2006 Javidan, Dorfman, Sully de Luque, and House 67 In the Eye of the Beholder: Cross Cultural Lessons in Leadership from Project GLOBE Mansour Javidan, Peter W. Dorfman, Mary Sully de Luque, and Robert J. House* Executive Overview Global leadership has been identified as a critical success factor for large multinational corporations. While there is much writing on the topic, most seems to be either general advice (i.e., being open minded and respectful of other cultures) or very specific information about a particular country based on a limited case study (do not show the soles of your shoes when seated as a guest in an Arab country). Both kinds of information are certainly useful, but limited from both theoretical and practical viewpoints on how to lead in a foreign country. In this paper, findings from the Global Leadership and Organizational Behavior Effectiveness (GLOBE) research program are used to provide a sound basis for conceptualizing worldwide leadership differences. We use a hypothetical case of an American executive in charge of four similar teams in Brazil, France, Egypt, and China to discuss cultural implications for the American executive. Using the hypothetical case involving five different countries allows us to provide in-depth action oriented and context specific advice, congruent with GLOBE findings, for effectively interacting with employees from different cultures. We end the paper with a discussion of the challenges facing global executives and how corporations can develop useful global leadership capabilities. Impact of Globalization lmost no American corporation is immune from the impact of globalization. The reality for American corporations is that they must increasingly cope with diverse cross-cultural employees, customers, suppliers, competitors, and creditors, a situation well captured by the following quote. A So I was visiting a businessman in downtown Jakarta the other day and I asked for directions to my next appointment. His exact instructions were: Go to the building with the Armani Emporium upstairsyou know, just above the Hard Rock cafeand then turn right at McDonalds. \"I just looked at him and laughed, \"Where am' I?\" Thomas Friedman, New York Times, July 14, 1997 Notwithstanding Tom Friedman's astonishment about the global world in Jakarta, the fact is that people are not generally aware of the tremendous impact that national culture has on their vision and interpretation of the world. Because culture colors nearly every aspect of human behavior, a working knowledge of culture and its influences can be useful to executives operating in a multicultural business environment. It is a truism by now that large corporations need executives with global mindsets and cross-cultural leadership abilities. Foreign sales by multinational corporations have exceeded $7 trillion and are growing 20 percent to 30 percent faster than their sales of exports.1 But while the importance of such business grows, 85 percent of Fortune 500 companies have reported a shortage of global managers with the necessary skills.2 Some experts have argued that most U.S. companies are not positioned to implement global strategies due to a lack of global leadership capabilities.3 *Mansour Javidan is professor and director of the Garvin Center for the Cultures and Languages of International Management at Thunderbird, The Garvin School of International Management in Arizona. He is on the board of directors of the GLOBE (Global Leadership and Organizational Behavior Effectiveness) research program. Contact javidanm@t-bird.edu Peter W. Dorfman is a full Professor in the Department of Management, New Mexico State University. Contact: pdorfman@nmsu.edu Mary Sully de Luque is an Assistant Professor of Management and a Research Fellow at Thunderbird, The Garvin School of International Management. Contact: sullym@t-bird.edu Robert J. House holds the Joseph Frank Bernstein endowed chair of Organizational Studies at the Wharton School of the University of Pennsylvania. Contact: house@wharton.upenn.edu 68 Academy of Management Perspectives How can companies best use the available information for executive development and, moreover, what is the validity and value of such information? U.S. and European executives have plenty of general advice available to them on how to perform in foreign settings. During the past few years much has been written about global leadership, including several books.4 Journals are also getting into the global action as seen in The Human Resource Management Journal which recently published a special issue on global leadership.5 Nevertheless, in a recent review of the literature, Morrison concluded that despite the importance of global leadership, \"relatively little research has thus far been carried out on global leadership characteristics, competencies, antecedents, and developmental strategies.