How is Leadership Different in Asian Business from Western Business - Coursework Example

How is Leadership Different in Asian Business from Western Business? Wayland Baptist Dr. J. Jeffrey Tillman RSWR 3345.VC03 Research Writing Methods January 25, 2013 Abstract Today’s’ businesses are more and more global and much more reliant on flexible and effective leadership to propel the ever struggling economy into the next generation. Efficient leaders anywhere in the world, whether they are in Asian or Western countries have the ability to cast vision, motivate employees and implement positive change. However, a strong contrast can be identified while analyzing leadership an Asian and the Western countries. On one hand, where the Asian firms are driven by leaders focusing on long-term relationships, a clear hierarchy and cultural values, on the other hand, individuality and change are the driving factors in the Western businesses. Understanding the differences in business leadership among these two continents helps both sides in the common goal of success. Table of Contents Introduction.....................................................................................................................................4 Dynamics of Leadership …….……………...……………………………………………….…....4 Leadership Trends in Asia and in the West………………………………………..………..…….5 Asian Research…………………….…………..………………...………………….……………..6 Styles of Leadership...……...……………………………………………………………………...7 Western Institutional Rules.…………….………………………………………………..……..…9 Leadership Contrasts…..……………...………………………………………………..…….…. 10 Conclusion……………………………………………………………………………………….11 References……………………………………………………………………………………….12 How is Leadership Different in Asian Business from Western Business? The success rate or even the failure rate of any company or organization depends solely on the strategy and management of resources. However, in order to implement the strategy and further to achieve the goals, many other factors have to be taken into account. This implies that the management and the leadership roles, both have a huge part to play in the smooth functioning of the strategy. On one hand, management is responsible to ensure that the resources are being utilized in the best way possible and maximum results are being produced to the advantage of the firm. On the other hand leadership has an even important role to play in envisioning the employees with the objectives of the firm and motivate their team in order to achieve a common goal. If the leaders lead their teams toward the right direction, the task of the management also becomes easier, and with that, the company is destined to reach another level. However, this paper will aim at analyzing the leadership roles in Asian business firms, alongside critically commenting on the leadership trends and shifts in the West to draw a clear contrast, and further to understand the effect of these differences on the global market. Dynamics of Leadership Prior to analyzing the leadership trends in Asia and in the west, it is crucial to understand the dynamics of leadership from both Asian as well as Western Perspectives, so that it becomes convenient to lay the foundation over which the comparison can be made. If there is a leader, then there are followers. If people are to follow someone then their leadership must be considered as something personal, a relationship between the leader and follower, with the leader’s credibility providing the foundation. There needs to be trust established between leader and follower. (Orridge, 2009, 19) Most importantly, leadership revolves around two things, i.e. vision and energy enhancement. Vision further involves two aspects which may differ when being studied from an Asian or Western viewpoint. The vision may be understood as being an integrated and a collective one over which the entire organization may be relying. On the other hand, the individualistic vision of the organization may be kept in view, especially with reference to the Western leadership ideologies (McNaughton, 2004, 19). In this context, once the leaders identify the vision of the organization, they will have to understand how each individual perceives the vision, and thus, it is then the job of the leadership of the organization to integrate both and thus, take out the maximum out of it. Furthermore, a leader is responsible for motivating the employees of the organization and thus, to take interest in the organization, rather than just relying on their personal goals. A true leader is the one who makes the employees own an organization as much as the top management does, and further ensure that each employee is contributing his/her maximum to the organization. However, as pointed out earlier as well, the dynamics of leadership in Asia may vary, as an integrated approach is appreciated while envisioning the employees keeping in view the collective societal will driven by cultural variables. Leadership Trends in Asia and in the West Further, giving a brief overview on the leadership trends in Asia and in the West can only prove to be a fruitful start to the discussion. Since the discussion will be focusing on how an executive contributes in setting the direction of the firm, and thus envisions and energizes the employees, these aspects would be analyzed from Asian as well as from Western perspectives. Studies from various aspects indicate that Asian business firms seem to be quite dependent on traditional family values and the hierarchal patterns being followed in countries like China and Japan and thus, succession within the family takes place more often than not. Also, the top management and the confidantes of the business owners are also close family contacts, and they prefer keeping the business details only to these few people. In contrast, Western business practices are nor as reliant on hierarchal patterns running within the family, and instead in most cases rely on ambition and