Business excellence in global corporations through ...

5 downloads 0 Views 204KB Size Report
B.S. Sahay is a Director, Management Development Institute (MDI), Gurgaon,. India. ... which usually characterises the global business environment, they have also ... on leadership in global context have convinced to the management thinkers.
Int. J. Value Chain Management, Vol. 3, No. 4, 2009

Business excellence in global corporations through emotionally intelligent leadership Sanjay Kumar Singh* OB&HRM, Institute of Management Technology, Raj Nagar, Ghaziabad – 201001, India E-mail: [email protected] *Corresponding author

B.S. Sahay Management Development Institute (MDI), Mehrauli Road, Sukhrali, Gurgaon – 122007, Haryana, India E-mail: [email protected] Abstract: The paper aims to investigate the antecedents of business excellence in global corporations across industry. The literature reviewed and its content analysis has given a very clear message about the role of leadership who are intelligent emotionally in making a corporation successful across the globe. It says that leader’s emotional intelligence plays a dominant role in designing organisations in such a way which will result into effective financial and psychological health of the organisation. As the model developed and depicted in the manuscript is conceptual in nature, it needs to be empirically validated before using it for the business excellence. Moreover, the proposed conceptual model can be used when the concerned organisations are engaged in designing organisational architectures. The research paper offers a fresh approach to look at the leadership developmental agenda of the companies. Keywords: leadership; emotional intelligence; global corporation. Reference to this paper should be made as follows: Singh, S.K. and Sahay, B.S. (2009) ‘Business excellence in global corporations through emotionally intelligent leadership’, Int. J. Value Chain Management, Vol. 3, No. 4, pp.431–445. Biographical notes: Sanjay Kumar Singh is a Faculty Member in the area of OB&HRM, Institute of Management Technology, Ghaziabad, India. He has keen interest in researching and has been published in many top rated national and international journals. He teaches organisational behaviour, organisation development, cross-cultural management and psychological testing. His research interest is in the areas of emotional intelligence, organisational culture and leadership, organisational learning, and knowledge management. B.S. Sahay is a Director, Management Development Institute (MDI), Gurgaon, India. His teaching, research and consulting interests include logistics and supply chain management, production and operations management, project management, productivity management and business modelling. He is a Fellow of number of professional institutions including Institution of Engineers, Indian Institution of Industrial Engineering, Indian Institute of Public Administration, System Dynamics Society of India and World Academy of Productivity Science.

Copyright © 2009 Inderscience Enterprises Ltd.

431

432

1

S.K. Singh and B.S. Sahay

Introduction

The construct of leadership speaks of a set of skills and abilities which are useful whether one is in executive suite or the worker in the assembly line, as well as whether one is at the Dalal Street in Mumbai or at Parliament Street in New Delhi. The skill of leadership works well to heal psychological pains and provide ecstasy to the people in the countryside, it also helps industry captains to create and enact functional vision as well as mission for any corporation worldwide. But, it should not be construed as something which can easily be mastered by many for the betterment of individual or society or business corporation. Instead, it is the investment of long years of education and socialisation that one has been acted upon by the agent of the society. Hence, we find people in the business organisations to act in a significantly different manner when the situations demand consummate use of the grey matters which lie beneath the bony skull. Leadership roles in global corporations have been changing steadily and what is working today for a leader may be the same even five year down the line. The cardinal theme of leadership in the future will be to focus on the emergence of identity and relationships. In other words, the leadership in the future needs to be viewed as a shared social influence process of relating to each other (Karp and Helgo, 2008). Martin (2007) says that today’s leaders must be prepared for the future as globalisation intensifies the complexity in an already complex world. With globalisation and complexity come a greater temptation of interruption and higher levels of stress. With this increased stress, leaders must create a foundation of health to ensure that they have the energy for the challenging times ahead. Zahra (1999) says that tomorrow’s global marketplace will reward companies which will value entrepreneurial risk taking, invest heavily in developing intellectual capital, promote individual growth and adopt policies that are environmentally friendly. Hence, to do these arduous jobs of global corporations, the successful competitiveness in 21st century will demand the use of visionary and dedicated leadership. It is also being viewed that the dynamics, complexity and diversity which usually characterises the global business environment, they have also diffused into the domestic market which to make increasing demands on management and leadership competencies at all level (Gregersen et al., 1998; Harvey and Buckley, 2002). To do business successfully under these circumstances, increasing understanding of different aspects of globalisation and interrelationships of various factors and their changes will help organisations to meet the new challenges brought by globalisation, whether their primary operation environment is domestic, international, or global (Jokinen, 2005). Hence, there is urgent need to develop global competencies for persons especially in leadership roles in the corporations. McCall and Hollenback (2002) believe that these global competencies should be based on to the global business strategy which to determine what kind of global presence is desirable, how many and what types of international or global jobs, projects, task forces and other types of interactions exist. Moreover, the effect of globalisation has been such that the operating environment of the business which used to reside well within the geographic boundary of the nation up to 1990’s has gone away and as a result organisational mindset is of working locally but thinking globally. It is such that what happens in the small city of the USA, it impacts immediately and significantly to the life of businesses in the Indian subcontinent as well. In other words, these developments suggest that now the context of the business has gone for a sea change and this calls for a fresh look on to the part of the captain of

Business excellence in global corporations

433

industry to think of global leadership competencies. It is these global leadership competencies which will remain now onward as only competitive advantages for any corporations anywhere.

