TO WHAT EXTENT ARE LEADERSHIP ATTRIBUTES CONSIDERED UNIVERSALLY EFFECTIVE AND DESIRABLE - Essay Example

? To what extent are leadership attributes considered universally effective and desirable? Critically evaluate the view that international leadershipand domestic leadership fundamentally require different leadership skills and competencies. Relevant examples must be used support your answer. Table of contents 1. Introduction 3 2. Requirements of international and domestic leadership in terms of leadership skills and competencies 4 2.1 Leader – characteristics 4 2.2 Environment that makes leadership international 5 2.3 Culture as related to domestic and international leadership 6 2.4 The influences of environment on domestic and international leadership 8 2.5 Challenges that international leaders face 10 2.6 Domestic vs global leader – differences and similarities 12 3. Conclusion 13 References 14 1. Introduction The performance of organizations in the global market is usually evaluated by referring to their leadership style. A leader is the individual who has the power to take all important decisions of each organization, including the design of its strategy and the control of all its activities (Grisham 2011). The behaviour of leaders is not standardized since each leader has his unique experiences, skills and perceptions. In fact, it has been proved that the development of an effective leadership strategy is depended on a series of factors. Most commonly, the socio-cultural and economic environment but also the objectives of the organization are the criteria on which leadership decisions are based. In addition, a leadership strategy needs to be feasible in terms of available resources. At this point, the following issue appears: can the effectiveness of a leader being influenced by the geographical region in which his decisions will be applied? In the literature, a distinction is made between domestic leaders and international leaders. The activities of the former are limited within a particular area; the leaders of organizations that operate only locally belong in this category. International leaders are those who can be involved in leadership decisions related to the global market (Marquardt 2000). In other words, a leadership is made international when referring to the global environment of an organization, meaning not only the needs of the organization in regard to its activities in a foreign country but also the challenges that the organization has to face in the global market; competition, cultural differences and regulatory framework are the most common challenges of this kind. The differences and similarities of domestic leaders and international leaders are analytically presented in this paper aiming to show that domestic leadership requires different skills and competencies than the international leadership. For this reason, the appropriateness of individuals to act as leaders domestically or internationally can be evaluated only if reviewing carefully their skills, as responding to the demands of each of these two leadership types. 2. Requirements of international and domestic leadership in terms of leadership skills and competencies 2.1 Leader - characteristics In order to be successful as a leader an individual needs to have certain qualities. In practice, the characteristics of leaders can be highly differentiated under the influence of their personal experiences and perceptions. Still, there are certain requirements that leaders need to meet (Maxwell 2005). A leader who meets all these requirements can be considered as fully successful in regard to his role (Maxwell 2005). It should be noted that leadership, as a role, can incorporate many phases. In each of these phases a leader should meet different requirements. These phases can be set in a hierarchy, and would be the following, starting from the lower level: a) Position;, b) Permission, c) Production, d) People development (Maxwell 2005). Each of these phases has different requirements; for example, in the first phase followers simply execute the orders given to them because they are obliged to; the autocratic leadership style is an example of such relationship between the leader and his followers (Maxwell 2005). Through a different approach, a leader allows to his followers to state their view in regard to the progress of various strategies of the organization. However, such intervention in the organization’s strategies would require the permission of the leader (Hogan 2011). A key characteristic of leadership is the following: it is possible for a leader to have unique qualities; in many cases the leader has inherited these qualities, i.e. he didn’t acquire them through training programs or through work experience (Pimpa and Moore 2012). This is the Traits theory of leadership, which is widely used worldwide for explaining the behaviour of leaders. Another theory of similar value is the Contingency theory which is based on the view that the characteristics of the leader, as reflected in his leadership style are highly depended on his environment (Schein 2010). In order to respond to all the requirements of his position, as a leader, an individual needs to have a series of skills. Emphasis should be given, in particular, to communication and negotiation skills as also the ability to retrieve critical information and to encourage his followers (Fujishin 1997). According to Popper a charismatic leader has to be able to develop effective and proactive relationship with his followers (Popper 2012). All other skills are considered as being of less importance for a charismatic leader (Popper 2012). 