Research Paper (Organizational Theory & Behavior) (Graduate school)

The Importance of Cultural Differences and Global Leadership

[Name]

April 15, 2018

Author Note:

This paper was prepared for Organizational Theory and Behavior, Section 9080, taught by Professor

The Importance of Cultural Differences and Global Leadership

Globalization impacts almost everyone on this planet today by making trade of goods and services between countries a normal aspect of life. According to the United Nations (2017), globalization has helped to increase economic growth in many countries, with global GDP rising from 50 trillion dollars in 2000 to 75 trillion dollars in 2016. Numbers like these show the immense opportunities that are offered by globalization. Citizens of a global world receive goods and services from organizations that employ people from different backgrounds and cultures. The manager of an organization selling a good or service had to gain an understanding of cultural differences and global leadership before their organization could go global. This is the management theory of cultural differences and global leadership come to fruition. Knowing the importance of cultural differences and global leadership is imperative for success in any part of the world. To ignore this important theory would be detrimental to managers, employees, customers, and any other members of society. I encountered this theory at a young age, and then came to appreciate in my professional experience. I now hope to use this theory in my career goal of becoming a global human resources (HR) manager.

There are several management theorists who have studied cultural differences to help managers be able to better create relationships with members of other cultures. From studying the cultural differences, the theorists have been able to deduce global leadership competencies that should be met in order to create relationships with certain cultures or groups of people. First, a manager should understand these theories and how to properly apply them. However, there are some critics of these distinguished theories, and these critiques should also be acknowledged for global leaders to fully succeed. Managers who encounter members from another culture and make managerial decisions should be critical of what knowledge they currently have, how it can be applied, and how it can further be developed to better suit the culture and situation for ultimate organizational success.

The first theorist to tackle issue of cultural differences was Geert Hofstede. Hofstede performed a study on IBM subsidiaries in 64 different countries (Moskowitz, 2009, para. 1). He used a questionnaire to survey 117,000 IBM employees in 1967 and 1973 (McSweeney, 2002). From the results of his research, he developed five cultural dimensions. He used a ranking system from zero being the lowest, to 100 being the highest, to rank each country on how they scored in each dimension. The cultural dimensions are power distance, individualism, masculinity, uncertainty avoidance index, and long-term orientation. Power distance determines a country’s acceptance of power inequality. Individualism tells if a culture is more concerned with the individual in their society. A country that scores low on individualism is more collectivist, which is concerned more for the group. Masculinity is the cultural dimension that determines whether a culture responds to issues with more masculine characteristics such as assertiveness and competition, as opposed to a more feminine response of caring and compassion. Uncertainty avoidance index gives insight on how a culture will respond to unknown situations and circumstances. The fifth dimension of long-term orientation was an addition to the original four dimensions after Hofstede conducted more research on predominately Confucian countries, such as China, Taiwan, Korea, and Japan. Confucius was a Chinese scholar dating back to 500 B.C. whose philosophical views shaped the values and beliefs of these and other Asian countries. This questionnaire was developed by Chinese scholars and given to students in 23 countries. Even though the results are focused more on Confucian countries, Hofstede still applied this dimension to non-Confucian countries (Moskowitz, 2009). Long-term orientation is a culture’s value of “thrift and perseverance” (Moskowitz, 2009, para. 6). Long-term oriented cultures have more of “a willingness to delay short-term success for longer term gain” (UMUC, 2018, p. 8). Countries who have short-term orientation are more concerned with “respect for tradition, fulfilling social obligations, and protecting one’s ‘face” (Moskowitz, 2009, para. 6). A sixth dimension, indulgence versus restraint, was added after additional culture research. Indulgent cultures are those that “allow relatively free gratification of basic and natural human drives related to enjoying life and having fun” (Hofstede’s Insights, 2018, para. 8). Cultures who are more restrained “suppress gratification of needs and regulates it by strict social norms” (Hofstede’s Insights, 2018, para. 8).