2

Leadership in global context

Dalton et al. (2002) believe that the challenges of global work arise in three areas and these are distance, country, and culture. Hence, when the world becomes smaller and workforce more diverse, a key challenge for leaders in this kind of scenario is to effectively lead across ‘cultural borders’. In this context, it is to note that global leadership needs to be custom fit to the multinational, multicultural, multilingual, multimedia worldwide that defines our relationships with our colleagues, subordinates, suppliers, customers, competitors, affiliates and parent organisations (Bonnsetter, 2000). For Martin (2007), leadership in globalised world is not a solo act, the concept of leadership is changing and the challenges that the leaders face today go well beyond their individual capacities. Leaders in the future need new skills set, greater collaboration skills, organisational architect ability, more flexible styles, to be open and adaptable to new ideas and be able to find examples of positive disobedience (Martin, 2007). These literatures on leadership in global context have convinced to the management thinkers about the need develop a different kind of leader who can effectively sail through even rough and turbulent water across cultures. Leaders of global enterprises need to be given a different kind of training to help them equip well with the challenges of liberalised world economy. Ready and Conger (2007) write that the HSBC, a global financial services firm, in an explicit efforts to develop leaders with wide-ranging international experiences have the organisational practices of tracking the career of their best performers and then to give them opportunities to work in different countries. Hence, it suggests that the corporations require to effectively manage their talent in such a way to create an enterprise-wide mindset in its employees, especially the top performers. The business organisations in the 21st century operate in an environment where there exist no physical or psychological boundaries, whatsoever. Hence, it has thrown both challenges as well as opportunities for the firms to increase their overall abilities for competitive advantages. The leaders of the future need to possess global capacity of appreciate cultural diversity, relationship skills, liking for technological innovations and their effective uses, and the likes. Companies must strive to become world-class organisations by providing the highest quality goods and services at the lowest cost, in a timely responsible manner, while simultaneously stimulating workforce morale and building collective learning capacities (Petrick et al., 1999). Hence, it is believed that successful corporate executives, when applying their global leadership styles and substance skills, enhance the intangible assets of corporate reputation and leverage the firm’s global sustainable competitive advantages (Barney, 1995; Davids, 1995; Heifetz and Laurie, 1997). Zahra (1999) believes that successful competitiveness in the 21st century will demand use of visionary and dedicated leadership, a balanced scorecard that enhances corporate accountability, and sustained investment in creating dynamic capabilities. Hence, it is stated that corporations which have truly become global in character in a free economy require leadership capabilities that are globally valued.

434

S.K. Singh and B.S. Sahay

Martin (2007) says that leaders of future need new skill sets, greater collaboration skills, and organisational architect abilities, to have in possession more flexible styles, to be open and adaptable to new ideas and be able to find examples of positive disobedience.

3

What leadership is?

Kets de Vries (1993) says that leadership has been the source of more intensive investigation than almost any other aspects of human behaviours. The year 1999 alone saw more than 2000 books on leadership getting published across the globe (Goffee and Jones, 2000). Leadership in organisation has been the most sought after topic to study by many management thinkers but still it remains a puzzle to be solved to the satisfaction of all concerned. This is simply because that leadership at workplace has been conceived and measured differently by those whosoever tried to help organisations in need. Today, CEOs are under constant pressure to find new sources of growth in an increasingly demanding and competitive business environment. CEOs must learn to inspire their organisations to new levels of inventiveness in everything that they do, not just in marketing or new product development (Leavy, 2005). Hence, it calls for a new kind of leadership role and thinking whereby all the stakeholders are internally energised for continuous renewal in people, processes, and product. In the knowledge economy, the challenges for leaders are to imagine an organisation in which innovation is the top priority, a company in which the culture supports the creativity and problem solving (McElroy, 2003). The knowledge-managing leadership drive invites creative responses to these demands by developing organisational environments which welcome experimentation and discussion among people at workplace (Uhl-Bien et al., 2004). One role of leadership is to remove barriers that suppress evaluation of business practices and often this requires release of personal power for the good of network development (Martin and Marion, 2005). It is also to quote Bennis (1999) who suggested that power in knowledge era resides more with all employees than with owners or managers. Leadership power, from this perspective, is a tool to enhance emergent behaviours among workers. Rather than prescribing processes for learning, then, leadership, according to this view, can amount to managing the conditions for learning and not learning itself (McElroy, 2003). To sum up, Senge (2000) enunciates three core characteristics for a person to be in a leadership role in present day organisations and they are of an architect, a teacher and a steward. These three qualities helps in clarifying mission, vision and values; specifying strategies, structure and politics; creating efficient learning processes and helping subordinate continually develop their mental model and system thinking. Survival and growth of organisations are based on a dramatic shift in leadership. It is no longer the time of a heroic leader – the leader walks in and takes up all the space in the board room. Instead, the job of today’s leader is to create space for other people to generate new and different ideas, to encourage meaningful conversation between people: and to assist people in becoming more effective, agile and prepared to respond to complex challenges (Martin, 2007). Many CEOs round the globe would talk to lack of qualified leadership talent as the most significant constraint on growth. Hence, companies must be rigorous in and focused in their assessment of leadership talent, aided by tools tailored to help achieve that end. They must hold leaders accountable for cultivating

Business excellence in global corporations

435

other, diagnosing gaps in execution and capability and redirecting resources as business needs change. In a nutshell, the companies need to bring a ‘measurement mind-set’ to the often inexact process of developing the next generation of leaders (Gandossy and Guarnieri, 2008). These academic discourses on leadership in present day modern organisations indicate that business in global environment requires a relatively different kind of leadership competencies than in a protected market. Hence, all the different perspectives on leadership need to be brought together and looked into to find pragmatic approach to help global corporations in building or developing leadership skills for excellence in boundary-less world. These efforts of academicians resulted into looking at leadership from two major lenses, namely transactional versus transformational approach. Still, none of them is perfect in itself but varying combination of transactional and transformational leadership attributes are exhibited by the global leaders in managing their corporations.