2.2 Environment that makes leadership international A leader who has the skills described in the previous section can be effective no matter the geographical area to which his position would be related. Indeed, a successful leader is expected to perform high no matter if his decisions are related to the local or the global environment (Grisham 2011). In other words, environment can be used for defining leadership as international. The characteristics of the environment that refers to international leadership would be the following: a) different cultures and ethics in the workplace (Connerley 2005), b) employees with different social or racial background; employees can be also be of different ethnicity (Grisham 2011), and c) operational activities need to be aligned with different regulatory frameworks, such as taxation regimes, labour laws or quality standards (Weber 2008); for example, the rights of the organization’s employees are regulated using different laws, according to the laws of the regions where the organization’s units are established (Grisham 2011). An environment that has been highly related to international leadership is the following: production units are established in foreign countries, so that the costs involved are kept low (Wu 2013). Leaders who have to manage the challenges related to such environment are characterized as international having to deal with various issues that are related to many countries simultaneously (Schein 2010). 2.3 Culture as related to domestic and international leadership Leadership is closely related to culture. In fact, the decisions of a leader cannot be applied in practice unless they are aligned with the cultural characteristics of the environment; otherwise, the resistance developed will be so strong that the cancellation of these decisions will be unavoidable (Schein 2010). It should be noted that today organizational culture is more complex than in the past; the high development of technology, the changes in life-style and the severe economic instability in markets worldwide have influenced the characteristics of culture, as a key part of organizational life (Schein 2010). A series of studies has been developed for explaining the interaction between leadership and culture worldwide. In one of these studies the public sector organizations in Australia and Thailand have been set under examination as of their leadership styles (Pimpa and Moore 2012). It has been proved that different cultures in Australia and Thailand have led to different leadership styles in the two countries, meaning that culture can highly affect leadership (Pimpa and Moore 2012). A similar issue was set under examination in the study of Prewitt, Weil and McClure (2011). In the above study emphasis is given to the following fact: the global environment is multi-cultural; thus, a leadership style that would be effective in such environment should be appropriately aligned, so that cultural conflicts in the workplace are avoided (Prewitt, Weil and McClure 2012). The leadership style that would best suit to such a multi-cultural environment is characterized as Global Leadership style and it is characterized by certain skills: a) ability to manage relationship, b) support to diversity, c) promotion of team-work and d) ability to motivate and to inspire (Prewitt, Weil and McClure 2012). At this point, the specific elements of the relationship between culture and domestic and international leadership should be identified. As of domestic leadership, culture has the following role: a) the culture of the domestic leader reflects the local cultural characteristics and ethics (Miner 2002), b) domestic leader is expected to support the promotion of local culture; discrimination in the workplace based on the cultural background of employees could be a challenge that a domestic leader would have to face (Pimpa and Moore 2012); c) a domestic leader is expected to resist in promoting the change/ alternation of the organizational culture (Mosier and Fischer 2010), which reflect the local culture as noted above. In regard to the relationship between culture and international leadership the following issues should be highlighted: a) a global leader tends to support multiculturalism (Uhl-Bien and Marion 2008); MNEs are likely to have flexible cultural characteristics, so that they can be changed anytime following the market trends, b) globalization is against the existence of cultural barriers (Wu 2013); a global leader cannot be opposed to cultural changes, if required, so that the international operations of the firm are further expanded (Wu 2013), c) discrimination in terms of culture is not allowed by modern ethics (Prewitt, Weil and McClure 2011); a leader that wished to succeed in the global market has to promote equality and elimination of any discrimination based on culture (Prewitt, Weil and McClure 2011). 