Asian countries such as India, China and Japan are fast becoming some of the most successful global players in international business. Not only have their businesses recovered more steadily from the challenges facing the global economy, but many have experienced higher growth and performance than any other region in the world. Many western businesses are now looking to Asian companies to see what they are doing that brings them such international success. In particular, there is an increased focus on those individuals leading across cultures as they are the ones making such immense strides in international business.
What is it that makes Asian businesses and leaders so successful? In 2010 the Hay Group conducted a survey in which they gathered information from 1,827 organisations worldwide to try to determine what made companies or leaders so successful. Interestingly, the survey found that Asian companies tend to be more willing to implement new ideas or best practice and change the way the business functions.
Samsung, one of the most successful companies in Asia, runs a series of special programmes for the top leadership team on subjects such as art, music and history to transform their members into ‘world-citizens’. By focusing on areas such as these, Samsung’s leaders are developing a broader suite of skills and knowledge that they can tap into as they develop new strategies for the company to ensure they stay at the forefront of their competition.
This is also part of the overall attitude that Asian companies convey when doing business across borders. Organisations in Asia Pacific spend more time visiting and learning from their peers than their Western counterparts. This has a strong influence on the way companies in the region manage their own employees as well. The survey showed that Asian organisations tend to transfer this curiosity to their subsidiaries, give them more autonomy and accept their ideas more readily.
The openness to new ideas and ways of thinking is definitely one aspect that makes leaders in Asia increasingly successful, however some argue that their leadership style may not be that transferable when leading across cultures. The survey showed that about half of the Asian leaders from the top five companies in Asia prefer a directive and authoritarian leadership style which respects hierarchy. While this can work in some cultures, it can also have the potential of being counterproductive to the performance and innovation of the company.
Despite this leadership style, Asian leaders seem to have developed pivotal skills in establishing external and internal relationships that enable the long-term good of the company. For example, Indian CEOs manage complex webs of external relations with the media and government while Chinese CEOs appear to be experts in the concept of personal relationship building referred to as ‘guanxi’. The importance many Asian leaders place on personal relationships, such that legal arrangements come second, can be quite a different approach to that of many western leaders.
While Asian companies stand out in contrast to other global companies in their way of networking, they also shine in how they promote or reward their employees. This can help to explain some of the vast growth and success of these top Asian companies, however they need to be cautious as promoting employees too quickly might also turn out to be counterproductive when employees don’t experience any room to develop their competencies fully or learn new business capabilities.
The hunger and curiosity for new ideas and best practices seen in Asian organisations shows a unique management style which is often extremely effective. Though the authoritarian leadership style and approaches found in many Asian cultures may be perceived negatively in some cultures, their overall interest for innovation is something that more Western countries should be tapping into and also applying to their own styles.
When leading across cultures, particularly in markets such as Asia, global leaders need to understand how the approach differs and adapt their own style to find the best of both worlds. A combination of each cultural leadership style can give global leaders and organisations a competitive edge in this increasingly challenging market.
© Communicaid Group Ltd. 2011