Organizational Culture of Indonesia - Dissertation Example

Organizational Culture of Indonesia Introduction What is leadership? What does it takes to be a leader? Is it only the charismatic personality? What leadership is all about? Is it only about inspiring others? Is it only the leader who is important in successful leadership or followers also has a role to play? Does the much hyped up political or religious leaders are the only kind or there exist many leaders around us in all strata’s of life varying in magnitude. If true than what are the different types of leadership. What are the factors that define a type of leadership? Do culture, organizational behavior, characteristics and attitude of the people has any role to play in defining the successful type of leadership for a particular organization in a particular country. In the fast changing world of the twenty first century, the ever accelerating pace of change creates a lot of challenges and opportunities for the organizations. Hence organizations today need the vision of leadership and adaptability to capture the opportunities and minimize threats for sustained growth (Kotter, 1996). This paper aims at studying the characteristics, attitude and behavior of the Indonesian people and the organizational culture and work environment of Indonesian organizations. I as a leader will analyze which leadership theory and style is more appropriate and suitable for them? How I will apply them to lead and guide people in my organization? Culture as Mental Programming There is almost as much variety in Human’s mind as it is in human beings themselves but fortunately there still exists a structure in this variety which provides the basis for mutual understanding. Every person has his own pattern of thinking and feeling which determines his potential action based on his lifetime learning. To deviate from such patterns and learn something new, a person has to do a lot of unlearning and unlearning is more difficult than learning. These patterns of thinking, feeling and actions form the mental programs. These mental programs are deep rooted in the social environment, life experiences which include family, neighborhood, youth groups, workplace and living in a society. All this information gives us an insight into an individual’s behavior and action and reaction (Gert Jan Hofstede, 2010). The sound knowledge of this mind program is very important for leadership. This mind program also defines the working environment in the organizations and determines the behavior and attitude of employees. I will not be able to lead people in my organization and successfully doing the unlearning unless I have sound knowledge of their mind program. The Relationship between Organizational Culture and Performance Research has proven that organizational culture has very weak link with organizational performance but it is an important determinant of internal control within the organization. Research also proves that organizational culture and internal control and governance although has positive relationship with organizational performance but its role is not very significant (Wobovo, 2008). This research further augments our point of the need of leadership for improving organizational performance. Behavioral tendencies of Indonesians Indonesia consists of 17,508 separate islands and the population exceeds 234 million. In terms of population it is the fourth largest country in the world. Indonesia is a multicultural society with one of the most populous Muslim majority country in the world. It also has significant number of Hindus, Buddhist and Christians. Hence the culture of one city is sometimes entirely different from other cities e.g. the culture of Hindu dominated Bali is entirely different from Jakarta which in turn is entirely different from Sumatra. Hence categorizing certain behaviors as Indonesian culture would be oversimplification. Despite these cultural variations the other factor which is more important for organizational culture is the “tightness” or “looseness” of the society or national culture in terms of organizational culture. This tightness or looseness is determined by the strength of societal norms and the degree of acceptability for deviations from these norms (James W. Smither, 2009). The Indonesian culture is quite loose because of already existing diversity in the society. Organizational Culture of Indonesia Organizational culture in Indonesia has transformed ever since the movement of democratization in 1998. It has resulted in a lot of freedom of expression and freedom of information. It has also brought changes in the organizational structures with a shift towards decentralization and democratization (Hill, 2011). The system of centralization and authoritarianism is now completely changed. According to researchers one major dimension along which many ethnic groups and nations vary from each other is the degree of individualism and collectivism. This behavior strongly determines the attitude, behavior and actions of the individuals and hence has a strong role to play in determining the working environment. According to Hofstede’s comparative study of nations in identifying the degree of individualism and collectivism countries like Indonesia, Pakistan and Japan has much greater tendency for collectivism as compared to countries like USA, Canada, United Kingdom and Australia who are more individualistic (Schein, 2010). This collective approach is quite useful for a leader because it brings synergy of work and minimizes rivalries and professional jealousy in the working environment. With the onset of global market places the study of cross-cultural business behavior has become eminently more useful. Global businesses demand negotiating with customers and suppliers all around the globe. Sales presentations, management style and many other things need to be changed