Academic journal article Indian Journal of Industrial Relations

Divergent Leadership Styles Practiced by Global Managers in India

Academic journal article Indian Journal of Industrial Relations

Divergent Leadership Styles Practiced by Global Managers in India

Article excerpt


The demands on the effective expatriate managers have mounted globally. The way these expatriate managers tackle the cultural issues would determine success or otherwise of the business of MNCs in the host country. Increased complexity in the business world also pushed the expatriate managers to understand cultural issues (Schein 1992). Due to globalisation and constantly increasing trend of expatriate managers to manage the business in host countries like India and China (two largest emerging economies of the world), many questions have been raised as to how these expatriate managers lead their subordinates in host nations, their behaviour towards others and most importantly, the style of leadership mostly preferred and practiced.

According to Yukl 2006, there exists no single leadership style that can be confirmed as the perfect one that works well under all conditions. He further states that expatriate managers will have to adopt different leadership styles depending upon different culture in the host countries. Muenjohn and Armstrong (2007a) hold that leadership styles and behaviour cannot be isolated from culture and hence it is one of the core elements that influence leadership style and approach. This view was justified by Hofstede (1984) that US leaders have the tendency to rate the performance of the followers on an individual basis based on his 4 dimension theory. But in the case of Japanese management, leaders prefer to evaluate the performance in group or collectivism.

Japanese subordinates prefer that their leader should praise their efforts and be supportive when needed. Same is expected if the leader is an American and subordinate is Japanese. As American leaders are not used to the cultural differences and peculiarities of a new (Japanese) culture wherein hospitality and admiration takes the centre stage and business matters are considered to be discussed at later stages. Among American leaders, such care is expected to be taken while dealing with Japanese subordinates, but it is ignored often and as a result stiffness in relationship occurs and business gets affected by all means. Considering the global business competition, the aforementioned aspect of dealing with employees due to cultural differences among the expatriate managers are being found to be entrenched more and more these days.

This makes it critical ever to try to understand different cultures and their influence on the ways people do business and view the world (Hall 1995). The costs of not understanding are getting greater and greater. Turnover and absenteeism are often higher. On the other hand, cultural differences can provide tangible benefits and can be used competitively. The potential for management frustration, costly misunderstandings and even business failures increase significantly when dealing with people whose values, beliefs, customs are different from each other (Bass 1990). However, when understood and successfully managed, differences in culture can lead to innovative business practices and sustainable sources of competitive advantage. Success in an increasingly competitive global market depends on the knowledge and sensitivity of managers to cultural differences in leadership styles.

America and Japan are considered to be good examples for studying cross-cultural leadership interaction due to the clear cross-cultural differences between the countries. Four classical cultural dimensions identified by Hofstede (1984) are used to describe the situations in USA and Japan. The US represents a small power distance where subordinates and superior consider each other as more equal; they have a fare amount of autonomy to participate in decision making. On the other hand, Japan represents a moderate power distance where inequalities and hierarchical systems exist. Subordinates are supposed to be told what to do. Japan was ranked high in uncertainty avoidance in which people try to avoid ambiguous situation by establishing formal rules and regulations. …

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