4

Understanding transactional vs. transformational leadership

In the time of rapid change and environmental complexity, leadership has taken a greater importance than ever before (Van Seters and Field, 1990). Yukl (2006) has succinctly explained in a very simplistic language that leadership is the ability to influence a group towards the achievement of the goals. Leaders are needed to empower all the members of the learning organisation by developing a shared vision, providing resources, delegating authority, celebrating successes, and most importantly, by being a learning architect (Hitt, 1995). Mahoney (2000) believes leadership to exist at all levels in the organisation, regardless of the size for it to consider itself a learning organisation ... there is no excuse for them (leaders) not creating an environment where everyone can participate in this process. The literature reveals that transactional leadership was largely studied until 1970’s which believe in reciprocity that the relationships between a leader and followers is based on the exchange of some form of reward. At the same time, it is to mention that the research literatures in the late 1970’s and onward started talking of a new kind of paradigm to be referred to as transformational leadership. Here, leadership is perceived as engaging the hearts and minds of others around for getting the work done in more effective way (Burns, 1978). But it is also to state that transactional and transformational leadership do not exclude each other, as a leader can be both (Bass, 1985). The research literatures indicate transformational as well as transactional forms of leadership to be positively associated with processes of organisational learning. Lam (2002) and Sadler (2001) in their studies found transformational leadership to have significantly positive effect on encouraging and emphasising teamwork spirits and involvement at workplace. Similarly, Bass (1997) and Bass and Avolio (1990) also found in their studies that transactional leadership significantly helps improve the efficiency of organisational learning. Therefore, it may be deduced that both transformational as well as transactional form of leadership have significantly positive effect on the functioning of learning organisation. The transactional leadership is oriented by demands, with focal emphasis on basic and external satisfaction against demands (Kim and Shim, 2003; Pounder, 2001). It is

436

S.K. Singh and B.S. Sahay

featured with a reasonable standard process for controlling, and it means a process of benefit exchange with the purpose to keep organisational stability. Robbins (2003) says that transactional leadership creates the goal orientation through role clarification and task request, and it can also lead and encourage subordinates through these activities. That means, leaders will affirm and reward subordinates’ efforts, and satisfy their relevant demands to reach esteem and support from these activities. Whenever subordinates commit any improper behaviour, immediate corrective punishment should be given immediately (Bass, 1997). On the other hand, the transformation leadership is there to inspire the potential capability of employee and allow subordinates with larger responsibilities to become an employee with self orientation and self enhancement capability. As a result, inspired employees reach organisational goals and personal milestones more easily (Burns, 1978; Fry, 2003). Tichy and Devanna (1986) contend that the transformational leadership should be cognitive of the requirements for organisational improvement, and further create the changed vision. Thus, they can receive organisational support through the change process. Walumbwa et al. (2005) say that twenty years of leadership studies have shown that leaders who exhibit the main components of transformational style generate higher level of commitment, greater satisfaction and effort on the part of the followers. It has also been proved that these components of leadership influences positively to the group cohesion in the organisation (Conger et al., 2000). It has also been observed in many of the studies that transformational style of leadership elevates self-efficacy of individual member of the company (van Knippenberg et al., 2004; Walumbwa et al., 2005). The character and strengths that an organisation gets depends to a large extent on the nature of leadership it has had, which flows from the top tier of management. Kotter (2002) says that leaders must make eight things happen in organisations which require significant and effective change. These eight things are namely instilling a sense of urgency, picking a good team, creating an enterprise vision, communicate well, remove obstacles, change fast, keep track of changing circumstances, and ensure the change to stick. Moreover, visioning, empowerment and the leader’s role in learning are essential ingredients of any successful leadership in organisation (Johnson, 1998; Senge, 1993). Mahoney (2000) views leadership to exists at all levels in organisation, regardless of the size, for it to consider itself a learning organisation … there is no excuse for them (leaders) not creating an environment where everyone can participate in this process. Leaders face a new challenge every time. They must see the emerging opportunities before they become manifest in the marketplace. The same sentiments have been echoed by Stonehouse and Pemberton (1999) who say that leaders must attach a high value to knowledge, encourage questioning and experimentation through empowerment, build trust and facilitate experiential knowledge of tacit knowledge throughout the organisation. Hence, we see that both transactional and transformational leadership are important for bringing successes to the organisation. It is the context where the role of these two different forms of leadership should be understood to have impact on to the overall functioning of the company. The transformational leadership is more suitable especially to organisations whose motives are to manage knowledge and become truly learning organisations. These organisations have got different culture, structure and the most importantly is the human resources who are highly motivated from within. Therefore, it is

Business excellence in global corporations

437

asserted that the preference for a particular form of leadership style should be based more on to internal environment of any organisation in any part of the globe.

