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Challenges Faced by the Multinational Companies- Leadership Dimensions continued (part 4 of 4)

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© 2017 Martin Zafirov, PhD Student, New Bulgarian University (F29144)

Edited by: Yara Mohamed, Mona Timor Shehata

Published by: Ahmed Mohamed Hassan

The necessity of comparative studies of management in the different cultures sets new areas of interest in the analysis of the intercultural business environment and its impact on the organisation. Cultural differences – knowing them, assessing them and taking them into account, are extremely important in achieving effective management of the human capital. The main problems which arise in organisations with different cultural discourse are related to overcoming ethnocentrism (the tendency and mindset to assess a culture only based on the standards of your own culture) and the reaction to the culture shock.

The conditions in the multinational companies and especially the specific characteristics and requirements of the human capital make the issue of the leadership in these companies one of the most important ones for them. It is not possible to build an effective leadership which would lead to effective management of the human capital in a multinational company if the leaders rely only on getting to know the cultural values, stereotypes and cultural trends in this company. It is necessary to apply this knowledge in the actual operation of the company by using different management models and methods for employee motivation for achieving optimal efficiency in the work process. The following table shows in a summarised form the main management tools, approaches and models depending on the reference boundaries of the cultural dimensions based on the Geert Hofstede’s model[1].

 

Table 1: Main management tools, approaches and models for the different boundaries of the cultural dimensions according to Hofstede

Dimensions Low values High values
Power distance – Flat organisational structure

– Most-effective management approaches are used in team activities;

– Efficiency is achieved by adding more persons to the decision making process

– The organisational structure is most efficient when there is a centralised power and clear hierarchy;

– Management from position of power;

– Answers and responsibility are to be found at the high organisational levels.

Individualism versus Collectivism – Harmonious relationships are valued more than honesty;

– Age, traditions and wisdom should be respected;

– Implementation of changes should be done slowly;

– Feelings and emotions are repressed in order to preserve harmonious relationships.

– Punctuality and personal freedom are highly valued;

– Challenges and remunerations for a job well done are a strong form of motivation;

– One of the effective management tools for revealing of potential is encouraging discussions and expression of original ideas as well as acknowledgement of the achievements.

Masculinity versus Femininity – Effective management depends on the equality between men and women;

– Women are capable of doing anything men can do;

– Positions and work relations are organised in a way as to not discriminate against any of the two genders.

– There is an inclination to separate into male and female roles;

– Effective management is achieved based on this;

– Behaviour should comply with the stereotype: Analytical attitude and reservedness by the men, emotionality and expressiveness for the women;

Avoiding Insecurity – Informal business relations;

– Inclination towards changes;

– Effective management is a management which does not create structures and rules unnecessarily;

– Control of the emotions, self-restraint;

– Variety is valued.

– Effective management is based on precise and clear expectation parameters;

– Planning is an important part of the management tools;

– Frequent communication and detailed plans;

– Focus on the tactical part of the project;

– Emotions are expressed through gestures and intonation;

– Structure is desirable and expected;

– Formal business relations, requirements and procedures.

Long Term Orientation versus

Short Term Orientation

– The successful management strategy acknowledges the equality of all;

– It stimulates creativity and individualism;

– Mutual respect;

– Adaptivity towards changes;

– Setting short term goals.

– The family and the family type relationships form the base of society;

– Successful management is based on the traditional positions;

– Acknowledgement and reward for loyalty, stubbornness and dedication;

– Frivolous and extravagant behaviour is not tolerated.

The dynamic world with all the changes happening in it lead to the rise of a new generation of leaders. The main characteristics of this type of manager are presented in Johnson and Oberwise’s article “Your #1 Leadership Challenge: Human Capital Maturity”[2]. According to the authors, it is about the rise of a new type of manager in the big companies (especially the multinational ones), whose experience is totally different from the one of the leaders of the previous years. The claim of the authors about the rise of this type of new leaders mostly in multinational companies seem completely logical, because this is exactly where there are many cultural and value differences regarding the human capital which require the most effective and adequate management.

