical SMEs in Pakistan, compare them to effective practices identified in literature, and analyze their influence on organizational performance.

1. Dissertation Title
"EVALUATION OF STRATEGIC LEADERSHIP PRACTICES AND ITS
IMPACT ON ORGANIZATIONAL PERFORMANCE IN PAKISTAN'S
SMALL & MEDIUM ENTERPRISES".
Author
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3. Chapter One: Introduction
"We are on the precipice of an epoch-a distinctive, exciting, and challenging time for
organizations, where focus is on twenty-first century organizations in view of strategies,
human capital, and characteristics of organizations required for survival and long-term
success"(Hitt, 1998, P.218). In existing highly complex and competitive business
environment, effective utilization of resources is a key to success that creates multiplier
effects (Doherty & Terry, 2013). In furtherance of achieving and maintaining competitive
advantage, human resource is crucial resource for organization (Dobre, 2012). Strategic
leaders are crucial part of human resource (Suresh, 2012).
Bacon and Hoque (2005) argue Small and Medium Enterprises (SMEs) holds the most
crucial positions in the economic growth of any country, through income generation and
employment creation (Lange et al.2000). According to Raziq (2014), regardless their
economic importance SMEs in Pakistan is suffering from various shortcomings, which
include inadequate guidance on their future actions, whereas government ever-changing
standards to support the sector also prove ineffective to bring long-term
positive change. Pharmaceutical SMEs face complex issues like change in technology,
government policies, lack of resources, globalization, and consumer expectations that
grow more challenging by the day (Zhang & Zhang, 2010) along with numerous
leadership challenges (Leslie & Palmisano, 2010).
Majority of the experts believe that effective strategic leadership practices are one of the
major contributors to cope such challenges in the companies' performance (Krupp &
Howland, 2013), therefore keeping in view the 21st century growing challenges it is
necessary to explore the effective strategic leadership role in organizational
performance (Hitt et al. 2010). At one side, this would make pharmaceutical industry
more competitive to compete in the international markets on the other side this will
further enhance its contribution in the economic development of Pakistan. Therefore,
based on an analytical review of current strategic leadership research and practice in

4. SMEs this study contributes to the current strategic leadership research in view to
enhance organizational performance.
Background of the Research
The business environment has changed dramatically as it modernizes in the recent
years mainly in developing countries small businesses are increasingly threatened
(Gosenpud & Vanevenhoven, 2011). Most of newly introduced factors are not in favour
of the SMEs (Bashar, 2012). Increasing globalization trend and rapid advancement in
the field of technology further enhanced uncertainty, turbulence, and competitive
environment in which organizations are operating. The capacity to enhance
performance is a learnable organizational competence (Owen et al. 2001). According to
Arslan and Staub (2013), organizations must consistently enhance performance to meet
the growing challenges of the highly competitive markets.
Most of the preceding literature emphasise the importance of leadership role for
enhancing organizational performance (e.g. Peterson et al. 2003; Boal & Hooijberg
2000). However, some erstwhile studies hold contradictory views about the role of
leadership for achieving organizational performance. According to Meindl et al. (1985),
leadership role holds limited importance for achieving the performance of organizations.
Whereas, contrary to above study Peterson et al. 2003; Finkelstein & Hambrick (1996),
suggest that in order to achieve a high level of an organization performance the role of
leadership is very important. According to Ireland and Hitt (2005), effective strategic
leadership practices can play a crucial role in increasing performance while operating in
unpredictable and turbulent environment. Hagen et al. (1998) investigate the six
practices for effective strategic leadership evolved by Hitt, et al. (1995). Later Ireland et
al. (2012) reviewed and represented five actions of effective strategic leadership by
merging two actions exploiting and developing human capital and maintaining core
competencies into effectively managing the firm's resource portfolio. These five
components are critically examined in chapter 2.

5. The Islamic Republic of Pakistan with an estimated 183 million population is world's
sixth most populous country (World Population Review, 2014). According to Radam and
Abdullah (2008), SMEs referred to as the backbone of the economy and holds a
significant role for the development of any country' economy. It is extremely important to
ensure development and growth of SMEs in order to achieve employment generation
and economic activity in a country, as has been witnessed during the course of
economic development in many Newly Industrialized Countries (NICs) in Asia, SMEs
have a crucial role to play in terms to poverty reduction (Naveed, 2012). This stands
stronger in case of Pakistan where SMEs constitute almost 90% of all the enterprises
and occupy a substantial role in the economy of Pakistan (SMEDA 2013). Issues
pertaining to development of efficient and viable SMEs are numerous (Muhammad et
al., 2010); varying between urban and rural areas, sectors, regions, and even between
individual enterprises within a sector. Nevertheless, certain constraints such as lack of
capital, technology, and human resources are common to all SMEs.
Pharmaceutical Industry is one of the leading industries in Pakistan, which consist of
approximately four hundred registered companies (Pakmission-UK 2014). The
pharmaceutical industry of Pakistan is divided between small and medium enterprises
and large size multinational and local companies, which together fulfil almost seventy
percent of the Pakistani pharmaceutical demand. There are thirty multinational
companies operational in the country, which hold 53% market share while the remaining
47% held by national pharmaceutical companies (Jamshed et al. 2009).
According to Hunger and Wheelen (2003), the organizations that are practicing strategic
management mostly outperform those that do not. The absence of long-term planning
and strategic thinking usually leads towards the business failure of SMEs (Analoui &
Karami, 2003). According to Dess et al. (2010), small organizations can compete and
grow with a fast pace by adopting strategic management practices compare to large
organizations with no strategic leadership opportunities. Furthermore, Leslie and
Palmisano (2010), studies in the present state of pharmaceutical sector suggest that