according to the local business culture (Gesteland, 2005). Good manners and socially acceptable and unacceptable behavior varies from country to country. These cultural differences must be taken into consideration when dealing with people with other cultures to avoid misunderstandings. Indonesians are very polite people and their culture is based on honor and respect for the individuals. Harmony and agreement is of utmost important for Indonesian people. It is reflected in all their dealings and interactions ranging from personal to political as well as business environment. Disagreements are usually discussed in private and not voiced in public (Heinrich, 2005). As a leader in Indonesian organization I have to follow their general mannerism in order to achieve their credibility and have to keep into consideration the element of politeness and respect in my style of leadership. Leadership style should be situational based on the time, place, culture and the people involved. National Culture and its Impact on Workplace National culture not only affects customer behavior and its decision making but it has strong impact on working environment of the organization. A Dutch academic Geret Hofstede studied the impact of employee behavior, motivation and national culture on local cultures. He proved that different national cultures have different perceptions of motivation, work and hierarchy. According to him the impact of these cultural differences on employee attitude can be measured through four dimensions. They are Power distance Uncertainty avoidance Individualism/collectivism Masculinity/femininity Power distance is derived from the distribution of power in the society. High power societies have strong hierarchy while others have loose hierarchy. Societies with high intolerance level for risk and uncertainty just like Indonesia wants uncertainty avoidance. It has already been discussed that on Individualism/ collectivism scale Indonesia has high score of collectivism. High score for collectivism requires subjugation of personal will and freedom to the need of community. Societies with high emphasis on status, personal goals, earnings and promotions are considered masculine whereas societies where human relationships and quality of life is more important are called feminine (Witzel, 2005). A leader while developing leadership strategy has to take into account these dimensions of culture in order to be successful. I as a leader in Indonesia cannot ignore the collective approach and feminist society. I can only be successful if I give importance to family values and the collective approach of the Indonesians. Leadership Theories Leaders inspire their followers and make them do things which otherwise they would not do because followers have trust and faith in their leaders. There are certain myths about leadership which needs clarification. An identification of essential elements and skills provide the basic framework required for success. A simple and unique not simplistic, definition of the leadership process Insight into the purpose of leading. Sound understanding of the organizational context in which one intends to lead Appreciation and ability to grasp opportunities and unique challenges inherent in each situation. Clarity about ones leadership role, what one brings to leadership table. Savvy and successful leaders build their own framework based on their skills and capabilities, reflecting self learning and experience and a healthy respect for challenges, opportunities and risks ((Joan V. Gallos, 2008). I as a leader also have to build my own frame work for my organization depending on the situation, requirement and culture of the Indonesian society and structure of the organizations. It is a widely accepted fact that leaders play a pivotal role in organization’s success. It is a critical factor in enabling organizations to adapt to its environment readily, surviving and thriving by successfully implementing organizational strategy. Based on vast research three themes about human behavior have been identified in which leaders behavior is vital and can act as driving force in successfully formulating and implementing organizational strategy. These three themes are intentions, influence and information. For me to be successful in Indonesia the most important theme would be information (Barker, 2006). The more accurate information about the country, the attitude and behavior of the people the better it will help me in adopting the appropriate leadership strategy. Here is a brief review of all the leadership theories development (Northhouse, 2010). It will help me in identifying the leadership theory which is more suitable in my case. Trait theory Behavioral theory Situational contingency theory Transactional theory Transformational theory Trait based theory is one of the earliest theories of leadership and perhaps the most irrelevant in our scenario. This theory is based on the concept that leaders are born with certain traits such as competency, knowledge, skills etc. They are viewed as necessary for success and effectiveness of leadership. Behavioral theory emphasized on pattern of actions used by different individuals determines leadership potential. Different kind of behaviors identified in this theory was autocratic, democratic and laissez-faire. It also included Michigan studies which discussed employee centered versus task centered theories. This theory can help me only in defining my leadership style which is should be democratic keeping in view the recent decentralization and democratization trend in Indonesia. Situational contingency theory was a combination of trait theory and behavior theory. Both are important aspects but must be taken in situational context i.e. situation matters. According to this theory group effectiveness depends on a perfect match between leadership style and situation. There