\"6 Advice to global managers needs to be specific enough to help them understand how to act in different surroundings. For example, managers with an overseas assignment are frequently exhorted to have an open mind and to show respect for other cultures.7 They may also be told of the importance of cross-cultural relationship management and communication. Some will wrestle with the idea that they need to develop a global perspective while being responsive to local concerns.8 Or they may wonder if they have the \"cognitive complexity\" and psychological maturity to handle life and work in a foreign setting. And they are likely to hear or read that they must \"walk in the shoes of people from different cultures\" in order to be effective.9 There is nothing wrong with such advice, and the scholars and writers who proffer it have often been pioneers in the field. But it is insufficient for a manager who is likely to assume, mistakenly, that being open minded in Atlanta, Helsinki, and Beijing will be perceived identically, or that walking in someone else's shoes will feel the same in Houston, Jakarta, and Madrid. Because of the lack of scientifically compiled information, businesspeople have not had sufficiently detailed and context-specific suggestions about how to handle these cross-cultural challenges. This is a particular problem for those in leadership positions. Although there are universal aspects of leadership, information about which will be presented February shortly, people in different countries do in fact have different criteria for assessing their leaders.10 The issue for the American manager is whether the attributes that made him or her successful as a leader in the United States will also lead to success overseas, be of no value or, worst of all, cause harm in the foreign operation. Using the findings from an extensive research effort known as the Global Leadership and Organizational Behavior Effectiveness (GLOBE) project, this article provides a few answers to the questions about the universal and culture specific aspects of leadership. We will present specific information about key cultural differences among nations and connect the \"dots\" on how these differences influence leadership. This information should help a typical global executive better understand the leadership challenges s/he faces while managing operations outside the United States. It will also provide suggestions on how to more effectively cope with such challenges. To make the GLOBE findings come alive, we will follow a hypothetical American executive who has been given two years to lead a project based in four different countries: Brazil, France, Egypt, and China. This hypothetical project involves developing a somewhat similar product for the four different markets. The project team in each country is tasked with the marketing of a new technology in the telecommunications industry. The executive will work with local employees in each location. Success will be determined by two criteria: the executive's ability to produce results and to show effective leadership in different cultures and settings. The four countries represent different continents and very diverse cultures. Brazil is the most populous and economically important South American country. France is the largest, most populous, and most economically developed Latin European country. Egypt is the largest and most populous Arab country. China is the fast growing giant economy with unprecedented growth in its economic and diplomatic power in the world. We chose these countries to provide context specific analysis leading to general recommendations for global executives. Our choice of countries was guided by our efforts to cover a wide range of 2006 Javidan, Dorfman, Sully de Luque, and House 69 cultures. Before turning to our hypothetical scenario, we will examine common cultural dimensions that characterize nations and discuss why these dimensions are important for the development of global leaders. parsimonious set of ten culture clusters (list provided in the next section). GLOBE studies cultures in terms of their cultural practices (the ways things are) and their cultural values (the way things should be). The nine cultural attributes (hereafter called culture dimensions) are: Common Cultural Dimensions o be open minded and to understand the cultures of the different countries, managers need to be able to compare their own cultures with those of other countries. After a review of the available literature, especially the work of Hofstede, Trompenaars, and Kluckhohn and Strodtbeck,11 GLOBE conceptualized and developed measures of nine cultural dimensions. These are aspects of a country's culture that distinguish one society from another and have important managerial implications. While a few of these dimensions are similar to the work of other researchers, the manner in which we conceptualized and operationalized them was different.12 We reconceptualized a few existing dimensions and developed a few new dimensions. In all cases, the scales designed to capture and measure these cultural dimensions passed very rigorous psychometric tests. A brief description of each cultural dimension is provided below along with the basic research design of GLOBE. Further details can be found on GLOBE's website, http://www.thunderbird.edu/ wwwfiles/ms/globe/. It might be noted that the GLOBE Project has been called \"the most ambitious study of global leadership.