If we look for the main difference between the new generation of leaders and the ones from the past, undeniably it is that leaders nowadays work in an environment quite different from the one in the past. The main reason for the change in environment is the accelerated globalisation which causes the need for global leadership. The authors of the article claim that most of the managers have to deal very early in their career with the necessity of working with teams whose members are located very far from their homes. So in order to be effective leaders should quickly become aware of and master a concept which is still unknown for the vast majority of current managers, namely human capital maturity.

Human capital maturity may be related to the employees possessing three important attributes (qualities): savvy (rational) understanding of the business, high emotional intelligence and a strong aptitude for continued learning. Even though it may be summarised this way, it should not be forgotten that the concept of human capital maturity may appear in different forms depending on the conditions in which it is applied. Studies show that there are stable differences in the work forces between some economies, relating to how the work force works productively in organizational settings.

This it is extremely important for management based on this concept to clearly take into account the existing stable differences. The existence of stable differences, which was mentioned by Johnson and Oberwise, should be explored not only in the context of the individual countries, but also in the context of the intercultural (cross-cultural) differences which exist between the human capital in multinational companies. In relation to that, in the future the new generation of leaders and managers will be expected to achieve high results and high quality performance no matter where their workplace is located. It is necessary to get to know the many existing variations of human capital maturity and this has nothing to do with the claim that a large part of the employees in some economies are psychologically immature. In some areas of business activity the maturity model is related only with taking into account the fact that the abilities of the employees are built gradually over time, step by step.

Actually, it is possible to make a wrong read too (to reach a wrong understanding) about the strong sides of the maturity concept in each of the mentioned areas. For example, the authors mention cases in which employees may be unusually empathetic and communicate clearly and even eloquently, but at the same time they are so used to showing respect for their bosses and for traditional methods that they are averse to learning new ways of doing things.

According to the author of this paper, even though nowadays the human capital maturity concept is gaining in popularity it still has not reached the necessary level of development and awareness. If the education and development programs should be evaluated on a global scale this evaluation will show that they are not at the required level which would give the leaders enough training on how to evaluate human capital maturity. This conclusion is exactly what gives a reason to formulate one necessary direction for future improvement of the management activity at multinational companies.  During the current stage as a step in this direction may be pointed out that even just the action of becoming aware of the existence in differences in human capital leads to significant changes in the management process.

Johnson and Oberwise give two more pointers for successful work at multinational companies, which in my opinion are useful to the leaders and respectively lead to increased efficiency of the business activity in these companies. The first advice is based on the specific characteristics which become apparent in the process of working in a team made of members from different countries and respectively different cultures. In order to optimise the work process it is not enough to just get in touch (meaning establishing a way to communicate – with or without a translator). It is also crucial to understand cultural nuances which impact the quality of the human capital and its capability of working as a team within a multinational company.

In this case, in my opinion, it is not always necessary to use the services of a professional translator, if it is even necessary to use such for performing the communication. Regardless, a good approach would be to use an associate who knows well the cultural specifics of the region where the affiliate of the multinational company is located and respectively the human capital used by it. This is the only possible way of overcoming the differences which arise when combining human capital with different cultural specifics. This would lead to a significantly easier performance of the duties of a leader and an improvement of the end results of the business activity of the company.

The second advice is partly intended to reduce the negative impact of conducting inefficient communication i.e. a discrepancy between expectations and reality. When there is a difference between what the employees should be able to do based on their experience and expertise and what they actually do, it is a clear signal for the manager that it is necessary for some time to be spend on finding the causes which lead to this discrepancy. According to the authors, there are quite a few leaders who believe that these differences are due to a lack of sufficient communication on the part of the employees or a lack of quality communication between the manager and the employees. But it turns out that these are only a few of all the possible causes for the creation of this difference. In my opinion, if we have to look for another reason for this occurrence, it is undeniably related to the fact that the companies in question are multinational ones in which in almost all cases there are cross-cultural differences present in regards to human capital.

