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Global leadership Challenges and practices


Hello, The current global and complex scenario faced by organizations is well-known. A new fact in this program is that several Brazilian groups are now also international. At this level companies will have to master a broader range of issues: the overseas market, a number of stakeholders, other laws and regulations. Owing to this, one of the challenges is to have well prepared leaders in global management. But what are the key issues faced by these professionals? Which skills are in contrast with those employed by their local peers? And which development strategies are required? In this eighth Pocket edition, we describe a summary of our metaresearch on specific global leadership challenges, a topic that has been given growing attention by the world’s key organizations.

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The Context Globalization is a road of no return. Its effects have been more and more perceived within and among the world’s organizations, cultures, and societies. One of its most striking evidences is the interdependence of world economies.


This dynamic and global environment has converted not only the expanded business scenario; it has also changed the way in which business is conducted, creating a need for leaders with differentiated competencies in order to be successful. Today’s companies active in the international sphere require leaders who are able to operate effectively in an ambiguous and constantly changing context. The level of pressure faced by them is as significant as the impact that they may cause. Their attributions include

expanding business into the international market, devising global strategies, managing and motivating multicultural and geographically dispersed teams, among many other aspects. In this regard, managing complexity is simply the key assignment of global leaders. And although a number of factors are beyond their control, these executives are more and more influent. By virtue of the strategic importance of their functions, good global leaders represent a competitive advantage for today’s multinational companies. Hear read phonetically.


Global The differences between local and global leadership requisites are striking.

Managing execution, information, and people, being familiar with the business, and having skills to deal with pressure are a part of any leader’s responsibilities. Nonetheless, each one of these requisites increases in complexity in a global scale. Basic leadership processes,

defining management, creating alignment and maintaining motivation, are more difficult to master at a global level owing to factors such as culture, distance, and time. Yet leadership at a global level is not restricted to doing business overseas. This is


Leadership an activity that involves a business’s strategic issues in a number of environments and contexts, by means of integrated management involving more comprehensive factors such as culture, economics, and legislation, among others. There are so many variables that need to be considered, that depending on where they operate, international companies should review their convictions in all sorts of things: from product

development and design, dealing with HR policies, and market positioning. Whatever the challenge, leading a global company is much different from managing a local concern. And these requirements at a world level need to be met by organizations that wish to remain competitive in this scenario. In summary, global leadership involves knowing how to deal with uncertainties, to manage complexities and diversity.


Spheres of

influence


The Context: Global leaders should perceive the business environment in constant change.

Complexity: Global leaders should be able to lead when faced by complexity and ambiguity.

Connection: Global leaders should be able to create connections, understand players in a larger political scenario, build effective relationships, engage in new kinds of outside partnerships (regulating bodies, competitors, NGOs, and local communities).


According to research conducted by Ashridge Business School, in relation to the challenges of developing global leaders, senior executives claim that these professionals should:

The Context:

82% 70% 70% 91% 90%

Complexity:

88% 77% 80%

Connection:

75%

74% 73%


perceive business risks and social, political, and cultural opportunities, in addition to environmental trends be able to convert social factors and environmental trends into strategic decisions know how to apply tools to plot the scenario and management risks in different contexts find creative, innovative, and original manners of solving problems learn from their mistakes be flexible and know how to react to change reconcile short- and long-term analyses

be able to develop partnerships with inside and outside stakeholders have skills to engage in effective dialogues understand how the organization impacts on these stakeholders: positively or negatively be able to detect stakeholders with greater influence over the organization Source: “Developing the Global Leader of Tomorrow�. Ashridge Business School, 2008.


What it takes to be a

Global Global leaders are basically executives who work with an international outlook. Professionals do not necessarily need to travel to other countries in order to be global leaders. They may operate locally at the head office or at a distance with professionals from other company units throughout the world, and may still be global leaders. “Global� is more associated with a function, with the work performed, or a manner of thinking, than with a professional’s location.