is no one best solution and it focuses on ability and willingness of followers. This theory probably best defines my scenario. I believe in situational and contingency approach. I would like to influence my people through my own behavior and will develop strategy for the organization based on the situation. Transactional leadership theory was proposed by Karl Kuhnert and Phillip Lewis. It is based on the theory of exchange; a transaction takes place when each party gives up something in exchange of other. It is the relationship between superiors and subordinates on mutual give and take. Leaders offer something of value such as benefits etc in exchange of extra work overtime special projects etc. transactional theory is based on contingent reward and management by exception (O, 2008). This theory is more suitable in masculine societies where promotions, earnings and status are more important than relationships. I as leader although cannot out rightly reject this style but a proper use of this approach in linking performance with reward will be my strategy without undue emphasis on money. Transformational theory focuses on achieving goals by more than just communication. It involves charisma, vision, sense of mission, inspiration, high expectations, intellectual stimulations which promote intelligence. According to this theory leader gives personal attention, coaches and give advices, in short individual consideration is given. A successful transformational leader possesses self confidence, dynamic personality, strong conviction and talent of motivating others. This type of leadership is value based; leaders lead by example and inspire others. In this type of leadership a leader is supposed to command a lot of respect among its followers which can only be achieved through performance and right attitude over a period of time. In my scenario this phase or kind of leadership will come later. My leadership theory and style for Indonesia I will use a combination of leadership theories and styles to influence my people and lead them to organizational success. First I will start with contingency or situational approach. Success in that kind of leadership will allow me to practice transformational leadership through which I can bring big changes and transform the whole organization with the support of my followers. In my opinion transformational leadership will be very successful in Indonesia. They have a culture of respect, politeness which brings with it work synergies by minimizing employee rivalries. Moreover Indonesians have a culture of collectivity that means sacrificing your freedom and independence for the collective good of the society. Transformational leadership requires participative type of leadership style. Charismatic, Inspiring and transformational leadership is very successful in enhancing work attitudes not only in stable environments but is also successful in changing environment depending on the openness to change. A study was conducted of the Indonesian banks in the post merger situation to study the relation of leadership style with job satisfaction, work commitment and openness to change. The study revealed positive relationship between transformational leadership, job satisfaction and successful change (Zahrouter R. Hinduan, 2009). I will also adopt this form of leadership to influence and lead people in my organization. Through building positive perception about change I can earn openness and willingness of the people. Motivation by me and job satisfaction through positive results can lead to successful change in my organization. I need the support of most of the employees without them no leader alone can bring change. To garner support of my staff I need to communicate effectively with them and build positive image of change. Motivation and job satisfaction through my style of leadership will urge my followers to tread towards success. Distinct leadership model of Indonesia The form of leadership that was earlier prevalent in Indonesian society was called Javanese-Indonesian leadership. The state ideology of Indonesia was that all the inhabitants of the state should work together in harmony for the development of the state. According to Indonesian version until 1990’s, liberalism and individualism actually give too much freedom. But Indonesia has come a long way since then. What we observe today is lot of decentralization and democratization. According to a survey conducted in the banking industry Indonesia is trying to cut a distinct leadership model for itself as opposed to following or assimilating any Western model of leadership. They are trying to identify the basic principles and dimensions of that model which is reflective and unique to Indonesian cultural diversity, social and business structure, social and religious values, business activities and practices. Such indigenized leadership model will definitely have its impact on future leadership initiatives (Glen Anthony, 2009). This gives us further scope for research. Conclusion Indonesia has very diverse culture in term of religion, society, business and societal structures. I as leader in an Indonesian organization will adopt charismatic and transformational leadership to influence and lead my people. This form of leadership is very much suitable for the organizational culture, structure and business values of Indonesia. Recent study of the banking industry of Indonesia has proved that transformational leadership has been successful in building positive image of change and creating job satisfaction. Although there is room for further research and Indonesia is trying to develop its own distinct leadership model suitable for the diverse culture of Indonesia as opposed to Western models. Such indigenized model will definitely affect future leadership initiatives. Bibliography Joan V. 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