Leadership Has Changed within the Context of a Globalized Environment - Coursework Example

How lеаdеrshiр hаs сhаngеd within thе соntехt оf а glоbаlizеd еnvirоnmеnt, оvеr timе Name Institution Table of contents 1.0 Introduction 3 2.0 Leadership style in Insureon Company 4 2.1 Relational leadership in Insureon Company 4 2.2 Personality traits of Ted Devine 6 3.0 Corporate culture and impacts of globalization 7 3.1 Effects of globalization on corporate culture 7 3.2 Corporate culture of Insureon Company 8 4.0 impacts of globalization on Insureon 9 4.1 Changing business environment based on PESTLE analysis 9 4.2 Changes of leadership 11 5.0 Communication styles of the leader 12 5.1 Communication styles on background of globalization 12 5.2 Change communication 13 6.0 Conclusion 14 7.0 References 15 1.0 Introduction Leadership involves creating direction by developing vision and strategy upon a given country or nation. It also involves alignment by helping other people to grow through shared culture and vision. Good employee relationships are built through leadership styles that focus on inspiring and motivating the workers. Leaders create change in society by establishing direction and by aligning people into that specific direction and encouraging them in order to overcome inevitable obstacles. Effective management skills are important in surviving the increasing level of competition. Insureon, a company that offers business insurance to small and startup firms has benefited immensely from effective leadership. Ted Devine, the CEO of Insureon Company, a leading online business insurance agency has implemented effective leadership. He has an open-plan office with the CFO’s space adjacent to his. The other department heads sit nearby the CEO. The office structure is not divided by cubicles (Carimac Business Elite, 2013). This enables Devine to communicate and liaise easily with all the 20 employees. The instituted open floor plan is a representation of the company’s management style which symbolizes Devine’s spirit of openness and availability to all the employees. His principle is that “One is: No walls, no borders, no hierarchy. Everybody can talk to everybody. Everybody can participate in a decision”. He emphasizes the importance of leadership that encourages people to work together. The change in leadership in Insureon is motivated by workplace behaviors of Millennial generation which comprises of population born between 1980 and 2000. Such persons are changing how leadership is taking place by advising leaders not to just issue direction on what should be done but also to explain why things should be done. They should also demonstrate how things should be done (Billprettyman, 2013). 2.0 Leadership style in Insureon Company 2.1 Relational leadership in Insureon Company Relational leadership is concerned with how leaders and followers influence and interact with one another. A good leader should be able to exchange information with the followers. Also, they should bring about significant change in the society. Such leaders engage all participants and enable them to contribute towards achieving the organisational vision. Transformational and transactional leadership styles are also part of relational leadership (White, 2013). Ted Devine is a relational leader going by the open floor office plan that he instituted in Insureon Company. He has a policy that discourages walls, barriers and hierarchal office structure. His ideology is that everyone should take part in decision making and should work together in order to transform the entire company. According to Devine, leaders should lead arm in arm with their team. He admires leaders that are easily accessible for consultation. This enables employees to contribute their views, raise complaints and share experiences and skills. Half of Insureon staff are born between 1980 and 2000. This generation is called Millennial generation. The role of such persons in the American workplace is to establish profound effect on how leaders lead. They require leaders to explain how things should be done and to demonstrate how they should be done. Devine has implemented this leadership approach in order to enhance communication. This has also enabled innovation and creativity among the employees. Insureon’s business structure is horizontal in nature whereby “Ted Devine works as the CEO together with Founder and Chairman, Jim Cochran, Chief Technology Officer, Ruri Ter-Saakyants, CFO and Senior Vice President, Product Excellence, Jared Kaplan and Senior Vice President, Strategic Partnership and Customer Excellence, Lou Friedmann” (Insureon 2012, p. 1). The leaders, together with 20 other employees are located at the headquarters. The structure has enabled them to take part in interpersonal communication. Devine has also diversified his operations by offering varying range of insurance products. The figure below shows the types of products that Insureon offers. Source: (Why insureon. 2012) The figure shows that Devine is a transformational leader. A transformational leader has the ability to bring significant change within a given organization or context. Leaders with such characteristics are able to bring changes in the organization’s vision, strategy and culture as well as promote product and technological innovation. This explains the CEO’s ability to diverse product coverage of Insureon’s insurance products. 