capabilities instead. Also, culture is quite a dominating feature crucial to analyze the leadership roles in both the societies. In Asia, culture, traditions and family variables play an important role (for instance the decision making body usually incorporates the important family members and thus, the leadership also has to act in a certain way to deal with the employees working in a culturally induced environment. In contrast, Western businesses are dependent on board of directors, or some other institutional setup (Wall Street for instance), thus leadership styles have to be different, the elaboration of which would be done throughout the system. (Klanko, 2007, 66) Starting off with Asian businesses and thus, the leadership styles dominant in Asian business firms, it would not be an understatement or even an exaggeration when one states that the leadership styles all over Asia don`t exhibit much of a diversity, however certain distinctive patterns may be observed. As stated above as well, family politics dominate; rather run all the big business firms throughout Asia. Most of the business firms in Asia started off after the World War II, and thus most of these large business corporations in Asia are a product of the decolonization. Thus, in this context, these huge investors were free and independent to conduct businesses in their territories. Given the insecurities and the close connections within the families, these businesses started to depend largely on the family politics dependent in a company (McMurray & Adele, 2003, 22. ). Thus, these company owners became highly experienced, and with time highly specialized in the fields, and eventually the trend developed which ensures that the business skills and specialties stay within the families of the large business owners. Thus, the leaders would have to keep this aspect in mind, and ensure smooth functioning of the firms by seeking out a way how to envision the employees and at the same time satisfying the higher-ups who are quite reluctant to accept change, and evolve in similar patterns. Asian Research Moreover, another pattern which is also a huge challenge for the firm would be deemed the issue of succession i.e. how one generation takes over another within Asia. A study conducted over 250 family firms in Hong Kong, Taiwan, and Singapore indicates that in the process of succession about 60% of wealth was lost, in three years after succession, as compared to that of five years before succession took place (Ben-Porat, 2005, 13). Thus, in this context, succession is a huge concern since when another generation takes over the family business, there is a lot at stake, and this issue needs consideration. However, it is important to analyze why succession has become such a huge issue to these businesses is, and research further solves this puzzle. If only wealth and capital was to be passed over to another generation, this wouldn’t have been such an issue, however, in this case, leadership skills and challenges are as important as are the assets, and mastering the skills of the ancestors isn’t such a piece of cake. Researchers have identified cultural indicators, history, value based leadership and implicit rules as being deterrents in the way of leadership enhancements.(Klancko, 2007). Basically, the family owners take years to master the tricks of dealing with such issues, and a trend has been developed where certain rules of business apply and history and family rules dominate politics. Also, these executives are the leaders who know the secrets to satisfying their employees with their vision, and thus, they master the art of dictating rules to their employees and the trend continues. Once another generation takes over, they get caught up in other technical and financial issues, and in this race, they compromise the leadership roles and thus the employees lose motivation, and within no time, the company is at risk. However, analyzing the same issue from an Asian Perspective can deem different results. On one hand where the Western scholarship states the hierarchal family values as a deterrence in leadership enhancements, on the other hands the Asian scholarship justifies this perspective acclaiming loyalty as an important aspect, since long term family employment within a firm gives way to long-term commitment. In this context, it is also crucial to point out that the Asian perspectives and decision making patterns are more dependent on contextual analysis, rather than on logical analysis (Nisbett, 2003, 31). This implies that the Asian see everything in relationship to a holistic cultural view, which further implies that leadership also takes into account the contextual variables involving the family commitments and traditions involved which are positive variable paving way for the uplift of a business firm. Style of Leadership In this context, the directive style of leadership works well in Asian business firms, whereby, the leader is the most influential person and has the maximum say in governing the order of business. This style requires the leaders to give orders and deadlines to their subordinates whereby the subordinates have no say in decision making, and they do as the higher-ups desire. This has to be understood from a broader aspect, more so from the Asian perspective. The socio-cultural approach to management in Asia is generally driven by prestige, moral character, and more so by the societal and cultural norms as being the general standards used to measure behavior. When this aspect is used to analyze leadership dynamics, the leader would be the most prestigious and culturally the most powerful figure, and it would make perfect sense for the subordinated to follow his order, and comply by his vision. Also, since he would be the most experienced of all, the firm may also benefit from his knowledge and vision to a grear extent. In contrast, the businesses running in the West follow certain institutional