5

Correlates of global leadership competencies

The filed of leadership has been more challenging for academia as well as practicing managers; hence, it has been thoroughly researched upon from different perspectives. As a result, the literatures on leadership are in plenty and used for developing leadership capabilities for organisational competitive advantages. On the other hand, we have scarce academic literatures which really dealt with unearthing genuine global leadership competencies needed for competing in a boundary-less world of business. In such a business scenario which the multinational corporations have been witnessing for past one decade or so, the role of management thinkers increases manifold for providing a culture-free set of global leadership competencies to be nurtured and nourished in their humanity at workplace for organisational excellence. This section exclusively deals with reviewing researches on global leadership competencies and also to develop a workable model for uses in the global corporations in operation across culture (Jordan and Cartwright, 1998). In a recent multinational talks in Beijing to resolve the North Korean nuclear situation, Russian diplomats reported that the North Korean missed a policy change enunciated by the US representative because they were too busy composing their own angry reply to what they expected him to say (Burris, 2003). The global leadership capability is basically a behavioural blend of cross-cultural competence combined with leadership skills. Success in the global environment requires more than just knowing about different cultural norms and management theories, but it is putting this knowledge into leadership practice (Carey et al., 2004). McCall and Hollenback (2002) observe that the global executives need to learn how to work cross-culture and it is for the most people an emotional education as well as an intellectual one. The challenges of global work arise in three areas: distance, country, and culture. When the world becomes smaller and the workforce becoming more diverse; the key challenge for leaders is to effectively lead across cultural borders (Dalton, 2003). Goleman et al. (2002) nicely summarise a business interaction which took place between American executive and Japanese client. One American executive was greeted with a prolonged silence after pitching a project to potential Japanese client. Instead of adversely reacting to the silence as a sign of disapproval, the American intuitively waited through the silence and, in the end, was rewarded with the contract. Hence, good understanding of the role of substantial difference in semantics for Goleman et al. (2002) is an important constituent of effective global leadership acumen. The learning emanating from literature review is that to thrive in global business environment, the leaders need to clearly understand their own culture, appreciate others’ differences, and adapt and integrate strategies for a variety of host cultures (Carey et al., 2004). Yeung and Ready (1995) in a comparative study of eight nations found six leadership capabilities which are universally valued in these countries for organisational excellence and these include capacity to articulate a tangible vision, values and strategy, to be a catalyst for strategic and cultural change, to achieve results, to empower others and to exhibit a stronger customer orientation. In a study of third world countries by Srinivas

438

S.K. Singh and B.S. Sahay

(1995), it was found that there are primarily eight component of global mindset which is essential for being successful in global business environment. These eight factors are curiosity and concern with context, acceptance of complexity and its contradictions, diversity consciousness and sensitivity, seeking opportunity in surprises and uncertainties, faith in organisational processes, focus on continual improvement, extended time perspective, and system thinking. Furthermore, it has also been noted by Jordan and Cartwright (1996) that personality characteristics as well as managerial competencies in equal proportion are requisite of international successes. In other words, Jordan and Cartwright (1996) believes that psychological profile of intellectual capacity, self-confidence, openness to experience and emotional stability along with managerial competencies of relational abilities, cultural sensitivity, linguistic ability, and ability to handle stress provide competitive advantages to leader(s) in the international business arena. On the other hand, at the macro level Rosen (2000) observes that globally literate leaders to possess four ‘global literacy’ namely, personal, social, business, and cultural literacy. These research literatures indicate that the capabilities of global leadership encompass almost all what we may think of a perfect personality which has equal concern for human resource, enterprise and its business strategy, and a genuine empathy for the welfare of the social community of the world. Hence, there is an urgent business need to find and also to develop a corporate personality who has got world class vision for both business and society for captaining the corporation(s) at a global level. The academicians as well as the practitioners have been constantly engaged in researching about global leadership competencies for the business organisations in the 21st century. It is simply because there is increasing business need for global leaders has been felt but still what specific competencies are required to be a global leader have not been explicitly identified (Morrison, 2000). It has been observed that excellent domestic leaders often have the same qualities as global ones, but that excellent global leaders retain these capabilities even in completely unfamiliar situations (Kets de Vries and Florent-Treacy, 2002). Such an observation made by Kets de Vries and Florent-Treacy (2002) suggest to the author(s) that people with global leadership attributes depict more of the qualities of an emotionally intelligent leaders who remain cool and composed even in tiring situations and deliver to the expectations of all concerned. Boyatzis et al. (1999) contends that emotional competencies such as self-awareness, self-management, social awareness, and relationship management are demonstrated by a person whenever she/he interacts with the world around. The research literatures like Boyatzis et al. (1999) on leveraging emotional intelligence for managing people and organisations are in plenty and all suggests to significant role of emotional intelligence competencies for bringing leadership excellence. The leadership excellence at the global level can also be brought about by the competencies of relationship management, personal effectiveness, business acumen, and the transformational self (Gregersen et al., 1998). All these competencies in a way suggest to leveraging the emotional brain to maximise competitiveness in a globally operated corporations. The literatures suggest that the greater the leaders’ emotional intelligence, the better leaders are at managing strong relationships by using emotion, and the better able they are to demonstrate effective performance (Goleman, 1998; Sosik and Megerian, 1999; George, 2000; Lewis, 2000). Moreover, in order to be a benefit to teams and work groups, leaders need to establish strong emotional relationships with team members (Goleman, 1998; Sosik and Megerian, 1999), and be able to

Business excellence in global corporations

439

effectively manage those relationships at workplace (Sosik and Megerian, 1999; George, 2000). George (2000) in a path breaking study found that there are primarily four aspects of emotional intelligence which to provide leaders with requisite abilities to motivate and transform team members. These are the ability to accurately appraise others’ emotions as well as effectively portray personal emotions; being thorough knowledge about emotions, meaning thereby that leader is able to predict emotional reactions in various scenarios; deals with usage of emotions whereby emotionally intelligent leaders recognise that emotions are useful in the influence of the behaviour on cognition of others; and finally the management of emotions by the leaders. If these are the characteristic features of emotionally intelligent leaders, they are said to be happier and more committed to their organisation (Abraham, 2000), perform better in the workplace (Goleman, 1998; Watkin, 2000), achieve greater success (Miller, 1999), take advantage of and use positive emotions to envision major improvements in organisational functioning (George, 2000). These research literatures have led us to believe that emotional competencies play a significant role in increasing the productivity level of persons in global leadership roles. Hence, it is needed to exclusively look for scientific literatures to conform the view point that emotional intelligence provides competitive advantages to people who are captaining corporations which are global in character.