If the issues regarding human capital maturity as a leadership concept are explored from another point of view, and the results show that nowadays in order for organisations to develop their leadership they should make an effort to also include this concept as a base for improving the qualification and expanding the qualities of the managers working in a time of globalisation and an increasing number of multinational companies. Global leaders with a more realistic understanding of what to expect from their employees in the different environments will be much better prepared to improve their efficiency and respectively the efficiency of the company.

The thoughts presented so far show that successfully identifying, developing and maintaining the talent of the managers has a decisive impact on the long term success of every organisation, including multinational companies. This is why many of them, especially the largest ones, depend on “talented management” during the whole work process. This means hiring such managers who possess leadership qualities which will lead to a successful coordination of their actions with the actions of the departments responsible for the human resources of the company.

In his article “You Can’t Delegate Talent Management to the HR Department”, Ron Ashkenas explores the need for these so-called “talented leaders” or “talent management leaders”. According to Tomas Chamorro-Premuzic, talent concerns the abilities, skills, and expertise that determine what a person can do. These talents enable those managers among the company’s roster who manage to implement processes thanks to which they are able to receive a direct assessment of the quality of the human capital and the possibilities for its improvements and at the same time to improve the concept of increasing the talent of the leaders themselves.

The author of this report accepts Ashkenas’s claim with no hesitation whatsoever because it is not possible and it is also inappropriate to demand development of the human capital in a multinational company without at the same time seeking a way to increase the efficiency of the system which manages and coordinates the actions of the company’s employees.

The article mentioned above also presents another important question which is an integral part of the explored question. As mentioned above, “having a talented leader” becomes a strategic advantage for every multinational company (and also for the other types of companies). Because of this, a decision to organise a company in such a way that the managerial decisions are made by a centralised body consisting of such talented leaders may be considered to be a successful one. The centralised function allows for an in-depth and objective look at the talent of the company’s employees and makes it easier to implement the decisions which had been made.

Investments in building a centralised managerial structure based on talented managers have lead to mixed results. According to a CEB survey from 2013 “in only one out of four organisations there is a successful integration of the talented managers practice when executing the strategic goals of the company.” A survey conducted by EY in 2012 reached the conclusion that almost 600 of the global business managers think that the functions of the talented management are limited to only measuring “easy indicators” like employee turnover. At the same time, such important factors for the organisation as whether the right persons possessing the necessary skills works at the correct (suitable) position remain outside the main focus.

My personal opinion is in agreement with the stated conclusion since it is quite possible for the lack of accurate human resource management (meaning accurate assessment of their qualities and capabilities and based on that wrong selection of a work position) to lead to much worse results than the high employee turnover.

 

List of References:

  • Hofstede, G., (2006) Cultures and Organisations, Sofia, KlasikaiStil, 2001
  • Johnson, B. and R. Oberwise, Your #1 Leadership Challenge: Human Capital Maturity, published on: 26 January 2012, available at: https://hbr.org/2012/01/your-1-leadership-challenge-hu
  • Chamorro-Premuzic, Т., Talent Matters Even More than People Think, published on: 4 October 2016, available at: https://hbr.org/2016/10/talent-matters-even-more-than-people-think
  • [1]Geert Hofstede., Cultures and Organisations, Sofia, KlasikaiStil, 2001
  • [2] Johnson, B. and R. Oberwise, Your #1 Leadership Challenge: Human Capital Maturity, published on: 26 January 2012, available at: https://hbr.org/2012/01/your-1-leadership-challenge-hu

Articles

Wellbeing @ Work Summit Middle East 2021 – where balance, resilience and authenticity break the Mental Health Stigma

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Written by: Cinzia Nitti

Globally, 2020 has been a year like no other. Coronavirus pandemic caused a massive business disruption; transformation has been key in supporting employees and catalyzing workplace changes. There was a rush to adapt and reinvent Business Models. Organizations had to rethink and reconsider how they deliver services and strengthen their Organizations through a forward-thinking Digital strategy. To be more agile and responsive in such uncertain times, we need to respond to challenges and adapt quickly to new scenarios by moving from rigid hierarchies to leaner and more flexible structures.

