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Cultural sensitivity necessary for global business leaders, scholar says

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Cultural sensitivity and a holistic approach to individuals are necessary qualities for executives working abroad, says Anupam Agrawal, a professor of business administration at Illinois.

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1/21/2014 | Phil Ciciora, Business & Law Editor | 217-333-2177; pciciora@illinois.edu

CHAMPAIGN, Ill. — Global business leaders must adapt their behavior to the country in which they are doing business or risk being perceived as ineffective and unable to handle complexity, change and ambiguity, says a paper co-written by a University of Illinois business professor.

With different cultures placing different relative value on certain leadership behaviors and styles, cultural sensitivity and a holistic approach to people are necessary qualities for executives working outside the U.S., says Anupam Agrawal, a professor of business administration at Illinois.

“Most major firms are grappling with this issue – how to have managers and leaders who are sensitive to cultural differences while also being effective employees when working abroad,” Agrawal said.

The paper, co-written by Caroline Rook, of INSEAD and Anglia Ruskin University, compared the leadership evaluations of 1,748 global leaders by superiors, peers and subordinates in 10 national clusters to see whether global leadership styles differ between cultures.

The study used data collected through the Global Executive Leadership Inventory, which measures global leadership behavior across 12 dimensions, to gain insight into whether the effectiveness of global leaders differs on the basis of their cultural origins.

“We wanted to answer the question, ‘Do global leaders in the Eastern Hemisphere display different leadership behavioral patterns from their counterparts in the Western Hemisphere?’ ” Agrawal said. “As an input, 360-degree feedback is useful in that it allows us to evaluate global leadership behaviors from multiple perspectives: from the leaders themselves, as well as their superiors, peers and subordinates. This research is based on those feedback loops. And since there’s a huge database of leaders from hundreds of countries, the results can be generalized.”

The researchers found that while global leaders across the world display similar patterns of leadership behavior, there are significant differences in some behavior that can be attributed to cultural origins, and which have implications for leadership effectiveness.

“Is there a great global leader who could parachute in and be effective anywhere? We find that that’s not so,” Agrawal said. “In some cultures, some particular traits of leadership are stronger. But it’s not possible to have a person who is strong in everything. There are differences depending upon where you come from, and differences manifest themselves because of culture.”

According to the research, leaders who are mindful of cultural differences are deemed more effective by the people they lead.

“A secondary point is that it’s best to accept that differences will be there and then work from there instead of saying this works where I’m from, therefore it must work here, too,” Agrawal said.

The research also found that there are definite differences between the two big geographical clusters, which Agrawal and Rook labeled “East” and “West.”

“For example, visioning is an important leadership capability in all countries, but leaders from southeast Asian countries showed visioning more than leaders from a country of the Anglo-cluster, which seems to indicate a greater expectation for this behavior,” he said. “Essentially, that means if you’re from the U.S. and your job is to manage a team in Malaysia you should be careful of the fact that your followers would expect you to behave in a way that they’re used to their leaders behaving. And that may not be your style.

“If you’re mindful of that, you’ll be able to be much more effective as a leader, wherever you’re posted.”

Agrawal is quick to caution that value judgments play no role in the paper’s conclusions.

“We’re not saying this certain characteristic is good or bad – our focus is on exploring comparative leadership from different cultures,” he said. “To be an effective global leader, it’s imperative to be mindful of something called a cultural context. If you’re not cognizant of that, chances are that you might not be an effective leader.”

For aspiring global leaders, the key takeaway from the research is that leadership is culturally and context-driven, Agrawal said.

“It’s not something that’s developed in isolation,” he said. “It’s not something that can be deployed everywhere in the same way, because it doesn’t work that way.”

According to Agrawal, the research is especially relevant to successful employees who work for large, multinational firms.

“As businesses are becoming more global, the chances are good that if you wish to advance in a multinational firm, you will need to work abroad in a leadership position for an extended period of time,” he said. “There’s a much greater need for people who can not only work where they are comfortable, but also work in unfamiliar situations, surroundings and geographies, and with people who don’t speak their native language. And they need to possess the humility to accept differences as well as the wisdom to be able to do business in different cultures.”

The paper will be published as a chapter in a forthcoming book.

Editor's notes: To contact Anupam Agrawal, call 217-265-0654; email anupam@illinois.edu.

The article, “Global Leaders in East and West – Do All Global Leaders Lead in the Same Way?” is available online.

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