Motivation and Leadership Practices Around the World

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Table of Contents

Introduction
Methodology
Background Literature
Case Study Analysis
Analysis
Conclusion
Reference

Introduction

Organizational culture is highly affected by national culture. Cultural conditioning affects the way a leader behaves and what his/her personal value systems are which in turn is reflected in his/her leadership style. It is the culture which shows what are the key factors that motivate an employee and what organizational policies and procedures have been “crystallized in the institutions” like family, organization, schools, etc. which reflect the culture that is shown upon the common beliefs which are derived from common culture (Hofstede, 1980, p.43). Employee motivation and leadership are strongly affected by culture (Hofstede, 1980). As there are differences in cultural practices so arises differences in practices of leadership (House, 2004).

Thus, culture has a strong impact on the employee motivation (Herzberg, 1965; Hofstede, 1980) as well as on leadership style (Hofstede, 1980; House, 2004). Further the effect of globalization has reduced the distance between cultures and more and more multinational companies are adopting a global culture which does not reflect the essence of any regional culture. Given this it will be interesting to understand if there exist any cultural affect on the leadership styles of cultures or there are any affect that culture has on motivation of employees. Further it is leadership of a company which shapes the organization and its operations. So leadership is an important factor which needs to be considered while analyzing two organizations and motivation is important to understand what drives the employees to work. For a company to be successful a good leader and motivated employees are very important. So it is important to understand what kind of leadership style and motivating factors drives the growth of two companies, from two different cultural backgrounds.

Aim and Objective

Culture of a country has its effect in forming the beliefs and thoughts of a country. It is argued that due to the difference in the value structure there is a difference in the leadership style and the motivation of employees. This paper argues that culture has its effect on the leadership style as well as motivation. The reason is found in the basic relationship between employee and leader as well as in the company policies. In this effect, the paper studies two organizations viz. Emirates and Virgin Atlantic in order to understand the cultural difference that affects the leadership style and motivation in both the organizations. Different organizations have different culture and structure which define the way employees are to be motivated or the leadership style that is prevalent in the organization. As British and Arab cultures are completely different from each other and so it will be interesting to understand the difference in leadership styles and The paper will also try to find if the perceived difference due to culture is actually existent or not. So the research question for the study is that if there is any difference in leadership style and motivation to employees in Virgin Atlantic and Emirates? If yes, to what the difference may be attributed?

Methodology

For this purpose the paper is divided into three broad categories. The first part will provide a brief understanding of the literature and theories which will be used throughout the paper. Then the study will undertake a qualitative research by presenting a case study analysis of Virgin Atlantic and Emirates airlines and undertake a study of the leadership and motivating factors used in the two organizations and the underlying difference in them. The data for the case study will be gathered from secondary sources and will be assembled to understand the effect of culture, and regional difference in leadership style and motivating factors. The paper will first discuss the background of Emirates and Virgin Atlantic. Provide a brief background of the company. Then we will provide a brief literature review where we will discuss the various leadership and motivation theories and which will be used for the study. Then the study will show the cultural variances that are expected in motivation and leadership. Given this the study will exemplify the case of Virgin Atlantic and Emirates with the aid of secondary sources like the newspaper, websites, magazines, etc.

Background Literature

The literatures which are relevant for this study are theories on motivation, leadership and culture. Motivation theories are full of theories which are used in the organization behaviour literature like the like the theories of Maslow, Herzberg, Vroom, etc. leadership theories are spread with various leadership styles which has been studied over the years like charismatic leadership, autocratic leadership or transactional or transformational leadership. With culture becoming the distinct moderating factor for these variables, it is also important to understand the effect of the leadership style and motivating factors of the employees with change in culture.

Culture

Hofstede presented a four dimensional model of culture where he states that culture varies due to the differences in the degree of these dimensions in the culture. The cultural dimensions as discussed by Hofstede are power distance, uncertainty avoidance, masculinity and individualism. Power distance is one of the first dimensions of national culture. This indicates if the society accepts the unequal distribution of power in organizations. This is reflected, according to Hofstede in the less powerful members of the society and the people with power. Uncertainty avoidance implies the extent to which society is threatened by uncertain or confusing situations and is eager to avoid these situations by providing greater career stability or through more formal rules, not tolerating non-standard ideas and behaviours etc. and societies where uncertainty avoidance is higher are characterized by higher degree of anxiety and a stronger inner desire to work harder. Individualism is a character of society which is demonstrated by frame of the society – whether it is loosely knit or tight social framework – which demonstrates whether the society is individualist or collectivist in nature.

