Considerable national and cultural differences have been found in required, preferred, and observed leadership that is autocratic or democratic, participative or directive, relations oriented or task oriented, considerate or structuring, and active or laissez-faire—the styles discussed earlier in Chapters 6 and 17 through 20. The cultural differences become even more apparent if the data are gathered from those who are most freely socialized within a given culture—that is, from those who endorse the core beliefs of the culture. Thus, Dorfman and Howell (1988) demonstrated that in Taiwan, directive leadership displayed by one’s superiors correlated .44 with subordinates’ satisfaction with work for subordinates who had strong beliefs in the key cultural values of the Chinese culture. The correlation was only .19 for those who did not have such strong beliefs in their culture.
R. Likert (1963) argued that democratic leadership and System 4, as described in Chapter 21, is most likely to be effective in any productive organization, regardless of the culture or the country. Despite the wide variations in leadership preferences and behavior, Likert’s argument was that regardless of culture, there was a best way to organize and lead. The System 4 participatory approach was successfully introduced into Japan, whose management had ordinarily been seen as a benevolent autocracy (System 2) practicing System 3 consultation (Sakano, 1983). In support of Likert’s contention, Misumi (1974) applied a System 4 strategy in 1970 in a large shipyard in Japan, using group meetings for group problem solving, goal setting, and decision making in an effort to reduce accidents among 4,000 workers. Accidents per man-hours worked (× 10) declined from 30 in 1969 to 12 in 1973.
Close rather than general supervision was found to be favored by workers in countries that are high in power distance and authoritarianism, such as Peru (Whyte, 1963) and Thailand (Deyo, 1978). Among North American workers and others in the Anglo-American cluster, however, the opposite was usually the case. Thus at the other end of the spectrum, as expected, 500 Australian managers from the Anglo cluster indicated their strong endorsement of democratic managerial beliefs, such as the capacity of subordinates to display initiative, the utility of sharing information, and the importance of self-control (Stening & Wong, 1983).
In the role playing in Exercise Supervise (Bass, 1975c), an equal number of contrived “passive,” “moderately involved,” or “vitally interested” subordinates meet in a counterbalanced order with a contrived democratic, autocratic, or persuasive “supervisor.” Although on a chance basis, 33% of the participants should prefer to work with a democratic supervisor again, Bass, Burger, et al. (1979, p. 167) found that 63% of French managers were most in favor of doing so and 40% of Japanese managers least in favor among 12 nationalities. The other 10 European, American, and Asian nationalities were in between in their favoring of the democratic leader. Latin Americans (19%) differed in their preference from Latin Europeans (33%). Likewise, North Americans (32%), Germans (33%), and Scandinavians (31%) differed from Britons (22%) in this regard. In this same analysis, the preference of the participants who played the supervisory roles to work again with passive, uninvolved subordinates was highest among Indian managers (47%) and lowest among the Japanese (12%).
Power Distance. Among the 50 countries in the IBM survey, those highest in reported Power Distance Index (PDI) scores included Malaysia, Indonesia, Singapore, and the Philippines from Southeast Asia; the Spanish-American countries of Mexico, Guatemala, Panama, Ecuador, Colombia, Venezuela, and Peru; India; the Middle Eastern countries; and the west African countries. At the lower end of the spectrum in the PDI were the Anglo, Nordic, and Germanic clusters of countries, Israel, and Costa Rica. Greater acceptance of an autocratic style of leadership was to be expected and found in the countries that were high in power distance and acceptance of a democratic style, in the countries that were low in power distance. Somewhat consistent with Hofstede’s results was the conclusion reached by Red-ding and Casey (1975) that managers in Malaysia, Indonesia, Thailand, and the Philippines favored an autocratic style, those in Singapore and Hong Kong were somewhat less favorable toward it, and those in Western countries favored it the least. Al-Hajjeh (1984) concluded from a survey of 25 North American and 25 Middle Eastern managers that the Middle Easterners supported more autocratic leadership and the North Americans did the reverse. Compared to the North Americans, the Middle Easterners felt less positive about the capacity of subordinates and saw a greater need to provide them with detailed instructions. Gebert and Steinkamp (undated) found from 218 interviews with representative indigenous manufacturers in Nigeria in West Africa that economic success was thought to depend on discipline and obeying rules whenever possible. Kenis (1977) compared the attitudes toward leadership of 150 Turkish and 147 American first-line supervisors in bank branches in Ankara and Istanbul. The Turks favored more autocratic leadership, in contrast to the Americans who favored more democratic leadership. Kenis attributed his results to the authoritarianism inherent in the Turkish culture. In a country high in power distance, such as Mexico, direction,7 coupled with supportive (caring) leadership, contributed directly to effective performance. In a country low in power distance like the United States, participation made a direct contribution to effective performance (Dorfman, Howell, et al., 1997). Eylon and Au (1999) found that MBA students in a management simulation were more satisfied with their jobs if they were empowered rather than disempowered. But only in low-PDI countries did they perform better. In a firm with operations in the United States, Poland, Mexico, and India, Robert, Probst, Martocchio, et al. (2000) found that continuous improvement related positively to job satisfaction in all four locations. However, empowerment, related positively to job satisfaction in the United States and Poland, was negatively associated with higher PDI in India but not in Mexico, also high in PDI. Huang (2003) found that empowerment and management openness worked to increase 136,018 employees’ willingness to voice their opinions about organizational issues in 24 countries low in PDI.
Chapter 12 discussed the extent to which greater power differences between the leader and the led accent the greater potential for the leader to be authoritarian, directive, persuasive, or coercive. Smith, Peterson, Schwartz, et al. (2002) found in GLOBE data in 47 countries that in high-PDI countries, managers used more rules generated from above to handle daily events. Compared to U.S. employees, Chinese employees were shown by Bu, Craig, and Peng (2001) to be more willing to accept direction from supervisors. In line with this hypothesis, Mulder (1976) saw a large power distance between the leader and the led associated with the fear of disagreeing with one’s superior. In Hofstede’s (1980) survey, the same connections were revealed. Coercive, autocratic leadership was more common in countries in which the power distance between superiors and subordinates was high. When PDI is high, children greatly respect parents, elders, and teachers. Teachers initiate all communications. In countries with a high PDI, decision making is more centralized and authority is concentrated. Organizations are tall. Ideal leaders are directive, benevolent autocrats who rely on formal rules. Subordinates expect to be told what to do. Superior-subordinate relations are polarized and emotional. Subordinates are influenced by formal authority and sanctions.
More democratic styles are practiced in countries with low power distance. National elites are egalitarian rather than authoritarian. Authority is based on secular-rational arguments rather than tradition. Top leaders are younger rather than older. Children treat parents and teachers as equals. In work organizations, in countries with low PDI, decision making is likely to be decentralized and authority is less concentrated. Organizations are flatter. Supervisors have a wide span of control, ideal leaders are resourceful democrats, practical, orderly, and rely on experience and subordinates. Subordinates expect to be consulted. Superior-subordinate relations are pragmatic. Subordinates are influenced by reasoning and bargaining (Hofstede, 2001, pp. 107–108).
Authoritarianism. Authoritarianism, as measured by the F Scale, influences the acceptance of autocratic rather than democratic behavior.8 The F Scale has been administered to student groups in many different countries. As previously noted, Turkish students were likely to score higher and American students lower on the scale. Indian students usually scored high as well (Meade & Whittaker, 1967). Meade’s (1967) experimental replication in India of the classic Lewin, Lippitt, and White (1939) study of leadership found that both productivity and satisfaction in boys’ groups were higher under autocratic than under nonautocratic leadership in India.
In Arab and other Muslim countries, family and tribal traditions result in benevolent, paternal, autocratic leadership. The leader is expected to be a father who cares more about his own followers than outsiders. In Arab organizations, this is combined with bureaucratic leadership left over from colonial days, the promulgation of many rules—which are ignored due to favoritism—and personal connections. Traditionally, each new ruler made new rules to replace the old ones. Conformity to rules depends on the power and personality of the rule makers. The typical organization is a strong patriarchical authority. Leaders are either prophets who depend on their personal charisma or caliphs who must rule by coercive power (Dorfman, 1996). The most desirable leadership in Qatar and Kuwait, according to surveys of 179 middle managers and interviews with another 21 upper-middle managers, were charismatic, self-protective, and considerate (Abdalla & Al-Homoud, 2001). According to 300 Iranian middle managers (Muslim but not Arabic) in the GLOBE project, effective leadership was helped or hindered by being supportive, autocratic, planful, familial, humble, faithful, and receptive.
Sinha (1976) agreed that authoritarian leadership is optimum in Hindu India. Such leadership features task orientation, strong personal involvement and effort by the leader. More democratic processes are possible only after the structure has become firm for the employees and moderate productivity has been achieved. In support, Singh and Arya (1965) studied 40 sociometrically identified leaders in a village in India. Given the strong authoritarian norm, it was not surprising that leaders were found to be significantly more authoritarian than were nonleaders. Leaders preferred task-oriented leaders to other types, but both leaders and nonleaders rejected the self-interested leader. However, neither Kakar (1971) nor Jaggi (1977) could find similar support for favoring the autocratic mode in India. According to Fujiyama (1997), Korean business leaders favor hierarchical, authoritarian, and centralized leadership, unlike Japan’s focus on consensus in reaching decisions after considerable deliberation. This enables Korean companies to take actions more quickly than can comparable Japanese firms. Variations have also been observed within Asia in the perceived power distance and in autocratic leadership behavior. The specific issues involved in a given country are likely to make a difference as well. Ishikawa (1986) compared the favored and perceived distribution of power of managers and employees in nine Asian countries. Employers viewed participation by workers more favorably in India and Japan than in Pakistan and Taiwan. Power distance regarding decisions about management policy, personnel, working conditions, and workplace issues generally was greatest in Thailand and least in Sri Lanka. In Japan, power distance was seen as being lower on workplace issues and higher on questions of management policy. In India and elsewhere, perceived power distance also depended on which issues were involved. But in general, workers in Taiwan perceived the strongest relation between one’s position in the hierarchy and one’s power.