rules, and every firm, regardless of the family name, is obliged to follow these set of rules not just by law, in fact by the order of business dominant in the region. In contrast to Asia, where the only leadership style being executed is the one driven by cultural values and hierarchal family succession, there are many diverse leadership styles which can be identified in the way. Out of these styles, the most effective and dominant styles are the participative, charismatic, directive, celebrity and empowering styles (Olapegba & Olowodunoye, 2011, 19). Participative leadership style is quite effective and dominant in the West as it requires team work, and input via subordinates for the smooth running of the business (Yang 2008). This implies that the leaders and executive donot just give orders to the subordinates, rather understand their own needs and priorities, and based on that, they lead the employees. Thus, the leaders working in such a scenario demonstrate the true leadership skills, as leadership is all about reading the subordinates and then giving them enough space to execute their activities. However, from the Asian perspective, they may be ignoring the true needs of the individuals to co-exist in the same cultural environment they may be living in, which may prove to effect the employees in a negative way, as they would not be able to reach their self-actualization goals in this context. Empowering leadership style is a new phenomenon, and it is also becoming quite dominant in the Western business firms. This leadership style implies that not only will the needs and desires of the subordinates be kept in mind, but they will also empowered to make a decision on their own, experiment, and learn the secrets to success themselves. Though this may sound risky, but it has its own advantages as well, as empowered employees will feel more strongly about their organization, and thus will contribute more positively. In addition, the leaders and executives still have an important role to play as in such a case, giving direction is more tricky as they will only have to lay the outline for the employees, and West is quite drastically now being shifted toward this style of leadership. (Pless, 2007, 26) Moreover, with the trends changing in the West, nowadays Charismatic leadership style is yet another one being implemented. This style is based on the ability of humans to lead and charm the subordinates by their presence (Visagie Linde, & Havenga 2011). This directly implies that the leader proves to be a role model or an interesting figure to the employees, whom they would like to follow with pleasure. This proves to be a good strategy as the subordinates would be doing something which truly motivates them from the inside, thus, they would take interest in the task, and this would eventually lead toward the development of firm objectives which would maximize the returns on investments. Lastly, Charismatic style is also quite adaptable to the business practices dominant in the West, as the CEO of the company or the other executives portray a positive image, in fact a celebrity figure of themselves. In other words, the company focuses on the branding of the CEO or the executive playing the role of a leader, which also contributes in motivating the employees to a great extent. (Ben-Poratt, 2009, 19) Western Institutional Rules Thus, in the West, institutional rules govern the executive order functional within the business firm, which requires the executives to pursue creative roles and innovative strategies to lead; as motivation is of a huge concern to the organizations when it comes to the Western perspectives. Institutional rules imply that these businesses are quite dependent on the trustees, board of governors, quality assurance standards, international framework and global trends. Thus, the game is fair and square, and the only person who succeeds the higher-ups is the one who`s the most capable one. However, a flaw may also be pointed out in this regard, as being the most “capable” candidate for a position not only involves intellectual capability, but also involves physical and personality traits over which the Asian scholarship may have some reservations. There is a strong corporate environment in the firms functional in the West, which determines the order of business, in contrast to the family politics dominant in Asia. Responsible leadership is a social and moral phenomenon that was pushed onto the agenda not only by recent scandals and the pressing issues that affect life on our planet, but also by the realization that multinational corporations and their leaders have an enormous potential for contributing to the betterment of the world. (Pless, 2007, 438) In such a case, there is a drastic competition amongst the companies, and the comparative advantage is not just the quantity or even quality, in fact, innovation and creativity then becomes the comparative advantage of these firms. In addition, diversity is another aspect which must be kept in mind while analyzing the leadership styles. Businesses in West cater to the needs of a diverse market; also the labor force in the West is comprised of people from various backgrounds and ethnic groups, which requires the businesses to alter their strategies accordingly. (Jarrett-Kerr, 2011) Thus, an executive employing a single leadership pattern may not be able to cater to the needs of all of the work force, thus it becomes crucial to empower the sub-ordinates in this regard. Thus, to cater to these needs, the leadership styles also need to be altered, and consequently, subordinates aren’t just treated like employees rather assets to an organization, as it is their ideas which are important for an organization. Leadership Contrasts Confidence in leaders is critical when we are about to embark into the unknown. Leadership at the team/group level that is consistent with the senior team is also a key element, as