Characteristics of effective leaders in rapidly developing economies

¶ … Leaders Rapidly Developing Economies

The success of any type of organisation, especially the ones functioning in the area of business depends upon the quality of their management. Changes in the latest period have turned leadership into one of the key resources in all the environments where achieving profit -- regardless of its form- is the goal. In other words, the old management skills are no longer sufficient, they need to be accompanied by leadership traits. Under these circumstances, it is only natural to wonder which are those characteristics which once acquired turn a good manager into a leader. A further question which arises regards the fact whether the leadership characteristics are the same in all cultural contexts and if they can be applied to any individual wishing to achieve the status under discussion.

Background information

If it is true that in the context of globalization the human resources are the final element which help differentiate the final result of a company's functioning, it is just as true that the coordination and the proper motivation of these resources is among the responsibilities of the organisation's leaders. Therefore the role of the leaders (not of managers) can be viewed as that of the central engine, constantly giving fuel to the entire machine. Research done in the area has suggested that in a borderless world such as the one in which we live today, the traditional management skills have become insufficient and self defeating. The change which has occurred is not one that has to do with form, it is a deep paradigmatic shift. As far as the characteristics which this thinking paradigm considers to be indispensable for the leader figure, generally these include: superior human skills ( we underline the shift of attention from the technical to the human dimension), having a vision, honesty and integrity, team building skills and a global outlook.

Why is the research needed

While numerous theories and research studies have been produced in the areas of marketing and management in this regard, it is not clear yet what are the psychological traits which support an individual to become a leader. I believe that some investigation is needed in order to understand which are the traits of leadership in the business environment. The issue is apparently simple, but the conclusions of the already existing research seem to suggest otherwise. It is clear that leaders react differently from non-leaders when faced with the exact same situation. however, leaders which are forced to act under different circumstances will use different instruments and characteristics. At this point it is safe to wonder if there can be such a thing as leadership traits which can be applied at an universal level or we must deal with the issue only based upon particular situations.

Theoretical framework

As far as the psychological traits of leadership are concerned, there are eight major theories which the research could analyze in depth as a starting point for further development. These are: the "great man" theories, the trait theories, the contingency theories, the situational theories, the behavioural theories, the participative theories, the management theories also known as transactional theories and the relationship theories.

The "great man" theories assume that leaders are born and not made. They portray the leadership figures as having mythical dimensions and occurring whenever they are needed. These theories ought to be compared and contrasted with the conclusions of research in the area of management in order to understand if its use is a relevant one.

The trait theories state that there are some characteristics which make some people more suitable for the leader position than others. These traits are believed to be inherited. Research in this regard is interesting because it is based on observational methods having leaders at their centre. However, these theories fail to explain why different people, although sharing the same traits do not have the same leadership status.

The contingency theories are concentrated on the various contingencies which can influence the characteristics of leadership. According to them, there is no such thing as an universal leadership style that people can apply all through the world, regardless of the situation. On the opposite, different situations request different skills that will turn one into a leader in that particular circumstance. These theories can be further analyzed in order to support the present research, although they are probably no likely to give us a decisive answer.

Situational theories state that the most important characteristic of leaders is to recognize the solution which can be implemented in the best manner in order to solve the problem- according to the situation. Since leadership and the process of decision making are strictly connected, it is safe to say that these particular theories might also be helpful for the present current.

Behavioural theories sustain the opposite of the "great man" theories, that is that great leaders are made and not born. Under these circumstances, the educational processes as well as the cultural environment where one lives are important factors in determining whether one will or will not become a leader. If people can learn to be leaders, this means that the leadership characteristics are available for learning themselves, through observational means. Further analysis in this regard can help us understand if one can learn behaviour patterns in a manner which is so profound that it will allow these characteristics to become his own personal thinking patterns.

According to the participative theories, situations end up having great results not because of the individual actions of the leaders, but because of the contributions of all the people involved. Under these circumstances, the most important characteristic of the leader figure is that of being able to stimulate group members, to make them feel important, to make them want to be part of the decision making process. In the context in which the human resources have become a strategic component of the company's functioning, it is easy to understand that the better motivated and stimulated they are, the better they will function (hence the importance of the leaders and their traits). What are the traits which can support the above mentioned characteristics? A further development of this research area could demonstrate useful for the present research attempt.

Management theories focus basically on the performance level of the groups. They are interested in the instruments which group leaders use in order to achieve the successful functioning of their team and the fulfilment of their goals. Since this research area is concerned mostly with the punishment and reward system which leaders often use, I do not believe that a deeper analysis could be helpful for the purpose of our paper.

2. The issue

Authors suggest that the leader figure can be recognized to have the following traits: he must have self-confidence and be able to inspire the others to have it, he must have efficient coaching skills as well as empathic listening skills. In addition, he must be visionary, inspiring, have the capacity to focus upon long-term objectives and to maintain consistency between what he says and what he does. Since team play is essential, the leader must also be able to maintain balance between the needs of the individuals and the ones of the team. Creativity, but also awareness of realistic conditions are other relevant traits. Furthermore, strong self-esteem, a sense of priorities, service mentality, honesty, technical or contextual expertise, trust and the willingness to share both responsibility and credit or recognition are traits which enhance the leadership condition. We can notice that the previous research in the area takes for granted the fact that leaders are comfortable with their roles and have no trouble fulfilling them. The purpose of the leaders is to bring about change. One of the goals of the paper is to understand the attitude that a leader must have towards change. In addition, the existing theory seems to suggest that leaders are leaders in any type of environment. Under these circumstances, must one understand that an essential leadership trait is the ability to work in unfamiliar environments? If such be the case, then must we also conclude that leaders are highly competent when it comes to understanding different cultures.

