Leadership and Culture - Essay Example

LEADERSHIP AND CULTURE Introduction Contemporary business organisations have a tendency to go beyond the domestic border to explore several foreign markets. Globalisation has been a major influencing factor behind the continuously increasing number of international brands. However, with the continuous expansion of business in the global platform, leadership across different geographical regions has become a point of concern for the contemporary leaders. According to Lakshman (2013), modern day leaders are finding it difficult to manage workforces across different cultures. It is becoming more evident that a standardised leadership approach might not be enough, at least for the brands operating in the different international regions. Taking into consideration the case of Uruguay and Moldova, the two countries have different cultural values. If an organisation wishes to operate in any of the countries, the leadership strategies need to be altered as per the countries’ cultural values. However, the leaders are likely to experience several challenges in both the countries. Challenges in leading in Moldovan culture Moldova is one of those European countries that have a rich tradition. Although the number of Moldovans are superior compared to other nationalities, there are Greeks, Bulgarians, Germans, Russians and others (Everyculture.com, 2015). However, the local people prioritise the indigenous culture strongly, which is based on the Romanian culture. When it comes to written language, Moldovan culture is prioritised by the local community, which is regarded as Romanian or a Daco-Romanian. One of the primary difficulties for the organisational leaders in the country would be to use English as the preferred communication language. Due to strong attachment with the indigenous culture, people are expected to avoid English as a mode of communication (Everyculture.com, 2015). Apart from the linguistic barrier, the Moldovan economy does not hold much promise. The country has experienced a significant downturn in economy since 1998. The major industries are found to be wine, tobacco and food processing sector (Everyculture.com, 2015). On top of that, acquiring top talents from the industry is likely to be a major challenge for the organisations as well. The educational infrastructure is relatively poor compared to other European countries. As a consequence, leaders might find it difficult to acquire local people for the workforce. Caligiuri and Tarique (2012) stated that hiring local people are more effective compared to bring expatriates. If the local people are hired, the training cost could be higher. In reference to the above conversation, both the parties agreed with the fact that Moldovans are sensitive towards ethnicity. It can be considered that the strong ethnicity bond connects the people residing in the country. Considering the Hofstede’s cultural dimensions, the Moldovan culture is similar to collectivism. Collectivist societies prioritise on the welfare for the society (Lakshman, 2013). As a consequence, the leaders can find it difficult to manage work groups if the employees are not convinced of their welfare while committing future in the organisations . On top of that, the leaders need to focus on holistic approaches that aim for the betterment of the society. The interview findings suggest that there exists a gap in the social class system of Moldova. The social status is determined by two specific parameters in the country including political and economic power (Everyculture.com, 2015). Therefore, compared to Hofstede’s power-distance index, the Moldovan culture scores high power-distance. Thus, the leaders can expect smaller work groups within the organisation depending on the economic status. As a consequence, complying with the workforce discrimination regulations and maintaining the employee relations benchmark could be difficult. As cited by Lakshman (2013), a workforce comprising of smaller employee groups is not compatible for a standardised leadership strategy. When it comes to uncertainty-avoidance index, the Moldovan culture scores high. In reference to the interview, it has been found that Moldovan people ponder over the past and present and are not bothered about future. According to Caligiuri and Tarique (2012), societies that scores high in uncertainty-avoidance index have low tolerance to change and express anxiety. Similarly, following change management strategies can be difficult for organisations operating in Moldova. The organisational leaders need to effectively play the role of change agents to ensure smooth transition of the change management process. Since the Moldovan people focus on past and present, the culture of the country is assumed to be short term oriented. The short-term oriented culture is centred on traditional approach that is to consider longer time to develop relationships considering the past and the present values (Caligiuri and Tarique, 2012). Thus, the leaders might need to wait for too long to build an effective employee relation within the work environment. The local employees are not expected to be committed towards the organisation initially. They are only going to be loyal towards the brands after serving a long period of time in the organisation. Therefore, high employee turnover is expected and the leaders need to show enterprise to tackle the situation. Challenges in leading in Uruguayan culture The Uruguayan culture is found to be different compared to the Moldovan culture. People generally use Spanish to communicate. Lakshman (2013) cited that Platellano or Rioplatense are the most common form of Spanish languages that the Uruguayans follow to communicate, while people in the rural areas use Criollo or Gauchesco (Everyculture.com, 2015). However, English is quite popular in the country. Majority of the organisations in the IT region use English as the default language for communication. On the other hand, the findings from the interview suggest that the language is becoming popular among the young population as well. Therefore, the business brands that wish to operate in Uruguay can avoid linguistic barriers. Unlike