The subscription to democratic leadership was found to be surprisingly high by Haire, Ghiselli, and Porter (1966) across the 14 countries they studied. But compared to U.S. managers, managers elsewhere indicated little acceptance of what would be required for such democratic leadership, such as agreement that employees as well as supervisors have the potential to exhibit initiative, share leadership, and contribute to the problem-solving process. The researchers concluded, on the basis of data from the early 1960s, that introducing democratic leadership into most other countries at that time would be “a little like building the techniques and practices of a Jeffersonian democracy on a basic belief in the divine right of kings” (p. 130). The proposition still seems to contain some truth in 2006, although fragile democracies have struggled to be established in countries as diverse as Ukraine and Nepal and much of Latin America. Autocratic charisma was regarded strongly pejoratively by managers from countries that experienced autocratic charismatic dictators.
Paternalism. The degree of paternalism in a culture affects the acceptance of benevolent authoritarian leadership and taking care of employees and their families. Failure of subordinates to comply with the wishes of the patron is seen as disloyalty. Paternalism was a dimension of consequence in Georgia, Russia, Kazakhstan, and the Kyrgyz Republic (Ardichvili, 2001) The sense of paternalism was higher among Taiwan Chinese and Mexican employees than among U.S. employees working for the same company. Using data on employees in Taiwan, Mexico, and the United States, Dorfman and Howell (1988) emerged with a factor of paternalism. When paternalism was strong, employees subscribed to expecting job security and to be looked after by their company as a person, not only as a worker. Lincoln, Hanada, and Olson (1981) found that Japanese and Japanese-American employees in 28 Japanese-owned firms in the United States valued paternalistic company behavior more than did American employees of the same firms. A 30-year survey of the literature on leadership in Korea by Baik (1999) found paternalism, “hierarchical structures where elders, predecessors, and patriarchs exert significant influence in Korean society” still a norm. In comparison to 235 German managers, 306 Korean managers more strongly valued family, authority, and paternalistic leadership, according to a study by Park in 1984 reported by Baik.
Farmer and Richman (1965) rated a number of countries on paternalism, using a review of the literature and reports from experts. They concluded that Japan was most strongly paternalistic, as evidenced by policies of lifetime employment, age-grade lockstep promotions and salary increases, and the companies’ provision of housing, recreational facilities, and shrines for worship for their employees. Other countries that were high in paternalism included Egypt, Chile, Germany, India, France, Mexico, and Saudi Arabia. At the other end of the spectrum were the United States, Britain, the former Soviet Union, and the former Yugoslavia.
In developing countries, paternalism featured autocratic patrons and compliant followers. Power distance was high. Patrons were expected to care for workers and their families (Dickson, Den Hartog & Mitchelson, 2003). In indigenous Brazilian industry, the traditional worker identified with the patrão, the patriarchial owner, to whom he was a ward, not just a member of an organization headed by the patron. In rural Guatemalan factories, immediate supervisors were of local origin. As members of the padrone’s workforce, they had limited authority; they could only suggest, not order. On the other hand, if the workers were not unionized, the foreign engineer and the owner or his white-collar surrogates treated workers like children, physically abusing them as well as dealing directly with their complaints (M. Nash, 1958). In India, Sinha (1980, 1994) found that both Indian managers and subordinates preferred as leaders benevolent autocrats who were nurturing and paternalistic if the subordinates were obedient, respectful, and task-oriented.
Smith, Peterson, and Schwartz (2002) found that western European managers preferred to rely more on subordinates for information about events than did managers from African countries, who preferred information provided by superiors and rules. A survey by Sirota (1968) of the attitudes of IBM employees in 46 countries toward supervision indicated their preference for consultation (the leader makes a decision after discussion with the subordinate) and participative joint decision making, although directive leadership was seen as being more common. In other studies, Israeli managers revealed more actual participatory leadership than they said they supported ideologically (Vardi, Shirom, & Jacobson, 1980). Australian managers were the reverse; they endorsed participatory practices ideologically but were actually less supportive of them in practice (Clark & McCabe, 1970). On the other hand, Australian managers more often chose participation among the Vroom and Yetton (1973) alternatives to handling problems than did managers from the Pacific Islands and Africa (Borttger, Hallein, & Yetton, 1985). Given the same Vroom-Yetton set of problems, Austrian managers, compared to American managers, chose group participation in making decisions. Consistent with these methods and results, German and Swiss managers also favored participation, in contrast to Polish and Czech managers, who were inclined to choose directive decisions (Reber, Jago, & Böhnisch, 1993). As would be expected from Chapter 18, the managers who consulted were viewed most favorably by subordinates. Leaders who practiced a lot of persuasion, especially the ones with “no style,” were viewed least favorably, particularly in Britain. In Britain, participative managers were not seen as good counselors; many subordinates objected to the number of meetings they called (Sadler, 1970). Consistent with these results, Chaney (1966) found that whereas more productive U.S. scientists had more frequent communications with their superiors and their colleagues, the reverse was true for British scientists—the more productive ones had less frequent communications with their superiors. In Israel, participation suppressed social loafing; in the United States, participation increased social loafing. The difference was associated with more collectivism in Israel and more individualism in the United States (Earley, 1993).
An analysis by Sadler and Hofstede (1972) of IBM employees from Australia, Brazil, Britain, and Japan showed that the preferred style by the employees was consultative, 65% to 45%, but only in Brazil was there a sizable preference also for participation (29%). These results were consistent with data gathered through the Management Styles Survey in the United States, Spain, Sweden, Finland, and India (Bass, Valenzi, Farrow, & Solomon, 1975). Consultation was preferred over participation everywhere and was more frequently seen everywhere. In all the countries in the IBM survey and in those just mentioned directive supervision was in little favor with the vast majority of subordinates. Although as noted in Chapter 18, the leader’s direction tended to correlate positively with the subordinates’ satisfaction with the leader, it did not do so as strongly as did participation. According to Bass, Burger, et al. (1979), the relative preference for participative leadership in decision making was highest among the Italians and the Japanese. Participative leadership was self-appraised (in exercise self-appraisal) as highest among the Italian managers and lowest among the Dutch and Japanese managers. Differences were found among eight countries in observed participation and direction by senior executives (Sweden was more participative; Israel was more directive). The differences were outweighed by which types of decisions were involved (Heller & Wilpert, 1981).
Howell and Dorfman (1988) found that participative leadership had stronger effects on the satisfaction and commitment of U.S. employees than on their Mexican counterparts. The correlations for the North Americans were .49 with satisfaction with work, .69 with satisfaction with supervision, and .65 with satisfaction with job performance. The comparable correlations for the Mexican employees were .26, .49, and .09, respectively. At the same time, as Dorfman and Howell (1988) hypothesized, directive leadership correlated between .38 and .50 with the Taiwan Chinese and Mexican employees’ satisfaction with the leader and commitment to the organization. For the North Americans, working in similar settings, the correlations of direction and the subordinates’ satisfaction were only .22 and .25 (Howell & Dorfman, 1988). Differences in the cohesiveness of the work groups could not substitute for the effects of differences in the leaders’ direction.
Consultation and Two-Way Communication. A multinational sample of IBM managers thought they did more consulting than their subordinates thought they did. Of the 178 managers, 71% saw themselves as using a consulting leadership style, but only 29% of their employees agreed with them (Sadler & Hofstede, 1972). A contradiction probably contributed to the discrepancy. In Haire, Ghiselli, and Porter’s (1966) 14-country study noted earlier, whereas 3,600 managers professed favorable attitudes toward participative leadership and sharing information, they also believed that the average individual preferred to be directed and wanted to avoid responsibility. Similar results were reported by Clark and McCabe (1970) for an additional 1,300 managers in Australia and by Cummings and Schmidt (1972) for a small sample of Greek managers.
These national differences in preferences for certain styles of leadership were seen with considerable consistency across studies. The percentages of managers in a country who preferred two-way over one-way communication in doing Exercise Communication (Bass, 1975g) correlated across nationalities .82 with Haire, Ghiselli, and Porter’s (1966) survey measure of the propensity to share information and objectives (Barrett & Franke, 1969). Consultation is the most popular style of decision making among U.S. and Japanese managers. U.S. and Japanese managers were also the highest among those of 12 nationalities in seeing two-way communications as less frustrating than one-way communications. The relatively least frustrated by one-way communications were the Belgians, the Germans, Austrians, and the French. All the Japanese managers who were sampled preferred two-way communications, as both senders and receivers. Almost identical results occurred for the U.S. managers. The Dutch, Belgians, German, Austrians, French, and Indians seemed somewhat more tolerant of one-way communications as senders, but not as receivers (Bass, Burger, et al., 1979).
A. S. Tannenbaum (1974) contrasted the extent to which employees participated both informally and formally in decision making in Italy, Austria, the United States, Yugoslavia, and an Israeli kibbutz. As expected, subordinates and superiors were closest in agreement about their job satisfaction and mental adjustment in Yugoslavia and in the Israeli kibbutz, where workers formally participated in organizational decision-making processes. They were farthest apart in Italy, where employees did not participate in decisions, either formally or informally, despite Italian legislation supporting such participation.
Legislatively Mandated versus Actual Participation. According to the International Research Group on Democracy in Europe (IDE), the percentage of decisions for which formal rules of participation apply was seen to vary in what had been legalized as of 1981 within 12 European countries and Israel. The European countries that were the highest in these percentages were the former Yugoslavia (76%), Italy (66%), Norway (64%), and Sweden (61%). The countries that were lowest were Britain (21%) and Israel (23%) (IDE, 1981). Elden (1986) argued that in countries with highly legislated programs for industrial democracy, such as Norway, participative decision making in the workplace may be preached more often than practiced. In the former Yugoslavia, with its strong legislative support for the participation of workers through workers’ councils, Kolaja (1965) observed that actually only about 40% of the decisions were instituted by workers and supervisors and 60% of the decisions were initiated by higher-level managers. This situation may be contrasted to that of the United States where, without such legislation, it was possible to find establishments that held participatory meetings in which blue-collar supervisors and workers initiated 52% of decisions and management was responsible for introducing only 48% of the ideas (Rosenberg, 1977). When Jacob and Ahn (1978) examined the participation of workers in six socialist and nine nonsocialist countries, they found that whether a country was socialist had little effect. Nor was the technological level of the workers in the different countries of any consequence. Rather, participation in influencing decisions depended on whether the management style, work culture, and formal industrial relations system of the country gave individual workers the feeling that they had the power to determine their work conditions.