2.2 Personality traits of Ted Devine Influence theory examines the processes of influence between followers and leaders. This theory focuses on charismatic leadership. A charismatic leader is one who develops specific behavioural patterns under specific circumstances. Such leaders have vision, self-confidence, high frustration tolerance levels, enthusiasm, emotional stability and assertiveness. Ted Devine, Insureon Company CEO is a charismatic leader. He inspires his fellow employees to contribute in decision making. He is also warm and appreciates the employees by encouraging them and eliminating walls that could limit staff members from accessing him. He is also very decisive. For instance, since he joined Insureon in 2011, he literally, brought down the walls in the office plan. He ensured that no boundaries exist within the office setting enabling all the employees to have access to him. He has also proven to be very social and open minded to all cultures going by his statement that everyone should be able to talk to everybody. This means that he respects other cultures which enables him to perform better in the globalized environment Devine is also very confident given that he has established a different business structure. He has also diversified the company’s presence by increasing the company’s product base. He is very efficient since Insureon’s profits rose by 25% as at 2011. This was achieved through diversified business ventures in technology, accounts, architectural and management segments. Devine is a diplomatic leader. He has established mechanisms to protect entrepreneurs’ financial futures and dreams. This has been achieved by establishing online websites that advertise the company’s products. Through the site, consumers are allowed to purchase insurance products of their choice. 3.0 Corporate culture and impacts of globalization 3.1 Effects of globalization on corporate culture Globalization has enabled people and organizations to get interconnected. It is a social and cultural channel that enables people from different cultural backgrounds to intermingle in all spheres of life. It exposes people to various ways of thinking (Ergil, 2010). Globalization has greatly impacted Insureon’s corporate culture. It has enabled the company to sell its insurance products to different regions and cultures. By establishing a website the company has managed to market its products to persons from all backgrounds. This has enabled it to expand its business coverage as well as growth. Due to globalization, the company has had to deal with employees and customers from different cultural backgrounds. For instance, the company has its headquarters located in Dallas while other offices are located in New York, New Jersey, Chicago and Nevada. It has also employed persons from different nations and cultural backgrounds. According to Hofstede’s cultural dimension theory there are five cultural dimensions. These are individualism, power distance, uncertainty, masculinity and long term orientation (Tang and Koveos, 2008, p.1045). Insureon exercises low power distance which means that power is shared and dispersed across the entire organization. This is because of Devine’s horizontal managerial approach which has eliminated boundaries and ranks in management. This corporate culture approach has been emphasized in order to respect people’s rights and interests. Countries such as Chicago, New York and New Jersey practice high level of individualism. This can make it challenging for non-European and non-American employees working in the company. Asians are also used to high power distance and it would be challenging for them to work in Insureon, a company that disregards hierarchical management style. Therefore, globalization may bring cultural diversity in globalized work environment and multinational employees and companies have to respond to it. Managers and CEOs need to develop means of unifying the employees with diverse cultural beliefs and values. Cultural diversity is a part of organizational performance management. In order to progress countries have to embrace cultural diversity as part of globalization (Hofstede’s Cultural Dimensions, 2012). 3.2 Corporate culture of Insureon Company Insureon’s CEO, Ted Devine is committed to the principle of “One is: No walls, no barriers, no hierarchy” (5 Influential CEOs Weigh in What Makes a Good Leader, 2013, p. 1). He states that everybody should be able to talk to everybody and take part in any form of decision making. His principle is that people should work together as a sign of good leadership. These values are part of Insureon’s corporate culture. They encourage employees to innovate, create and get empowered. The company has used this creativity and diversity to expand its business coverage. The free communication culture also helps in destroying the barriers of entry since marketers and sellers are able to understand cultural differences of the target markets. The company also encourages diversity by establishing businesses in different countries. It values swift and streamlined procedures as well as real time insurance services. It does this by encouraging online applications for service provision. This has enabled the company to expand its customer base. Its performance is also rising as a result of product diversity. Corporate culture is also influenced by the leaders’ personal traits. Devine is a social leader who encourages free thinking and interaction. This culture encourages innovation and creativity. He also encourages young people known as Millenials to take over the business operations by advising the best management styles. The generation requires leaders to explain how things should be done instead of just giving directions. They also require leaders to step out of their offices and demonstrate to employees how exactly they would like things to be done. This management style has helped Insureon to beat competing companies’ rigid corporate cultures that discourage free communication. Devine has successfully managed to change Insureon’s corporate structure by literally bringing down walls and setting up open space office plan. This has enabled him to interact closely with other members of the management team and to be readily available for all forms of consultation. This move is a necessary element of successful leadership. 