Leader So, what are the specific challenges faced by these leaders, that places them in another leadership class? Global leaders need to be able to grasp the interdependence of their actions and the global and local implications of their business decisions. Furthermore, they need to manage the relationship between the head office and local facilities, understand the overseas context, deal with cultural conflicts, adapt their own behavior, create shared objectives, put in place synergy at work,

and also be well prepared to communicate. In fact, those persons who work in a global environment require two great responsibilities if they wish to have influence over other cultures: firstly they will need to understand their own cultural outlook, and secondly they should be open to the cultural outlook of other persons and countries. Though this seems basic, if this is not born in mind they will be unable to deal with greater complexities.


Global leaders should master

three behavioral dimensions: Self-conscience (self)

Style of interaction (others)

Global executives understand their personality, outlook, strong and weak points, and are enthused with the likelihood of adding knowledge to their business repertory.

The best global leaders act in a balanced manner in their social interactions. They find a middle course and understand that there are differences that should be respected, and detect more easily specifics on individuals and groups.

But how are global leaders able to put together this level of information, emotional, social, and cultural, which serves as a guide to circulate i n overseas environments?


Information processing (environment) Good global leaders spend time becoming familiar with a country, the market, competitors, and local habits. This means that when they finally make their move and start to act and produce overseas, they will be better prepared.

A specific profile (adaptable, extrovert, open to new experiences)

+

A comprehensive manner of thinking (global mindset)

facilitate this task


Big Five in global leadership

*


Each one of the Big Five’s attributes has a degree of relation with the success of persons who live and work internationally, and to a certain point they serve as a basis for the ability to perform successfully some global leadership tasks.

1

Extroversion

2

Affability

3

Mindfulness

4

Emotional stability

5

Open to experience

*Model that identifies five broad personality traits


1

Extroversion

2

Affability

3

Many global leadership tasks have a social component (e.g. working with overseas colleagues, supervising persons of different nationalities). Extroverts naturally find it easier to deal with social requirements, and they are therefore more likely to interact more effectively with persons from other countries.

Affability makes it easier to form reciprocal social alliances. More affable leaders deal in a cooperative manner with conflicts, they make a greater effort in mutual understanding and are less competitive. In this regard, they are more able to adapt culturally and tend to be more successful in global leadership tasks that involve cooperation.

Mindfulness More mindful persons demonstrate greater effort and commitment with their tasks. Owing to their higher complexity, global leadership tasks (e.g. managing overseas suppliers or salespeople) requires a greater effort than similar tasks in the local scenario.


4

Emotional stability

5

Open to experience

Emotional stability is an adaptable universal mechanism that allows people to deal with stress. As stress is often associated with ambiguous and unknown situations, emotional stability becomes essential for global leadership.

For global leaders, the ability to correctly assess a social environment is more complex, as the global context provides ambiguous social traces or those more difficult to fathom. Those persons more open to change have fewer rigid viewpoints regarding what is right and wrong, adequate and inadequate, etc. Therefore they are more likely to accept different cultures.

Source: “Developing Global Leaders�, Paula Caligiuri. Human Resource Management Review, 219-228, 2006.


A Global

Mindset

A global mindset is essentially a manner of thinking and acting that makes global leadership easier. According to Mansour Javidan, a specialist on this topic, a global mindset is the “mental inclination to use ample and multiple outlooks in order to create replies and interpret situations before individuals, groups, organizations, and systems that are very different from that very person.�


A global mindset is essentially a manner of thinking and acting that makes global leadership easier. According to Mansour Javidan, a specialist on this topic, a global mindset is the “mental inclination to use ample and multiple outlooks in order to create replies and interpret situations before individuals, groups, organizations, and systems that are very different from that very person.� Global mindset leaders look on and think of the world differently from those persons who feel pressured and exhausted by the challenge of dealing with the ambiguity of unstable and unknown situations. But which is the essential trace that defines this global mindset? Having a basic inclination for new experiences. For example, the wish to experiment local cooking instead of international cuisine in a five-star hotel, or buying a local newspaper instead of a leading world paper, are attitudes that reflect an open mind.