Legally required formal codetermination in corporate decision making by worker representatives and management reduces the power distance in organizations and promotes democracy. Franke (1997) found differences among 11 European nations, Israel, and Japan in the extent to which national legislation and practices provided workers with decision-making rights. In 1980, the nations ranged in ratings of industrial democracy from Finland (2.88) to Belgium (1.36). These ratings strongly correlated with economic growth rates of the countries between 1980 and 1990 corrected for their levels of economic development in 1980. (Those at lower levels in 1980 gained more.)
Legislatively Mandated Participation and Perceived Influence. Comparisons were made in the perceived influence of workers and supervisors among 12 European countries and Israel with surveys by the IDE (1979) where participation was nationally legislated. Although perceived influence by workers was lowest for the Israelis and highest for the Yugoslavs, legalized participation was not strongly associated with actual perceived influence on the decision-making process in most of the other European countries (IDE, 1981a, 1981b). In Israel and Belgium, workers felt relatively less influential in comparison to workers elsewhere in Europe about 16 decisions. In the former Yugoslavia, workers felt relatively more influential in comparison to workers elsewhere. Danish supervisors perceived themselves as being highest in influence compared to supervisors elsewhere; Belgian supervisors felt the least influential. German and French top managers thought they were the most influential, while Scandinavian and Yugoslavian top managers felt the least influential.
When Participation Is Not Legally Required. In a comparison by Lam, Chen, and Schaubroeck (2002) of American and Chinese American workers in a multinational bank in an individualistic culture, the workers were more likely to participate if they felt self-efficacious. In a collectivist culture, they were more likely to participate if they felt their group was efficacious. This was affirmed in a study of 402 Chinese and Indian banking and finance employees. Collective efficacy but not self-efficacy mediated the effects of transformational leadership on work-related outcomes. Transformational leadership had more of a positive effect on organizational committment and job satisfaction when self-efficacy was high (Walumbwa, Lawler, Avolio et al., 2005). For 387 students of Australian and Chinese background, Weirter, Ashkanasy, and Callan (1997) showed that high self-monitors were more affected by the message than the personal charisma of the leader. Additionally, the Chinese high self-monitors were more affected than the Australians.
Hierarchical Influences. Top-down decision making accompanies the power distance that is prevalent in West Africa and in the Arab countries of the Middle East even in minor matters (Pezeshkpur, 1978), as well as in Turkey. Ottih (1981) observed a low level of delegation and participation by subordinates in decision making in Nigerian banks, where decision making was highly centralized as favored by management. Ergun and Onaran (1981) suggested that direction and negotiation were “natural” in Turkey. As mentioned before, Kenis (1977) concluded that Turks favored directive leadership. Nonetheless, in the survey of Turkish electric utility employees by Ergun and Onaran (1981), the employees reported similar satisfaction whether their supervisors were directive or participative. Correlations ranged between .32 and .42 in the satisfaction of subordinates and the tendencies of their supervisors to be more active in any one of five styles ranging from directive to delegative.
Manipulative versus Participative Tactics. Bass and Franke (1972) administered the Organizational Success Questionnaire to 1,064 university students from six countries in their native languages. The students were applying for summer jobs in other countries. The students’ nationality strongly influenced how they varied in their endorsement of political manipulative approaches to success in getting ahead in management, such as bluffing, rather than social participative approaches, such as openly committing oneself.9 All six nationalities tended to favor the participative approaches and to reject the political manipulative ones. In addition, the Germans were highest among the six nationalities in their endorsement of openly committing themselves, but they were lowest in finding it important to share in decision making. The Swedes were highest in endorsing the fostering of mutual trust and leveling with others and lowest in the political withholding of information, maintaining social distance, compromising for delay, and initiating but retarding actions. Students from the United States were highest in endorsing the establishment of mutual objectives and lowest in endorsing bluffing and making political alliances. The French were highest in supporting the participative arranging of group discussions and sharing in decision making, as in the making of political alliances.
Although they were relatively high in their willingness to share in decision making, the British were lowest in their endorsement of openly committing themselves and fostering mutual trust. They were also highest in their endorsement of withholding information for release when it would do the most good. The Dutch were next to the highest among the six nationalities in favoring the fostering of mutual trust; they were the lowest in endorsing the establishment of mutual objectives, leveling with others, and arranging for group decisions. They also were the highest in their support for maintaining social distance and initiating actions but then retarding their progress.
The participative endorsements for the six countries as a whole correlated .89 with Haire, Ghiselli, and Porter’s (1966) managers’ preferences in the same countries for sharing information and objectives. Furthermore, endorsement of the participative approaches for the six countries correlated .77 with the countries’ national wealth, as measured by the per capita gross national product.
Personality Influences. DeFrank, Matteson, and Schweiger (1985) surveyed 107 Japanese and American CEOs and found some personality differences between them that may influence their leadership style and how they look at participation and direction. The Japanese CEOs were less ambitious, hard-driven, and impatient (less Type A). However, compared to American CEOs, the Japanese CEOs reported feeling more stressed in their daily activities and less able to relieve the stress. They were also less satisfied with their pay, position, and discretionary freedom on the job.
Personnel Practices. To create better problem finding, important to the applicability of creative thinking, Japanese firms are likely to provide their scientific and engineering personnel in their first six months with positions in the sales department to give them an understanding of the firm’s customers problems and needs. The next 18 months are spent rotating through manufacturing and engineering before taking up their work in R & D. Suggestions from all employees and problem finding are strongly encouraged. In contrast to 2.3 suggestions per employee annually from the typical leading U.S. firm, suggestion rates in the largest Japanese leading companies, each receiving more than a million suggestions per year, range from Mazda’s rate of 126.5 per employee to Nissan’s 38.5 per employee. Employees post perceived problems (“golden eggs”) on a wall and their group and relevent others proceed to try to solve and implement them (Basadur, 1992).
Japan. Franke (1984) compared 149 Japanese managers’ and 1,373 U.S. managers’ tendency to endorse these same participative and political approaches. The Japanese significantly endorsed all the political approaches to a much greater degree than did the North American managers. Although they agreed that their success could be enhanced by participative decision making with subordinates, it was the Americans who were more in favor of leveling with others, openly committing themselves, establishing mutual objectives, fostering mutual trust, and arranging for group discussions.
Some of these differences between the Japanese and Americans’ endorsements of participative decisions may have been due to the extent to which such practices are discretionary for American leaders but institutionalized, as the ringi method in Japan. Participation may take on a different character in a country like Japan from what is ordinarily practiced elsewhere. In traditional Japan, negative votes in a group were rare. The members of a group faced loss of esteem, ridicule, and causing offense to others if they deviated from the “will of the group,” as announced by the group leader. The leader, in turn, had to divine intellectually and emotionally “with his belly,” haragei, what the group needed and wanted as a group (Kerlinger, 1951). Supervisory leaders play a more inportant role in Japanese organizations than in the United States (Smith & Misumi, 1989). To a Western observer, leader-subordinate relations in which complete subordinate obedience is given to decisions announced by the leader may seem authoritarian-submissive in style. Actually, leadership in Japan, as seen in the ringi method, is a blend of full consultation all around and a seeming intolerance for deviation when consensus has been reached. In the West, consultation is initiated by the leader, who asks for the subordinates’ opinions and suggestions before deciding. In Japan, consultation, as seen in the ringi system, begins with nemawashi, the informal sounding out of opinions of colleagues about ideas, then formally submitting to one’s superior what has emerged in consultation with them (P. B. Smith, 1984a). Nemawashi may also involve middle managers talking to subordinates individually about how upper management really feels about an issue before it is to be discussed in public by their group of subordinates (Yokochi, 1989b). Long-term planning and collective responsibility are the rule rather than the exception (Keys & Miller, 1984). Yet Japanese leaders can structure their relations with their subordinates to some extent rather than depend solely on tradition (Durphy, 1987).
Misumi (1984) noted several important features of ringi. First, many people, whether directly or indirectly involved, learn about the proposal. Consensus has developed among many in the organization before the decision reaches the top management. The experience and knowledge of all who are involved are applied to the decision, which enhances its quality. (Thus, Maguire and Pascale [1978] found that the quality of decisions in Japanese firms was correlated with the extent to which the decisions came from below. This was not true for American firms, in which the quality of the decision was better if more time was spent studying the issues.) Second, the wide involvement in the process of people at all levels in the organization means that the decision can be implemented quickly if it is authorized. (This was of great assistance in Japan’s rapid change over the last century.) Third, the originator of the idea receives training in management development. Fourth, the ringi method fits large firms as well as smaller, family-owned, paternalistic companies. However, when Japanese supervise North American workers, they are less consultative than are American supervisors. Communication difficulties and cultural barriers inhibit implementing the ringi practice with American workers (Beatty, Owens, & Jenner, undated).
China. Lindsay and Dempsey (1985) suggested that leadership in state enterprises in China can only be described as “semiparticipative.” It blends group criticism and group discussion without group decision making. There is an avoidance of strong public disagreements, a strictly patterned discussion flow, and a strong dependence on authority. In private enterprises, we need to add an understanding of the varieties of leadership and decision making in China. Tsui, Wang, Xim, et al. (2003) collected descriptions of the behavior of 550 Chinese CEOs provided by 1,500 professional employees and middle managers in their firms. The descriptions were converted into questionnaires, which were then factor-analyzed into six dimensions and clustered into four types of leadership styles. The dimensions were: (1) articulating vision (communicating a future to followers), (2) monitoring operations (setting context, shaping decisions, and controlling managerial and operational systems), (3) being creative and risk-taking (in thinking and formulating strategies), and (4) relating and communicating (maintaining harmonious interpersonal relationships with employees and outsiders), (5) showing benevolence (doing personal favors, showing concern for the well-being of and demonstrating generosity toward employees and their families), and (6) being authoritative (emphasizing personal dominance over subordinates, centralizing authority, being the “father figure,” and making unilateral decisions). Many of these dimensions in the Chinese context go beyond their meanings in the West. For instance, showing benevolence is not necessary for achieving instrumental or immediate objectives, but is intrinsically valued. It reflects the Confucian virtue that superiors should treat subordinates with kindness. In return, subordinates should respect their superiors with filial duty, deference, loyalty, and obedience. (Consistent with these findings, an interview survey of 50 workers and 120 managers noted that managers in China offer favors, develop warm relationships with workers, loosen the operating rules, and request assistance from the workers and their families [Wall, 1989].)