A collectivist society is one where the community and societal bonds are stronger while it is weaker in individualist societies. An individualist society is characterized by a group of people who are expected to take care of their immediate family only while a collectivist society is characterized by in-groups or out-groups wherein it is expected that the in-group will take care of them. Masculinity and femininity is the third dimension of culture as demonstrated by Hofstede. A masculine culture is characterized by masculine characters like assertiveness, acquisition of money and other materials, non-caring, etc. these values as Hofstede states reside within the cultures (Hofstede, 1980). Given this difference in culture due to variations in the degree of dimensions in the culture, there arises a variety of differences in cultures and so the way people behave and work in different cultures differ. This will further be explained through a discussion of motivation and leadership.

Applying this theory on the cultures of Great Britain and Iran (we assume that Iranian culture will represent the Middle Eastern culture in totality in terms of the cultural dimensions of Hofstede) Hofstede got the following result. First, in terms of power distance and uncertainty avoidance, Middle Eastern countries have a large power distance and strong uncertainty avoidance. While that of Great Britain is low power distance and weak uncertainty avoidance. Great Britain has a highly individualistic culture while that of Middle East is collectivist in nature. According to Hofstede, Great Britain has a masculine culture while that of Middle East is feminine in nature.

Motivating Employees

Why do people do their job? This is because something or someone motivates them to do it. There are a large number of theories on human motivation. According to Sigmund Freud humans are prompted to work by unknown forces within themselves which he termed as id. He called human conscience ego which Freud believes tries to control and enforce the unknown forces within humans. And there exists according to Freud a superego which criticizes the human’s acts when it succumbs to the id and ego and is called the superego. According to Freud, superego is the production of early interaction and socialization process, where the human learns from family, society, etc.

Though Freudian theory has been very successful in the field of psychology, it is seldom used in organizational theory. Other researches like David McClelland, Abraham Maslow, Frederick Herzberg, and Victor Vroom. According to Mclelland, who devised the need theory states that humans work because they have an innate need to achieve. He feels that humans work for they have a desire to achieve something, and this desire motivates them to work. Maslow postulated a hierarchical need theory of humans. He stated that human’s needs are stacked up in hierarchical pyramids. With the basest need related to physiological existence like food, cloth etc. are called physiological needs which is followed by security, social needs and at the top self actualization. Maslow uses McClelland’s theory of achievement but defines it in a broader way.

Maslow’s need hierarchy theory postulates that a higher need gets activated if and only if a lower need is satisfied. Maslow postulates that human needs are based on rational desires which are successively stacked in hierarchical pattern. Herzberg presented two factor theory of motivation which distinguishes between hygiene factors and motivating factors or motivators. The former, according to Herzberg, correspond to Maslow’s lower end levels of needs like the physiological, security and social needs while the latter corresponds to its higher end needs like esteem, self-actualization. The hygiene factors can motivate negatively if they are not fulfilled, thus, making them the reason of dissatisfaction among humans if not fulfilled, while the motivators when fulfilled provide motivation to work through positive motivation. Vroom brought in the role of expectancy in motivation, where he argued that humans expect some kind of outcome of their actions and are driven by it consciously. So the drive is external in case of Vroom’s theory and in all other theories like that of Maslow, Herzberg or McClelland as opposed to Freud’s theory which talks of internal drive which makes people do a certain job. Given these theories on motivating, it is now important to understand the cultural effect on motivation.

Leadership

Power and leadership has been discussed by Machiavelli as early as in the fifteenth century, who discussed various tactics to be used to manipulate the power to get the desired outcome. The present leadership theories which are present in the organisational behaviour literature are that by Douglas McGregor (Theory X Theory Y), Rensis Likert (System 4 management) and Robert Blake and Jane S. Mounton (the Managerial Grid). These theories stress on the advocate of the leader’s decision on the followers/ employees. Here the theories stress on participative management style but the basic assumption is that they take is that the leaders initiate the participative process. Hofstede’s argues that these leadership styles are culturally bound, so we consider two leadership styles which are transaction, transformational leadership and passive leadership.