6

Role of emotional intelligence in global leadership capability

Learning to work across cultures has been proved to be important competencies for any global executive, and these learning for most people is an emotional education as well as an intellectual one (McCall and Hollenback, 2002). Gardner (1995) believes that leaders help create meaning for teams and groups of people – they interpret, react, and show emotional response to ideas, concepts, and situations. The emotional role of the leader is of particular importance in times of change and reform (Harris et al., 2003), which explains the growing interest in the significance of emotional intelligence in leadership. It is being believed that emotions convey information about relationships and therefore people with emotional intelligence might be more socially effective than others in certain respects. Effective leaders have a high level of emotional intelligence (Goleman et al., 2002; George, 2000; Goleman, 1998), have ability to perceive and express emotions, assimilate emotions in thought, understand and reason with emotions, and regulate emotions in themselves and others (Mayer et al., 2000; Cherniss, 2001), and sensitive to situational cues and readily adapt their own behaviour appropriately (Sosik et al., 2002; Kolb, 1998; Zaccaro et al., 1991; Cronshaw and Ellis, 1991). Bennis (1989), an important management thinker, believes that emotional intelligence being more powerful than IQ in determining who will emerge as leader under given situations. It is also being deliberated that managers in corporations need planning, organising and controlling skills while leaders need emotional intelligence and behavioural skills (Gill, 2002). One of important observation among management thinkers, especially in the Europe, has been that there is growing recognition for a new type of leadership in order for British business to be more competitive in the global market. Moreover, there is no general agreement about what this should be, or how it should be developed, but as a start, leadership development as distinct from management

440

S.K. Singh and B.S. Sahay

training should focus on the emotional intelligence of the individual. It has been found while reviewing many research findings by Goleman et al. (2002) that the more senior the leader, the more critical emotional competencies become. This pointed observation of Goleman et al. (2002) is still to find wide acceptance in both academia as well as the corporate world. Hence, it is contended that the claim made by Goleman (1995) that emotional intelligence accounts for more than 85% of exceptional performance in top leaders is not supported by empirical researches conducted across the globe (Harris et al., 2003). Cooper (1997) while quoting Nick Zenuik, a former leader of an executive team at Ford Motor Company, says that “emotional intelligence is the hidden competitive advantage and if one takes care of the soft stuff the hard stuffs take care of itself”. Other authors, from evidence gathered in other fields of study, assert that focusing on emotional intelligence can contribute to building competitive advantage (e.g., Cooper, 1997; Cooper and Sawaf, 1997; Harrison, 1997; Martinez, 1997). In some of the studies, it has also been found that emotional intelligence is related to positive outcomes such as pro-social behaviours, parental warmth, and positive family and peer relations (Mayer et al., 1999; Rice, 1999). Leading the global corporations require leadership to be stress resistant as it helps them perceive and interpret the business reality as they exist. These mental exercises may create perception of too much of stress at times, but leader(s) need not to get distracted by the destructive emotions. They need to possess skills and competencies to convert these destructive emotions into positive one in the larger interest of the organisations. It has been observed that person in leadership roles who are emotionally intelligent experience significantly less stress at work than their less emotionally intelligent counterpart (Bar-On, 1997; Bar-On et al., 2000; Ciarrochi et al., 2002; Nikolaou and Tsaousis, 2002; Slaski and Cartwright, 2002). It is a fact that captaining any business organisations in present day boundary-less world, the CEOs need to possess as well as uses of emotional intelligence to gain competitive advantages. Of late, management thinkers have started talking about urgent need for an appropriate leadership framework which if practiced will lead the leaders to create business value in their corporations which are global in operation. There is not a single framework on leadership for global corporation which is effective yet simpler in providing easy insight to the CEOs in managing their businesses. Hence, the framework of leadership for global business enterprises are proposed by the authors which is based on the research findings of the management thinkers across the globe. This leadership framework has been developed by deducing the cardinal theme which has been found to run across research literatures on leadership. The framework of leading corporation(s) in global market is based on the assumption that cognitive competencies of the CEOs provide them with only threshold level input as well as perspective in making business sense in a complex global business environment. Hence, to leverage only the cognitive mind with all its higher level of mental processes involved will let the leaders know the business reality which to exist at the surface level. Such a surface level understanding of the business reality will certainly be detrimental in managing the show at in a global world order. Hence, what is required is that these CEOs need to scratch the surface level facts, figure, information and the likes to fid out the real underlying cause(s) of the problems in the operating business environment. Therefore, they have to maximise other domain of competencies than the cognitive one and here comes the role of competencies which are integral part of the affective mental domain.