The Chinese CEOs were clustered into four leadership styles according to their distance from one another on scores on the six dimensions: (1) Advanced leaders were highest on all except the authoritative dimension, where they were moderate in score. (2) Authoritative leaders were highest on the authority dimension but in between the other three types on the other dimensions. (3) Invisible leaders were lowest on all the dimensions except for being authoritative, on which they were moderate in score. (4) Progressing leaders were moderate on all six dimensions. To illustrate, S. M. Zhang of the Neptunus Group, an advanced leader, is highly intelligent and creative, incorporates Western practices with Chinese values, and is regarded as a hero. Yue Zhang of Shanghai Broad Air-Conditioning, an authoritative leader, is rule-driven, hardworking, and extremely task-oriented. His subordinates are intimidated and highly controlled by him.
Russia. Participative approaches in Russia’s largest textile factory resulted in a decrease in performance (Welsh, Luthans, & Sommer, 1993). This could be explained by Russian national norms favoring the use of authority and direction from above. According to numerous Russian opinion polls since the demise of the Soviet Union, their allegiance is to family and friends. Trust in outsiders is low. Compared to multinational polls showing Swedes as most trusting of their government, Russians are least trusting of their government. In 2003, 78% of respondents agreed that democracy is a façade for government control by rich and powerful cliques. A majority said that multiparty elections did more harm than good. In one province, 88% indicated they would choose order over freedom. Most said they would be willing to give up freedom of speech, press, or movement in exchange for stability, and 76% favored restoring censorship over the mass media (Pipes, 2004).
Britain and France. Decision-making processes take a different form in Britain than in France. According to Graves (1973), British managers do not consider all alternatives. Greater conflict occurs in regard to the value of various alternatives; nevertheless, once a decision is reached, there is more commitment to it. French managers place more weight on alternatives but may be less committed to the alternative selected for implementation. Subordinates’ felt pressure to participate in decisions may depend more on individual differences. It may be a more impersonal matter in Britain and more personal in France (Inzerilli & Laurent, 1983).
Multinational Subsidiaries versus Indigenous Firms. Heller and Wilpert (1981) surveyed the extent to which decision making was directive (with or without explanation), consultative, joint, or delegative among 625 boss-subordinate dyads in 29 firms in eight countries. The results varied by country from most directive to most participative. Israel was most directive, and Sweden was most participative. But the authors noted that the type of firm had to be taken into account. For example, more direction was found in indigenous German firms than in German multinational corporations. German subsidiaries of multinational firms headed by other nationals were the most participative. Similarly, Negandhi and Prasad (1971) obtained results indicating that managers in North American subsidiaries in Argentina, Brazil, India, the Philippines, and Uruguay found it more comfortable to delegate than did indigenous managers in locally owned firms in the same countries. Whether employees in North American subsidiaries of Japanese multinationals were satisfied or tended to quit appeared to depend on whether the management was under more Japanese or American influence. Japanese employees were more satisfied with Japanese managers and practices than were U.S. employees (Yokochi, 1989b).
Influences of Power, Legitimacy, and Expectations. Although a participatory style may work well for leaders and with subordinates in low power distance, as in the United States where it is culturally legitimate, considerably less effective outcomes may be found in high-PDI countries in which participation is less expected and appreciated. For example, in Saudi Arabia, Algattan (1985) compared the effectiveness of participatory leadership on U.S. and mainly Asian and African workers. Participatory leadership was more effective with the U.S. workers and was related to their greater need for the scope of the task, growth, and inner locus of control in comparison to Asian and African employees. The referent power of U.S. supervisors, their esteem and popularity, enhanced the performance of their subordinates, but legitimate power was more important to Bulgarian supervisors in contributing to their subordinates’ effectiveness. In Bulgaria, the supervisor was seen to have the right to control subordinate behavior (Rahim, Antonioni, Krumov, et al., 2000).
In a seminal field experiment, Coch and French (1948) found a marked increase in productivity by North American work groups that were permitted to participate in goal-setting decisions that affected them. This was in contrast to findings with control groups that were not permitted to participate. But the same experiment failed with Norwegian factory workers because Norwegian workers were thought to have a lower need for autonomy and did not see participation as legitimate to the extent that American workers did (French, Israel, & As, 1960). Locke, Latham, and Erez (1987) showed in laboratory comparisons that group participation in goal setting was unnecessary in the United States, where (serendipitously) the experimenter had been friendly and supportive when instructing the subjects. In Israel, the experimenter had been more curt. In Puerto Rico, when the manager of a new Harwood Manufacturing plant began to encourage employees to participate in problem-solving meetings, turnover increased sharply! It was found that the workers in Puerto Rico had decided that if the management was so ignorant of the answers to its problems that it had to consult employees, the company was poorly managed and unlikely to survive (Marrow, 1964b). In the same way, Israeli sailors were more satisfied with expected legitimate directive leadership than with participative leadership (Foa, 1957).
Considerable agreement across countries was reported by Blake and Mouton (1970) in what managers regard as ideal. Among almost 2,500 managers from the United States, South Africa, Canada, Australia, the Middle East, and South America in GRID seminars, most agreed that the “9,9 management style” (integrated concern with both production and people), as defined in Chapter 19, was the ideal for their company. But much of the uniformity across countries could be attributed to indoctrination in the GRID seminars. There was more concern in general for productivity when managers described their own actual behavior. In the same way, Howell and Dorfman (1988), comparing Chinese, Mexican, and American employees in electronics manufacturing plants, concluded that supportive leadership generally had similar positive effects on satisfaction and commitment in all three samples. Moreover, the cohesiveness of the work groups could often substitute for the supportive leadership in generating the satisfaction and commitment Ayman and Cherners (1983) and Kakar (1971) reached similar conclusions.
The relations orientation and task orientation (Bass, 1967b) of leaders and nonleaders have been studied in many different countries, including Poland (Dobruszek, 1967), Britain (Cooper, 1966; R. Cooper & Payne, 1967), India (Muttayya, 1977) and Hong Kong (Lomas, 1997). Lomas found that Hong Kong Chinese project managers, in comparison to their Western counterparts, placed more emphasis on personal relationships than on the task. Muttayya observed that among 275 diverse formal and informal Indian leaders and nonleaders that the leaders were more task oriented, as expected. Lindell and Arvonen (1996) obtained results indicating that Latin European managers were somewhat higher in task orientation than Scandinavian and Hungarian managers. Employee orientation was higher in Scandinavian than Latin European managers. Likewise, the importance of the vertical dyad linkage on the quality of superior-subordinate relationships was as applicable in Japan and elsewhere as in the United States (Wakabayashi & Graen, 1984).
Dorfman (1996) concluded from a review of the literature that the importance of task orientation and its contribution to subordinate satisfaction and effectiveness did vary somewhat from one culture to another. A third dimension needed to be introduced to account for the fuller orientation of the leader toward the task and relationships. Such a third dimension dealing with character and morals had to be added to P(roduction) and M(aintenance)to describe Chinese leaders in the application of Misumi’s PM theory. According to Peterson (1988), PM theory, which was developed and validated in collectivist Japan, may be improved in the individualist United States with some modification of this type.
The Japanese Example. As noted earlier, the Japanese place a particular premium on the quality of relationships with others. A variety of empirical studies and case analyses have corroborated this finding. Among the 12 national groups studied by Bass, Burger, et al. (1979), the Japanese managers were relatively high or highest in preferred awareness of self-understanding, listening to others with understanding, and accepting warmth and affection from others. They were also highest in their willingness to discuss feelings with others and to cooperate rather than to compete with their peers, and in seeing the need for top management to be tolerant. At the same time, they remained relatively high among the nationalities in their actual and preferred task orientation relative to their human relations orientation, which admittedly was also strong in an absolute sense. The task centeredness of the Japanese managers appeared more acceptable than it would for British managers, according to White and Trevor (1983), for the Japanese were considered more committed, expert, and socially close (P. B. Smith, 1984a).
Task orientation was expected to be high in organization members in Japan, for it is directly connected with acceptance of the organization’s mission and goals. Relations orientation was beyond discussion, for it was assumed on the Japanese scene that organizational survival and success depended on it as well as concerns for the task (Yokochi, 1989b). The same emphasis on task orientation was seen in Japanese-owned plants in Britain, the United States, and Hong Kong, even when a majority of supervisors were not Japanese (Smith, Paterson, Misumi, et al., 1992).
Bolon and Crain (1985) compared the responses of 40 Japanese and 39 U.S. managers and executives in how they would handle a problem subordinate. The Japanese were found to take significantly more steps in dealing with the subordinate. They invested more effort in trying to understand the situation. On the other hand, U.S. male managers (but not female managers) more often attempted to resolve the situation by firing the subordinate or forcing him or her to quit. When American, Indian, and Japanese managers were compared by Ivancevich, Schweiger, and Ragan (1986), it was found that the Japanese felt they obtained more social support from their bosses than did the Indian or American managers. For Indians and Americans, spouses and relatives were more important providers of such social support.
The greater emphasis on the human side of enterprise by Japanese compared with American managers in large firms was seen in their differential response to intensified price competition. Americans cut their human resources expenditures while maintaining their capital equipment, plant, and material resources. They sought financial and legal solutions to deal with the competition rather than technical ones. Before the economic recession in the 1990s, the Japanese tried to save their human resources. They avoided layoffs, discharges, and wage reductions to reduce labor costs, although they did withhold bonuses. If personnel costs had to be cut, they reduced their own salaries and made use of quality circles and other “bottom-up” suggestions to reduce costs. They reduced the costs of production by increasing the flexibility of their operations. When they replaced workers with automation, they transferred and retrained the displaced workers. The Japanese approach required a high degree of coordination and good working relations among R & D, manufacturing, and marketing, as well as commitment, loyalty, and employees’ involvement (Tsurumi, 1983).