6. there are significant gaps in many key leadership capabilities that are critical to success
in an organization.
Hence, effective and qualified strategic leadership is required to tackle the issues
related to strategic thinking and planning, which also helps to align strategic direction of
the company. McGrath and Macmillan (2000) studies emphasise the role of effective
strategic leaders that have to perform during uncertain conditions and suggest that they
must seek opportunities in a volatile environment and apply strategic thinking skills that
help them to utilize those opportunities. Strategic leaders that operates in old-fashioned
ways will produce failure compare to effective strategic leadership who are more
innovative will take the best human resource, markets, and even the assets of the
organization with ineffective strategic leaders (Hamel, 2007). Therefore, the only way to
survive and thrive for pharma organizations is to develop such critical strategic
leadership skills to achieve above average organizational performance and face the
growing challenges of 21st century like global competition and struggling economy.
Therefore, keeping in view lack of research on the topic of strategic leadership in
Pakistan's SMEs, contradictory findings about the role of leadership in organizational
performance and developing countries' pharmaceutical SMEs aforementioned issues
indicate the further need to explore the strategic leadership role in pharmaceutical
industry in view to enhance organizational performance. Especially, Suzanne and
Charles (2013) suggest the further need of study to explore the relationship between
organizational performance and strategic leadership.
Furthermore, majority of the erstwhile research have focused on the role of effective
strategic leadership within the church context (e.g. Pearse, Noel J 2011), Public service
(Schutte & Barkhuizen 2014), and in Telecommunication sector of Pakistan (Sajjad &
Sameera 2011). That is why very limited research available about the relationship
between strategic leadership and organization performance in the context of
pharmaceutical industry. The ultimate goal of current study is to evaluate contemporary

7. strategic leadership practices in SMEs within the Pakistan pharmaceutical industry and
its impact on organizational performance.
AIMS of the RESEARCH
The focus of this research is to explore the contemporary strategic leadership practices
in pharmaceutical SMEs in Pakistan and its impact on organizational performance.
Therefore, the research aims at understanding the specific role that these strategic
leaders practice and their effect on the performance. Furthermore, this research while
evaluating current strategic leadership practices will compare it with effective strategic
leadership actions as describe by Ireland et al. (2012). This is discussed in detail from
theoretical point of view in second chapter.
OBJECTIVES of the RESEARCH
The objectives of the study are:
o To gain insight into the current strategic leadership practices in pharmaceutical
SMEs in Pakistan.
o To critically evaluate the most important practices/actions required for effective
strategic leadership in pharmaceutical SMEs in Pakistan.
o To find a gap between contemporary and effective strategic leadership practices
in pharmaceutical SMEs in Pakistan.
o To analyse the current strategic leadership practices that influence organizational
performance.
The above objectives of the research reflects the intention of the researcher to indentify
essential strategic leadership practices, which will narrow down the research gap on this
specific topic and will help strategic leadership of pharmaceutical SMEs in Pakistan to
handle the performance challenges innate in the twenty first century trends the industry
faces.

8. Organization of the Dissertation
The monograph splits into four sections. Theoretical aspects including literature review,
methodological framework, and ethical considerations are discusses in the first section.
The second section includes discussion and justification of the methodological
framework adopted in the study. The third section consists of research findings of the
results and discussion (based on the results) in a logical manner and in accordance with
the aim and objectives of the study. The fourth and final section presents conclusion
follow by reflection.

9. Chapter Two: Literature Review
Strategic Leadership
A plethora of individual studies have been conducted to evaluate the impact of
leadership style and practices on organizational practices such as culture, performance,
job satisfaction and citizenship behavior (Gardner et al., 2010). Few researchers and
scholars have also started to examine the impact of leadership styles on organizational
outcomes in perspective of strategic leadership. In the last decade, several studies were
conducted to demonstrate the association between styles and values of strategic
leaders and organizational performance (de Luque et al., 2008), charismatic leadership
styles (Waldman et al., 2006) and transformational leadership style (Ng & Sears, 2012;
Waldman et al, 2006). Before proceeding further, it is important to define the term
strategic leadership. Gardner et al (2010) have defined this term as leadership that is
concerned with the strategic choices, scope of activities, and apex of the organization.
Finkelstein et al (2009) have explained the scope of strategic leadership by saying that
it incorporates head of businesses, CEOs, board of directors and dominant
management in the organizations. On the other hand, Worden (2003) suggested that
strategic leadership is concerned with the mission, ideology, vision and macro
environment and core competencies of the organization. These definitions suggest that
strategic leadership is mostly related with the senior positions that have high powers.
This also suggests that strategic leadership sets organizational strategy at place and
establishes framework for attaining relevant objectives. However, it is important to note
that the responsibility of strategic leadership is only to initiate change for making desired
future of the organization (Thomas et al., 2004). The strategic leadership focuses on
background and personality of leaders who are the main authority to make decisions for
future of the organization. Maak (2007) noted that knowledge and vision of strategic
leadership is important with the increasing demands, complexity and roles of leaders in
the organizations. He further emphasized that strategic leaders are not only responsible
for taking decisions for wealth maximization of shareholders but also expected to meet

