The Four Cultures of Leadership
As Trump continues to be himself and what millions around the world find distasteful, you have to agree that he is an agent of change. Whether you like or dislike his policies and his delivery, he is single-handedly spear-heading a culture change within America that is also being emulated across the world. We discovered recently how many of his fellow Americans support his style. One thing for me is certain, it puts the culture of leadership front and centre on the world stage.
Here is a more local and less controversial story of culture. The Selfridges Group is a global department store retailer, that owns the Hold Renfrew chain in Canada, the Brown Thomas Group in Ireland and the Selfridges stores in UK. To further maximize its reach and expertise in running profitable stores, it acquired de Bijenkorf, the Dutch department store retailer in 2011.
Acquiring and integrating any acquisition is a challenge, but in this case the fit with the overall group was strong. It was very clear that de Bijenkorf had more potential to grow sales and profitability, once the expertise of the wider group was integrated with it.
As the ink was drying on the contract, a Selfridges Group team started to immerse itself in the new business and was careful to not be imposing or directive. Within a few months, I was invited to delve in and get to grips with the culture, the strategy and the mechanics of how the organisation was run. This ‘discovery’ phase always entails asking lots of questions and listening.
It quickly emerged how cultural leadership can differ across countries. Despite us treading lightly, some of the old leadership team saw us as interfering. Their expectation was that they would continue to operate forever as a standalone business, with simply the occasional update on progress to group. That made for a steep learning curve.
The thing is, regardless of whether it’s during an acquisition or even just with business as usual, doing business across different cultures is challenging. In our day to day activities, most of us concentrate on strategy and operational detail. We busy ourselves talking about new products, cutting costs, driving synergies and developing new markets. But we just don’t give enough airtime to the topic of culture. Considered the softer issues by many, but the crucial one in my experience.
I want to focus here on two key dimensions of leadership culture. One is authority and the other is decision-making. In some cultures, they are one and the same. But let me illustrate how they are very different. And here I will draw from excellent research done by Erin Meyer, professor at INSEAD.
Since modern management theory started to develop (mainly in the US) in the ‘60s, we have learned that being democratic is much more preferable and effective to being authoritarian. Leaders encourage their people to speak up, to use first names, and ultimately, have become more inclusive. Empowerment is also a new buzz-word and ‘management by objectives’ has become the norm. Tentative problem-solving is encouraged at ground level and then escalated to management for a decision. And it is expected that decisions are then made quickly.
And in this context, Americans see the Japanese, Germans and Dutch as very hierarchical. Yet in Japanese and German culture where positional authority is indeed still prevalent, decision-making is much more consensual and collaborative. Problems are discussed at ground level and solutions are sought. Leaders then act more as facilitators rather than decision-makers. These differences are all very confusing at first, until you take time to understand them.
It’s interesting that the different management styles I described earlier between the Selfridges and de Bijenkorf teams were within Europe, where only a few hundred miles separate us. But as I then described the differences in American, Japanese and German management styles, what can we say about culture differences from Chicago to Cork, Cologne to Cairo and further east to Cebu?
Tips on dealing with the four cultures of leadership
Consider the two dimensions that Professor Meyer refers to and imagine them intersecting on a 2×2 matrix. Then consider the team that you manage, their preferred style and then adapt accordingly.
1. Hierarchical and top-down
I was speaking with an Irish organisation that has a joint venture with a Saudi Arabian partner. This culture of leadership is very prevalent in that country. My client needs to flip its default collaborative and democratic style and be more directive. That what they expect and need. So they should be clear on expectations and don’t make flippant or off-the-cuff remarks, as they may be taken literally.
2. Hierarchical and collaborative
This is where teams expect the boss to make decisions but will also expect to be consulted beforehand. The leader should therefore ask lots of questions but check for quality of input and reasoning behind opinions, before making a decision. I personally use this style in Germany.
3. Democratic and top-down
Regardless of your status in the team, speak up before the decision is made. But even if you don’t agree with the final decision, support it as if it was your own. You’ve had your say and you didn’t manage to convince the relevant person. So accept it and move on positively.
4. Democratic and collaborative
This is where the team gets involved in making decisions and may get upset if the leader takes over. The leader’s job is to facilitate the process. Accept that decision-making will take longer but the execution of the decisions will be swift. So avoid being directive.
Boyle Sports recently announced its acquisition of some additional William Hill stores. It won’t have different country cultural norms to contend with, but that does not mean that it can ignore organisational cultural differences. Every organisation has a culture, even if is not defined or written down. The challenge is to take time to understand the differences.
Leaving geographic borders aside, this is intended to illustrate differences that can even exist within the same company, within the same building. After all, individuals bring different styles to the job based on their past experiences of other organisation cultures. Recognising and embracing difference is your challenge.