2.4 The influences of environment on domestic and international leadership When referring to leadership, the term environment can be related to three sectors/ areas: a) economic, b) social/ administrative, c) political and d) cultural. A) Economic environment is a term used for describing different issues, such as: the structure of an economy, the funds available for the support of organizational plans or the rate of economic growth either locally or globally (Wu 2013, p.96); b) Social environment; it is a term used for showing the key characteristics of local population in regard to people’s demographics, culture, average income, health status and educational skills/ background at average level (Uhl-Bien and Marion 2008); the social environment is often combined with culture in order to show a region’s social and cultural framework (Uhl-Bien and Marion 2008); c) Political; the political environment refers to the ‘national political situation’ (Wu 2013, p.95) that leaders have to face while developing their decisions. The political conditions in each country can highly influence the plans of organizations established locally; for example, the decision in 2008 of the US government to introduce quite strict rules in regard to the control of financial institutions has caused severe turbulences in the local and the global market (Prewitt, Weil and McClure 2011); d) cultural. The power of culture to influence leadership, both the domestic and the international leadership, has been analyzed in previous section. The environment can highly influence leadership style, either in the short or the long term. In the literature different views have been developed in regard to the power of the environment on leadership decisions. For example, the model developed by Fiedler is based on the view that the effectiveness of each leader is likely to be influenced by two factors: ‘the leadership style and the situation that gives to leader control and influence’ (Phillips and Gully 2011, p.429). The above view is relevant to the position and the powers of the domestic and the international leaders, a fact that denotes the relationship between the environment and both types of leadership. Sharma, Sun and Kannan (2012) developed an empirical study in order to explore the potential influence of gender and nationality on the performance of leaders. Teachers in schools in three different countries, China, Malaysia and India, were asked to participated in the specific study and state their view in regard to their principals (Sharma, Sun and Kannan 2012). About 100 teachers from each of the above countries participated in the survey; no indication was found that gender or nationality influence the performance of principals as leaders (Sharma, Sun and Kannan 2012). The principals’ leadership qualities on which teachers had to state their view are presented in Table 1 below, where the performance of principals as leaders is also presented. Table 1 – Leadership qualities of principals in China, India and Malaysia (source: Sharma, Sun and Kannan 2012). The leadership qualities, as used as a basis for the above survey, are normally expected to be met both to domestic and international leaders. Therefore, the findings of the study indicate the power of the environment on domestic and international leadership. This means that both the domestic and international leaders should have excellent communication skills and empathy, the leadership qualities that ranked first in the survey. Table 2 – Leadership styles that are most common in the literature (source: Iqbal et al. 2012, p.652) The high influence of the environment on leadership is also verified through the findings of the study of Iqbal et al. (2012). The above researchers made an extensive review of the literature published in regard to leadership styles used in organizations of different cultural and economic characteristics; their study revealed that transformational and transactional styles of leadership have been given highly attention by researchers (Iqbal et al. 2012). These styles are based on the continuous update of leadership decisions so that failures in achieving the targets set are avoided; most leaders worldwide prefer these leadership styles (Iqbal et al. 2012), a fact that further proves the influence of environment on leadership. The leadership styles mentioned above are used both in the domestic and the international leadership theory. Therefore, the study’s findings are related to both these leadership styles. 2.5 Challenges that international leaders face In the context of the global market the challenges that an international leader has to face can be numerous. The key reason for this phenomenon is ‘the high complexity of the global environment’ (Bikson 2003, p.22). In addition, the approaches used by international leaders for facing the challenges of global environment cannot be standardized (Bikson 2003). For example, in the education sector an international leader has to focus on issues such as the promotion of home-based education programs/ distance-programs or the increase of motivation of teachers (Bikson 2003). In another sector, as for example the public sector, an international leader should emphasize to ‘the improvement of the recruitment processes and the increase of programs based on co-operation’ (Bikson 2003, p.22). In general, the effective handling of problems related to the global environment would require by international leaders to employ the following approach: to develop certain strategies ‘for improving existing workforce’ (Bikson 2003, p.22) and to identify strategies that could secure the high performance of employees in the long term (Bikson 2003). A major challenge that international leaders have to face in the global environment is to understand ‘the interests of all stakeholders worldwide’ (Goodman, Fandt and Michlitsch 2006, p.59). These interests are often opposed, a problem that needs to be carefully addressed otherwise severe turbulences can be developed across the organization (Goodman, Fandt and Michlitsch 2006). In addition, an international leader has to identify the criteria on which ‘the purchase of products by various regions will be based’ (Goodman, Fandt and Michlitsch 2006, p.59). In regard to this case, the following problem is likely to appear: while buying at low cost should be of key importance for choosing a market, certain implications cannot be avoided (Goodman, Fandt and Michlitsch 2006, p.59). For example, US multinationals have been often