Cross-cultural psychology attempts to understand how individuals of different cultures interact with each other. Along these lines, cross-cultural leadership has developed as a way to understand leaders who work in the newly globalized market. Today's international organizations require leaders who can adjust to different environments quickly and work with partners and employees of other cultures. It cannot be assumed that a manager who is successful in one country will be successful in another.
Related Theories and Research
Implicit Leadership Theory The Implicit Leadership Theory (ILT) asserts that people's underlying assumptions, stereotypes, beliefs and schemas influence the extent to which they view someone as a good leader. Since people across cultures tend to hold different implicit beliefs, schemas and stereotypes, it would seem only natural that their underlying beliefs in what makes a good leader differ across cultures.
Hofstede’s Cultural Dimensions One of the most prominent and influential studies to date regarding leadership in a globalized world is the Hofstede dimensions of culture. The study reveals similarities as well as differences across cultures and emphasizes the need to be open-minded to understand the differences in other cultures. Hofstede utilizes six dimensions of culture to compare cultures to give leaders an understanding of how to adjust their leadership styles accordingly. These dimensions include individualism/collectivism, feminine/masculine, power distance, uncertainty avoidance, long-term/short-term orientation, and indulgence/restraint.
GLOBE The Global Leadership and Organizational Behavior Effectiveness Research Project (GLOBE) study incorporated both the ILT and Hofstede's dimensions into one unique research study. The GLOBE study extended the ILT to include individuals of a common culture maintaining a relatively stable common belief about leaders, which varies from culture to culture. They labeled this the Culturally Endorsed Implicit Leadership Theory (CLT). The GLOBE study came up with the nine dimensions of uncertainty avoidance, power distance, collectivism I: societal collectivism, collectivism II: in-group collectivism, gender egalitarianism, assertiveness, future orientation, performance orientation and humane orientation. Some of those dimensions correlate with the respective dimension from Hofstede. However, they differ since the GLOBE dimensions distinguish between cultural values and cultural practices, as opposed to Hofstede.
Leadership styles Paternalistic leadership Paternalistic leadership “combines strong discipline and authority with fatherly benevolence and moral integrity couched in a ‘personalistic’ atmosphere”. Paternalistic leadership is composed of three main elements: authoritarianism, benevolence, and moral leadership. At its roots, paternalistic leadership refers to a hierarchical relationship in which the leader takes personal interest in the workers’ professional and personal lives in a manner resembling a parent, and expects loyalty and respect in return. These leaders want to transform a team into a family-like group. They would like to know employees' quality of the life overall such as hobbies, parents' health condition, and children's education.
A great deal of research has been conducted on the prevalence of this leadership style in non-Western business organizations, indicating the prevalence of paternalistic leadership in countries like mainland China and Taiwan. However, considerably less research has been done on whether paternalistic leadership exists in Western cultures. Recently, there has been an increase in the amount of attention placed on paternalistic leadership in non-Western cultures. Although it is a relatively new area of focus in leadership research, evidence has been found supporting the relationship between paternalism and positive work attitudes in numerous cultures, including those of the Middle East, Latin America, and Pacific Asia. Paternalistic leadership has been found to be positively associated with job satisfaction in India but not in the United States. In both countries, paternalistic leadership was positively related to leader-member exchange and organizational commitment.
Transformational & transactional leadership Transformational leadership is loosely defined as a charismatic leadership style that rallies subordinates around a common goal with enthusiasm and support. Transactional leadership is characterized by a give-and-take relationship using rewards as an incentive.
In a 2004 questionnaire study of employees at 10 different banks, responses indicated that only 3 of the 7 factors that were found in the ideal leadership style in Egypt corresponded with the US factors. The other 4 were unique to Egypt or perhaps the Middle East in general. These results indicate an inability to assume that transactional and transformational leadership will succeed in non-western cultures. In a study of transactional and transformational leadership in China and Australia, transformational leadership predicted performance and trust in the Australian population, but only predicted trust, not performance, in the Chinese population. Transactional leadership did not predict trust or performance in either population.
Other findings, however, saw a strong presence of transformational and/or transactional leadership in China, India, Kenya, and the U.S. Allocentrists, similar to collectivists, respond more positively to transformational leadership because they unite individuals around a common goal. Idiocentrists (individuals found in individualistic cultures) are more amenable to transactional leaders who reward individuals for hard work and success and less amenable to leaders who encourage group work and reduce individual identity.