Business excellence in global corporations

441

These competencies in the affective brain of the CEOs are the emotional competencies which if used effectively will certainly maximise their chance of making correct business decisions when handling the imperceptible world of global corporations. It is these imperceptible world where does lie both business and knowledge solutions to the problems of the corporate world. Hence, the CEOs who is having superior form of emotional competencies and also adept in using these mental resources in an efficient way will certainly getting more and more successes. Figure 1

Emotional intelligence, global leadership competencies, and organisational effectiveness: a conceptual model

Emotional intelligence

Cognitive intelligence

Global leadership skills

Organisational design Strategy, techno-structural, culture, human resource policies, inter and intra-organisational linkages

Organisational effectiveness

This framework of leading global corporation should be taken into consideration with pinch of salt as the laboratory in the field of management science is significantly different from the laboratory in the field of truly physical sciences. In other words, there are variables which are extraneous in nature which the CEOs will find difficult to control and as a result some of their business decisions may not be functional for the overall competitive edge of their corporations.

7

Conclusions

Looking into all the above mentioned empirically arrived at findings on leading a global corporation, it becomes imperative to note that a leader needs to intelligently use all his/her higher form of mental resources for competitive advantages in a global environment. To be more precise, it is not only the uses of cognitive brain alone but also of the resources of emotional brain which should be utilised equally for providing competitive edge to the firm in operation in any part of the world. If a leader lacks emotional intelligence, his/her success rate is likely to be low as the cardinal threads of leadership are creating trust, inspiring people, drafting vision, managing relationships, ability to look clearly into the invisible part of the business, and the likes. These needed skills of leaders consume lot of their psychic energy which resides in the emotional cortex and hence, their effective management is prerequisite for leveraging higher mental processes of reasoning, analysis, synthesis, and the likes. It is only an emotionally intelligent leader who can do it successfully with great ease. Thus, the businesses in the present millennium need to practice the mantra of ‘competing through emotional intelligence’.

442

S.K. Singh and B.S. Sahay

References Abraham, R. (2000) ‘The role of job control as a moderator of emotional dissonance and emotional intelligence – outcome relationships’, The Journal of Psychology, Vol. 134, pp.169–184. Barney, J. (1995) ‘Looking inside for competitive advantages’, The Academy of Management Executive, Vol. 9, pp.49–61. Bar-On, R. (1997) The Emotional Quotient Inventory (EQ-I): Technical Manual, Multi Health Systems, Toronto, Canada. Bar-On, R., Brown, J.M., Kirkcaldy, B.D. and Thome, E.P. (2000) ‘Emotional expression and implications for occupational stress: an application of emotional quotient inventory (EQ-I)’, Personality and Individual Differences, Vol. 28, pp.1107–1118. Bass, B.M. (1985) Leadership and Performance Beyond Expectations, Free Press, New York. Bass, B.M. (1997) ‘Does the transactional-transformational leadership paradigm transcend organizational and national boundaries?’, American Psychologist, Vol. 52, No. 2, pp.130–139. Bass, B.M. and Avolio, B.J. (1990) ‘The implications of transformational and transactional leadership for individual, team and organizational development’, in Richard W.W. and William, A.P. (Eds.): Research in Organizational Change and Development, Jai Press, Greenwich, CT, Vol. 4. Bennis, W. (1999) ‘The leadership advantage’, Leader to Leader, Spring, Vol. 12, pp.8–23. Benniss, W. (1989) On Becoming a Leader, utchison, London. Bonnsetter, W. (2000) ‘The DNA of global leadership competencies’, Thunderbird Magazine, Vol. 42, No. 2, p.136. Boyatzis, R.D., Goleman, D. and Rhee, K. (1999) ‘Clustering competence in emotional intelligence: insights from the emotional competency inventory (ECI)’, Consortium for Research of Emotional Intelligence in Organizations, available at www.eiconsortium.org. Burns, J.M. (1978) Leadership, Harper and Row, New York. Burris, J. (2003) ‘Bush foreign policy: major thinking afoot’, The Honolulu Advertiser, B2. Carey, C.E., Newman, P.M. and McDonough, L.M. (2004) ‘Global leadership capability: an Asia-pacific perspective’, Performance Management, Vol. 43, No. 8, pp.13–18. Cherniss, C. (2001) ‘Emotional intelligence and organizational effectiveness’, in C. Cherniss and D. Goleman (Eds.): The Emotionally Intelligent Workplace, Jossey-Bass, San Francisco, pp.3–12. Ciarrochi, J., Deane, F. and Anderson, S. (2002) ‘Emotional intelligence moderates the relationship between stress and mental health’, Personality and Individual Differences, Vol. 32, No. 2, pp.197–209. Conger, J.A., Kanungo, R.N. and Menon, S.T. (2000) ‘Charismatic leadership and followers effectiveness’, Journal of Organizational Behavior, Vol. 21, No. 7, pp.747–767. Cooper, R.K. (1997) ‘Applying emotional intelligence in the workplace’, Training & Development, Vol. 51, No. 12, pp.31–38. Cooper, R.K. and Sawaf, A. (1997) Executive EQ: Emotional Intelligence in Leadership and Organizations, Gosset, Putnam, New York NY. Cronshaw, S.E. and Ellis, R.J. (1991) ‘A process investigation of self-monitoring and leaders emergence’, Small Group Research, Vol. 22, pp.403–420. Dalton, M. (2003) Center for Creative Leadership Update, Center for Creative Leadership, Greensboro, NC. Dalton, M., Emst, C., Deal, J. and Leslie, J. (2002) How to Work Across Distance, Countries and Cultures: Success for the New Global Managers, Centre for Creative Leadership, Greensboro, NC. Davids, M. (1995) ‘Where style meets substance’, Journal of Business Strategy, Vol. 16, No. 1, pp.48–60.