\"13 Our world-wide team of scholars proposed and validated an integrated theory of the relationship between culture and societal, organizational, and leadership effectiveness. The 170 researchers worked together for ten years collecting and analyzing data on cultural values and practices and leadership attributes from over 17,000 managers in 62 societal cultures. The participating managers were employed in telecommunications, food, and banking industries. As one output from the project, the 62 cultures were ranked with respect to nine dimensions of their cultures. We studied the effects of these dimensions on expectations of leaders, as well as on organizational practices in each society. The 62 societal cultures were also grouped into a more Performance Orientation. The degree to which a collective encourages and rewards (and should encourage and reward) group members for performance improvement and excellence. In countries like the U.S. and Singapore that score high on this cultural practice, businesses are likely to emphasize training and development; in countries that score low, such as Russia and Greece, family and background count for more. Assertiveness. The degree to which individuals are (and should be) assertive, confrontational, and aggressive in their relationships with others. People in highly assertive countries such as the United States and Austria tend to have can-do attitudes and enjoy competition in business; those in less assertive countries such as Sweden and New Zealand prefer harmony in relationships and emphasize loyalty and solidarity. Future Orientation. The extent to which individuals engage (and should engage) in future-oriented behaviors such as delaying gratification, planning, and investing in the future. Organizations in countries with high future oriented practices like Singapore and Switzerland tend to have longer term horizons and more systematic planning processes, but they tend to be averse to risk taking and opportunistic decision making. In contrast, corporations in the least future oriented countries like Russia and Argentina tend to be less systematic and more opportunistic in their actions. Humane Orientation. The degree to which a collective encourages and rewards ( and should encourage and reward) individuals for being fair, altruistic, generous, caring, and kind to others. Countries like Egypt and Malaysia rank very high on this cultural practice and countries like France and Germany rank low. Institutional Collectivism. The degree to which organizational and societal institutional practices encourage and reward (and should encourage and reward) collective distribution of resources and collective action. Organizations in collectivistic countries like Singapore and Sweden tend to emphasize group performance and rewards, whereas those in the more individualistic countries like Greece and Brazil tend to emphasize individual achievement and rewards. T 70 Academy of Management Perspectives In-Group Collectivism. The degree to which individuals express (and should express) pride, loyalty, and cohesiveness in their organizations or families. Societies like Egypt and Russia take pride in their families and also take pride in the organizations that employ them. Gender Egalitarianism. The degree to which a collective minimizes (and should minimize) gender inequality. Not surprisingly, European countries generally had the highest scores on gender egalitarianism practices. Egypt and South Korea were among the most male dominated societies in GLOBE. Organizations operating in gender egalitarian societies tend to encourage tolerance for diversity of ideas and individuals. Power Distance. The degree to which members of a collective expect (and should expect) power to be distributed equally. A high power distance score reflects unequal power distribution in a society. Countries that scored high on this cultural practice are more stratified economically, socially, and politically; those in positions of authority expect, and receive, obedience. Firms in high power distance countries like Thailand, Brazil, and France tend to have hierarchical decision making processes with limited one-way participation and communication. Uncertainty Avoidance. The extent to which a society, organization, or group relies (and should rely) on social norms, rules, and procedures to alleviate unpredictability of future events. The greater the desire to avoid uncertainty, the more people seek orderliness, consistency, structure, formal procedures and laws to cover situations in their daily lives. Organizations in high uncertainty avoidance countries like Singapore and Switzerland tend to establish elaborate processes and procedures and prefer formal detailed strategies. In contrast, firms in low uncertainty avoidance countries like Russia and Greece tend to prefer simple processes and broadly stated strategies. They are also opportunistic and enjoy risk taking. Regional Clustering of GLOBE Nations LOBE was able to empirically verify ten culture clusters from the 