3. The purpose of the study

The purpose of this study is to establish whether the western ideas regarding leadership translate to rapidly developing economies. In order to support the research reach its final goal, we will bring under analysis those characteristics which the effective leaders who work in rapidly growing economies are known to be endowed with.

4. Literature review

"Think global, act local" is a slogan which both managers and leaders have been forced to learn in the past years. The abolition of the borders through the globalization process has turned the world into an gigantic market. However, this does not mean that all its inhabitants are homogenous. On the contrary, the cultural differences exist and they have a strong impact upon commerce. The local community is one of the most important stake holders. This is why leaders must have a good comprehension of the local realities, in order to be able to properly communicate with them. There are research studies about knowledge management and local knowledge which the present research must take into consideration. However, judging from the information which is available online, it is safe to say that this is a research area which still needs to be worked upon. The studies which already exist are limited to describing local needs in small communities through the world and the manner in which leaders of various types have reacted to them.

Cultural competencies refer to those skills and behaviours which allow an individual or an organisation to work in an efficient manner in a cross cultural environment. The mechanisms through which such a process becomes possible include understanding, appreciating, honouring and respecting both the similarities and the differences encountered between cultures. Again, the existing literature focuses mainly upon very specific case studies which are often based upon cultural situations which are located outside the United States. Analyzing these studies might help us come up with some conclusions. It would be interesting to test these conclusions against the western cultural environment in order to see their validity.

From what we have said so far, one might read between the lines that leaders are leaders because they are able to work comfortably in unfamiliar environments. What does this imply? We could assume that they either have a powerful capacity of understanding any type of environment and its thinking pattern or that they have the capacity to work in environments which remain hostile (or both). The literature addressing these issues is limited and the information available most often deals with conflict management. Under these circumstances, it would be interesting to see which are those characteristics that allow one to deal with unfamiliar tasks in the absence of fear. Diversity may be a positive factor, just as it could be a source of risk, according to the online literature. Managing diversity, preventing conflict and knowing how to smartly put an end to it are all aspects that the present research must deal with in depth.

A further point that we must deal with is represented by the capacity that is often attributed to leaders-that of being comfortable with change. "Leadership and change" is a very popular research theme and there is a lot more information regarding it compared to the three areas mentioned above. What all the studies agree with is that organizational change is here to stay and that some sort of model of organizational change is needed in order to deal with an environment in which stability has become a relative utopia. This model is not a fix scheme, but is made of beliefs, perceptions, intuitions and personal values. Therefore it is safe to say that creativity as well is part of the process under discussion. If leadership is supposed to be change-centred, under the circumstances in which both products and processes are affected, are there traits or actions which can be thought of as efficient for all the leadership styles?

5. Questions and hypotheses

One of the hypotheses that we will attempt to verify is that good leaders rely upon local knowledge and cultural competence. A further hypothesis that we will try to verify is that efficacious leadership skills must include factors such as comfort with working in unfamiliar environments, pace or being comfortable with change. The contemporary conditions in which leaders must undergo their activity suggest that these two hypotheses are valid.

6. Methods and procedures

The methods that we will use within the present research project are mostly analytical. The project is based upon a large amount of information from the areas of management, marketing, but also psychology. This information will be studied, discussed, analyzed and its conclusions will be correlated if possible. The purpose is to be able to come up with some concrete conclusions which can afterwards be practically applied to the field of leadership. Leaving aside the contemporary context of the crisis which started in the U.S.A. And then spread throughout Europe, we can say that the American economy has been a thriving one. Although change has never been such a present factor as it is today, it would be interesting to find out what top managers from the U.S. (but also from other countries) have to say about the issue. Under these circumstances the analytical method is no longer enough and other further investigative instruments will be needed.

7. Instrumentation -- surveys, interviews

As far as the instrumentation needed for the success of the present research project, it includes both surveys and interviews. Both instruments will be conceived in the best possible manner in order to address the manner in which top managers who believe themselves as leaders relate themselves to issues such as the need for local knowledge, cultural competencies, comfort with working in unfamiliar environments, comfort in dealing with change. While the surveys can provide quantifiable data, helping us to create profiles and also obtain insight regarding leadership styles and traits which they might have in common, the interviews will help us understand if the personal background of the interviewed played a fundamental role for the acquisition of his leader status, for the manner in which he reacts to the issues under discussion- and how.

8. Data analysis

The analysis of the data will be descriptive, correlative, interpretative. The descriptive part is needed in order to eliminate ambiguities and to clearly state which are the fundamental concepts that the final interpretation will be based upon. The correlations are needed in order to make relevant connections between data coming from various fields of study. Scientific literature will be used and also case studies of they are available. All the information will be connected with the conclusions reached through the use of the afore mentioned instruments.