The most recent study on culture, and the second most influential, is the GLOBE (Global Leadership and Organizational Behavior) Project in 2004 and 2012 (Dorfman, Javidan, Hanges, Dastmalchian, & House, 2012). While this study is similar in practice to Hofstede’s cultural study, the GLOBE Project sought out to “investigate the complex relationship between societal culture and organizational behavior” (Dorfman et al., 2012, para. 1). This study not only found cultural differences between countries, but also found global leadership theories for each country. This enormous study was conducted by 200 researchers (Dorfman et al., 2012), and analyzed 62 different countries (UMUC, 2018). The GLOBE Project configured their own nine cultural dimensions after researching the works of Hofstede, Trompenaars and Hampden-Turner, and Kluckhohn and Strodtbeck (Javidan, Dorfman, De Luque, & House, 2006). The first cultural dimension, performance orientation, determines whether a culture rewards the group or team for performance improvement and excellence (Javidan et al., 2006, p. 69). Assertiveness, the second cultural dimension, tells how aggressive or competitive the culture’s individuals can be. The third dimension, future orientation, is like Hofstede’s long-term orientation dimension. Cultures high in future orientation, such as Singapore and Switzerland pass up opportunities that will be successful in the present moment, for success in the long-term future. Humane orientation, the fourth dimension, determines how the group “encourages and rewards individuals for being fair, altruistic, generous, caring, and kind to others” (Javidan et al., 2006, p 69). Egypt and Malaysia are countries that are high in humane orientation. Institutional collectivism, the fifth dimension, determines how much a society or organization encourages sharing of resources and activities. For example, individuals in Singapore and Sweden will work in groups, while people in Greece and Brazil will work individually. The sixth dimension, in-group collectivism, tells how a country’s individuals will “express pride, loyalty, and cohesiveness in their organizations or families” (Javidan et al., 2006, p. 70). Egyptian and Russian society and organizations encourage high in-group collectivism. Gender egalitarianism, the seventh dimension, shows how much a country or society will create gender equality. European countries score higher on gender egalitarianism, while Egypt and South Korea scored low meaning that their society is very male-dominated. Power distance, the eighth dimension, is the same as Hofstede’s power distance dimension. In this GLOBE dimension, Thailand and Brazil scored high on power distance. The last dimension, uncertainty avoidance, is also the same as Hofstede’s cultural dimension. Singapore and Switzerland scored higher in the GLOBE Project meaning they have rules and regulations to avoid uncertain situations. Meanwhile, Russia and Greece scored low in this dimension where they are more “opportunistic and enjoy risk taking” (Javidan et al., 2006, p. 70).

The GLOBE Project also utilized a questionnaire to survey over 17,000 managers to develop global leadership theories (Dorfman et al., 2012). The survey included a grading scale for managers to rate on a scale from one to seven how “the behavior or characteristic greatly inhibits a person from being an outstanding leader” to how the “behavior or characteristic contributes greatly to a person being an outstanding leader” (Dorfman et al., 2012, para. 7). This incredible feat of research resulted in 21 primary leadership dimensions, six global leadership dimensions and ten culture groupings. The ten culture groupings are Anglo, Eastern Europe, Latin America, Confucian Asia, Nordic Europe, Sub-Saharan Africa, Southern Asia, Germanic Europe, and Middle East. The six global leadership dimensions are charismatic/value-based leadership, team-oriented leadership, participative leadership, humane-oriented leadership, autonomous leadership, and self-protective leadership. Charismatic/value-based leadership is a leader’s “ability to inspire, to motivate, and to expect high performance outcomes from others based on firmly held core values” (Dorfman et al., 2012, para. 8). The primary leadership dimensions in this dimension are visionary, inspirational, self-sacrifice, integrity, decisive, and performance oriented. Team-oriented leadership focuses on “effective team building and implementation of a common purpose or goal among team members” (Dorfman et al., 2012, para 9). The primary leadership dimensions in this dimension are collaborative team orientation, team integrator, diplomatic, malevolent, and administrative competent. Participative leadership is similar to Hofstede’s power distance dimension in that it addresses how much outside involvement a manager will allow when making and executing decisions. The primary leadership dimensions are nonparticipative and autocratic. Humane-orientated leadership involves a manager showing supportive and considerate leadership, while also being compassionate and generous. This global leadership dimension is like Hofstede’s masculinity dimension, but on the feminine ranking of the cultural dimension. The primary leadership dimensions are modesty and humane orientation, also akin to Hofstede’s feminine cultural dimension. Autonomous leadership is one that focuses on “independent and individualistic leadership attributes” (Dorfman et al., 2012, para. 12). This dimension only has one primary leadership dimension called autonomous leadership. The sixth global leadership dimension is self-protective leadership. This type of leadership “focuses on ensuring the safety and security of the individual and group through status enhancement and face saving” (Dorfman et al., 2012, para. 13). The primary leadership dimensions for self-protective leadership are self-centered, status conscious, conflict inducer, face saver, and procedural. (Dorfman et al., 2012).