Moldovan, the Uruguayan economy looks more promising for business. The sector is more diversified compared to that of Moldova. The economy is boosted by food manufacturing, petroleum, beverage, chemical, textile, tobacco, electronics and transportation equipment sectors. The steady economic growth over the last decade is another positive indication for sustainable business development (Everyculture.com, 2015). As a consequence, organisations can expect sustainable business development in the region. The businesses can be further complemented by availability of talent pool. The country’s educational infrastructure is quite strong and companies can expect availability of desired candidate profile. The leaders can expect lack of complexity in talent acquisition. The foundation of the Uruguayan society has been developed on democratic culture. Therefore, the power-distance index is assumed to be low. According to Hofstede, low power-distance promotes a culture that prioritises democratic values and equality (Lakshman, 2013). Organisational leaders in the country need to focus on developing a diverse workforce to comply with the cultural values. However, the leaders are likely to face several complexities in developing a diverse workforce. For instance, organisations following a rigid hierarchical framework can struggle while operating in the Uruguayan culture. The democratic political environment in Uruguay promotes the fact that the society prioritises collectivism. As a consequence, organisations operating in the region needs to follow teamwork culture. The Hofstede model suggests that collectivist societies emphasise on team goals rather than individual goals (Lakshman, 2013). However, integrating a team work culture can be a time consuming process. It is likely to take considerable amount of time for the leaders to promote a teamwork culture within the work environment. As far as the masculinity-femininity index is concerned, Uruguayan culture scores low on the dimension. In other words, the society promotes women empowerment and the difference between male and female is assumed to be relatively low. In reference to Hofstede’s cultural dimension, a low score on the domain reflects low gender discrimination (Caligiuri and Tarique, 2012). Low gender discrimination index in Uruguay can be supported by the findings from the interview. The findings suggest that a considerable number of women personnel dominate the country’s top decision making units. Therefore, gender equality and women empowerment need to be the top priority in the leadership agenda of the country. People in Uruguay look for future developments rather than bothering over past or present, which is unlike Moldovan culture. This particular value can be compared against Hofstede’s long-term and short-term orientation dimension. The Uruguayan culture can be compared with the long-term orientation that focuses on future. Hofstede’s model implies that short-term orientation emphasises on traditional methods that prioritise past and present, while long-term orientation prioritise future developments (Caligiuri and Tarique, 2012). As a consequence, the employees here are likely to be optimistic and the leaders need to make sure that there is plenty of scope for career developments. If there is lack of scope for career development, the leaders could experience increasing grievance or demotivation within the workforce. Methodological issues and possible pitfalls Hofstede’s model of cultural dimension can be considered as an effective guideline to evaluate national culture. However, the model might not be effective in addressing several hard requirements concerning a culture like legal policies, pay structure etc. Researches on Moldovan administration highlight partly implemented reform that has ultimately resulted in rising social discontent. Approximately, 72% of the Moldovans strongly believe that the recent administration policies are not effective (Everyculture.com, 2015). Although the average monthly wage of the workers has reached all time high, the standard is relatively poor compared to other European countries. From a firm’s perspective, the situation can be favourable, although growing employee concern can be hard to manage by the leaders. When it comes to Uruguay, increasing corruption and the Government’s inability to address the situation has been an underlining factor. Corruption and bribery are something that is common in the region, and business organisations need to follow operations complying with such activities. The pay structure however followed as per the industry benchmark across different sectors. Another methodological issue is found to be the dependency on verbal opinions. A considerable number of assumptions have been made assessing the response of the interviewee. In order to further establish the fact, several empirical evidences could have been considered. Conclusion Leadership practices in cross cultural platforms can be difficult at times. Among the obvious factors, the most potent factor is found to be the cultural background of the local people and the viewpoints towards foreign organisations and its cultures. Evaluating the Uruguayan and Moldovan culture using the Hofstede model, it has been found that the two cultures are quite different. Leaders in Moldovan culture might experience challenges in incorporating a standardised leadership strategy and ensuring a committed workforce. Whereas, leaders in Uruguayan culture might experience challenges in developing a diverse workforce and convince the employees for long term career development. In order to minimise such problems, following a cross cultural training program can be focused by business organisations while operating in foreign markets. Reference List Caligiuri, P. and Tarique, I., 2012. Dynamic cross-cultural competencies and global leadership effectiveness. Journal of World Business, 47(4), pp. 612-622. Everyculture, 2015.  World Culture Encyclopedia. [online] Available at: [Accessed 6 November 2015]. Lakshman, C., 2013. Biculturalism and attributional complexity: Cross-cultural leadership effectiveness. Journal of International Business Studies, 44(9), pp. 922-940. Read More