The Japanese attention to relationships was made more specific by Hall and Hall (1987), who pointed to the unusual degree to which the Japanese place a premium on listening and the value of agreement. Questions should not be posed unless they have answers or the answers can be found beforehand by asking the questions in advance of a meeting. Proposals should not be refused outright, but should be taken under consideration. If a proposal is finally rejected, the reasons need to be fully stated with politeness and apologies. The transformational factor of individualized consideration, as measured by the Multi-factor Leadership Questionnaire, emerges from a different set of items in Japan because such consideration is expected from one’s supervisor even though it remains unspoken. Guidance by the supervisor and acceptance by the subordinate is an unsaid rule governing their relationship (Yokochi, 1989a).
Westerners who interact with Japanese will be more successful if they pay attention to the need for patience. Impatient behavior will be interpreted as bad manners and a lack of sincerity. Uncontrolled emotion will be considered as weakness and in bad taste. But patience may not help the Western negotiator. Until the economic downturn in the 1990s, the Japanese remained ethnocentric in their domestic business activities in Japan itself. They made special efforts to buy Japanese products whenever possible rather than buying them abroad. They infringed on Western patents (not infringement, according to Japanese law) and continued to rely on more expensive Japanese suppliers. The “old-boy” networks were particularly strong in Japan and difficult for foreigners to penetrate.
Cultures differ in what is seen as considerate behavior. In the West, it is considerate for a leader to praise publicly but criticize privately. In Japan, criticism from a leader comes indirectly through a peer since direct criticism from the leader would cause the follower to lose face (Smith & Peterson, 1988). Substantial differences in the initiation of structure and consideration have been found among managers from different countries. For instance, Anderson (1983) did not find that consideration by leaders contributed to the effectiveness of managers in New Zealand as was usually found elsewhere. In the Bass, Burger, et al. (1979) 12-nation data for Exercise Self-Appraisal, although there was an overall trend to see the need to be more considerate by leaders at lower levels of management, the French and Latin countries regarded being considerate as relatively unimportant at all levels of management; Northern Europeans, British, and Americans thought it more important. On the other hand, consideration was emphasized by fast-rising but not by slow-climbing managers in Italy, Spain, Portugal, and the United States; it was deemphasized by those with accelerated careers in Belgium, Scandinavia, France, Latin America, and India. Tscheulin (1973) found positive effects of consideration on satisfaction for a German sample, as did Rim (1965) for Israeli nurses and industrial supervisors and Fleishman and Simmons (1970) for Israeli supervisors. But L. R. Anderson (1983) reported the opposite for middle managers in New Zealand.
L. R. Anderson (1966a, 1966b) studied discussion groups composed of American and Indian graduate students. The leader’s effectiveness, as rated by the American students, was positively correlated with both the leader’s consideration and initiation of structure. But Indian students’ ratings of leader effectiveness were correlated only with the leader’s consideration scores. When the initiation of structure scores eliminated the coercive items such as “pushing for production,” initiation of structure also correlated positively with leader effectiveness.
Differences in Psychometric Properties. Culture may affect the psychometric properties involved in measuring initiation and consideration. As noted earlier, the factor structures of leadership behavior descriptions in the United States, Britain, Japan, and Hong Kong systematically differed, especially in which questionnaire items correlated with initiation of structure (Smith, Tayeb, Peterson, et al., 1986). Ayman and Cherners (1982) emerged with a single factor instead of the two factors of initiation and consideration for European in contrast to U.S. managers, as described by their respective subordinates. When K. F. Mauer (1974) administered the Leadership Opinion Questionnaire to a sample of 190 mine overseers and shift bosses in the South African gold-mining industry, neither a varimax rotation nor an orthogonal target rotation of the two extracted factors approximated the findings of U.S. and Canadian researchers. An oblique target rotation produced a South African solution that was closest to the North American solution.
The correlation between the factors was much higher than that found in other studies. Nevertheless, Matsui, Ohtsuka, and Kikuchi (1978) were able to replicate and extend Fleishman and Peters’s (1962) U.S. results with 79 Japanese supervisors. As with the U.S. results, they found that considerate Japanese supervisors (as seen by their subordinates on the Supervisory Behavior Description Questionnaire) were higher in self-inventoried benevolence on L. V. Gordon’s Survey of Interpersonal Values. The supervisors’ initiation of structure, as described by their subordinates, was lower if the supervisors reported themselves to be higher in valuing independence.11
In data collected between 1968 and 1972, the preference to be more influential was high among managers from all 12 nations studied by Bass, Burger, et al. (1979). But it was highest among Japanese, Spanish, and German managers and lowest among French and Dutch managers. During this same period, the endorsement of active intervention by the leader, in contrast to laissez-faire behavior, was seen by Bass and Franke (1972) to relate to a country’s rate of economic growth. Bass and Franke obtained a correlation of .93 in the ranking of six industrialized countries between the rate of economic growth of the country for the preceding nine years and the extent to which students from those countries endorsed a manager’s being both more participative and more political to achieve success in a career.
Some consistency with these results was obtained by Keys, Edge, Heinz, et al. (1986), who compared the self-descriptions of 214 Korean, 101 Filipino, and 97 American middle managers about how active they were in their relations with others in dealing with various issues. The issues were expected to make a difference, since the Asians were more likely to be more collectivistic and the Americans more individualistic. The Americans reported themselves as being more likely than did the Filipinos or Koreans to threaten their subordinates to obtain compliance with requests. Americans also more frequently ordered subordinates to “do what I want done.” Furthermore, the U.S. middle managers were most likely to say that they would disagree openly with their boss and remind the boss about matters if he or she procrastinated. However, the Korean managers were most likely to indicate that they would confront their boss if treated unfairly, while the Filipinos were most likely to indicate a reluctance to go over the boss’s head to a higher authority. Less collectivistic than the Filipinos or Koreans, the Americans were more likely to actively complain to their boss if their peers got out of line. They were most likely to remind their peers of rules and policies.
Motivation to Manage. Collectivisim and individualism had different effects on the motive to manage others in hierarchical settings. Projective results on the strength of the motivation to manage within bureaucracies, as revealed by scores on the Miner Sentence Completion Scale (MSCS)13 by foreign and U.S. students in American schools, were quite different. Consistent with the decline in American MSCS scores between 1960 and 1980 (Miner & Smith, 1982; Miner, Smith, & Ebrahimi, 1985), American students were found to score much lower than Asian or African students. Also, Ebrahimi (1985c) noted that the motivation to manage, as measured by the MSCS, was significantly higher in a combined sample of Japanese, Korean, Taiwanese, Philippine, Malaysian, and Chinese students and a separate sample of Thai students than in a sample of American students. Also, the MSCS scores were successively higher for students from India, Iran, Thailand, and Nigeria. Some of these differences could be attributed to personal differences among the students. The foreign students studying in the United States were likely to be more ambitious, adventuresome, assertive individuals, who were more highly socialized to Western mores and higher in class and education than those who remained at home. At the same time, the results suggested, these Asian and African students would fit more readily into management in the highly bureaucratized organizations in which they were likely to find employment when they returned home. Consistent with these results, Wachtel (1988) found that prospective managers from Mexico were higher in managerial motivation than were their American counterparts.
With few exceptions, transformational leadership is universal in its greater success and effects on positive follower outcomes in comparison with management by exception and laissez-faire leadership (Bass, 1997, 1998). Yet there are cultural contingencies. Yan and Shi (2003) set forth that each of Hofstede’s (2001) five dimensions differentially relate to the adoption of Bass’s (1985) original dimensions of transformational leadership and acceptance by followers. Jung, Bass, and Sosik (1995) argued that transformational leadership was more likely to appear in collectivistic than individualistic cultures. In the collective cultures like those of China, Japan, and Korea, individuals more readily identify with a group, share responsibility for goal attainment, try to maintain a harmonious group, and emphasize mutual interdependence in organizations. These behaviors are consistent with what a transformational or charismatic leader tries to accomplish.
Davis, Guan, Luo, et al. (1997) distributed the Multifactor Leadership Questionnaire in Mandarin to all managers and their subordinates in a state department store in central China. A 65% response rate provided 241 completed questionnaires. Stepwise regression analyses with transactional scores and then transformational scores were added as predictors of outcomes. An index of transformational leadership added significantly to transactional leadership scores in the prediction of effectiveness (R2 = .43); individual effort (R2 = .65), satisfaction with the leadership (R2 = .31) and intention to quit (R2 = −.20). Contrary to Bass (1997), Ardichvili (2001) found more country specificity than universality in transformational leadership in Georgia, Kazakhstan, Russia, and the Kyrgyz Republic. Koh (1990) reported the same kind of results for school principals in Singapore, which is also high in collectivism and mainly Chinese in culture. Chiu (1997) compared results obtained with 233 part-time MBA students working in collectivist Hong Kong and the sample of individualist Americans used by Bycio, Hackett, & Allen (1985). He also compared in-group members in Hong Kong, those who looked out for the welfare for each individual member in the group, with out-group members. Hong Kong Chinese leaders were more likely to use intellectual stimulation and individualized consideration with their in-group members. American leaders were less likely than Chinese leaders to show individualized consideration to their subordinates. Compared to Americans, Hong Kong Chinese subordinates and members of the in-group were more likely to perceive their leaders as charismatic. Howell, Dorfman, Hibino, et al. (1994) reported that charismatic leadership correlated with subordinate satisfaction in Korea, Taiwan, Mexico, and the United States, but not in Japan.
Japanese leaders take full responsibility for organizational outcomes. They make extra effort to understand their followers’ needs and feelings. In turn, they are treated with respect and trust. According to Yokochi (1989a), in collectivist Japan, managers at the CEO level and several rungs below are much more transformational than transactional. Their subordinates are likely to indicate on the Multifactor Leadership Questionnaire that their leaders take full responsibility for their actions (as a matter of tradition) and are generous in giving concrete guidance. The leaders are highly respected and trusted. The leaders encourage sacrifice by subordinates and at the same time make extra efforts to assure subordinates of their feelings and concern for the welfare of the subordinates and their families. Subordinates are challenged with new ideas and tasks. As noted elsewhere, it is the firm or agency, not the leaders, that provides unspoken rewards and promotions.