Transactional leadership is stressed by a few characteristics by the following characteristics as has been described in Eeden and Cilliers based on the study of Bass and Avolio (Eeden et al, 2008). This leadership style involves a leader who clarifies what need to be done and what need to be done to complete the task. So the follower completes the task as instructed by the leader in order to gain reward and avoidance punishment on non-completion. In this form of leadership, the stress is laid on rules and regulations, and when failure occurs, followers in consultation with the leader take corrective actions. While in case of transformational leadership style, the leader has idealized influence over the follower who respects, admires and trusts the leader and tries to emulate his/her behaviour. So the leadership values are transgressed into the follower which becomes the main discourse of leadership. Thus, this leadership style is focused on empowerment of the employees and the leader inspires the follower with his/her enthusiasm, charisma, and vision to achieve specific goals. This form of leadership enables intellectual stimulation to the followers and so innovation and creativity development is encouraged. Follower development becomes a concern of the leader and mentoring is actively encouraged in this form of leadership. Passive leadership style emphasizes the absence of leadership where the leader completely leaves the responsibility on the follower and the followers are self managed.

Case Study Analysis

Company Background

Virgin Atlantic

Virgin Atlantic Airways is a British long-haul international airline (Datamonitor, 2009). The company is a privately owned company with 51 percent of its stakes with Virgin Group and 49 percent with Singapore Airlines (Datamonitor, 2009). The airline was launched by Richard Branson’s Virgin Group in 1984 and is based from London’s Gatwick and Heathrow airport. Presently Richard Branson is the chairman of Virgin Atlantic and the CEO is Steve Ridgeway.

A quick SWOT analysis of Virgin Atlantic shows that the strengths of the company are its strong brand name which is attached to Richard Branson and his Virgin Group. And comprehensive services which includes “Scheduled passenger services, Cargo handling, Aircraft maintenance, Ancillary airline activities, Leisure travel services” (Datamonitor, 2009, p.13). The weakness of the company is in its private ownership which makes it at the disadvantage as compared to publicly held companies when it comes to raising money and lack of scale where it is not in a position to compete with KLM r British Airways due to diseconomies of scale. The opportunities for Virgin Atlantic are in the growth of UK airline industry, moderately growing global airline industry, and the global growth of tourism. The threats that it faces are intense competition in international airline arena due to price discounting of fares, slowdown of global economy, and EU regulations which states that all passengers who have been denied a seat and hold a valid ticket must be compensated (Datamonitor, 2009).

Emirates

Emirates Airways is a Dubai based airline, which has 20 years with a net income of $1.37 billion (ATW, 2008). The CEO and Chairman of the company is Ahmed bin Saeed Al-Maktoum. The company is wholly owned by the United Arab Emirates (UAE) government (Datamonitor, 2008). It is a travel organization which provides travel solution to the Middle East. It was established on 1959.

Culture and Motivation

Now if we consider British culture with that of Middle Eastern culture using Hofstede’s cultural dimensions. The research by Hofstede demonstrates the following (Hofstede, 1980):

Middle Eastern countries score higher in power distance than Great Britain.
In uncertainty avoidance, Middle Eastern countries have stronger uncertainty avoidance than British culture.
Middle Eastern culture is essentially collectivist in nature, while that of Britain is individualist.
Middle Eastern countries score lower on masculinity than Great Britain.

Thus Middle Eastern culture’s one striking feature is high power distance and uncertainty avoidance which Hofstede’s believes is a more comfortable combination as where the leadership process ensures that there is a powerful leader who is blamed as well as praised thus satisfying one need of high uncertainty avoidance. Working hard acts as an external force rather than internal force to work which drives the urge to work in these parts of the globe. While in Great Britain, has a low power distance, and low uncertainty avoidance, implying that the work is done to satisfy two motivations, first is to satiate the desire to undertake risky venture and the drive to work is internal for there is a lack of power distance.

Further, as individualism is, low in Middle Eastern countries, there is a stress on collective form of work environment. There is a form of group thinking and behaviour that can be identified in these countries, where there is more of citizenship behaviour in the organization. So with high collectivism and uncertainty avoidance and low masculinity, there is a stress on service quality in airline business in Middle Eastern countries. That is why emirates stress on the quality of service they provide and they compete as a full service airline in this era of low-cost airlines. Hofstede further showed that Middle Eastern countries are lowest in their desire to achieve according to McClelland’s model and high in case of Great Britain. As has been identified by Hofstede Britain is more concerned with performance and willingness to accept risk as a performance measure has been a key to motivating employees in this region, while in middle eastern countries, there is a stress on quality rather than quantitative performance aspect as in case of middle eastern countries.