But what about Mental Health at Work, and why is it essential?

What’s the Office of the Future?

Within the Wellbeing @ Work Summit Middle East 2021, HR Leaders tried to normalize the conversation about Mental Health by putting the topic first, enabling self-care and professional support, raising awareness, and building knowledge around its related issues. Nowadays, personal and work life are more intertwined than ever, so it becomes vital to create balance: the more employees feel free to talk about Mental Health, the more they can prevent struggle and breakout at the Workplace. HR leaders play a crucial role in making an IMPACT by pushing new solutions, promoting work-life balance, redesign workloads, and supporting their Teams.

In this general frame, Irada Aghamaliyeva (MENA Diversity, Inclusiveness & Wellbeing Leader at EY) affirmed: “Workplaces that are inclusive foster enhanced employee wellbeing; employees with high levels of wellbeing are more inclusive”. How can Organizations increase employees’ resilience and embed sustainable Leadership behaviors in the post-covid reality?

Dr. Irada Aghamaliyeva introduced the Mindfulness practice in the Workplace and highlighted its benefits on a large scale: improved wellbeing and resilience on a physical level; positive emotions, self-regulation, empathy and awareness of social dynamics; learning and innovation thanks to the implementation of flexible thinking, intuition and problem-solving processes. So breaking the stigma is possible, starting from personal wellbeing to sustain positive energy and fuel resilience.

About the Power of Empathetic and Authentic Leadership, Dr. Rima Ghose Chowdhury (EVP & Chief Human Resources Officers at Datamatics Global Services) stresses the importance of Leadership roles today. The virtual environment employees are working in, makes them more vulnerable due to a lack of balance between emotional and authenticity traits. Authenticity is the primary factor in effective leadership, regardless of the leadership style. Putting employees first as a strategic priority and hearing their voices to guide strategy; embracing agility to work more effectively in tumultuous time; including a multigenerational work-force: these are the key concepts within Dr. Rima’s motto “Empowering is to enable”. Through motivation and filling emotional support needs, the Empowering Teams Process leads to employees’ safety, esteem, and self-actualization. 

The Wellbeing @ Work Summit delivers strategic direction, advice and inspiration from employers and experts from across the world to help you create a more compassionate corporate culture that delivers results. To know more about the FOW Future of Work Insights platform around the world, click here: https://fowinsights.com/

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The Wellbeing @ Work virtual Summit Middle East returns for its 5th annual event on 22-24 February 2021

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The summit provides an innovative and experiential virtual learning opportunity for our audience of CEOs, benefit and reward business leaders and senior HR professionals. The information and knowledge gained from attending this event allow the opportunity to make strategic wellbeing and mental health decisions within an organization, supporting our mission to create more flourishing and thriving workplaces. Never before has the mental health and wellbeing of your employees been so important. The Wellbeing @ Work Summit includes keynote speeches, panel discussions, workshops, and fireside chats alongside unrivaled networking with leaders across the Middle East using our AI-enabled matchmaking platform. This is far more than a webinar! An engaging 3-day event providing you invaluable insight and tools to create thriving workplaces.