62-culture sample. These culture clusters were identified as: Latin America, Anglo, Latin Europe (e.g., Italy), Nordic Europe, Germanic Europe, Confucian Asia, SubSaharan Africa, Middle East, Southern Asia, and Eastern Europe. Each culture cluster differs with G February respect to the nine culture dimensions (e.g., performance orientation). Table 1 shows a summary of how the clusters compare in terms of their scores on cultural practices. The clusters that are relevant to this paper are in bold. For instance, clusters scoring highest in performance orientation were Confucian Asia, Germanic Europe and Anglo (U.S. and U.K. among other Englishspeaking countries). Clusters scoring lowest in performance orientation were Latin America and Eastern Europe. The Appendix shows the actual country scores for the six clusters in this paper. Managing and Leading in Different Countries iven the differences found in cultures around the globe, what does an effective American manager need to do differently in different countries? Everything, nothing, or only certain things? From a leadership perspective we can ask whether the same attributes that lead to successful leadership in the U.S. lead to success in other countries. Or are they irrelevant or, even worse, dysfunctional? In the following sections, we will answer these questions. We will examine some similarities and differences among cultures regarding management and leadership practices. We then assert that many of the leadership differences found among cultures stem from implicit leadership beliefs held by members of different nations. Expatriate managers working in multinational companies hardly need to be reminded of the wide variety of management practices found around the world. Laurent, and more recently Trompenaars and Briscoe and Shuler,14 document the astonishing diversity of organizational practices worldwide, many of which are acceptable and considered effective in one country but ineffective in another country. For instance, supervisors are expected to have precise answers to subordinates' questions in Japan, but less so in the United States. As another example, the effectiveness of working alone or in a group is perceived very differently around the world; this would certainly influence the quality, aptitude, and fair evaluation of virtual teams found in multinational organizations.15 An inescapable conclusion is that acceptable management practices found in one country are hardly guaranteed to work in a different coun- G 2006 Javidan, Dorfman, Sully de Luque, and House 71 Table 1 Cultural Clusters Classified on Societal Culture Practices (As Is) Scores Cultural Dimension Performance Orientation High-Score Clusters Mid-Score Clusters Low-Score Clusters Confucian Asia Southern Asia Latin America Germanic Europe Sub-Saharan Africa Eastern Europe Anglo Latin Europe Cluster-Average Range 3.73-4.58 Nordic Europe Middle East Assertiveness Germanic Europe Sub-Saharan Africa Eastern Europe Latin America Nordic Europe 3.66-4.55 3.38-4.40 Anglo Middle East Confucian Asia Latin Europe Southern Asia Future Orientation Germanic Europe Confucian Asia Middle East Nordic Europe Anglo Latin America Southern Asia Eastern Europe Sub-Saharan Africa Latin Europe Humane Orientation Southern Asia Middle East Latin Europe Sub-Saharan Africa Anglo Germanic Europe 3.55-4.71 Nordic Europe Latin America Confucian Asia Eastern Europe Institutional Collectivism Nordic Europe Anglo Germanic Europe Confucian Asia Southern Asia Latin Europe Sub-Saharan Africa Latin America 3.86-4.88 Middle East Eastern Europe In-Group Collectivism Southern Asia Sub-Saharan Africa Anglo Middle East Latin Europe Germanic Europe Eastern Europe 3.75-5.87 Nordic Europe Latin America Confucian Asia Gender Egalitarianism Eastern Europe Latin America Nordic Europe Anglo Middle East 2.95-3.84 Nordic Europe 4.54-5.39 3.56-5.19 Latin Europe Sub-Saharan Africa Southern Asia Confucian Asia Germanic Europe Power Distance Southern Asia Latin America Eastern Europe Sub-Saharan Africa Middle East Latin Europe Confucian Asia Anglo Germanic Europe Uncertainty Avoidance Nordic Europe Confucian Asia Middle East Germanic Europe Anglo Latin America Sub-Saharan Africa Eastern Europe Latin Europe Southern Asia NOTE: Means of high-score clusters are significantly higher (p 0.05) than the rest, means of low-score clusters are significantly lower (p 0.05) than the rest, and means of mid-score clusters are not significantly different from the rest (p 0.05). 