Hofstede (1980) further argues that according to Maslow’s hierarchy of need, there is a need for achievement motivation which he describes as performance and risk, strong uncertainty avoidance implies security motivation. So in case of middle eastern countries work security and low risk is a motivational factor while in Great Britain, higher risks motivates a person. Again the stress is on performance rather than quality. Social motivation of Maslow is dictated by quality of life motivation which is high in Britain as well as Middle East but the security factor is added in the former’s motivational system. Hofstede’s argues that “Maslow’s hierarchy puts self-actualization (achievement) plus esteem above social needs above security needs” and thus does not description of all the cultures globally (Hofstede, 1980, p.55). So according to Hofstede, in Great Britain social needs rank highest as a motivating factor and in middle eastern countries, security and social needs are the highest need that is required to be motivated (Hofstede, 1980, p.56).

Culture and Leadership

Leadership in this globalized has been identified as a key factor for the success of an organization (Javidan et al, 2006). Research has shown that leadership style differs with the influence of culture (Hofstede, 1980; Javidan et al, 2006). According to the globe project study the leadership style that is more prevalent in Great Britain is charismatic/value based leadership, medium team orientation, high participation, low humane orientation, medium level of autonomy and low serf-protective. While in case of Middle Eastern leadership, the study found that the leadership are low on charisma/value based leadership style, low team orientation, low participative management style, medium humane orientation, medium autonomy and high self protective. So the main difference in the leadership styles of Britain and Arab world is in self-protective nature of the leader. Arab leaders are essentially self-protective while British leaders are low on the scale. Charisma is low for Arabic leaders who concentrate more on transaction based leadership while British leaders are more charismatic and value oriented and thus enforce a transformational form of leadership style. Further team orientation is medium while in the Arab world, team orientation is low enforcing individual’s responsibility.

Hofstede has also stated that culture of the organization also has a significant effect on the leader’s personality through societal constructs which are shown through the leader’s interaction with his subordinate (Hofstede, 1980). The leadership values and beliefs find exposure in leadership style which may be embedded in low/high power distance or low/high uncertainty avoidance, and so on. So Hofstede states that countries where power distance is low, like Great Britain, subordinates are found to be more independent, there is more participation in decision making process, leaders are value based or charismatic, an equitable distribution of laws and rules irrespective of position, and “status symbols are frowned upon” (Hofstede, 1980, p.61). Whereas in case of Middle Eastern leadership, which is characterised by high power distance, Hofstede believes that the leadership style represents stronger subordinate dependence on leader, autocratic leadership is accepted norm and followers expect leaders to be autocratic, an ideal leader is more paternalistic in nature, leaders are expected to have privileges of position and status symbols are considered important in such cultures. Thus, there is a distinct difference in the leadership style of Great Britain and Middle Eastern countries.

Analysis

Emirates Airways and Virgin Atlantic are companies which operate in the same industry segment and cater to similar customers, but their basic differences lie in two facts: (1) both are from different cultures, one from Arab culture and the other from British culture and (2) Virgin Atlantic is owned by Richard Branson’s and Emirates is a government owned company.

Leadership of Emirates and Virgin Atlantics

To compare the leadership of Virgin Atlantic and Emirates we will consider the two owners of the companies i.e. Richard Branson and Sheikh Ahmed bin Saeed Al-Maktoum.

Richard Branson is characterized by high level of charisma that has infused his personal interests and values in the enterprise he has created (Mayer, 2007). His colourful personality and adventures are reflected through his leadership style which steers Virgin Atlantic. Airlines are the biggest piece of Branson’s operations and his charismatic and colourful personality has helped in creating red and violet of Virgin Atlantic. He is a transformational leader. One reason for this is his initiative to bring about change in the company as well as in the whole industry for a social cause: “In a letter to airlines, aircraft manufacturers and airport operators, Branson said aviation creates around 2 percent of global CO2 emissions.

We need to accelerate the pace at which we reduce aviation’s impact on the environment” (Business Travel News, 2007). He emphasizes on a leadership style which is characterized by taking calculates risks and like to take ones. So he is a leader who is low on power distance and uncertainty avoidance. Branson has been described as the “rebel billionaire” and (Thottam et al, 2008). The business model for Virgin Atlantic that Branson has shows his leadership style which is “a hybrid that delivers good service at a reasonable price and eliminates the hub-and-spoke approach that creates mayhem whenever the weather sours” (Thottam et al, 2008, p.42). Thus, his leadership style is more on taking risks and he is an individualistic leader. Richard Branson is a transformational leader who thrives with charisma and vision. He presents these visions to his employees and provides them a goal and the leverage to work independently to achieve the vision. Richard Branson has the characteristics of a British leader who is charismatic, team oriented, and low protectionist attitude.