10. expectations of wide range of stakeholders of the organization. On the whole, this
suggests that strategic leadership is a broad aspect that takes higher decisions for the
organization.
Strategic Leadership Style
Strategic leadership values focus on impacts of leadership on performance of the
organization. However, the measures of leadership styles are not appropriately
identified by literature (Bass et al., 2003). Strategic leadership encompasses several
leadership styles specifically those that emphasize on behavior of leadership. Important
leadership styles identified by Walumbwa et al (2004) include transactional,
transformational and charismatic leadership. Here is the explanation of these strategic
leadership styles.
Transactional leadership refers to the process by which leaders deliver reward based
transactions to followers for motivating them to achieve the desired targets and goals
(Smith et al., 2004). The existing volume of research on transactional leadership has
aimed at contingencies and reinforcement such as performance of followers in response
of rewards such as appraisal and recognition by leaders. In addition, it also emphasizes
prevention of specific behaviors of followers to get the desired goals and rewards (Bass,
1985 and Bass et al., 2003). The rationale of transactional leadership is not very
complicated rather simple. The followers who perform their tasks and responsibilities in
an effective manner are rewarded by leaders. This leadership style is effective to
motivate followers in short time and get their desired performance.
The transformational leadership refers to the process that binds followers and leaders
into a coherent link (Sashkin & Sashkin, 2003). Within this leadership style, the critical
thing is to develop a vision, communicate it and inspire followers (Goldman & Casey,
2010; and Sashkin & Sashkin, 2003). The researchers have also suggested that
transformational leadership promotes organizational change by delivering energy to
followers (Tucker & Russell, 2004). This leadership is important for followers to get
identified with organizational vision, mission and values. The identification of followers
with such aspects is critical at strategic level of leaders where they are supposed to

11. perform. This is because unless followers do not get identified with organizational
values and mission, they cannot deliver optimal output and show commitment with the
organization. In the same vein, Yukl (2006) has also suggested that transformational
leadership us important for encouraging followers, influencing them, and invoking higher
level needs in followers. Overall, the transformational leadership style is effective for
followers to outperform for attaining desirable goals.
The charismatic leadership is defined as the one that involves inspiring followers by
sharing common vision and values with them (Murphy & Ensher, 2008; and Smith et al.,
2004) and also to have collective focus towards organization (Bligh & Robinson, 2010).
This suggests that charismatic leadership involves collaborative actions by leaders and
followers. Seyranian & Bligh (2008) have also suggested that charismatic leadership
incorporates use of influencing language in order to build support for followers.
Charisma can be regarded very important for leaders to influence their actions and
implement strategies of the organization in an effective manner. Cannella & Monroe
(1997) argued that decision making role of leaders is less emphasized in this leadership
style.
Effective Strategic Leadership Model
Effective leadership is regarded as basis for appreciating different aspects of
organization, business environment and people. In order to demonstrate strategic
leadership phenomenon in an appropriate manner, effective leadership model has been
proposed by Hitt and Ireland (1999). This model provided the theoretical foundation to
this topic and it provides a practical approach for identifying nature of leadership. Ireland
and Hitt (1999) explored strategic leadership as “the ability to anticipate, envision,
maintain flexibility, think strategically, and work with others to initiate changes that will
create a viable future for the organization” (p. 43). They suggested that strategic
leadership can be one of the important issue faced by organizations in the current era.
They believed that without understanding and implementing strategic leadership
framework, the possibility that an organization will gain superior performance will be
minimized.

12. In the context of challenges faced by organizations in turbulent business environment,
Hitt and Ireland (1999) suggested six components of effective strategic leadership.
These components included: 1) determining purpose and vision of the organization, 2)
identifying and exploiting organizational competencies, 3) developing human capital
base, 4) developing and sustaining organizational culture, 5) focusing ethical practices
and 6) maintaining balance between control measures of the organization. All these
components of strategic leadership lead towards superior performance of the
organization.
Hitt & Ireland (1999) have suggested that the top managers feel it impossible to get
answers of all queries, be willing to work and learn with followers, and to understand
uncertainties faced by organizations. In this respect, all these aspects effect top as well
as lower management of the organization. The strategic leadership is about developing
groups within organizations who accept their tasks and responsibilities for attaining
desired outcomes and seek to learn from others. The authors argued that to be an
effective leader, a person needs to take decisions, execute leadership by interacting
with others through sharing vision and delivering knowledge to others (Hitt & Ireland,
1999). The interactions among leaders and followers occur when leaders and
stakeholder groups interact and agree on satisfying interests of each other (Hitt et al.,
2005).

13. Strategic Leadership competencies
The empirical and theoretical research findings on strategic leadership competencies
and values have been comparatively limited. Therefore, there is need to conduct
substantial research on micro levels on this topic area. From perspective of culture,
Schwartz (1999) proposed a topology of cultural value in terms of autonomy, harmony,
egalitarianism, conservatism, intellectual autonomy, hierarchy and mastery. Contrary to
this, Sosik (2005) proposed that the personal values of managers such as traditional
values, collectivism, individualism and self enhancement are linked with the perceptions
of subordinates and these are further related with efforts of subordinates, managerial
performance, and citizenship behavior of subordinates. This implies that competencies
of leaders do have influence on organizational outcomes. Cha & Edmondson (2006)
suggested that often charismatic leaders face risk of producing disenchantment in
employees when they are hypocritical to values of organization as consequence of
failures for delivering commitments in changing environment.
Organizational Performance
The research on strategic leadership has emphasized on evaluating organization’s
financial outcomes in relation to leadership styles. The indicators of organizational
performance, as identified by Hambrick & Mason, 1984 included survival, growth and
profitability. These performance outcomes mainly relate with the organization’s strategy.
The stakeholder theory suggests that organizations and leaders are responsible to a
large number of stakeholders (Maak, 2007). Contrary to this, there is literature evidence
that strategic leaders emphasize heavily on economic outcomes rather than
noneconomic outcomes (Agle et al., 1999; Jawar & McLaughlin, 2001). This elaborates
the idea that several organizations are assessed on the basis of their ability of value
creation, specifically for shareholders. Maak (2007) has also revealed that the leaders
and organizations are increasingly accountable for their tasks and fail to focus on
interests of large number of stakeholders and society at large. This also strengthens the
idea that leaders need to get a broader view of organizational performance.