72 Academy of Management Perspectives try. Titus Lokananta, for example, is an Indonesian Cantonese holding a German passport, managing a Mexican multinational corporation producing Gummy Bears in the Czech Republic.16 What management style will he be most comfortable with, and will it be successful with Czech workers and Mexican CEOs? How does he effectively manage if a conflict evolves between managing his workers and satisfying his supervisors? Should we, however, conclude that cultural differences are so vast that common management practices among countries are the exception rather than the rule and will ever remain so? Not necessarily. Companies are forced to share information, resources, and training in a global economy. The best business schools educate managers from all over the world in the latest management techniques. Using academic jargon, the issue of common versus unique business and management practices is framed using contrasting perspectives embodied in the terms cultural universals versus cultural specifics. The former are thought to be found from the process of cultural convergence whereas the latter from maintaining cultural divergence. Perhaps not surprisingly, empirical research supports both views. For example, in their event management leadership research program Smith and Peterson found both commonalities and differences across cultures in the manner by which managers handled relatively routine events in their work.17 All managers preferred to rely on their own experience and training if appointing a new subordinate, relative to other influences such as consultation with others or using formal rules and procedures. However, there were major differences in countries in the degree to which managers used formal company rules and procedures in contrast to more informal networks, and these differences covary with national cultural values.18 As another example, Hazucha and colleagues19 found a good deal of similarity among European countries regarding the importance of core management competencies for a Euromanager. Yet there were significant differences among countries in the perceived attainment of these skills. Javidan and Carl have recently shown important similarities and differences among Canadian, Taiwan- February ese, and Iranian managers in terms of their leadership styles.20 Should we also expect that leadership processes, like management practices, are similarly influenced by culture? The answer is yes; substantial empirical evidence indicates that leader attributes, behavior, status, and influence vary considerably as a result of culturally unique forces in the countries or regions in which the leaders function.21 But, as the colloquial saying goes \"the devil is in the details,\" and current cross-cultural theory is inadequate to clarify and expand on the diverse cultural universals and cultural specifics elucidated in cross-cultural research. Some researchers subscribe to the philosophy that the primary impact of culture depends on the level of analysis used in the research program. That is, some view the basic functions of leadership as having universal importance and applicability, but the specific ways in which leadership functions are enacted are strongly affected by cultural variation.22 Other researchers, including the contributors to this article, question this basic assumption, subscribing more to the viewpoint that cultural specifics are real and woe to the leader who ignores them. Do Required Leadership Qualities Differ Among Nations? t has been pointed out that managerial leadership differences (and similarities) among nations may be the result of the citizens' implicit assumptions regarding requisite leadership qualities.23 According to implicit leadership theory (ILT), individuals hold a set of beliefs about the kinds of attributes, personality characteristics, skills, and behaviors that contribute to or impede outstanding leadership. These belief systems, variously referred to as prototypes, cognitive categories, mental models, schemas, and stereotypes in the broader social cognitive literature, are assumed to affect the extent to which an individual accepts and responds to others as leaders.24 GLOBE extended ILT to the cultural level of analysis by arguing that the structure and content of these belief systems will be shared among individuals in common cultures. We refer to this shared cultural level analog of individual implicit I 2006 Javidan, Dorfman, Sully de Luque, and House leadership theory (ILT) as culturally endorsed implicit leadership theory (CLT). GLOBE empirically identified universally perceived leadership attributes that are contributors to or inhibitors of outstanding leadership. Project GLOBE's leadership questionnaire items consisted of 112 behavioral and attribute descriptors (e.g., \"intelligent\") that were hypothesized to either facilitate or impede outstanding leadership. Accompanying each item was a short phrase designed to help interpret the item. Items were rated on a 7-point Likerttype scale that ranged from a low of 1 (this behavior or characteristic greatly inhibits a person from being an outstanding leader) to a high of 7 (this behavior or characteristic contributes greatly to a person being an outstanding leader). Project GLOBE also empirically reduced the huge number of leadership attributes into a much more understandable, comprehensive grouping of 21 primary and then 6 global leadership dimensions. The 6 global leadership dimensions differentiate cultural profiles of desired leadership qualities, hereafter referred to as a CLT profile. Convincing evidence from GLOBE research showed that people within cultural groups agree in their beliefs about leadership; these beliefs are represented by a set of CLT