Business excellence in global corporations

443

Fry, L.W. (2003) ‘Toward a theory of spiritual leadership’, The Leadership Quarterly, Vol. 14, No. 6, pp.693–727. Gandossy, R. and Guarnieri, R. (2008) ‘Can you measure leadership?’, Sloan Management Review, Vol. 50, No. 1, pp.65–69. Gardner, H. (1995) Leading Mind: An Anatomy of Leadership, Basic Books, New York, NY. George, J.M. (2000) ‘Emotions and leadership: the role of emotional intelligence’, Human Relations, Vol. 53, No. 2, pp.1027–1041. Gill, R.W. (2002) ‘Is Britain being led astray?’, in Simms, J. (Ed.): The Director, January. Goffee, R. and Jones, G. (2000) ‘Why should anyone be led by you?’, Harvard Business Review, Vol. 69, No. 1, pp.131–137. Goleman, D. (1995) Emotional Intelligence: Why it Can Matter More than IQ, Bantam Books, New York. Goleman, D. (1998) ‘What makes a leader?’, Harvard Business Review, Vol. 76, No. 4, pp.92–102. Goleman, D., Boyatzis, R. and McKee, A. (2002) Primal Leadership, Harvard Business School Press, Boston, MA. Gregersen, H.B., Morrison, A.J. and Black, J.S. (1998) ‘Developing leaders for the global frontier’, Sloan Management Review, Vol. 40, No. 1, pp.21–32. Harris, A., Day, C., Hopkins. D., Hadfield, M., Hargreaves, A. and Chapman, C. (2003) Effective Leadership for School Improvement, Routledge Falmer, New York and London. Harrison, R. (1997) ‘Why your firm needs emotional intelligence’, People Management, Vol. 3, No. 1, p.41. Harvey, M. and Buckley, R.M. (2002) ‘Assessing the conventional wisdom of management for the 21st century organization’, Organizational Dynamics, Vol. 30, No. 4, pp.368–378. Heifetz, R.A. and Laurie, DA (1997) ‘The work of leadership’, Harvard Business Review, Vol. 75, No. 1, pp.124–134. Hitt, W.D. (1995) ‘The learning organization: Some reflections on organizational renewal’, Leadership & Organization Development Journal, Vol. 16, No. 8, pp.17–25. Johnson, J. (1998) ‘Embracing change: a leadership model for the learning organization’, International Journal of Training and Development, Vol. 2, No. 2, pp.141–150. Jokinen, T. (2005) ‘Global leadership competencies: a review and discussion’, Journal of European Industrial Training, Vol. 29, No. 3, pp.199–216. Jordan, J. and Cartwright, S. (1996) ‘Selecting expatriate managers: key traits and competencies’, Leadership & Organization Development Journal, Vol. 19, No. 2, pp.89–96. Karp, T. and Helgo, T. (2008) ‘The future of leadership: the art of leading people in a ‘post-managerial’ environment’, Foresight, Vol. 10, No.2, pp.30–37. Kets de Vries, M.F.R. and Florent-Treacy, E. (2002) ‘Global leadership from A to Z: creating high commitment organizations’, Organizational Dynamics, Vol. 30, No. 4. pp.295–309. Kets De Vries, M.R. (1993) Leaders, Fools and Imposters, Jossey-Bass, San Francisco, CA. Kim, H.S. and Shim, S. (2003) ‘Gender-based approach to the understanding of leadership roles among retail managers’, Human Resource Development Quarterly, Vol. 14, No. 3, pp.321–342. Kolb, J.A. (1998) ‘The relationship between self-monitoring and leadership in student project groups’, Journal of Business Communication, Summer, Vol. 35, No. 2, pp.264–282. Kotter, J.P. (2002) ‘Managing change: the power of leadership’, Balanced Scorecard Report, HBS Publication, Boston, MA, pp.1–4. Lam, Y.L. (2002) ‘Defining the effects of transformation leadership on organization learning: a cross-cultural comparison’, School Leadership & Management, Vol. 22, No. 4, pp.439–452.