Effects of cultural values in management
Differences in performance of management functions (Planning, Organizing, Commanding, Coordinating, controlling) across countries arise from different value orientations.
Time focus Different cultures have different perceptions of time according to their environment, history, traditions and general practices. Monochronic - Planning is task-oriented; Organizing is structured, linear and task-focused; Commanding - put emphasis on making and following plans, managing the inflow and distribution of detailed information; Coordinating is focused on the shorter term, meets immediate needs and requirements; Controlling use control systems that depend on detailed information and involve strict deadlines. Polychronic - Planning is people-oriented; Organising is less structured, more holistic in nature and people-focused; Commanding - flexible, react to changing circumstances, give priority to people over plans, relies on sharing knowledge and information; Coordinating - is focused on the longer term, with concern for building relationships over time; Controlling use more flexible control systems involving people in addition to information.
Time orientation Past orientation - Planning put emphasis on continuing traditions; Organizing decisions are made within the context of the customs of the society, past goals and precedents guide the process of organizing; Commanding - develop vision and mission statements with emphasis on company's values and reputation; Coordinating - involves slower adapting of the criteria by which the management select and train employees; Controlling develop performance objectives in keeping with customary goals. Future orientation - Planning put emphasis on long-term plans and long-term results; Organizing - work and resources are divided and co-ordinated to meet long-range goals and projections for the future; Commanding - develop vision and mission statements with focus on achieving long-term benefits; Coordinating involves selecting and training employees to meet long-term business goals; Controlling develop performance objectives in the context of long-term goals.
Power Hierarchy - Planning - autocratic; Organization structure is tightly controlled, authority and responsibility are centralized; Commanding - employees are closely supervised and feel comfortable with a directive supervisor; Coordinating - subordinates expect bosses to take initiative to train, develop and promote them; Controlling - personal control preferred over impersonal control systems. Equality - Planning - participative planning; Organizational structure encourages individual autonomy, authority is decentralized to lowest possible level; Commanding - participative or consultative management style, employees are not afraid to disagree with their managers; Coordinating - work relationships are not strictly prescribed in terms of behaviours and roles; Controlling - subordinates work with bosses to develop, implement, monitor and alter performance objectives.
Competitiveness Competitive - Planning - emphasis on speed and task performance; Organization structure individual achievement is encouraged in organizing the work, managers have more of leadership role; Commanding - leader's role is to track and reward achievement, higher stress in working process; Coordinating - employees are selected on their ability to work independently; Controlling - performance-based systems. Co-operative - Planning - emphasis on maintaining relationships in plan implementation; Organization structure group integration, positive working environment, convenient schedules, managers have facilitating role; Commanding - leader's role is facilitate mutually beneficial relationships; Coordinating - employees are selected on their ability to work well in group; Controlling - task performance and team effectiveness.
Activity Doing cultures - Planning - developing measurable, time-framed action steps; Organizing involves action-oriented documentation for project management with clearly spelled out tasks; Commanding - managers are effective if they have the necessary expertise and competence; Coordinating - employees are chosen on their ability to carry out organizational tasks; Controlling - estimates task performance and the way how it was done. Being cultures - Planning - strong focus on the vision or ideal a company wishes to attain; Organizing more focused on common vision and personal trust; Commanding - managers are effective if their personal philosophy, values and style are seen are compatible; Coordinating - career development is based not only on performance but also on personal and social criteria; Controlling - estimates effectiveness and adaptability.
Space Private - Planning - usage of individualistic or systematic forms of planning; Organizing approaches are centred on tasks; Commanding - managers and employees do not share the same office; Coordinating - explicit information about how staff should be employed; Controlling - managers use explicit measures of performance. Public - Planning - usage of group-oriented or authoritative forms of planning; Organizing approaches are centred on relationships; Commanding - location and size of office where employee works does not reflect that person's rank in the company; Coordinating - implicit information about how staff should be employed; Controlling - managers use explicit measures of performance.
Communication Low-context - Planning - explicit, detailed, quantifiable and information-based; Organizing - task-responsibility guidelines are explicit; Commanding - managers get work done through others by outlining specific goals and ways to achieve them, explicit communication and depersonalized conflict; Coordinating - detailed contracts of employment and explicit performance appraisals; Controlling -task driven control in accordance with monitoring and control procedures used to ensure performance objectives.