leadership profiles developed for each national culture and cluster of cultures. For detailed descriptions of the statistical processes used to form the 21 primary and 6 global leadership dimensions and development of CLT profiles see House et al.25 Using the six country scenarios, in the last half of this paper we will show the range of leadership responses that should be effective in each cultural setting. The six dimensions of the CLT leadership profiles are: 1. Charismatic/Value-Based. A broadly defined leadership dimension that reflects the ability to inspire, to motivate, and to expect high performance outcomes from others on the basis of firmly held core beliefs. Charismatic/valuebased leadership is generally reported to contribute to outstanding leadership. The highest reported score is in the Anglo cluster (6.05); the lowest score in the Middle East cluster (5.35 out of a 7-point scale). 2. Team-Oriented. A leadership dimension that 3. 4. 5. 6. 73 emphasizes effective team building and implementation of a common purpose or goal among team members. Team-oriented leadership is generally reported to contribute to outstanding leadership (Highest score in Latin American cluster (5.96); lowest score in Middle East cluster (5.47)). Participative. A leadership dimension that reflects the degree to which managers involve others in making and implementing decisions. Participative leadership is generally reported to contribute to outstanding leadership, although there are meaningful differences among countries and clusters. (Highest score in Germanic Europe cluster (5.86); lowest score in Middle East cluster (4.97)). Humane-Oriented. A leadership dimension that reflects supportive and considerate leadership but also includes compassion and generosity. Humane-oriented leadership is reported to be almost neutral in some societies and to moderately contribute to outstanding leadership in others. (Highest score in Southern Asia cluster (5.38); lowest score in Nordic Europe cluster (4.42)). Autonomous. This newly defined leadership dimension, which has not previously appeared in the literature, refers to independent and individualistic leadership. Autonomous leadership is reported to range from impeding outstanding leadership to slightly facilitating outstanding leadership. (Highest score in Eastern Europe cluster (4.20); lowest score in Latin America cluster (3.51)). Self-Protective. From a Western perspective, this newly defined leadership dimension focuses on ensuring the safety and security of the individual. It is self-centered and face saving in its approach. Self-protective leadership is generally reported to impede outstanding leadership. (Highest score in Southern Asia cluster (3.83); lowest in Nordic Europe (2.72)). Table 2 presents CLT scores for all 10 clusters. Analysis of Variance (ANOVA) was used to determine if the cultures and clusters differed with respect to their CLT leadership profiles. Results indicate that cultures (i.e., 62 societal cultures) 74 Academy of Management Perspectives and clusters (i.e., 10 groups consisting of the 62 societal cultures) differed with respect to all six CLT leadership dimensions (p .01). Table 3 presents summary comparisons among culture clusters to indicate which clusters are most likely to endorse or refute the importance of the 6 CLT leadership dimensions. Tables 2 and 3 may be used in combination to provide an overall view of how the different cultural clusters compare on the six culturally implicit leadership dimensions.26 February Cross-cultural Leadership Is Not Only About Differences The global and cross-cultural leadership literature is almost exclusively focused on cultural differences and their implications for managers. There is a basic assumption that leaders operating in different countries will be facing drastically different challenges and requirements. GLOBE surveys show that while different countries do have diver- Table 2 CLT Scores for Societal Clusters Societal Cluster Charismatic/ Value-Based Team Oriented Eastern Europe Latin America Latin Europe Confucian Asia Nordic Europe Anglo Sub-Sahara Africa Southern Asia Germanic Europe Middle East 5.74 5.99 5.78 5.63 5.93 6.05 5.79 5.97 5.93 5.35 5.88 5.96 5.73 5.61 5.77 5.74 5.70 5.86 5.62 5.47 CLT Dimensions Humane Participative Oriented 5.08 5.42 5.37 4.99 5.75 5.73 5.31 5.06 5.86 4.97 4.76 4.85 4.45 5.04 4.42 5.08 5.16 5.38 4.71 4.80 Autonomous Self-Protective 4.20 3.51 3.66 4.04 3.94 3.82 3.63 3.99 4.16 3.68 3.67 3.62 3.19 3.72 2.72 3.08 3.55 3.83 3.03 3.79 NOTE: CLT leadership scores are absolute scores aggregated to the cluster level. Table 3 Summary of Comparisons for CLT Leadership Dimensions Societal Cluster Eastern Europe Latin America Latin Europe Confucian Asia Nordic Europe Anglo Sub-Sahara Africa Southern Asia Germanic Europe Middle East Charismatic/ Value-Based Team-Oriented M H M/H M H H M H H L M H M M/H M M M M/H M/L L CLT Leadership Dimensions Humane Participative Oriented L M M L H H M L H L M M L M/H L H H H M M Autonomous Self-Protective H/H L L M M M L M H/H M H M/H M H L L M H/H L H/H NOTE: For letters separated by a \"/\