14. Elkington (1994) revealed that triple bottom line is important for assessing the
performance effectiveness. These aspects include financial, environmental and social
performance indicators. Contrary to this, another literature stream suggests that
organizational performance is related with planet, people, and profit (Fry & Slocum,
2008; Slaper & Hall, 2011). In this respect, McWilliams & Siegel (2011) argued that
these performance measures are viewed differently by different stakeholder groups.
The financial performance measures may include return on investment, profits,
revenues, and return on assets. Schwartz & Saiia (2012) suggested that most of
performance measures of organizations are financial that further focus on maximization
of profits. Contrary to this, another literature stream has emphasized that organizational
performance is also related with social measures such as charitable contributions,
community support, wellbeing of employees and organizational commitment (Fry &
Slocum, 2008; and Slaper & Hall, 2011).
Pharmaceutical SMEs LR
Rzziq (2014) has conducted an empirical study to investigate the relationship between
firm size and management systems in perspective of Pharmaceutical industry of
Pakistan. This study identified that there exists partial relationship between form size
and leadership and management system. This suggests that it cannot be theorized that
a small firm has high influence of leadership than a large firm.
Relationship between Effective Leadership & Organizational Performance
A substantial literature stream has elaborated relationship between leadership styles
and organizational performance. For instance, Bass (1985) suggested that there is
positive relationship between transactional leadership and performance of employees.
However, he further elaborates that the effectiveness of leadership style reduces when
contingencies are involved. In the same manner, Ng & Sears (2012) have also
proposed positive association between diverse practices of leaders, social values and
outcomes of transactional leadership. Some authors reveal that the transactional
leadership is often limited to show its results; hence it is unfavorable to produce positive
organizational outcomes (Tucker & Russell, 2004; Vera & Crossan, 2004).

15. Bass et al (2003) and Geyer & Steyrer (1998) suggested that the performance
outcomes of transformational outcomes are more visible and sustainable as compared
to those of transactional leadership. They also emphasized that transformational
leadership influences mind set and perception of employees and organizational culture
positively. A profound literature stream revealed that transformational leadership is
positively linked with the performance of employees (Nemanich & Keller, 2007; Piccolo
& Colquitt, 2006), job satisfaction (Walumbwa et al., 2004), identification with
organization (Epitropaki & Martin, 2005), and organizational commitment (Walumbwa et
al., 2004). Contrary to this, Waldman & Yammarino (1999) suggested that charismatic
leadership influences organizational culture to bring desired results. Moreover, Rowold
& Heinitz (2007) pointed that this leadership style enhances operational performance
and motivation level of employees. Waldman et al (2001) have also identified positive
relationship between charismatic leadership and net profit margin.
Summary & Implications
On the whole, effective leadership has been demonstrated from multiple perspectives
within recent literature. It has been noted that effective leadership can emerge in any of
styles such as transactional, charismatic or transformational. On the whole, the
literature findings revealed that leadership styles influence organizational performance
in multiple respects. In this way, leaders can amend their leadership style in such a
manner that maximizes organizational outcomes.

16. Chapter Three: Methodology
"Methodology is the frame of reference for the research which is influenced by the
'paradigm in which our theoretical perspective is placed or developed'."
(Walter, 2006, P.35)
Introduction
This particular research chapter has been outlined to demonstrate methodology of the
study. Research methodology refers to the specific methods, approaches and data tools
by which a study has been conducted. It is important to justify the choices of research
methods, approaches and tools made for conduction of a particular study. This is
because without justification of choices, it is difficult to justify answers of research
questions. This particular study has been conducted to evaluate and assess the impact
of strategic leadership on performance of the organization. In this respect, relevant
research methods and approaches have been adopted to get aim of study.
This particular chapter starts with the introduction of research methodology. Further this
chapter extends to specific methodological framework of the study. In this section,
specific elements of research methodology including research design, methods,
approaches and data collection tools have been elaborated. In addition to this, sampling
decisions and data analysis decisions are also made in this chapter. This section has
been justified in the light of research aims and objectives. Further, this chapter extends
to demonstration of ethical considerations undertaken by researcher for this particular
study. Finally, conclusion of chapter has been presented to elaborate its linkage with the
next section.
Research Philosophy
Research philosophy refers to the overall framework, perception and assumptions
undertaken by researcher for conducting a particular study (Cohen et al., 2007). This
also outlines the overall methodology by which data is collected and analyzed to reach
at the conclusion of study. Moreover, it also elaborates beliefs of researchers regarding

17. the study (Bryman & Bell, 2011). This particular study has been conducted by adopting
Epistemology that is specifically related with determination of knowledge in particular
area. There are several philosophical aspects such as positivism and Interpretivism
within Epistemology.
Positivism is the research philosophy that is based on the evaluation of facts and figures
in a scientific manner (Bryman, 2008). The positivism philosophy is a mix of qualitative
and quantitative methods for getting in depth logical results. In this study, the
researcher has not applied this particular philosophy to get detailed and explanatory
view of research problem about strategic leadership and its influence on performance of
pharmaceutical SMEs in Pakistan.
This particular study has been conducted by implementing Interpretivism philosophical
assumptions. Cohen et al (2007) noted that Interpretivism philosophy is based on
interpreting facts and problems from researchers’ point of view. This philosophy is
appropriate for getting detailed explanation of the research questions. By implementing
this philosophical choice, the researcher has interpreted results independently while
taking an in depth view of impact of strategic leadership on performance of
pharmaceutical SMEs in Pakistan. The research methods and data collection tools are
also selected in alignment with the Interpretivism research philosophy.
Research Approach
In an alignment with the Interpretivism philosophy, the researcher chose inductive
research approach for evaluating the impact of strategic leadership on performance of
pharmaceutical SMEs in Pakistan. According to Babbie et al. (2006), during the analysis
of qualitative data prominence was placed on inductive approaches. Geoffrey (2008)
suggested that inductive approach is the one in which existing theories are analyzed
and research questions are tested or verified. In the same way, the theoretical basis of
strategic leadership and organizational performance has been analyzed and research
questions are developed for this particular study. The theoretical framework of this study
has been tested through statistical and descriptive methods. In this manner, this study