4.0 impacts of globalization on Insureon 4.1 Changing business environment based on PESTLE analysis Multinational enterprises have received significant changes due to globalization. PESTLE analysis has been used to understand how globalization affects Insureon’s leadership (Clarke, 2008). Political and legal factors. Dallas, situated in the USA is Insureon’s headquarters. The city is well known for its stability including stable political environment governed by rule of law. This protects Insureon’s business operations against political unrest. It has also contributed to the company’s growth. However, the company has expanded its operations into other regions and countries where political instability may be common. Although the European region is known to be politically stable, political interference due to change in governance and leadership is not inedible in any country. Economic factors. The global financial crisis of 2008 and 2009 destabilized many businesses. Although many companies have recovered from the crisis, market growth process is still slow. Investing in various products in different regions can also increase exposure to economic risk. Insurance products are mostly affected by economic conditions since many persons feel that it is not a necessity to have insurance covers. Additionally, people reduce their coverage during tough economic times. This affects economic growth and performance. Social and cultural factors. Different cultures and believes affect how people perceive insurance coverage. Insufficient knowledge about insurance products has affected how Insureon markets and sells its products. However, the company has established majority of its international products in Europe where people value insurance services. This has enabled the company to expand its product base. However, future expansion plans may be curtailed by social and cultural differences in regions such as Africa and Asia. These regions do not have high value for insurance products. Insurance companies already set up in these regions have saturated the market and it would make it challenging for any other insurance companies to enter the markets in future. Technological factors: Insureon has established businesses in developed markets which have advanced technological systems. This has enabled the company to market and sell its products. The company has also set up online facilities which monitor sales and markets. Insureon conducts advertisements over the internet enables its customers to access product information. Customers are also allowed to make applications for insurance products of their choice. Technology is the most common and affordable means of advertising an organisation’s products. However, insecurity has posed a challenge risking customer’s personal and financial information. Companies such as Insureon need to set up more secure links in order to ensure that consumer privacy and security is not compromised. Environmental factors: insureon offers insurance services and therefore it is not affected by environmental protection laws. It is not required to observe environmental conservation regulations. However, it is expected that its office premises should be safe from pollutants. 4.2 Changes of leadership Leaders should carefully consider the effects of globalization. The business environment is keen on maintaining efficient leadership. Globalization is responsible for shaping economic, technological, political and environment factors. Businesses can boost their businesses by changing their management styles. The PESTLE analysis reveals that globalization causes major changes to political, economic, social and technological aspects of the company. Efficient leadership keeps on changing as the business environment changes. Insureon Company is expected to prepare itself for the changing business environment by enhancing its leadership and leadership style. The new change in management style is also important in preparing the company into effects of globalization. Leaders have the responsibility of running business operations, making progresses and adjustments. For example, Devine introduced the open floor office plan which has led to improved communication styles in the company. Insureon has also been changing its leadership. For instance, it currently recruited Ted Devine among other top management position directors. Devine has created open floor business plan which promotes free communication. The headquarters only has 20 employees and this kind of business structure eases up communication. The CEO allows the other members of the management to sit in the same floor as he does. Devine has spread his new management ideology to the other leaders which has led to smooth business operations. 5.0 Communication styles of the leader 5.1 Communication styles on background of globalization Globalization has challenged leadership style in Insureon Company. Cultural diversity of the company’s clientele and employees has created the need to change the management style. The traditional top down management approach is getting impractical in the globalized environment. Leaders in the globalized environment need to implement diversified communication needs. They should learn that leadership and communication cannot be separated. Leaders can implement efficient cross-cultural communication which can impact Insureon’s leadership. Communication is an important skill that leaders should have. Devine has introduced electronic communication style whereby he enables customers as well as employees to access product and company information. The CEO also uses the marketing team to advertise its insurance products. He has ensured that the marketing team learns the new communication style in order to improve its interaction with the customers. By encouraging fellow employees to take part in product