accused for buying products from countries where labour costs and prices are too low but where the conditions of work are unacceptable (Goodman, Fandt and Michlitsch 2006, p.59). An international leader needs to set the balance between organizational interests and corporate social responsibility so that the values of the organization are not violated (Goodman, Fandt and Michlitsch 2006). In any case, an international leader has also to deal with different cultures and regulatory frameworks, as applied in countries where organizational units have been established (Mendenhall, Kuhlmann and Stahl 2001). In this context, an international leader has often to take decisions that can be applied only in certain units of the organization, while for the other units these decisions are inappropriate as they are based on different cultural criteria (Mendenhall, Kuhlmann and Stahl 2001). For example, in a firm’s unit in Asia emphasis should be given to the participation of employees in the decision making process while in USA the arrangement of teams that will follow strictly the orders given may be more appropriate (Mendenhall, Kuhlmann and Stahl 2001). 2.6 Domestic vs global leader – differences and similarities In general, international leaders have to face similar challenges with domestic leaders, even if differences cannot be avoided. More specifically: a) a global leader has, necessarily, to employ advanced technology when developing and applying his decisions; for example, an advanced IT system is able to secure the accuracy of information provided on a firm’s units abroad (Marquardt 2000). Without the support of technology an international leader would face severe difficulties in responding to the needs of his position. A domestic leader may not need advanced technology in his daily duties as a leader; The difference between domestic and global leader as of the use of technology is made clearer today, when the IT systems employed in organizations are quite advanced, compared to the past (Popper 2012). In this context, a global leaders is expected to face no problems in using online forums or virtual meetings for communicating with employees and stakeholders (Popper 2012); a domestic leader may not be able to use such technology; b) A global leader focuses on innovation and vision-building while a domestic leader aims primarily to secure the fulfillment of customers’ expectations (Marquardt 2000, p.18); c) A global leader is more likely to take risks while for domestic leader the speed in developing and completing changes is more important (Marquardt 2000, p.18); d) in regard to the behaviour towards the followers, a global leader aiming to inspire employees to think as members of the global community while a domestic leader tries to increase employees’ ability to understand the needs of customers locally (Harzing and Pinnington 2010). On the other hand, a global leader, as the domestic leader, emphasizes to the achievement of organizational goals and objectives and the respect of organization’s values (Mosier and Fischer 2010). According to Goldsmith (2003) the geographical region in which leadership is developed is not a decisive criterion for defining a leader as global or domestic. Indeed, it seems that every leader that meets the following five requirements can be characterized as a global leader, even if his working environment is limited to a particular region: ‘a) he supports diversity, b) he thinks globally, c) he appreciates the technology advances, d) he is willing to share his powers as a leader and e) he is able to develop effective network of alliances’ (Goldsmith 2003, p.5). 3. Conclusion A global leader is differentiated from domestic leader. However, the differences between these types of leader are not related to geography. Indeed, the literature reviewed for this study has revealed that global leaders are those leaders who are fully aware of the various aspects of the international market and can support more effectively the global activities of their organizations, compared to domestic leaders. For example, international leader has been found to be aware of the advances of technology in all organizational fields, including communication and production (Popper 2012), in opposition with domestic leader who seems to be unable to use effectively the technology available for the completion of business tasks. In addition, it has been supported that a global leader is able to identify organizational strategies that would secure competitive advantage for his organization when operating in the international market (Hogan 2011), a quality that is not incorporated in the characteristics of the domestic leader. In general, it has been proved that the skills and the priorities of a global leader are differentiated from those of a domestic leader. This difference cannot be used for characterizing global leaders as more skilled or competent from domestic leaders. Rather, the decision of an organization in regard to the skills of his leader should be based on the following term: in which environment would the leader work? If local market would be of primary importance for an organization then a domestic leader could be proved quite competent in securing organizational growth. If the expansion of the organization in the global market would be the key target then a global leader should be rather preferred as being more able to secure the organization’s competitiveness towards its rivals. References Bikson, T., 2003. New Challenges for International Leadership: Lessons from Organizations with Global Missions. Santa Monica: Rand Corporation. Connerley, M., 2005. 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