Leadership Effectiveness in Global Teams

Table of Contents

List of Abbreviations

List of Figures

List of Tables

1 Introduction
1.1 Problem and Objectives
1.2 Procedure of Seminar Paper

2 Defining the Terms
2.1 Leadership
2.2 Effectiveness
2.3 Leadership Effectiveness
2.4 Global Teams

3 Leadership Effectiveness in Global Teams
3.1 Theoretical Models of Leadership Effectiveness
3.1.1 Contingency Model
3.1.2 Transactional and transformational Leadership Approach
3.2 Effective global Leadership
3.2.1 Challenges of effective global Leadership
3.2.2 The global Team Leader Competency Model
3.2.3 Global vs. cross-cultural Perspective
3.2.4 The Relevance of Leadership Qualities
3.3 Measurement and Evaluation of Leadership Effectiveness
3.4 Organizational Requirements to develop global Team Leaders

4 Conclusion and Outlook

Bibliography

List of Abbreviations

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List of Figures

Figure 1: Fiedler´s Model of Leadership Effectiveness (Sornapudi 2012)

Figure 2: Global Team Leader Competency Model (Martinelli 2010, p. 161)

Figure 3: Leadership Qualities (UoA 2014)

List of Tables

Table 1: Lessons of Leadership Effectiveness (Dekker 2013, p. 86)

Table 2: Task-oriented vs. relationship-oriented Leadership (Bass 1990, p. 472-474)

Table 3: Transactional vs. Transformational Leadership (MSG 2014)

Table 4: Challenges of Leadership Effectiveness in global Teams (Kayworth and Leidner 2002, p.10)

Table 5: Global vs. cross-cultural Perspective of Leaders (Gurchiek 2014)

1 Introduction

1.1 Problem and Objectives

Centuries ago and still evolving today is the idea of globalization. Visionary leaders have recognized that competitive advantages can be gained with an effective globalization strategy over their rivals. Many current leaders have founded their globalization competitive advantages in their industry, but to be part of the global arena they spent many years in learning and establishing their global business models. These global models or strategies can include developing strategic alliances with overseas development and marketing partners, off-shoring and outsourcing of their product and service development process, moving operations to other countries, and acquiring other companies. Causes for globalization are especially reducing costs, expansion into emerging markets and acquiring the world´s top talent. (Martinelli 2010, p. 17-29)

Most organizations realize that a good global strategy is not enough but it has to be convertible. This is where a lot of organizations fail. The focus must shift from the development and initiation of the globalization strategy to operational success in a global model. Actually this difficult task has to be fulfilled by the middle managers and leaders. They are trying to sew the globalization strategy and global execution together from the middle of the organization. This is a big challenge for the middle management. (Martinelli 2010, p. 30-31)

This assignment discusses the topic ‘leadership effectiveness in global teams’. It argues in detail the challenges the leaders of global teams have and which competencies are needed to fulfil the job of a global team leader. Content is also how leadership effectiveness can be measured and evaluated as well as the basic requirements on organizations. This assignment does not include the organizational specifics and changes by ‘globalizing’ a company.

1.2 Procedure of Seminar Paper

At the beginning key words in context of Leadership Effectiveness in global Teams are defined in chapter two. Chapter three includes theoretical models of leadership effectiveness, effective global leadership, measurement and evaluation of leadership effectiveness, and the organizational requirements to develop global team leaders. At the end a conclusion and outlook is given.

2 Defining the Terms

2.1 Leadership

Before leadership itself is described, there are a lot of definitions of leadership of whom in this assignment only the following is mentioned: “Leadership may be considered as the process (act) of influencing the activities of an organized group in its efforts toward goal setting and goal achievement.” (Stogdill 1950, p. 3)

Leadership includes the individuals who are the leaders in an organization, regarded collectively. Further it involves the activity of leading a group of people, an organization, or the ability to do this and the act of inspiring subordinates as well as engaging in achieving goals. Hereby the leader establishes a clear vision, shares that vision with others so that they will follow willingly, and provides the information, knowledge, and methods to realize that vision. Additionally the leader coordinates and balances the conflicting interests of all members and stakeholders. (Business 2014a)

2.2 Effectiveness

Effectiveness can be defined as the degree to which objectives are achieved and the extent to which targeted problems are solved. There is a contrast to efficiency that is determined with reference to costs and means ‘doing the thing right’ in opposite to effectiveness, what means ‘doing the right thing’. (Business 2014b)

2.3 Leadership Effectiveness

In a survey of Dekker, where global leaders were interviewed about the success in global leadership, the interviewees reported feelings of career success and career satisfaction when being successful in the leadership roles. Therefor Table 1 describes leadership effectiveness in terms of career success and career satisfaction. (Dekker 2013, p. 85-86)

Table 1: Lessons of Leadership Effectiveness (Dekker 2013, p. 86)

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2.4 Global Teams

The term global is often used interchangeably with the words international and worldwide. It pertains to the entire globe rather than a specific region or country. (Business 2014c) A global team is a group of people with a full set of complementary skills required to complete a project, job, or task internationally. When a strong sense of mutual commitments is creating synergy in a team, the team becomes more than just a group of people. A team can generate performance greater than the sum of the performance of its individual members. The team members:

- “operate with a high degree of interdependence,
- share authority and responsibility for self-management,
- are accountable for collective performance, and
- work toward a common goal and share rewards.” (Business 2014d)

3 Leadership Effectiveness in Global Teams

The following chapter elaborates the main issue of this assignment ‘Leadership Effectiveness in Global Teams’ by entering at the theoretical models of leadership effectiveness followed by the most relevant factors of influence on the leadership effectiveness in global teams. How to measure and evaluate leadership effectiveness in global teams replies the subchapter 3.3 Measurement and Evaluation of Leadership Effectiveness. The last subchapter describes the organizational requirements to develop global team leaders.