innovation and sales, the company has managed to go beyond cultural boundaries. This has enabled it to setup successful businesses in countries such as New York and New Jersey. The company’s ability to globally communicate in a professional manner has enabled it to attract the attention of international leaders. For instance, Insureon’s CEO, CFO and other key leaders were recruited from high profile companies. Devine, the CEO was initially working for AON, an international provider of insurance services. These leaders’ interests in Insureon proves that the company has effective communication styles through which it captures the attention of prospective employees. Secure communication is important in a globalized environment. Insureon has secured its sources of information and information dissemination through its technological department. The department monitors both incoming and outgoing information. It also monitors internet sites such as Tweeter and the company’s website. This enables the company to monitor consumer opinions and comments about its products. Globalized communication environment is incorporating consumer opinions. This is creating competitive advantage by enabling consumers to take part in business operations. Such comments and opinions can cause a business’s downfall or success. 5.2 Change communication Globalization is challenging organizations to change their management and leadership styles. Most specifically, leaders are challenged to change communication styles towards employees by motivating and encouraging them to be creative and innovative and to emulate team work. Leaders should take part actively in achieving effective organizational communication. They should demonstrate how they would like duties done by taking part in training sessions. This would ensure that clear instructions are received and effected. A leader should directly get involved with the achievement of organization goals and outcomes, and make the necessary amendments to the results. Devine has established sustainable leadership style through innovation which has helped in the company’s sustainable growth. Devine conforms to employee needs by setting up organizational duties and changes and clearly communicating them to the employees. He communicates business ventures, leadership changes and innovated products through internal emails as well as through company websites. He holds the company in high regard by working efficiently. He is clear and precise how he would like things done. He also prefers face to face communication since it is much straight forward. This is a new communication style which is different from the usual communication style that the company uses. However, Devine encourages the employees to identify and conduct themselves in accordance to other company values of competency, integrity and ethics. New employees are advised about new business structure and the strategic goals of the company. Devine is also committed to offering sustained growth by empowering employees and the management to act responsibly in order to build trust. Insureon values its employees since they are part of its assets. It ensures that employees are well trained and compensated as a way of motivating them. Insureon employees value communication since it is the tool used to link the organisation’s cultural values and future goals. 6.0 Conclusion The aim of the paper is to identify and analyse the effect that globalization has on leadership. It also discusses the desired communication styles. The main focus was on Insureon, a leading provider of insurance services to small size firms. Insureon’s CEO Ted Devine possesses great leadership and interpersonal skills that enable him to integrate easily with the rest of the management team. Globalization has caused both positive and negative effects on the company’s social, economic, political and legal status. Insureon faces most of its challenges from economic and legal factors causing slow performance and growth. Devine has established online platforms through which consumers can easily access company insurance products. He has facilitated an open plan office space to enabled the management team to easily contribute to decision making. This transparency had contributed to increased ideas that have boosted the company’s growth. Devine encourages freedom of communication and his policy is that people should communicate freely with one another. His leadership style has changed the management styles of other companies such as BET cable network and Linkedin. 7.0 References 5 Influential CEOs Weigh in What Makes a Good Leader. (2013). Retrieved from http://www.entrepreneur.com/article/225804 Billprettyman: The Collaborative Workplace. (2013). Retrieved from http://billprettyman.com/collaborative-workplace/ Carimac Business Elite. (2013). Retrieved from http://doublehelixed.wordpress.com/category/uncategorized/page/3/ Clarke, M. (2008). Globalization and its Effect on Cultural Diversity. Retrieved from http://etec.ctlt.ubc.ca/510wiki/Globalization_and_its_Effect_on_Cultural_Diversity Ergil, D. (2010). Social and cultural impacts of globalization. Retrieved from http://www.todayszaman.com/columnists-204938-social-and-cultural-impacts-of-globalization.html Hofstede’s Cultural Dimensions. (2012). Retrieved from http://www.mindtools.com/pages/article/newLDR_66.htm Insureon. (2012). Retrieved from http://www.accretivellc.com/2012/02/08/ted-devine-appointed-ceo-at-leading-online-business-insurance-agency-insureon/ Tang, L., Koveos, P., E. (2008). A framework to update Hofstede's cultural value indices: economic dynamics and institutional stability.Journal of International Business Studies, 39(6), 1045-1063. White, L. (2013). MM324: Organisational Leadership and Performance. Lecture 2 of 12 (T2 2013). Why insureon. (2012). Retrieved from www.insureon.com/about-us/why-insureon/ Read More