18. has adopted “bottom up” approach i.e. inductive approach for analyzing the research
aims and objectives. By studying the theories of strategic leadership (top), the topic has
been narrowed down in perspective of pharmaceutical SMEs of Pakistan. This particular
approach is suitable and aligned with the research philosophy.
Research Methods
The research can be conducted by two methods. These include qualitative and
quantitative research methods (Richards, 2005). The quantitative research methods are
specifically based on numerical analysis (Bryman, 2008). These methods are
appropriate for collecting quantitative data and concluding results in numerical way
while establishing of discarding relationship between variables. On the other hand, the
qualitative research is the one which is based on textual explanation of variables
(Richards, 2005). The qualitative research methods conduct non-numerical explanation
of variables of study.
In order to evaluate the impact of strategic leadership on performance of
pharmaceutical SMEs in Pakistan, the researcher has used qualitative methods. By
using this method, the researcher relied on the views and opinions of research
participants for assessing the relationship between strategic leadership and
performance of pharmaceutical SMEs of Pakistan. These research methods have
provided in depth analysis of research problem for this particular study. The use of
qualitative methods is also aligned with the Interpretivism philosophy of study (Richards,
2005). The qualitative data is in the form of texts, observations or photographs. In this
particular study, the researcher has implemented qualitative methods to get non-numerical
data from representatives participants of pharmaceutical SMEs of Pakistan.
In this way, detained and in depth relationship has been evaluated between strategic
leadership and performance of pharmaceutical SMEs of Pakistan.
Data Collection Methods
Yin (1994) described six sources of information including archival records;
documentation; physical artefacts; participant observation; direct observation and

19. interviews. Furthermore, data can be categorized into two types. These include primary
and secondary data. The primary data is the first hand information that is collected by
researchers for the first time. This data do not exist in any prior source (Bryman, 2008).
The collection process of primary data is usually lengthy and difficult because
researchers have to approach participants for getting desirable information. However,
this data has high originality because it is in the raw form and unprocessed. On the
other hand, the other form of data is the secondary data that exists in earlier sources in
the form of theories and models (Bryman, 2008). This form of data is the prior
evaluation of variables by researchers and scholars. The collection of this form of data
is not a difficult process because it is readily available in books, research papers, data
bases and journals (Dallas & Grimmer, 2007). The originality of this form of data is low
because it is already interpreted and assessed by previous researchers and scholars.
In this particular study, the researcher has used mix of primary and secondary data to
find relationship between strategic leadership and performance of pharmaceutical SMEs
of Pakistan. The primary data has been collected through interview tool. The interview
tool is appropriate for getting in depth analysis of research problem about strategic
leadership and performance of pharmaceutical SMEs of Pakistan.
The semi structured face-to-face interviews are appropriate for getting detailed data in
short time duration. For collecting primary data, the researcher has developed an open-ended
questionnaire. This questionnaire included questions about strategic leadership
and performance of pharmaceutical SMEs of Pakistan. This questionnaire provided in
depth, qualitative and textual information about research problem.
There have been several pharmaceutical SMEs in Pakistan. The large population of
SMEs makes it difficult for researcher to get data from all of them. To get data for this
study, the researcher targeted SMEs in the major city of Pakistan. In this respect,
Lahore has been chosen where several pharmaceutical SMEs operate. From this major
city, the researcher chose sample of 12 pharmaceutical companies. This sample size
has been chosen randomly to collect data. This sample has been chosen by
convenience sampling approach. Only those companies are chosen that are easily

20. accessible for data collection purpose. This sampling approach is appropriate to get
desired data in short time duration. This sampling technique has been preferred over
other techniques because it is not complex to understand. Moreover, on basis of
accessibility of management, the researcher can choose sample subjects by using this
technique.
For collecting primary data, the researcher targeted senior management of chosen
pharmaceutical SMEs of Pakistan. The senior management has been chosen for this
study because it can provide reliable and accurate information regarding leadership
practices and styles prevailing in the organization. In addition to this, the senior
management is also an appropriate choice to get information about performance
aspects of pharmaceutical SMEs.
Data Analysis Methods
Data analysis consists of categorizing and examining the evidence to tackle the early
proposition of the research. For analyzing results of interviews, the researcher chose
explanatory methods of data analysis. Through this data analysis approach, the
researcher has become able to get in depth and logical interpretation of strategic
leadership and performance of pharmaceutical SMEs of Pakistan. Besides this, the
researcher has also interpreted results in a descriptive manner. By organizing interview
data, the researcher has cross compared results and found specific themes within data
to find result. This analysis approach is also aligned with the research philosophy and
research methods used in this particular study.
Theoretical Framework of The Study
This particular study has been based on the evaluation of impact of strategic leadership
on performance of pharmaceutical organizations in Pakistan. Specifically, the SMEs in
the pharmaceutical industry of Pakistan are targeted in this study.