While the Hofstede study and the GLOBE Project have been highly praised by those in the international management industry, there are some who question their theories and point out potential weaknesses of these theories. Rachel Baskerville (2003) describes that Hofstede never actually studied culture according to the theories of anthropology and sociology, and thus his cultural dimensions cannot be true. Hofstede instead focused more on “management-related disciplines, and psychology” (Baskerville, 2003, para. 9). Baskerville also pointed out that Hofstede identified “nation states with culture”, and that “cultures do not equate with nations” (Baskerville, 2003, para. 24). For example, Africa has 98 diverse cultures contained within its 48 countries, while North America has 147 Native American cultures and nine folk cultures (Baskerville, 2003). Baskerville (2003) argues that Hofstede placed broad titles on cultures based on their country of origin, instead of accurately describing the diversity of the cultures. Hofstede also developed some of the dimensions based on the socio-economics of the country, instead of the actual culture. For example, uncertainty avoidance was correlated with age and anxiety of those taking the surveys (Baskerville, 2003). Sunil Venaik and Paul Brewer (2016) also point out that both Hofstede’s cultural dimensions and the GLOBE Project’s cultural dimensions have issues correctly correlating the dimensions to the culture. Uncertainty avoidance, for instance, only measured the responses based on their work or job environment, but didn’t account for other “non-cultural issues important to the respondents, such as ambition, age, gender, contract conditions, state of the local economy and so on” (Venaik & Brewer, 2016, p. 568). Managers who encounter cultural differences and global leadership should keep these weaknesses in mind when using Hofstede’s or the GLOBE Project’s cultural dimensions.

There have been other global leadership theories that offer new perspectives on leading across different cultures. One such theory is by Rakesh Mittal and Peter Dorfman on servant leadership across different cultures. They studied how servant leadership across cultures could create better relationships between managers and employees from different cultures. Servant leadership involves creating a bond with members of the organization while also improving society as a result (Mittal & Dorfman, 2012). Mittal and Dorfman (2012, para 1.) describe servant leadership as “an emphasis on service motivation, as demonstrated by empowering and developing people with empathy and humility.” Servant leadership has five aspects to it: egalitarianism, moral integrity, empowering, empathy, and humility. Egalitarianism is the idea that leaders are not superior to other members in the organization. Moral integrity focuses on retaining a high moral code for oneself, others and the organization. Empowering looks to foster personal development and growth. Empathy is a personality characteristic where one listens to others and understands “their emotions and needs” (Mittal & Dorfman, 2012, para. 14). Finally, humility involves recognizing other’s achievements and contributions first, while putting your own accomplishments and contributions second. Mittal and Dorfman found that aspects of servant leadership will help managers in certain cultures more than others. For example, egalitarianism and empowering were aspects of servant leadership found to be highly encouraged in the Nordic Europe regional cluster, but were less favored in the Confucian Asia cluster region. Empathy and humility were found to be more endorsed in Asian cultures, but not as much in European cultures. Interestingly, their research found that all regional clusters scored similarly on moral integrity. All countries value having leaders while high morals and would welcome it from any leader regardless of a different culture (Mittal & Dorfman, 2012). Servant leadership is one that I would favor as a global leader because it focuses on creating relationships, which is important when in a new environment and culture. Knowing how to apply this leadership style to different countries based on their values is a key strategy and global leadership skill that could lead to higher efficiency and effectiveness for the organization.

If Hofstede’s and the GLOBE Project’s cultural dimensions do not apply, and the GLOBE leadership theories as well as servant leadership fail, Salvatore Snaiderbaur suggests using symphonic leadership. Snaiderbaur (2012) describes symphonic leadership as if treating the organization like a symphony where you need composition, orchestration and performance to effectively lead. Snaiderbaur uses Cirque de Soleil as his metaphor to a “successful multicultural organization” (2012, p. 7). This organization has a combination of talent, an environment that encourages creativity, a mission to bring creativity to the world, encourages risk taking, and the adaptability to stay relevant and entertaining to the audience. These are also attributes of what an organization needs to be successful in today’s globalized world. Organizations should go through stages of composition, orchestration, and performance to become symphonic. Leaders should be able to take all the different cultural talents that organizational members offer and compose them into an effective group with a mission to pursue, or “score” to perform. Following composition, the organization needs to rehearse in the orchestration stage with the conductor’s guidance. In organizational terms, they need to combine their talents to work together to find the best balance in their organization. Finally, they take the symphonic sound from rehearsal to give a successful performance to its audience. For an organization, all the hard work by the members and the leader to find balance in their group is utilized to deliver the best service or good to their client or customer (Salvatore, 2012). Salvatore also mentions that leaders need to be ethnopluralistic, “where each cultural component becomes key to the organization’s success” (2012, p. 10). This is fundamentally different from other theories that work to overcome ethnocentrism, the idea that one’s culture is superior to another culture (Nielsen & Krivnak, 2008). I think this is one of the most important mindsets that a leader can have and use in becoming a global leader.