Yokochi (1989b) completed an MLQ survey of three hierachical levels in 14 Japanese firms involving 66 executives, 44 managers, and 194 subordinates. She concluded that Japanese leaders take readily to transformational leadership as a consequence of their humanistic values and corporate goals. Intellectual stimulation is comfortable due to the culture’s emphasis on continuous learning and pursuit of intellectual activities. Strong adherence to company management philosophy is attributed to the desire to emulate senior management behavior. Adherence to hierarchy does not mean autocratic leadership but is rather symbolic. The emperor is highly revered as a figurehead in a constitutional monarchy. Legimate hierarchical orders are usually consensual; decision making is widely shared. The preference is for working in groups. Standing alone for personal freedom is not admired.
Pereira (1986) found similar results in collectivist India for 58 senior and middle-level managers from Larsen and Toubro, an engineering firm. Again, Echevarria and Davis (1997) in the collectivist Dominican Republic reported similarly high correlations of transformational leadership with effectiveness, satisfaction, and extra effort for 402 employees from two newspapers.
Walumba and Lawler (2000, 2003) collected survey data from 745 employees in banking and finance in China, India, Japan and Kenya. They confirmed that transformational leadership contributed to job satisfaction and commitment in all four collectivist countries. In low-power-distance countries such as Australia, transformational leaders are participative in style (Ashkanasy & Falkus, 2004). In high-power-distance countries, they tend to be more directive (Den Hartog, House, Hanges, et al., 1999). Howell and Dorfman (1988) expected charismatic leadership to have a considerable impact on Mexican and American employees’ satisfaction with work and with supervision. Although the expected effects were positive on both samples, the impact of charismatic leadership was greater on the American employees. Correlations of .50 and .70 were found, compared to the Mexican employees, for whom the correlations were .29 and .57. Some of the darker history of charismatic Mexican political leaders may have been a drag on the Mexican results. This may partly explain why Ardichvili (2001) found more country specificity than universality in transformational leadership in Georgia, Kazakhstan, Russia, and the Kyrgyz Republic. Although Australia and the United States belong to the same Anglo-American cluster of countries, Australians put even more of a premium on equality and individualism. Transformational leadership had the same effects in both countries, but Australians varied more in attributing it to their leaders. Transformational factors in Australia are 0.7 to 1.1 lower in standard deviation (Parry, 1994). However, according to Parry (1996), Australians, more than Americans, expect charismatic leaders to take an interest in the welfare of their followers—to be individually considerate. Australians expect a lot more from their leaders than do Americans. High status is not enough to create respect; respect has to be earned.
Transactional Leadership: Contingent Reinforcement. Transactional leadership has many elements that fit better with an individualistic society. Rather than endorsement of shared purposes and identification with group goals, leaders and subordinates are motivated by personal goals. Individual initiatives and self-interest are more important (Jung & Avolio, 1999). Early (1988) pointed to important cross-cultural differences in the effectiveness of contingent rewarding. He noted that since workers in individualist En gland did not value praise, criticism, or general conversation with their superiors, as did American or Ghanaian workers (Early, 1984), English workers would be less likely to be influenced by contingent rewarding. The En glish workers, particularly those in heavy industry, would distrust feedback from their supervisors (Blumberg, 1968; Goodman & Whittingham, 1969). In the same way, individualistic U.S. worker samples generated higher correlations between transactional contingent rewarding and measures of satisfaction with work and with supervision (.48 and .73) than Howell and Dorfman (1988) found in collectivist Mexican workers (.19 and .57). Likewise, the effects of contingent punishment were greater for the U.S. than the Mexican samples. Nonetheless, contingent reinforcement was found to have positive effects on satisfaction and organizational commitment in collectivist Taiwan (Dorfman & Howell, 1988). Similar correlations were found by Peterson, Peng, Hunt, et al. (1994) when they compared 447 middle managers and supervisors working in local city government (.54) in the individualistic United States with their 196 counterparts in city government in the collectivist Japan. While noncontingent punishment correlated negatively with job satisfaction in the United States (−.39), it had no effect in collectivist Japan (−.05).
The transactional factor of contingent reward is complicated in Japan by unspoken expectations of reward as well as obligations. For example, the failure to be promoted would be a consequence of failure to meet unspoken expectations. Strict rules of tatamae prohibit explicitly seeking rewards or professing open expectations of them. Unspoken needs are those that will be fulfilled with successful leader-follower performance. This honne is well understood, although not by those unaccustomed to the system (Yokochi, 1989a). Even more complicating is the fact that Japanese employees do not differentiate themselves from their supervisors and managers but see all collectively as members of the company. Promotion is from within the organization, so that shared common mottos, values, and goals are maintained by workers and management. Pay differentials are small and are decided (along with promotions) not by one’s immediate superior but by the amorphous company, consistent with its standards, values, history, and traditions. Even more of a problem for the Japanese is management by exception, since it is difficult for them to appreciate such a supervisory-subordinate relationship. For them, it would be a matter of custom and tradition for a supervisor to be more concerned about the subordinate.
Howell, Dorfman, Hibino, et al. (1994) reported that contingent reward, praise, approval, and recognition by the leader for good performance universally generated follower commitment, satisfaction with supervision, and satisfaction with the leader. (This is not surprising since Antonakis and Avolio (2004) found that contingent reward such as recognition is both transformational and transactional.) Material rewards are transactional. However, contingent reproof and disapproval for poor performance had more of an impact in individualistic countries like the United States than in the collectivistic countries of Asia. The same should be true for management by exception. Parry (1996) set forth the idea that monitoring and controlling subordinates’ interpersonal behavior is indicative of less effective leadership, more in Australia than in the United States. Subordinates are more cynical about authority and likely to reject influence based only on the status of the source.
International organizations, both collegial and hierarchical, have been around for a long time, dating back to the ancient world. Currently, executives, managers, and employees from the world’s different nations work together in the United Nations, the World Bank, the World Court, and a host of other international agencies and private enterprises. Among these international organizations, much of the available research on leader-subordinate relations appeared in studies of multinational corporations that began with management and industrial activities in one country and spread to others as they went beyond importing and exporting to manufacturing, marketing, and research in the other countries through developing, purchasing and franchising subsidiaries organized for these purposes. Many MNCs have recognized that increasingly their sales and revenues are coming from foreign sales and services. For instance, Avon Products, a U.S. firm, was making 65% of its sales abroad by the mid-1990s (Henson, 1996).
The Growth of MNCs. Direct investment in development or acquisition of foreign subsidiaries or merging with other companies across borders came when import or export alone failed to meet supplies, sales, or service objectives domestically or as a result of the personal predilictions of senior management of the MNC. An MNC may develop and provide funding for a new start-up subsidiary headed by a parent-company executive and some staff who will mainly hire and train host-country nationals. It may purchase a local firm for cash or stock in whole or in part. If integration with the parent company or domestic and other foreign subsidiaries is sought, parent-country or third-country executives, managers, and supervisors may be placed in key positions. MNC mergers involve creating one company out of two by one company taking over another across borders. Development of a foreign start-up contains the fewest cross-cultural problems and is likely to be successful. Mergers encompass the most cross-cultural problems and are least likely to be successful (Hofstede, 2001). Deals may fail as a consequence of misunderstanding one’s own culture or the other party’s culture (Kemper, 1997). Often, mergers and joint ventures face conflicts in the distribution of power and agreement about the criteria on which to judge performance. For instance, in Chinese and American joint ventures, the Chinese favor evaluating the technology; Americans favor evaluating operations (Zhao & Culpepper, 1997). Cultural proximity between the MNC and the subsidiary increased the chances for Dutch MNCs’ success in start-ups, acquisitions, and mergers (Barkema, Bell, & Pennings, 1996) and likewise for Chinese joint ventures with foreign MNCs (Luo, 1999).
International Strategic Alliances. These are formal contracts or understandings between partner firms across borders. They provide linkages of resources for joint accomplishment of objectives. In 1983 to 1986, such cooperative arrangements were likely to generate cross-cultural conflicts. For instance, Americans want frequent interactions in alliances and explicit understandings in formal contracts; Japanese are satisfied with more implicit agreements. The Americans are comfortable with vigorous conflict; the South Koreans and the Middle Easterners find conflict distasteful. A survey of cross-border alliances with American firms had a failure rate of 70%. Nevertheless, Americans felt that alliances provided important information. European and Japanese firms emphasized the strategic needs met by alliances (Parkbe, 1993).
The United States dominated the multinational scene in the 1960s. European MNC parent countries included Germany, Britain, Sweden, and Italy. MNCs also originated in Japan, Korea, India, and Arab countries as well as in Australia, South Africa, and elsewhere. Regardless of origins, MNCs become truly globalized, with shares owned, components assembled, markets, personnel, and research deriving increasingly from many countries. In 1991, 4.1 million Americans were working for foreign multinationals in the United States (Eunni & Post, 2002). Their headquarters are in Britain, the Netherlands, Germany and Japan. For instance, in 1992, Japanese nationals with subsidiaries in the United States employed an estimated 850,000 Americans and about 27,000 Japanese expatriates. About three-fourths of the 7,000 businesses were small or medium-sized. They were owned by 2,000 Japanese firms. They tried to minimize layoffs, provide 20% more pay, and hire as many women and minorities as their American counterparts. Americans participate as managers at all levels, but much more at lower levels. The Americans had to adapt to the more flexible Japanese management system (Tsurumi, 1992).
Approaches to Management. MNCs, such as General Motors (United States), L. M. Ericsson (Sweden), Mitsubishi (Japan), and Ciba-Geigy (Switzerland), originating as they did in different countries, vary considerably in their approaches to coordination, the balancing of requirements, promotion of host country nationals, decision making, and power relationships (Doz & Prahalad, 1984). On the one hand, we have seen, for instance, in the Exxon studies that forecast success as a manager (Laurent, 1970) and the Arab-American homogenization of perceived leadership styles within their multinational firms (Algattan, 1985), that multinational firms are a force for global convergence. At the same time, the GLOBE studies confirmed both the similarities and differences among managers from different countries (House, Hanges, & Javidan, 2004).
