Globalization and Its Effect on American and Asian Leaders

It is important to study leadership in the era of globalization as more than ever leaders in the contemporary world have to ensure that they have a global outlook as they have to compete with other nations and global businesses. Indeed, as this article discusses the effect that globalization has had on leadership, the key themes that emerge is that globalization has had both a homogenizing and a diversifying effect on leaders of companies, states, and regions.

Differences and Similarities in Leadership between the US, China, and India

Leaders whether they are CEOs of companies or politicians in the US, China, and India are characterized by different leadership styles and different attitudes towards the practice of leadership as well as different temperaments. For instance, for much of the 20th century and before, the Indian businesses tended to be family owned and managed by family members, which is a clear indication that the business families controlled their companies in the same way they ran their families.

This tends to introduce authoritarian, patriarchal, and opaque leadership as the families who ran the companies took decisions unilaterally, were not open to the idea of consensual decision-making, and was reluctant to let outsiders into the top leadership positions. Further, they tended to keep women out of the companies especially in the managerial positions, which were a result of the deep-seated and deep-rooted prejudices against women in Indian society as well as the relatively inferior status that women had in India.

On the other hand, in the United States, the leadership styles evolved with the adoption of scientific principles of management and the progression of mass produced manufacturing which meant that leaders in companies were open to the opinions of others. Once the services sector began to grow in prominence, the business leaders in the US realized that they had to change with the times and hence, actualized flat organizational structures where employees addressed each other and the managers with their first name.

Apart from this, the business leaders in the US tended to welcome the participation of women, though the “glass ceiling” was and remains to this day a very real aspect of the corporate world. The point here is that when one contrasts the leadership styles in the US and India, we find that the former follow the norms which management experts prescribe whereas the latter follow the established procedures and norms that have been handed down to them by their fathers as most businesses were family run.

On the other hand, the US is characterized by a presence of professionally managed companies that are run on managerial styles that are meritocratic, open, democratic, and consensual.

Diversifying Effect of Globalization

Globalization has been defined as the closer integration of the economies of the nations of the world and increased trade and commerce between these entities leading to more interaction between the peoples of the world. It has had an impact on the leadership styles of CEOs as well as politicians who either have adopted the global outlook or have withdrawn into their shells and become inward looking and parochial.

While those leaders who have adopted a global outlook are discussed in the next section, this section examines how globalization has resulted in the leaders in India becoming more jingoistic and regional instead of being global or embracing the outward looking vision and outlook.

This is mainly because globalization favours the skilled and the knowledgeable over those without English speaking skills and without basic computing abilities. Further, globalization in India has benefited a few at the expense of the many as the fruits of the process and the gains from it have not percolated to the bottom.

This has resulted in the creation of “islands of prosperity” in the midst of poverty and deprivation which has led to the “world on fire” in the regions in India because of the ethnic and the racial aspects wherein some groups benefit more than the others.

The diversifying effects of globalization can be seen in the way the Indian city of Bangalore, which is known as the “Silicon Valley” of India, is governed. As the IT, professionals in Bangalore live and work in high-rises and use the latest technology, the environment outside is one where even garbage is not collected because of the present leaders of the state who are unable to reach an agreement on how to dispose of it.

When these leaders are questioned by industry captains and business leaders of the IT companies, the answer that they get is that only the IT professionals seem to be bothered about this problem and that they cannot ask and get everything. The reason for citing this example is to draw attention to the fact that “pockets of affluence” cannot coexist with “regions of squalor and dirt” and as the leaders occupy themselves with issues related to other things that they perceive fetch them votes, the diversifying effect of globalization on the leadership styles can clearly be seen.

On the other hand, China, which was a parochial and inward looking country, which distrusted the outside world, is an example of a country that has gone from this scenario to a state where its leaders have embraced globalization in its entire entirety and have ensured that the benefits of globalization percolate down to the masses.

Homogenizing Effect of Globalization

In recent years, thanks to globalization, leaders in India and China have been adopting a more democratic and open leadership style when compared to the earlier era leadership of patriarchal and opaque leadership patterns. It can be said that globalization has had a part and a role to play in accentuating a more democratic leadership style among not only the CEOs of top companies but also the politicians who now realize that they have to think global if they are to survive in the intensely competitive business landscape of the 21st century.

For instance, most of the CEOs and the business leaders in India and China routinely refer to the need for consensual decision making, foregoing the earlier emphasis on taking unilateral decisions and forging a new path for their businesses.

Even the politicians have started to appreciate the benefits of globalization (especially in India where as we have discussed earlier, they tended to be parochial and jingoistic) and hence, they are more amenable to attracting foreign investment which they see as being key to the generation of employment opportunities that are so crucial to the economic success of their countries.

Further, globalization also has the effect of making the business leaders and the politicians in India and China think global and act local or the adoption of a “Glocal” style of leadership where they actualize local strategies for global business drivers.

The best examples of this kind of leaders are Narendra Modi in India and Li Xiping in China who have increasingly been talking about how to make globalization work for them in their countries.

The key point to be noted here is that these leaders want to focus on the economic aspects as well as the political and the cultural aspects, which marks a departure from the earlier emphasis on separating economics from politics and culture. In other words, globalization has had the effect of making these leaders shed their parochial and authoritarian leadership styles in favour of a consensual and democratic approach to leadership.

Conclusion

The recent changes because of globalization on the leadership styles can be summarized as being in two ways. One way is the way of China where leaders at all levels have embraced globalization, and the other way is India where some leaders have developed a global mindset whereas other leaders remain inward looking and cater to their voters whom they give freebies and subsidies to make them vote for their parties.

This means that China and India offer contrasting styles of leadership as far as the effect that globalization has had on them is concerned. Of course, some leaders in India have embraced globalization, and they have done this by adopting a global outlook and combining it with local execution so that a “Glocal” approach to leadership is actualized.

The key conclusions that one can draw from the preceding discussion is that globalization has affected China and India differently as far as both economic growth and leadership styles are concerned. Of course, the key reason for this is that India is a democracy where leaders have to be elected, and China is an autocracy that does not need elections.

This means that politicians in China need not be attentive to the needs of the masses whereas, in India, they have to be elected every five years. Therefore, the difference in the approach to globalization as far as leadership is concerned has to do with the differing political and business systems in these countries.

While the big companies in China are mostly state-owned, they are family run in India. Therefore, both the political and the business leaders in China and India act differently as far as the effect of globalization on their leadership styles is concerned. In conclusion, globalization has both homogenized and diversified the leadership styles in China and India and this is the summary of the discussion in this article.


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