444

S.K. Singh and B.S. Sahay

Leavy, B. (2005) ‘A leaders guide to creating an innovation culture’, Strategy and Leadership, Vol. 33, No. 4, pp.38–45. Lewis, K.M. (2000) ‘When leaders display emotion: how followers respond to negative emotional expression of male and female leaders’, Journal of Organizational Behavior, Vol. 21, No. 2, pp.221–234. Mahoney, R. (2000) ‘Leadership and learning organizations’, The Learning Organization, Vol. 7, No. 5, pp.241–243. Martin, A. (2007) ‘The future of leadership: where do we go from here?’, Industrial and Commercial Training, Vol. 39, No. 1, pp.3–8. Martin, J.S. and Marion, J. (2005) ‘Higher educational leadership roles in knowledge processing’, The Learning Organization, Vol. 12, No. 2, pp.140–151. Martinez, M.N. (1997) ‘The smarts that count’, HR Magazine, Vol. 42, No. 11, pp.72–78. Mayer, J.D., Caruso, D.R. and Salovey, P. (1999) ‘Emotional intelligence meets traditional standards for an intelligence’, Intelligence, Vol. 27, pp.267–298. Mayer, J.D., Salovey, P. and Caruso, D.R. (2000) ‘Models of emotional intelligence’, in R.J. Sternberg’s, (Eds.): Handbook of Human Intelligence, Cambridge University Press, New York, p.396. McCall, M.W. Jr. and Hollenback, G.P. (2002) Developing Global Executives: the Lessons of International Experience, Harvard Business School Press, Boston, MA. McElroy, M. (2003) The New Knowledge Management: Complexity, Learning and Sustainable Innovation, KMCI Press/Butterworth-Heinemann, New York, NY. Miller, M. (1999) ‘Emotional intelligence helps managers succeed’, Credit Union Magazine, Vol. 65, No. 6, pp.25–26. Morrison, A.J. (2000) ‘Developing a global leadership model’, Human Resource Management, Vol. 39, Nos. 2/3, pp.117–132. Nikolaou, I. and Tsaousis, I. (2002) ‘Emotional intelligence in the workplace: exploring its effects on occupational stress and organizational commitment’, The International Journal of Organizational Analysis, Vol. 10, No. 4, pp.327–342. Petrick, J.A., Scherer, R.F., Brodzinski, J.D., Quinn, J.F. and Ainina, M.F. (1999) ‘Global leadership skills and reputational capital: intangible resources for sustainable competitive advantages’, The Academy of Management Executive, Vol. 13, No. 1, pp.58–69. Pounder, J.S. (2001) ‘New leadership and university organizational effectiveness: exploring the relationships’, Leadership and Organization Development Journal, Vol. 22, No. 6, pp.281–290. Ready, D. and Conger, J. (2007) ‘Make your company a talent factory’, Harvard Business Review, Vol. 85, No. 6, pp.68–77. Rice, C.L. (1999) ‘A qualitative study of emotional intelligence and team performance’, Unpublished Master’s Thesis, Pepperdine University, Malibu, CA. Robbins, S.P. (2003) Organizational Behaviors: Concepts, Controversies, and Applications, 7th ed., Prentice Hall, Englewood Cliffs, NJ. Rosen, R.H. (2000) ‘What makes a globally literate leader?’, Chief Executive, April, pp.46–48. Sadler, P. (2001) ‘Leadership and organizational learning’, in Dierkes, M., Antal, A.B., Child, J. and Nonaka, I. (Eds.): Handbook of Organizational Learning and Knowledge, Oxford University Press, Oxford. Senge, P.M. (1993) ‘Transforming the practice of management’, Human Resource Development Quarterly, Vol. 4, No. 1, pp.5–32. Senge, P.M. (2000), ‘Reflection on a leaders’ new work: building learning organization’, in D. Morey and B. Thuraisingham (Eds.): Knowledge Management: Classic and Contemporary Work, MIT Press Cambridge, MA. Slaski, M., and Cartwright, S. (2002) ‘Health, performance, and emotional intelligence: an exploratory study of retail managers’, Stress and Health, Vol. 18, No. 2, pp.63–68.

Business excellence in global corporations

445

Sosik, J. and Megerian, J. (1999) ‘Understanding leader emotional intelligence and performance’, Group and Organization Management, Vol. 24, No. 3, pp.367–391. Sosik, J.J., Potosky, D. and Hjung, D.I. (2002) ‘Adaptive self-regulation: meeting other’s expectations of leadership and performance’, Journal of Social Psychology, Vol. 142, No. 2, pp.211–232. Srinivas, K.M. (1995) ‘Globalisation of business and the third world: challenge of expanding the mindset’, Journal of Management Development, Vol. 14, No. 3, pp.26–49. Stonehouse, G.H. and Pemberton, J.D. (1999) ‘Learning and knowledge management in the intelligent organization’, Participation and Empowerment: An International Journal, Vol. 7, No. 5, pp.131–144. Tichy, N. and Devanna, M. (1986) The Transformational Leader, John Wiley & Sons, New York, NY. Uhl-Bien, M., Marion, R. and McKelvey, B. (2004) ‘Complex leadership: shifting leadership from industrial age to the knowledge era’, Paper presented at the National Academy of Management Meeting, New Orleans, LA. Van Knippenberg, D., van Knippenberg, B., De Kremer, D. and Hogg, M.A. (2004) ‘Leadership, self and identity: a review and research agenda’, The Leadership Quarterly, Vol. 15, No. 6, pp.825–856. Van Seters, D.A. and Filed, R.H.G. (1990) ‘The evolution of leadership theory’, Journal of Organizational Change Management, Vol. 3, No. 3, pp.29–45. Walumbwa, F.A., Lawler, J.J., Avolio, B.J., Wang, P. and Shi, K. (2005) ‘Transformational leadership effects on work-related attitudes: the moderating effects of collective efficacy and self-efficacy across cultures’, Journal of Leadership and Organization Studies, Vol. 11, pp.3–16. Watkin, C. (2000) ‘Developing emotional intelligence’, International Journal of Selection and Assessment, Vol. 8, No. 2, pp.89–92. Yeung, AK and Ready, DA (1995) ‘Developing leadership capabilities of global corporations: a comparative study in eight nations’, Human Resource Management, Vol. 34, No. 4, pp.529–547. Yukl, G.A. (2006) Leadership in Organizations, Prentice Hall, New Jersey. Zaccaro, S.J., Foti, R.J. and Kenny, D.A. (1991) ‘Self-monitoring and trait-based variance in leadership: An investigation of leader flexibility across multiple group situations’, Journal of Applied Psychology, Vol. 76, No. 2, pp.308–315. Zahra, SA, (1999) ‘The changing rules of global competitiveness in the 21st century’, The Academy of Management Executive, Vol. 13, No. 1, pp.36–42.