they will often be seen as the senior team’s proxy. (Orridge, 2009, 18) Leaders need to ensure that their vision has been communicated and understood and that people’s own personal visions map on to the corporate one. Once there is a commonality of vision there is an increased likelihood that there will be clearly defined goals at all levels of the organization. (Orridge, 2009, 18) Thus, in a nutshell, if one makes an effort to compare the leadership practices in the West and Asia, a huge contrast can be tracked. We live in a global age, and apparently, it seems like the business practices all over the world have been integrated, and the business environment all over the world would be similar. However, research indicates quite the opposite, and nowhere in the future can the convergence patterns be traced. On one hand, family politics, culture, and contextual perspectives fuels up the businesses in Asia, where rules of business are strict, inflexible and all subordinates are strictly asked to adhere to these rules. On the other hand, the Western business institutions are strictly governed on the institutional rules of business. External auditors, in the form of institutions act as the governing authorities, and in order to run in the system, it becomes crucial to follow these rules (Guthrie, 2010). Thus, to survive in such a system, the companies have to respect and also, rely on the subordinates, as much as the subordinates rely on the company, and consequently, the executives are subject to mend their rules in favor of the employees. Thus, on one hand a strict leadership style dominates the Asian Business scenario, the business companies in West follow friendly, supporting, and an accommodating style, to increase the creativity in the firms. Conclusively, Asian business style is distinct from the rest of the world. Culture, internal family politics, ethnic priorities and family dominance and heritage makes the business environment less subjective to change, and more dependent on the rules which may not be changed in any circumstances. Thus, the executives have to be dictators, who set punitive actions against anyone who dares to challenge the status quo or the rules of business. In contrast, the west follows a system which is free from corruption and politics, which makes it favorable for anyone who is competitive to take the lead and enter into the market. Thus, the environment is very competitive, and the leadership style is such that it favors free thinking and also friendly competition. Thus, these differences should be kept in mind while analyzing businesses as these would affect other determinants to a huge deal, and thus, both environments must be kept independent from the other and considered as separate subjects, given the difference in the leadership styles in both the environments. References Ben-Porat, G. (2005). Between power and hegemony; Business communities in peace processes. Review of International Studies, 31: 325-348. Harvey C, Press J, and Maclean P. (2011). William Morris, cultural leadership, and the dynamics of taste. Business History Review, 245-271. Volume 85. Guthrie, D. (2010). Remade in China: Foreign Investors and Institutional Change in China. The China Quarterly, 726-728. Jarrett-Kerr, N. (2011). Alternative Business Structures – the Long Pregnancy. Legal Information Management, 82-85. Klancko, R. J. (2007). Sustainable Business Development: Inventing the Future through Strategy, Innovation, and Leadership. Environmental Practice, 66-68. McNaughton, J. R. (2004). Brand Logic: A Business Case for Communications. Journal of Advertising Research, 232-236. Nisbett, R. E. (2003). The Geography of thought: How Asians and Westerners think differently…and why. New York: The Free Press Pless, N. (2007). Understanding Responsible Leadership: Role Identity and Motivational Drivers. Journal Of Business Ethics, 74, 437-456. PO Olapegba, & SA Olowodunoye. (2011). Assessing Self-Reported Organizational Citizenship Behaviour: The Role of Organizational Climate and Leadership Styles. (African Journal for the Psychological Study of Social Issues; Vol 14, No 2 (2011).) African Journal for the Psychological Study of Social Issues. Swinburne University of Technology. Australian Graduate School of Entrepreneurship, & McMurray, Adela J. (2003). The relationship between organizational climate and organizational culture. American Academy of Business, Cambridge. Visagie, J., Linde, H., & Havenga, W. (January 01, 2011). Leadership competencies for managing diversity. Managing Global Transitions, 9, 3, 225-247. Yang, C.-W. (January 01, 2008). The relationship among leadership styles, entrepreneurial orientation, and business performance. Managing Global Transitions, 6,3, 257-275. Rubric Research Paper Needs Attention Comments Points Organization 11/15 Introduction Needs interesting hook into topic Introduction needs to control and direct better Needs thesis statement limiting attention and signaling what follows to reader Body Needs more sophisticated content x Needs a more analytic structure. There’s lots of repetition and overlap in the discussion. 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Needs some more research to provide a clearer picture of Eastern styles. 9/15 Need to be academically oriented Avoid plagiarism Need balanced usage—sections need to be a synthesis of several sources APA style General Form Issues 12/15 Title page needs to follow APA style Many line spacing problems Everything needs to be doublespaced Set spacing after line returns to 0 pt. x Correct font First page header style Subsequent page header style Page numbering References 6/10 Sufficient # of References Lots of entries are missing information Need to be in alphabetical order Needs proper style for author name x Needs proper capitalization style for titles x Italicize volume numbers No issue number for journals when DOI. 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