Though more difficult to be developed, this is a valuable feature for global leaders, as it is this ability to adapt, to be flexible, that encourages a productive involvement with overseas partners and overseas environments. In order to act with a global mindset, professionals should be interested in social aspects and values different from their own, sufficiently sensitive to perceive cultural differences and also be prepared to change their behavior as a sign of respect for people with different repertories. These skills are not always intuitive to leaders involved in global activities. Hence, the need for specialized training - whether formal or informal – directed at overcoming ethnic unawareness will be indispensable to exercise global leadership.

Mindset Local

Global

Expertise focused on the function

Multiple perspectives

Ability to prioritize

Find a balance between contradictions

Application of structures

Trust in the process

Individual responsibility

Teamwork and diversity

Predictability

Make changes in view of opportunities

Readiness to deal with surprises

Readiness to accept new ideas

Source: “Global Teams: Trends, Challenges and Solutions�. Center for Advanced HR Studies - Cornell University, May 2010.


Versatility: An essential attribute The GLOBE project (Global Leadership and Organizational Behavior Effectiveness), one of the most comprehensive studies on the impact of cultural practices and values in leadership and in organizational processes, gathered data from 17,300 mid-level managers in 951 organizations from 62 cultures, and arrived at the basic attributes, or cultural dimensions, that impact leadership. The results of GLOBE have shown that successful global leaders are endowed with a high degree of versatility. Versatility depends on a broad repertory created by experience and on a highly developed level of empathy and emotional stability.


Developing global leadership In business nowadays there is an ever growing need for leaders able to operate globally – and this is something beyond simply knowing how to adequately greet a customer or colleague of a different culture. The way to become an effective leader in this globalized world requires more detailed levels of knowledge and a number of new competencies for each business model or specific situation.

Developing a global attitude, valuing diversity, improving personal and organizational performance, in line with a more comprehensive context, and balancing contradictions when dealing with all sorts of uncertainties are this leader’s basic skills. But how can these skills be developed? In order to advance beyond the basics and to achieve greater sophistication in the actions of global leaders, it will be necessary to:


ASSESS the global leadership profile and specific competencies in order to outline a complete learning experience.

COMBINE different methodologies according to a participant’s learning style (contents, context, and media).

PERFORM an individualized follow-up with constant feedback and activities adaptable to the progress of learning.

ENCOURAGE overcoming ethnic unawareness and the development of empathy.

INCLUDE a protective network in the process, chiefly in practical experiences.

MAKE ROOM FOR self-managing activities (e.g. those outside the working environment).

The “Global Leaders” report in LAB SSJ contains an analysis on preparing global leaders. The survey describes how this challenge is perceived by large Brazilian and multinational corporations.


If we don’t develop talents and assume risks, if we don’t do this in an international scale, business expansion and strategic decisions by organizations will be jeopardized.”

- A global leader in “What the Future Demands” (Mercer, 2007)


Bibliography BLACK, J. S. Advances in Global Leadership. Insead, 1990. BEECHLER, S. & JAVIDAN, M. Leading with a Global Mindset. In: Advances in International Management: the global mindset, 131-169. Elsevier, 2007. CALIGIURI, P. Developing Global Leaders. In: Human Resource Management Review 16, 219-228. Elsevier, 2006. IRVING, J. A. Educating Global Leaders: Exploring intercultural competence in leadership education. In: Journal of International Business and Cultural Studies, 1-14, 2008. MCCALL, M. W. Desenvolvimento de executivos globais: as lições da experiência internacional. Bookman, 2003. OLSON, E. Creating Global Leaders. In: What the Future Demands: The growing challenge of global leadership development. Mercer & Oliver Wyman, 2007. TESSMANN-KEYS, D. & WELLINS, R. S. The CEO’s Guide to: Preparing Future Global Leaders. DDI, 2007.


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Pocket Learning 8 - Global Leadership