21. Figure 3.1: Effective strategic leadership - researcher's compilation
EFFECTIVE STRATEGIC
LEADERSHIP PRACTICES
(Five practices)
ORGANIZATIONAL
PERFORMANCE
(Growth Perceptive)
Pharmaceutical SMEs in Pakistan
Measurement of Key Variables
The two crucial variables indentified for this study as mentioned below:
1. Strategic Leadership
2. Organizational performance
In order to analyse variables following questions are developed as below:

22. Table 3.1: Questionnaire
QUESTIONNAIRE
1. Tell me about your position and role in the organization?
2. For how many years you have been serving in the organization?
QUESTIONS ABOUT EFFECTIVE STRATEGIC LEADERSHIP PRACTICES:
 Determining Strategic Direction
3. Who is responsible in the organization for developing long term plans?
4. How are long term directions taken within your organization?
5. How will you make assessment of threats and opportunities faced by the
organization?
6. How is organizational vision communicated across the organization?
 Establishing Balanced Organizational Controls
7. What type of control measures are taken in the organization for checking
organizational outcomes?
8. Who is responsible for assessing and monitoring organizational outcomes?
 Effectively Managing the Firm's Resource Portfolio
9. What are core competencies of the organization?
10. How is human capital managed within the organization?
 Sustaining an Effective Organizational Culture
11. Which communication strategy is followed within the organization? Open or close?
12. How are employees encouraged and motivated to perform better?
13. Do you think preserving organizational culture is associated with better performance
of the organization?
14. How is organizational culture sustained even in changing external environment?
 Emphasizing Ethical Practices
15. Which ethical standards are critical for your organization?
16. How are employees influenced to follow ethical standards of the organization?
QUESTIONS ORGANIZATIONAL PERFORMANCE:
17. How has organization performed over the years in terms of revenue growth?

23. 18. How has employee productivity improved over the years?
19. How do you relate organizational performance with the leadership followed in the
organization?
Ethical Considerations
The research ethics have been defined by Bryman and Bell (2003) as moral practices,
principles and code of conduct for undertaking a particular study. Ethical considerations
also refer to specific principles that differentiate right and wrong practices of a specific
conduct. In this particular study, the researcher has adopted particular ethical norms
and practices by which an honest, fair and justified study has been conducted.
Specifically, the researcher remained alert and mindful during the whole process while
demonstrating multiple roles.
Denzin and Lincoln (2000) defined accuracy; informed consent; confidentiality and
privacy; and deception as four primary guidelines for ensuring ethical conduct during
research process.
In the process of data collection, the researcher remained concerned for protection and
security of data provided by participants. Before collection of data, the researcher
attained formal permission letter from all selected SMEs for conduction of interviews.
The researcher attained permission from all participants for taking part in data collection
phase. In this respect, he did not pressurize or influence nay participant rather it was
free consent of participants to provide information about leadership strategies and
organizational performance of SMEs. The researcher followed informed consent
principle in this study. In this regard, he informed all participants about aims and
objectives of study and also about purpose of data collection. The participants of study
were also given freedom to quit in any phase of interview.
The researcher also assured all participants about secrecy and privacy of data. In this
respect, anonymous data has been collected that does not show the identity of any
participants. In addition to this, the researcher has also kept data in password protected

24. system so that interview data cannot be leaked to any third party. The findings of this
study are used for academic purpose only. Moreover, the research participants were
also allowed to check the interview transcripts for verifying correctness of data provided
by them.
The researcher has also remained ethical in perspective of intellectual property rights.
He has openly acknowledged the contributions of previous scholars and researchers.
Throughout the study, the researcher has appropriately cited all secondary data sources
in Harvard format and cited all secondary data sources within text as well as in the
reference list.
Finally, during data analysis phase the researcher remained honest and ethical. In this
respect, he has interpreted data findings in an honest and fair manner without unfair
interpretation. He has not undertaken any practice to mislead readers and reach at
biased results. Ethical actions build and enhance sense of collaboration and trust in
those participating in the research process, along with strengthening abilities of decision
maker (Mele & Guillen, 2006).
Besides this, the researcher has also taken approval from university through Ethical
Form before conduction of the study. After getting Ethical approval regarding research
methods, data collection tools and analysis approach, the researcher has started this
study.
Chapter Conclusion
In conclusion, it has been said that the research methodology is aligned with the overall
research purpose. The aims and objectives of study are considered while making final
choices about research approach, methods and data collection tools. The use of
qualitative methods, interview tools and research approach is aligned with the research
philosophy and aims and objectives of study. In the next section of study, the
researcher has tabulated and analyzed the findings of data that is collected through
structured interviews with the management of pharmaceutical SMEs in Pakistan.

25. Chapter Four: Findings & Discussion
Introduction
This particular study has been based on leadership impact on organizational
performance in the context of SMEs in Pakistan. For achieving this aim of study, the
researcher has conducted interviews with the senior management of pharmaceutical
SMEs in Pakistan. 8 interviews have been conducted with the senior management to
get in depth information regarding leadership style followed in them. In this section, the
researcher has presented and analyzed research findings to reach at the conclusion
about impact of leadership in pharmaceutical SMEs in Pakistan. The first section of this
chapter is based on presenting findings whereas the next section is based on analysis
of the findings in a descriptive and critical manner.
Background
The study has been based on the pharmaceutical industry of Pakistan, specifically in
the SMEs. The pharmaceutical industry in Pakistan has been growing with the entry of
international companies. At the same time, several SMEs have also been operating in
this industry. However, recent studies have specified that pharmaceutical industry in
Pakistan have been facing critical issues such as low employee satisfaction, low
productivity and low performance (Bilal et al. 2011). It has also been noted in previous
studies that SMEs in the pharmaceutical industry are more vulnerable to low
performance and critical issues because of lack of resources and ineffective leadership
(OECD, 2009). Although this sector has been facing critical issues, yet its importance
for the development of economy cannot be denied as it provides opportunities of
employment (Sebone & Barry, 2009). In this respect, the role of leadership needs to be
explored in the context of Pharmaceutical SMEs of Pakistan. This particular study has
explored the impact of leadership on performance of SMEs through qualitative findings.
The next section is based on presentation of findings of this study.