Key Reasons to Attend:

  • An engaging AI-enabled matchmaking platform to make invaluable connections & host virtual meetings up to 2 weeks before the three-day festival
  • Learn how multinational organizations are creating workplaces where employees thrive in the new world
  • Campfire panel discussions informing workplace change & mental health solutions
  • Middle East-based employer case studies providing the secrets to employee wellbeing success
  • International experts bringing best-practice from across the globe
  • Invaluable networking with business leaders from across the Middle East

The Wellbeing @ Work Summit delivers strategic direction, advice and inspiration from employers and experts from across the world to help you create a more compassionate corporate culture that delivers results. The design and implementation of a holistic wellbeing and mental health programme that delivers healthy outcomes and a more productive organization is paramount right now. 

In addition, the results of the extensive Middle East region-wide survey on wellbeing and mental fitness in organizations across the region made in partnership with Cognomie will be presented during the event.

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DECODING FUTURE HR: Global 24 hour virtual event | 19 and 20 January 2021

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DECODING FUTURE HR: Today’s challenges are tomorrow’s trends and opportunities

Global 24 hour virtual event | 19 and 20 January 2021

www.decodinghrevent.com

The world in 2020 has changed to a ‘new normality’ but what’s that ‘new normality’ everybody talks about? Is it here to stay? How is it affecting us in our daily lives in the different versions of ourselves? As a customer, an entrepreneur, a parent, a friend…a worker…

Our job is a key part of our lives and we are indeed living through a fundamental transformation in the way we work. Automation and ‘thinking machines’ are replacing human tasks and jobs, and changing the skills that organisations are looking for in their people. These momentous changes raise huge organisational, talent and other HR challenges. It has become clear that few organisations are likely to revert to pre-pandemic practices even after a vaccine is found.

Decoding Future HR 2021 is bringing you the ideology of how today’s challenges are becoming tomorrow’s trends and opportunities resulting in HR excellence.

Why you should attend:

  • Learn about the trends and best practices shaping future HR
  • Get valuable insights from expert speakers
  • Share ideas and research to help your organisation reach its goals
  • Understand what do employees want in ‘New Normal’
  • Develop new vision for HRBP and Centre of Expertise
  • Identify, integrate and understand stakeholders to create an intentional employee experience
  • Approaches and elements to leadership development.

Some of our confirmed speakers:

  • Tshepo Yvonne Mosadi , Human Resources Director, The HEINEKEN Company
  • Sarah Tabet, Global HR Director/ D&I Leader | Author for “Inclusion Starts with U”, Schneider Electric
  • Wadah Al Turki, Country Talent Manager KSA and Bahrain, IKEA
  • Lesha Chakraborti, Head of HR – EMEA, Travelex
  • Shaban Butt, Director HR & Administration, The Coca-Cola Company
  • Sajjad Parmar, Head of Rewards – APAC, eBay
  • Katey Howard, VP, Talent Management AMESA, Pepsico
  • Chen Fong Tuan, HR & General Affairs Director, Samsung Electronics
  • Prerna Ajmera, Senior Director, HR Experiences and Solutions, Microsoft
  • Václav Koranda, Vice President Human Resources / Member of the Board of Directors, T-System
  • Amy MacGregor, VP Employee Experience, Global HR, Manulife
  • Adwait Kashalkar, People Analytics and Programme Management Leader, APAC, Mastercard

Click here to view all speakers: www.decodinghrevent.com/speakers

At Wisdom we remain positive that ‘normality’ will soon return and that we will be able to physically meet together once again as speakers, delegates and sponsors at our beautiful venues around the world. But meanwhile, life continues and we need to keep in touch and learn from each other. This 24-hour virtual event will be of great benefit and value to your businesses and its continued development during these challenging times. While this virtual event comes at a lesser cost, it provides for now a wider reach into an international audience, with flexibility of access to content as well as allowing you to have the same opportunity as at a face-to-face session for one-to-one business meetings. We look forward to welcoming you in January.

Date and time: 19-20 January 2021Where: Virtual engaging platform
  Further information and bookings: www.decodinghrevent.com        Contact:
marketing@wisdom.events   #WSDM_BI
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