3.1 Theoretical Models of Leadership Effectiveness

Studies of leadership effectiveness have produced different theories involving traits, situational interaction, function, behaviour, power, vision and values, charisma, knowledge, and intelligence, among others. Two of the theories are introduced in the following.

3.1.1 Contingency Model

In Fiedler's contingency model, leadership effectiveness is the result of interaction between the style of the leader and the characteristics of the environment in which the leader works. He pointed out three situational components that can determine whether the orientation of the leader to the task (low Least-Preferred Coworker (LPC^[1] )) or to the relationship (high LPC) (Table 2) enhances the performance of the team:

- Leader-member relations – degree of respect and confidence (Fiedler 1967, p. 29-32)
- Task structure – decision verifiability, goal clarity, goal path multiplicity, solution specificity (Fiedler 1967, p. 28)
- Leader position power – power in the leader´s position (Fiedler, 1967, p. 22-25)

Figure 1 illustrates the most effective leadership concerning the task and the relationship oriented leader to extremely favourable and unfavourable situations and situations with intermediate favourability.

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Figure 1: Fiedler´s Model of Leadership Effectiveness (Sornapudi 2012)

To point out the differences between the leadership styles of Figure 1, the following Table 2 compares the task- and the relationship-oriented leadership styles:

Table 2: Task-oriented vs. relationship-oriented Leadership (Bass 1990, p. 472-474)

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3.1.2 Transactional and transformational Leadership Approach

Another theoretical leadership model of the researcher Bernhard Bass is the new leadership approach. Two leadership types, the transactional and the transformational type, were developed. The transactional leader is more short-term and hard data oriented than the transformational leader. The leader is oriented in long-term goals and focuses on missions and strategies. Table 3 compares the leadership types.

Table 3: Transactional vs. Transformational Leadership (MSG 2014)

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3.2 Effective global Leadership

This Chapter consists the view on the most important aspects of leaders regarding leadership effectiveness in global teams. The content of chapter 3.2 is:

- Challenges of effective global Leadership
- The global Team Leader Competency Model
- Global vs. cross-cultural Perspective
- The Relevance of Leadership Qualities

3.2.1 Challenges of effective global Leadership

Table 4 concludes some challenges of leadership effectiveness in global teams.

Table 4: Challenges of Leadership Effectiveness in global Teams (Kayworth and Leidner 2002, p.10)

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3.2.2 The global Team Leader Competency Model

The following subchapter gives an overview of the competencies a global team leader needs to fulfil the requirements and challenges (3.2.1) of the leader´s job. The global team leader competency model (Figure 2) can be used to detail the knowledge, skills, and abilities to successfully perform the role as a global team leader. Competence could be defined as the sum of knowledge, skills, personal qualities, and experience.

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Figure 2: Global Team Leader Competency Model (Martinelli 2010, p. 161)

Besides the hard skills as knowledge, experience, and skills in business, customer & market and the project & process management, this assignment emphasizes the soft skills. They are especially to find within the competencies team leadership and virtual management. Team leadership includes the core leadership qualities, influencing skills, prioritization skills, symphonic and system skills, and political savvy. In chapter 3.2.4 particularly the leadership qualities are illustrated. The next chapter 3.2.3 describes contents of virtual management that are the cross-cultural management skills, communication skills, networking skills, emotional intelligence skills, etc. whereas the aspect of leading virtual global teams is not part of the assignment. (Martinelli 2010, p. 161-189)

3.2.3 Global vs. cross-cultural Perspective

A typical global team consists of people with different cultural backgrounds located throughout the globe. A study from a Society for Human Resource Management, released in July 2011, highlighted the importance of considering global characteristics of leaders and members of multicultural teams. Additionally it underlined the importance of using a selection and training process that focuses on a global perspective rather than on a cross-cultural one. When leading global teams effectively it comes to differences between having a global or a cross-cultural perspective. The different perspectives (Table 5) explain why comparisons between two national cultures can be meaningless if multicultural teams, with people from different nationalities work together, operate in a global context. Comparisons of cultures might also not interpret relationships in the team around the globe. (Gurchiek 2014)

Table 5: Global vs. cross-cultural Perspective of Leaders (Gurchiek 2014)

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For global team leaders the characteristics openness to cultural diversity, global identity, cultural intelligence, and global leadership behaviours are most important. That means also reflecting cultural values of the work being performed in a global surrounding and making it possible for the team to adapt to the global environment. (Gurchiek 2014)

By recognizing some trends and cultural differences, a global leader can communicate more effectively with the leader´s subordinates. Expresses a leader individualism, which is often associated with leaders from the United States, values personal rewards but it often causes isolation. Therefor in China, employees tend to be wary of leaders who speak without directing specific actions. Indian workers prefer more assertive managers and tend to dislike visionary leadership. In Japan, employees usually receive negative feedback from a peer rather than a superior and in Latin cultures, interruption signifies interest but in Asian countries, that might be considered rude. (Duggan 2012)

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^[1] Score, derived from only one of the coworker descriptions. (Fiedler 1967, p. 43)