Management / Leadership Style AMERICA RUSSIA VS.

Leadership Styles 1. Transformational Individualized consideration (IC) Intellectual stimulation (IS) Charisma (CHA) Inspirational motivation (IM) 2. Transactional Contingent reward (CR) Behavior and management by exception (ME) 3. Laissez-faire Leadership exists in all societies and is essential to the functioning of organizations within societies. However, the attributes that are seen as characteristic for leaders may vary across cultures and also depend on leadership style (Bass, 1985): 1. transformational (includes individualized consideration (IC), intellectual stimulation (IS), charisma (CHA), and inspirational motivation (IM)) 2. transactional (includes contingent reward (CR) behavior and management by exception (ME)) 3. laissez-faire

Differences in Leadership Style in AS and ME Russia and Finland is a TRANSITIONAL ECONOMY

Management Styles Most popular management styles: Democratic Management Style A democratic manager delegates authority to his/her staff, giving them responsibility to complete the task given to them (also known as empowerment). Staff will complete the tasks using their own work methods. However, the task must be completed on time. Employees are involved in decision making giving them a sense of belonging and motivating individuals. Because staff feel a sense of belonging and are motivated the quality of decision making and work also improves. Although popular in business today, a democratic management style can slow decision making down because staff need to be consulted. Also some employees may take advantage of the fact that their manager is democratic by not working to their full potential and allowing other group members to 'carry' them. Autocratic Management Style In contrast to the above an autocratic manager dictates orders to their staff and makes decisions without any consultation. The leader likes to control the situation they are in. Decision are quick because staff are not consulted and work is usually completed on time. However this type of management style can decrease motivation and increase staff turnover because staff are not consulted and do not feel valued. Consultative Management style A consultative management style can be viewed as a combination of the above two. The manager will ask views and opinions from their staff, allowing them to feel involved but will ultimately make the final decision. Laissez Faire Management style A laisses faire manager sets the tasks and gives staff complete freedom to complete the task as they see fit. There is minimal involvement from the manager. The manager however does not sit idle and watch them work! He or she is there to coach or answer questions, supply information if required. There are benefits, staff again are developed to take responsibility which may lead to improved motivation. However with little direct guidance from the manager staff may begin to feel lost and not reach the goals originally set within the time frame.

Socio-Cultural Framework 5 socio-cultural dimensions (Hofstede -1984, 1997) are used to compare differences in management of different countries: Power Distance (PDI) Individualism (IND) Masculinity (MAS) Uncertainty avoidance (UAI) Long-term orientation (LTO) The style of management in different countries can also be anywhere on the scale, from fully authoritarian at one end of the scale to fully participative at the other end and it depends on the cultural characteristics of the country. Usually 5 socio-cultural dimensions, identified by Hofstede (1984, 1997) are used to compare differences in management of different countries: Power Distance (PDI) Individualism (IND) Masculinity (MAS) Uncertainty avoidance (UAI) Long-term orientation (LTO)

Russian vs. America

American Leadership/Management Individualistic in approach Managers are accountable for the decisions Decisions discussed in open forum Ultimate responsibility within the boss Outstanding success brings outstanding rewards. Titles are poor reflection of importance Importance is linked to power American management style can be described as individualistic in approach, in so far as managers are accountable for the decisions made within their areas of responsibility. Although important decisions might be discussed in open forum, the ultimate responsibility for the consequences of the decision lies with the boss. The up side of this accountability is, of course, the American dream that outstanding success will inevitably bring outstanding rewards. Therefore, American managers are more likely to disregard the opinions of subordinates than managers in other, more consensus or compromise- oriented cultures. Titles, in any case, tend to be a poor reflection of the relative importance of an individual within a company. Importance is linked to power, which could be determined by a number of factors such as head-count responsibility, profitability of sector or strategic importance to the organization at that point in time. Power Distance (PDI) Individualism (IND) Masculinity (MAS) Uncertainty avoidance (UAI) Long-term orientation (LTO) Conclusion: US managers are characterized by low PDI, LTO, and UAI, and high IND and MAS; US leaders ranked higher on two dimensions of transformational leadership (charisma and inspirational motivation).

Russian Leadership/Management Management centralized and directive. ‘Big boss’ expected to issue direct instructions. Consultation from manager is a sign of weakness. Middle managers have little power over strategy. Precise instructions to subordinates with no discussion. Conclusion: Russian leaders use an autocratic leadership style; no clear preference for one of two major leadership styles (transactional or transformational), and elements of both styles are being used. Russian managers would be characterized by high PDI, high UAI, medium-range IND, and low MAS. As has been stated, management tends to be centralized and directive. The boss - especially the 'big boss' - is expected to issue direct instructions for subordinates to follow. Little consultation will be expected from people lower down the company hierarchy. Indeed too much consultation from a senior manager could be seen as a sign of weakness and lack of decisiveness. Middle managers have little power over strategy or input in significant strategic decisions. Delegation is usually in terms of managers giving precise instructions to subordinates who are expected to perform their allocated tasks with little or no discussion.

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