Following Salvatore Snaiderbaur’s ethnopluralistic mindset, mindfulness and having a global mindset are other skills that global leaders need to have to be successful. A global mindset is described as “being open to diverse cultural perspectives and articulate strategic realities after considering the nuances at both the global and local levels” (Chandwani, Agrawal, & Kedia, 2016, p. 619). Mindfulness is the “state of mind characterized by heightened awareness of self and the surrounding environment, and not to be nonevaluative and nonjudgemental in experiencing the present” (Chandwani et al., 2016, p. 619). Mindfulness can lower hostility to negative feedback, and thus produce better self-control. This mindset can “reduce cross-cultural misunderstandings, enhance interpersonal relationships, and improve social behavior as well as the capability to manage interpersonal conflicts” (Chandwani et al., 2016, p. 622). Mindfulness helps to create a global mindset by encouraging teamwork, collaboration, and openness to other’s views. It also helps to improve social skills, tolerance, and ultimately an understanding to different cultures (Chandwani et al., 2016). These characteristics and skills are necessary to be an effective global leader thanks to mindfulness.

My interest in cultural differences and global leadership was peaked during my internship at the World Trade Center Institute (WTCI) in Baltimore, Maryland. WTCI is an organization whose mission is to encourage global business between foreign countries and organizations in the Maryland, Washington, D.C., and Virginia areas. WTCI embraced cultural differences and applied global leadership with symphonic leadership and servant leadership skills. WTCI had team members from all over the world such as Brazil, France and Eastern Europe. They collectively used their differing cultures and backgrounds to work together and create wonderful programs for visiting groups to learn new business techniques and procedures to take back home to their country to implement. Because of their great work, they created lasting relationships with the foreign visitors. WTCI also used the cultural differences outlined by theorists such as Hofstede and the GLOBE Project to build relationships between host organizations and foreign countries. A Chinese group of delegates came to visit various organizations in Maryland to learn about environmental sustainability to deal with the pollution ailing their country due to its rapid rise of economy. WTCI had to convey to these organizations that the delegates would act more collectivist than individualistic. The Chinese group would want to know how the lessons learned from the Maryland organizations would help the overall group. Since the organizations were well informed by WTCI, the Chinese group and organizations could communicate well and learn from one another. Without these theories and leadership skills, WTCI would not be one of the most prestigious global organizations in Maryland.

I think placing an emphasis on such global leadership skills such as mindfulness, and global leadership theories such as symphonic leadership have a positive impact on helping to bridge the gap between cultural differences and create a unified, global society. Of course, this will not come without its difficulties. Finding the right people with the correct attitude and willingness to take on such a broad leadership topic can be difficult to find and teach. I do believe that Hofstede’s and the GLOBE Project’s theories are a good start to building a cultural connection, but the research from Baskerville, Venaik and Brewer prove using other cultural characteristics into account to bring in more successful relationships. WTCI can expand on these theories and look at other cultural factors such as age and tribal affiliation to create more relationships with foreign groups. Overall, I think the best way for a leader to become a successful global leader is to have an open-mind, be creative, and be willing to immerse themselves in a foreign culture to gain the true understanding of what is expected and needed of them as a leader in a foreign country.

Meta-Analysis of Process

From the beginning of this journey of selecting my leadership preference in the Leadership Preferences Survey (LPS) all the way to this research report, I have learned the importance of pacing in my assignments. Our assignments throughout the course paced me perfectly for developing my knowledge of cultural differences and global leadership. The LPS, library research, persuasive essay, and midterm assessment all created stepping stones for me to arrive at this research report. In retrospect, the effort put into each assignment was just a little more than the assignment preceding it. Sorting through all of my library research was my toughest task because of the large amount of information that I had to find useful for my topic. However, I would say that my skill level in research has improved as a result.

While I had prior knowledge of this subject matter from my undergraduate studies, I do believe that I have expanded my knowledge and critical analysis of this material for years to come. I am sure that I will be able to apply this research to my work in global HR and my job duties at WTCI. I will also be able to pace important tasks for projects in my professional experience. I can apply feasible deadlines to each task, and complete them in a timely fashion to produce a final product that I know will be useful and appreciated by my audience. I am sure that my expanded knowledge, critical analysis, and pacing skills will have a positive impact on both my professional and continuing education careers.

References