Fitting the Culture. Management and leadership in multinational corporations (MNCs) need to fit more with the host country than with the parent-country culture. For instance, Newman and Nollen (1996) found that among 176 business units in 18 Asian and Western foreign subsidiaries of a U.S. MNC, unit and subsidiary profitability as measured by returns on sales and assets was higher if practices in the unit matched whether the host country was high or low in Hofstede’s (2001) dimensions. Nevertheless, the American MNC Procter & Gamble introduced a U.S. code of ethics into its Asian and African subsidiaries. The subsidiaries, unlike the ones in the United States, were all high in power distance, collectivism, uncertainty avoidance, and masculinity. P&G expected to see some adaptation in the subsidiaries of reduced collectivism and masculinity (Reeves-Ellington, 1995).
Management controls tend to reflect more the culture of the parent company’s home-country culture. According to a study of 75 foreign acquisitions, American MNCs tend to emphasize more informal control and the use of teams; British and French MNCs tend to stress more formal control (Calori, Lubatkin, & Very, 1994). In general, the greater the cultural distance between the parent and host country, the more likely is control to be personalized and centralized (Harzing, 1999) and the more likely is the CEO to be from the parent country, according to a study of 287 subsidiaries of 104 MNCs in nine parent countries and 22 host countries by Harzing (1999).
The cultural adaptation of the parent-country manager to the host country may make a difference. A videotape of a Japanese parent-company national interacting with host-country national subordinate in the United States was shown to 223 employees of Japanese manufacturing firms in the United States. Management effectiveness and intentions to trust were positively related when the manager was shown as being culturally adapted to the United States (Thomas & Ravlin, 1995). Nationals of a country may differ in what they do when they are at home and when they go abroad. Takamiya (1979) observed that Japanese firms in the United States and in Europe were not providing lifetime job security or Japanese-style company welfare programs for their employees. Nonetheless, the Japanese firms abroad were found to be highly productive and to maintain the same high-quality standards they did at home. The success of the firms appeared to be more a consequence of their attention to production management and high-quality standards than to Japanese-style human relations practices (Hayes, 1981). Pascale and Maguire (1980) came to similar conclusions from a study of 13 Japanese firms operating in both Japan and the United States. They found that the location of Japanese plants in Japan or the United States was more important to supervisor-subordinate relations than the fact that the management was Japanese. Absenteeism was lower in Japan; more was spent on employee benefits in the United States. According to a study of 126 firms, they were more likely to expand and diversify internationally if their top management team was younger, longer-tenured, higher in elite education, and more experienced internationally (Tihanyi, Ellstrand, Daily, et al., 2000).
Little has been reported about the specific leader-subordinate relationships of supervisors of one nationality and subordinates of another. They may be operating together at the headquarters in the parent country, in a host country, or in a third country. The leader or the subordinate may be a parent-country national (PCN), a host-country national (HCN), or a third-country national (TCN).
Developing International Managers. Oddou and Derr (1991) examined 55 Anglo American, Scandinavian, German, Dutch, and Latin European MNCs ranging in size from under 1,000 to over 200,000 employees. The functions internationalized in order from most to least were marketing, finance, manufacturing, R & D, and human resources. Fifty-three percent of the top 50 line managers had experienced at least one international assignment, as had 48% of the staff managers. The two most frequent means of developing international managers were moving PCNs to foreign offices and conducting international seminars with PCNs, HCNs, and TCNs. More needed to be done by developing international task forces and bringing HCNs and TCNs to a major parent-country national office Additionally, to meet the needs for more expertise about the host countries and international issues, the firms planned to: (1) hire more HCNs, (2) use more specialized consultants, (3) increase use of HCNs in other countries, (4) send top managers to international seminars, and (5) create international networks with friendly firms. Company inattention to proper selection and training of PCNs was a particularly important source of failure. In another study of 105 MNCs, ratings of the reported lack of rigor of selection, training, and preparation of personnel for overseas assignment correlated .63 with personnel failure rates (Tung, 1979).
Decision Making, Status, and Power. Of considerable importance to the leader-subordinate relationship in the MNC is its method of decision making and the differential status and power of its PCNs, HCNs, and TCNs. Perlmutter (1969) saw three possibilities: (1) ethnocentric—the PCN in all respects and all decisions and methods is controlled by the PCN. PCNs monopolize the power and status; (2) polycentric—the organization is host-oriented. Local HCNs are seen able to make the best decisions. HCNs are more equal in power to PCNs; and (3) geocentric—the organization is world-oriented, and a balanced view of decision making takes account of local and national interests and the objectives of the multinational firm. Managerial positions are filled by people having the most talent, regardless of their national background. TCNs have as much status and power as PCNs and HCNs.
As a multinational organization matures, it moves from ethnocentric to geocentric organizational patterns. Presumably, cultural origins become less significant in the decision-making process with increasing maturity. Ethnocentricity may be maintained longer by Japanese firms. Polycentrism may be the only stage for some service firms, such as convenience foods franchises; geocentrism may be reached early in other industries that find comparative advantages in integrating activities in different countries to obtain their financing and supplies, their research, development, and manufacturing, and marketing their products. But empirically, according to their CEOs, Japanese parent company headquarters exert little influence on leadership style in American subsidiaries. On the other hand, the leadership style in Japanese foreign subsidiaries are influenced by TCNs and HCNs in their corporate headquarters (Justin & Jones, 1995).
Differences in Satisfaction, Perspective, and Valuation. A job satisfaction survey completed by Peter (1969) for Shell, a British-Dutch multinational corporation, illustrated the significance of employees’ identification as PCNs, HCNs, or TCNs. Non-Europeans were much more dissatisfied with the company’s image than were Europeans. Moreover, among all the nationals, the PCN British and Dutch were relatively most satisfied with the company as a place to work and with opportunities to obtain responsibility and authority.
The managers’ work location, their willingness to work abroad, and their experience in working abroad are likely to affect their attitudes. Positive experiences are likely to generate more favorable attitudes and satisfaction with foreign assignments. The turnover rates of American PCNs ranged from 16% to 40%, compared to 5% to 15% for Americans who remained in the United States (Eunni & Post, 2002). Their intention to quit the job in the foreign location was greater than to leave their organization (Birdseye & Hill, 1995). But Yeh (1988) generally did not find differences in power distance, avoidance of uncertainty, individualism, and masculinity when PCN and TCN managers (63 American and 356 Japanese) were compared with HCN managers (2,237 Taiwanese) working for firms in Taiwan.
Possibly reflecting MNCs in general, Swedish and Dutch MNCs top management teams have not internationalized as have their employees (Eunni, 2002). When a team is international in composition, the perspectives of the different members need to be understood. Members may vary in whether they are oriented toward the mastery of nature and its control with technology, are oriented to subjugation of nature with a predestined plan and unavoidable constraints, or are oriented toward living in harmony with nature and a balance of self and environment. Humans are seen as basically good or evil. If good, they can be trusted; if evil, they are untrustworthy. Their perspectives also differ if they come from countries high rather than low in PDI, UAI, IDV, MAS, and/or LTO. International teams need to decenter—change from blaming others for the differences and developing an understanding that the differences are due to different perspectives. Then they can recenter—build a common view of the situation to better deal with it (Maznevski & Peterson, 1997).
Uniformity. According to interviews with 248 HCNs and PCNs by Zeira (1975), PCNs and TCNs tend to impose parent-country headquarters’ managerial patterns on their host-country peers and subordinates. This finding was corroborated by Al-Jafari and Hollingsworth (1983). But although an Arab organization, as such, would have been expected to operate more autocratically than a U.S. or European multinational firm, among 337 managers of 10 multinational organizations in the Persian Gulf region, both U.S. and Arab managers saw their organizations operating in a Survey of Organizations Systems 3 (consultative) mode and leaning toward Systems 4, an even more participative style (Al-Jafari & Hollingsworth, 1983).
According to headquarters’ PCN personnel directors, multinational uniformity facilitated comparisons of managers in subsidiaries in different countries (Zeira, 1975). Uniformity was also thought to keep up the firm’s reputation in different countries and to make it easier to introduce policy changes. HCNs disagreed. A majority thought that PCNs maintain uniformity of policies and practices for their own self-interest. The HCNs believed that the PCNs (and the TCNs) at higher management levels in the local subsidiaries were not motivated to make local improvements or to meet local needs. They thought that the PCNs’ insensitivity to the expectations of local HCNs resulted in many conflicts. The HCNs were particularly critical of the tendency of multinational firms to centralize decisions, which made it impossible to adapt to the needs of the local marketplace. They mistrusted their PCN superiors and believed that their promotion to a higher level was prevented by their not being nationals of the parent country (Zeira, 1975).
PCN Benefits. Because the PCNs are representative of their multinational corporations, they can achieve entry into the upper-class social life of the local communities beyond what they could reach in their previous positions at international headquarters at home. PCNs obtain special benefits as part of their compensation abroad. This makes it possible for them to enjoy a standard of living that is considerably higher than that of their local peers and higher than what they can expect when they return home.
Why PCNs Fail or Succeed. Despite the extra benefits of working abroad, the failure rates of PCNs are high. More than one third return from overseas assignments prematurely. The incidence of divorce, alcoholism, and drug abuse is high (Chesanow, 1984). PCNs may experience anxiety over their transfer, disorientation as a result of culture shock, social dislocation, anxiety about being separated from family and friends, and feelings of having been abandoned by headquarters. They may sense that they lack the necessary influence and local technical assistance. They may have physical problems. Reentry problems on returning home also need to be faced (Ronen, 1986).