26. Findings
Tell me about your position and role in the organization?
The results have revealed that 1 respondent was serving the firm a regional manager. 3
respondents were serving their respective firms as managing directors. In addition, 3
respondents were serving as CEOs and the rest of the respondents were serving as
directors. This suggests that all respondents were at senior positions in the
pharmaceutical SMEs.
Position and role in the organization
1
3 3
1
3.5
3
2.5
2
1.5
1
0.5
0
Regional Manager Managing Director CEO Director
For how many years you have been serving in the organization?
The results of survey have indicated that 3 of interview respondents were serving the
organizations for 0-5 years. There were 3 respondents who were serving in their firms
for 6-10 years. Only one respondent was working in the firm for 11-15 years. Moreover,
only one respondent was serving the organization for more than 15 years.
Years of Service
3 3
1 1
3.5
3
2.5
2
1.5
1
0.5
0
0-5 yeaers 6-10 years 11-15 years Above 15 years

27. Determining Strategic Direction
Who is responsible in the organization for developing long term plans?
It was found that in 1 organization, general management is responsible for developing
long term plans. On the other hand, in 4 firms, company directors develop long term
plans. In the rest of firms, top management such as CEOs are responsible for deciding
long term plans.
Who is responsible in the organization
for developing long term plans?
1
4
3
5
4
3
2
1
0
General Managerial Level Company directors Top Management
How will you make assessment of threats and opportunities faced by the
organization?
It was found that in 2 organizations, there is no assessment tool for assessing
weaknesses and threats in the external environment. In one firm, current performance is
matched with already developed standards to assess potential limitations. The results
also noted that in two organizations, detailed competitor analysis is conducted for
threats analysis and seeking opportunity through business environment scanning.
However, in one firm, time to time threats are assessed but there is no clarity of
assessment criteria.
How is organizational vision communicated across the organization?
In response to this question, the results have indicated that in three firms, organizational
vision is communicated from top to bottom level but there is no specific clarity in

28. communication strategy. In three meetings, monthly meetings are held for
communicating organizational vision. In rest of the organizations, presentations and
meetings are held to communicate employees about organizational vision.
Establishing Balanced Organizational Controls
What type of control measures are taken in the organization for checking
organizational outcomes?
In response to this question, the results have revealed that in 5 firms, current
performance is measured with the already developed standards. In 6th firm, financial
performance outcomes are assessed and compared through financial statements. In the
7th firm, reactive management style is adopted for measuring outcomes. In the 8th firm,
the financial performance, productivity performance and task competition are adopted
as control measures.
Who is responsible for assessing and monitoring organizational outcomes?
In response to this question, the results have revealed that top management is
responsible for assessing and monitoring organizational outcomes. In one firm, specific
committees are responsible for assessing and monitoring organizational outcomes. In 3
firms, middle management such as supervisors is responsible for monitoring
organizational outcomes. In the rest of firms, bottom to top level management is
responsible for measuring organizational measures.
Who is responsible for assessing and
monitoring organizational outcomes?
1
3
1
3
3.5
3
2.5
2
1.5
1
0.5
0
Top management Bottom to top
managerial level
Specific committees Middle managers

29. Effectively Managing the Firm's Resource Portfolio
What are core competencies of the organization?
It was found that in 4 firms, employee training, development and skilled workforce are
core competencies. In 2 firms, friendly workplace environment is the core competency.
In one firm, market research is regarded as core competency whereas in the rest of the
firm, strong IT infrastructure is regarded as the core competency.
How is human capital managed within the organization?
In response to this question, it was found that 2 firms in sample neglect human capital
management. In 2 firms, training and development aspects are considered for
managing human capital. In one firm, training & development, incentive plan, and good
performance reward systems are taken for managing human capital. In two firms,
reward strategies are developed to manage and motivate staff. In one firm, full
guidelines and clear information is provided for managing human capital.
Sustaining an Effective Organizational Culture
Which communication strategy is followed within the organization? Open or
close?
In response to this question, it was found that in 3 firms, open communication strategy
is followed in which employees and senior management is given freedom to
communicate with each other. In 2 firms, communication is hidden. In the rest of
organizations, mixed communications strategy is followed.
Which communication strategy is followed within
3
the organization? Open or close?
2
3
4
3
2
1
0
Open Hidden Both

30. How is organizational culture sustained even in changing external environment?
In response to this question, the results have indicated that in three firms, no measure is
taken for sustaining organizational culture. In 4 firms, continuous adjustments are made
for sustaining organizational culture. One of the sample firms minimizes negative effects
of external environment to sustain cultural values.
How is organizational culture sustained even in
3
changing external environment?
1
4
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
No measure taken Minimize negative effects Contonuous adjustment
Emphasizing Ethical Practices
Which ethical standards are critical for your organization?
In response to this question, the results have indicated that different ethical standards
are taken. In one firm, quality products production for human life safety instead of high
profit through unethical means is taken as ethical measure. Only one firm does not
adopt any ethical standard. In three firms, specific ethical standards are taken and
followed. In one of the interviews, the respondent revealed that trust, follow government
and environmental laws are considered by the firm. One firm emphasizes on honesty
whereas the other one emphasizes wellbeing of customers as ethical standards.
How are employees influenced to follow ethical standards of the organization?
In response to this question, the results have indicated that different strategies are
adopted by pharmaceutical firms for influencing employees to follow ethical standards.