Now considering the leadership style of Sheikh Ahmed bin Saeed Al-Maktoum we see that he is more of a transactional leader. The power distance is evident in the organization through its stress on the chairman being called and mentioned as “His Highness” in the company annual report. So there is a stress on symbolism and position. The leader states that the management and the directors are fully responsible in taking decisions regarding organizations and due to its bureaucratic structure the leadership and power distance is high in the organization. The leader gains immense power over and above other executive and non-executive members and there is a general acceptance of the same. The chairman having descended from the royal family enjoys the privileges and treatment of the royalty. The leadership is high on protectionism which is clear from the allegations against the airline regarding subsidies provided by the government which creates its profits. The leader states that they are not being subsidized and refutes the allegations:

“Sheikh Ahmed shrugs off such allegations. “To us, it’s something that airline chief executives bring up to make them look good in front of their governments or boards of directors. They cannot compete and they blame subsidies for their failures,” he says, adding that the charge is groundless. “Look at our fleet. The Dubai government couldn’t cover our cost of developing it, even if all our oil revenues went to pay for it. Or look at our financing: ask any of the banks that we deal with, they can tell you that the government not only puts forward no money, they don’t even guarantee any of our purchases.” (Pinkham, 2003, p.30)

Thus, the leadership style is distinct with power distance, protectionist attitude of the leader, and transactions in leadership style where they are more concerned with the operations and profits and nothing else. While the leadership of Virgin Airlines shows a high degree of charisma and value based ideology infused in the organization which makes the environment more vibrant and colourful like the personal values and personality of t he leader. In the case of Virgin Atlantic the organizational culture is developed around the personality of Richard Branson, while that of Emirates is a power and bureaucracy based structure which is based on the national cultural values and norms and not on the personality of the leader Al-Maktoum.

Motivation in Emirates and Virgin Atlantics

As has been discussed earlier, motivation of employees depends on the culture of the nation and organization. As in case of Virgin Atlantic, the culture stresses on an independent, creative, value based environment. The employees in Virgin Atlantic are expected to be motivated by their charismatic leadership. This has been seen in many instances where Branson has stated his personal values and ideal to create the visions of the leader. In case of Emirates traditional thinking dominates decision making process and high power distance is evident which provides security to the employees. Thus, there is high uncertainty avoidance in the society which is removed by job security in the organization. The employees being mostly from Arab world are motivated by traditional motivators of high degree of rules and regulations and security. For instance in case of Emirates a regulation based, hierarchical structure will be motivating for employees while in case of Virgin Atlantic motivation will be derived from team based structure.

Virgin Atlantic’s ventures into risky and uncertain avenues show that employees are happy in this environment, but if such uncertainty was brought into the lives of the employees of Emirates they will be highly dissatisfied. Due to existence of high power distance in Arab culture there is a distinct demarcation in the leader-follower relation and a distance is maintained between the two with formalized relationship. While that is Virgin Atlantic is very open with employees having the privilege to meet the company leadership or escalate matters to the top management whenever need be. The paternalistic ideology of motivation in Emirates is clear from the chairman’s quote in the Career section of their website which states: “I look forward to you joining our team and being part of our future success, as we grow and expand our business globally.” (Emirates, 2009). While Branson’s statement in the career section of Virgin Atlantic shows the empowerment that organization holds to motivate its employees is reflected: “The people who make up Virgin Atlantic, make Virgin Atlantic” (Virgin Atlantic, 2009). Thus, there is a strong empowerment and independence as motivational factors in Virgin Atlantic while Emirates is motivated through paternalistic leadership with rules base system.

Conclusion

Motivation and leadership styles change as the national and organizational culture change. Hofstede’s assertion that national culture has a strong effect on the leadership style of the company has been found true in case of our case study analysis of Virgin Atlantic and Emirates Airlines. The cultural dimensions bring about a difference in the leadership style and the motivational factors in the organization. Both the companies are profit making companies but the main essence of the organization are different and the difference arises due to the difference in the culture and leadership personality of the companies. The leadership styles and values are completely different and their operational and ventures are also different. Further culture changes the motivational factors which will help the employees be oriented to work. In conclusion it can be said that the research shows that companies are affected by the culture of the country they hail from. Their leadership and motivation are moderated by the cultural dimensions and characteristics.

Reference

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Javidan, M., Dorfman, P.W., Luque, M.S.d. & House, R.J., 2006. In the Eye of the Beholder: Cross Cultural Lessons in Leadership from Project GLOBE., Academy of Management Perspectives 20(1), p. 68-90.

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