A survey of 321 American managers on international assignment found a correlation of .71 between commitment to both the parent and host companies with how much discretion they had in their roles, .47 with adjustment to the host country, and .33 with how much they interacted with host nationals. They were commited to their parent company rather than their host country company to the extent they had predeparture training (r = .60) and if they were not adjusted to the host country (r = .53) (Gregersen & Black, 1992). Among 109 British managers, willingness to work abroad depended on the country to which they might be assigned. On a scale of 1 to 7, among 22 countries, they were most willing to serve in the Netherlands (5.11), France (5.01), northwestern European countries (4.67), North America (4.64), and Australia (4.40). They were less willing to serve in southern Europe (3.77), eastern Europe (2.84), South America (2.77), and Japan (2.71), and least willing to serve in Africa (2.36), China (2.21), and the Middle East (1.92). They were most willing to go abroad for a British parent organization (6.53) and least willing to go abroad for a Japanese parent organization (2.28). The willingness to accept a foreign assignment was correlated with viewing a life goal of independence as highly important and a life goal of security as less important.
The spouse’s willingness to relocate, short-and long-term, was seen to be a function of individual, family, and organizational circumstances according to a questionnaire survey of 427 international managers and their 167 spouses by Konopaske, Robie, and Ivancevich (2003). A survey of 105 U.S. multinational firms by Tung (1979) suggested that the most important reasons for a PCN’s failure to function effectively in a foreign environment were: (1) the inability of the manager’s spouse and family to adjust to a different physical or cultural environment; (2) the manager’s inability to adapt to a different physical or cultural environment; (3) the manager’s emotional immaturity; (4) the manager’s inability to cope with the larger responsibilities posed by the overseas work; (5) the manager’s lack of technical competence for the job assignment; and (6) the manager’s lack of motivation to work overseas.
Hechanova, Beehr, and Christianson (2003) completed a meta-analysis of 42 empirical studies involving 5,210 PCNs and TCNs demonstrating that general, interactional, and work adjustment were predicted by self-efficacy. The mean correlations ranged from .27 to .41. Path analysis indicated that the three adjustments reduced stress and increased job satisfaction with the foreign assignment. Finally, job satisfaction and lack of stress both contributed to organizational commitment, job performance, and intention to stay.
PCNs can fail because their customary back-home autocratic or democratic style of leadership may be a poor match for the host culture (M. G. Harvey, 1996). Or they can fail because they erroneously adopt the wrong leadership style for the host country. For instance, probably because of their low estimation of the capabilities and discipline of their Melanesian host employees in Papua New Guinea, an Australian firm adopted a rational-economic, authoritarian, hierarchical leadership approach that was incompatible with traditional styles of Melanesian leadership. Performance and job satisfaction suffered, and the project had to be abandoned following large sunk costs (Ronen, 1986). In En gland, Holland, Belgium, and West Germany, most HCNs felt that to avoid failure, PCNs need to adapt their leadership style to fit the prevailing pattern in the host country, rather than to emphasize uniformity with the multinational parent country. PCNs need to understand the local nonverbal language and clients’ and employees’ expectations. A sore point is the larger benefit package often provided to the PCN than to HCNs (Zeira & Banai, 1981).
Stolin (1997) suggested that North American executives fail in selecting competent managers in Russia because the PCNs tend to choose those with whom they will be more comfortable, that is, those with a good command of En glish and a Westernized persona. Such managers may be less respected by subordinates than those who pursue a more Russian leadership style. For instance, in Canada and the United States, a manager’s delegation is seen as a sign of trust and confidence. In Russia, it is perceived that by delegating, the manager is avoiding the risk that he is imposing on the subordinate.
Repatriation. Most PCNs experience problems when in returning to their parent country. Positions similar to their status and responsibility abroad need to be found. Visibility and promotional opportunities in the home office may be lost while the PCN is away (Gregerson & Black, 1996). There may be a loss of autonomy, career direction, and a feeling that the foreign experience was undervalued (Scullion, 1992). Reintegration into the firm was seen as more difficult by most expatriates than the original move abroad (Linehan, 2001). Many chose to resign from the organization and take jobs with other firms (Black & Gregersen, 1998).
Conflicting National Values. Despite globalization and convergence, large differences in national values can be continuing sources of stress and conflict when managers work outside their own country. Japanese value patience, harmony, and hierarchy; Americans value action, freedom, and equality. According to an eight-country multinational survey of 2,514 senior managers, 50.4% rated their top-management teams as insensitive to internal issues within their corporation and 27.8% as divergent in vision rather than sharing in vision of internal issues (McMahon & Myers, 1995).
The newly arrived Japanese manager in the United States may be shocked by American social diversity, violence and crime, poverty and homelessness, inadequate service, hasty deal making, legal minefields, lack of spiritual organizational quality, individual careerism, narrow job focus, political confrontation, and employee disloyalty. The Japanese manager may also be shocked by American assertiveness, frankness, egoism, glibness, and impulsiveness (Linowes, 1993). I asked a group of Japanese managers working for various firms in New York City about their biggest surprise in their American assignment. They all said that they were most surprised by how the American experience had changed their wives.
Suggested Remedial Actions. A survey of 402 corporate employees with overseas experience concluded that selection based on interviews and psychological analyses of the candidates and their families is likely to be more useful in placing employees in foreign assignments than is depending on training alone to provide employees with the means to cope with cultural problems and communication barriers (Dotlich, 1982).
At the same time, a phenomenon that may help PCNs in a foreign assignment is the socialization process in shifting attitudes from the norms of the parent country toward the norms of the host country. For example, Lee and Larwood (1983) found that a sample of 33 U.S. expatriate managers in Korea shifted significantly closer to the mean of 105 native Korean managers and away from the mean of 74 U.S. managers in the United States in favoring more nonmaterialism, less materialism, more security, less achievement, less competition, more reflectiveness, less activity, and more subjectivity in relationships.
Expatriate managers agreed that the adaptability of families, interpersonal and leadership skills, and technical and language competence are required for the success of PCN managers. They also pointed to the importance of respect for the laws and people of the host country (Gonzalez & Negandhi, 1967). In a policy-capturing analysis, Russelli and Dickinson (1978) identified, from among 75 attributes, what it takes to be successful in work in other countries: the acceptability of the assignment to the candidate and the family, skill in interpersonal re lations, skill in planning and organizing, and linguistic and technical ability. Thirty-nine upper-middle managers in international divisions of their companies used these attributes to judge 60 profiles, half of which were of candidates for jobs in hardship posts, the other half in relatively comfortable foreign assignments. The acceptability of the assignment to the candidate and the family weighed more heavily in the decisions of the 39 managers than all the other attributes. Skill in interpersonal relationships weighed more heavily than skill in planning and organizing, proficiency in the language of the host country, and technical ability. Adaptability weighed more heavily than did technical ability and proficiency in the language of the host country.
Staffing with HCNs. A survey of PCN West German male middle managers in a German multinational corporation found them likely to doubt the competence of their HCN subordinates (more particularly in Latin America and Europe, rather than in the United States) but not the competence of their own peers or supervisors (Miller & Cattaneo, 1982). Consistent with this finding, more HCNs are used in developed countries than in developing countries, where qualified HCNs are less readily available. Nevertheless, when efforts are made to locate, select, and train HCNs, dramatic increases can be achieved in the percentage of HCN managers in a developing country, as was illustrated by Nestlé, the Swiss multinational firm, in its Ivory Coast subsidiary (Salmons, 1977).
Multinational firms can attract potentially more productive and accommodating types of HCNs into their ranks than can comparable domestic firms. For example, Vansina and Taillieu (1970) showed that highly task-oriented Flemish business school graduates preferred to work for U.S. or German companies than for their own Belgian organizations.
North American and European multinationals employ HCNs at all levels of management, particularly in developed countries. The reasons for management staffing with HCNs include familiarity with the culture, knowledge of the local language, reduced costs, and good public relations (Tung, 1979). TCNs are most likely to be used as a consequence of their competence and technical expertise. PCNs, likewise, are selected for technical competence and are more likely to be used when starting up a foreign enterprise.
Japanese multinationals are most likely to continue to employ PCNs for top-and middle-management positions in their foreign operations (Tung, 1982), in the belief that HCNs or TCNs will not be able to understand, transmit, and maintain the desired organizational culture and policies and communicate easily with the Japanese home office. However, the interest of U.S. multinational corporations in the local employment of HCNs, rather than PCNs, has increased, and their interest in training PCNs for work abroad has decreased. It is uncertain how this change in interest will influence the movement of local HCNs into the headquarters offices and into top-management positions (Latham, 1988), but it does suggest that fewer U.S. PCNs will be able to have experience in foreign assignments as they move up the corporate ladder—an important aspect of management development in any firm in the global market for suppliers and customers. In the long term, developing HCNs as managers is less expensive than continuing to depend on PCNs abroad, but it requires good communications, decentralization of decision making, and prospects of career advancement similar to those enjoyed by PCNs, thereby making the multinational more attractive to HCNs (Rosenzweig, 1994).
The exponential increase in cross-cultural research in leadership in the past 25 years led Dickson, Den Hartog, and Michelson (2004) to suggest that it would be impossible to cover the topic with one chapter. I have tried and hope I did not leave out too much. Although internationalization proceeds apace as we become a unified global economy, cultural and national differences affect leader-follower relationships. Nevertheless, there is considerable universality in traits, origins, and requirements for leadership.
Countries and cultures can be clustered to provide the bases for useful classifications. The unit of study one uses to examine how nationality and culture affect leadership may be clusters of countries with cultural affinities, individual countries within the same or different clusters, and subgroups within countries. Different conclusions may be reached, depending on which unit is used. The cultural dimensions of consequence to leadership in a given society include traditionalism, particularism, collectivism, and idealism, compared to modernity, universalism, individualism, and pragmatism. In the same way, the needs for achievement, affiliation, and the power of subordinates and supervisors have different effects on leader-follower relations in different cultures. The meaning and practice of styles of leadership such as participation differ considerably when studied in China rather than in Britain or France.
Although some argue that there is one best way to manage, considerable evidence points to the greater effectiveness of autocratic leadership behavior in authoritarian cultures and of democratic leadership behavior in democratic cultures. The same is seen for direction versus participation, task orientation versus relations orientation, and initiation versus consideration. Within the multinational firm, leader-subordinate relations will be affected by whether the firm is ethnocentric, polycentric, or geocentric and whether the individuals involved are from the parent country of the organization, the host country, or a third country. The success rate of managers in foreign assignments can be improved considerably by assessment and training, as will be discussed next for leaders in general.