31. Most of the organizations revealed that ethical guidelines are developed and
communicated across organization to influence employees to follow them. Moreover,
motivational practices and regular communication strategies are followed for
communicating employees to follow ethical standards.
Organizational Performance
How has organization performed over the years in terms of revenue growth?
In response to this question, the results have indicated that 4 organizations out of 8
have performed on average level as compared to industry scales. 2 of the firms have
performed below average of the industry ratings. The rest of the organizations have
performed above average to industry standings.
How has organization performed over the
years in terms of revenue growth?
4
2 2
5
4
3
2
1
0
Average Above industry average Below average
How do you relate organizational performance with the leadership followed in the
organization?
In response to this question, the results have indicated that most of organizations
consider leadership as effective indicator behind organizational performance. It was
elaborated by one of respondents that the old management was ineffective and recently
new management took over to improve organizational performance. One of the
respondents said that very strong relation exists between effective leadership and

32. organizational performance. All the rest of respondents emphasize that effective
leadership is critical for generating good performance.
Discussion
From interview results, it was found that most of respondents have been serving on
senior management positions in the respective pharmaceutical SMEs. Moreover, their
experience in the organizations is also of appropriate duration. Hence, their responses
are worthwhile for discussing impact of leadership on performance of SMEs.
Leadership is one of the critical aspects behind organizational performance. For
evaluation of this aspect of leadership, effective leadership model proposed by Ireland
et al (2012) has been implemented in this study.
Determining Strategic Direction
The results of the interview have revealed that strategic directions in pharmaceutical
SMEs of Pakistan are mainly taken by senior management. Senior management is
responsible for developing long term plans in organizations. This is one of the critical
areas of organizations that directs organizations what to attain in future. In perspective
of this study, it was found that in some pharmaceutical SMEs, there is no appropriate
way of making assessment of strengths and weaknesses faced by organizations.
Moreover, the organizations where assessment measures are taken, detailed analysis
is not made by management. This is because mere feedback from employees and
environmental scanning cannot assess the forces impacting the organizations. This
suggests that leadership within pharmaceutical SMEs has not been developed
effectively to take strategic directions for future. Ireland et al (2012) have also pointed
that lack of strong leadership is less likely to develop effective plans that lead
organizations to success
Effectively Managing the Firm's Resource Portfolio
Effective leadership manages resources of organization in a reasonable and effective
manner. From perspective of this study, it was found that pharmaceutical SMEs in
Pakistan have different competencies for attaining organizational goals and objectives.
Having trained and talented employees is more likely to be a sustainable competency

33. for pharmaceutical SMEs. This is because skilled employees have more potential to
adapt to changing environment and competition. On the other hand, pharmaceutical
SMEs that have IT and research and development are more likely to excel competitors
because they have resources for innovation in the industry. Waldman et al (2006) also
denoted that research and development is critical for pharmaceutical firms to promote
innovation and creativity. Regarding human capital management, it was found that 25%
firms of sample do not focus on this area. These firms can have low performance
because their employees do not have updated skills and knowledge. Through training
and development of employees, firms can have good performance. On the other hand,
managing human capital through reward system is more likely to motivate employees of
pharmaceutical SMEs. Nemanich & Keller (2007) have also noted that motivating
employees is an important character of effective leadership.
Establishing Balanced Organizational Controls
From perspective of this study, it was found that most of pharmaceutical SMEs have
adopted ordinary control measures such as matching with current standards monthly,
comparing financial productivity with the standards and reactive control measures.
These ordinary control measures cannot be effective to deal with the emerging threats
and challenges in the competitive environment. Contrary to this, if pharmaceutical SMEs
adopt proactive control measures, it will be more effective to cope with the challenges of
competitive environment. The assessment and monitoring organizational outcomes is
mainly done by top management, middle management and specific committees in the
pharmaceutical SMEs in Pakistan. In this respect, it can be suggested that engagement
of senior management in assessment activities may divert attention of leadership from
core activities. Previous studies have also suggested that leadership with proactive
strategy can be effective to deal with the challenging competitive environment
(Nemanich & Keller, 2007).
Sustaining an Effective Organizational Culture
Organizational culture is an important pillar behind organizational success. The external
environment of organizations changes abruptly which pose threats for managing
organizational culture. In this respect, the results have revealed that most of

34. pharmaceutical SMEs in Pakistan adapt to changing environment continuously. This
strategy can be effective to make relevant adjustments in the culture for attaining
organizational outcomes. However, some firms have not taken any measure for
sustaining culture. These organizations may not respond to the environmental
challenges in an effective manner as their cultural values are fixed and do not involve
adaptive measures. Besides this, the results have also noted that 3 pharmaceutical
SMEs have open communication strategy whereas same numbers of companies have
mixed strategy i.e. open and hidden. Having open communication strategy is more likely
to engage senior management with the lower end employees. Consequently,
organizational vision is shared effectively across the firms and employees will have
more clear view of organizational targets. Open communication strategy is one of the
characters of transformational and charismatic leadership that positively influences
organizational performance (Rowold & Heinitz, 2007). Previous studies have also noted
that effective leadership is the one in which leaders openly communicate with
employees and continuously motivate them to attain organizational tasks (Bilal et al.,
2011).
Emphasizing Ethical Practices
It was found that most of pharmaceutical SMEs have adopted effective ethical
standards such as quality standards and well being of customers. These ethical
standards are important to develop an effective workplace environment and also to
deliver quality products to customers. It is important to note that effective leadership
develops and communicates ethical values across the workforce and motives them to
follow such standards (Irelandet al., 2012). In perspective of this case, it has been
deduced that pharmaceutical SMEs which have open and mixed communication
strategy are more likely to practice ethical values in an effective manner.
Organizational Performance
Regarding performance of pharmaceutical SMEs, it was found that most of firms have
performed on average basis. The firms where human capital is managed effectively,
open communication strategy is followed and effective control measures are taken have
performed above industry average. On the other hand, organizations where

35. transformational leadership traits are followed have performed better than the others.
The respondents of interviews have also suggested that leadership influences
organizational outcomes to considerable extent. Previous theoretical findings have also
supported this evidence that effective leadership enhances organizational performance
(Nemanich & Keller, 2007).
Linkage
On the whole, the results have indicated that the effective leadership is necessary for
good organizational performance in the pharmaceutical SMEs of Pakistan. Through
analysis of findings, it has been derived that effective leadership lacks certain limitations
in the pharmaceutical SMEs of Pakistan which resulted in average and below average
performance of firms. In the next section, conclusion of study has been derived.
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