CHAPTER 8

LEADERSHIP AND EMPLOYEE BEHAVIOR IN

INTERNATIONAL BUSINESS

MGT 361: CHAPTER 8_FPP UITM

 LEARNING OBJECTIVES:

1. Identify and discuss the basic perspectives on individual

differences in different cultures.
2. Evaluate basic views of employee motivation in
international business.
3. Identify basic views of managerial leadership in
international business.
4. Discuss the nature of managerial decision-making in
international business.
5. Describe group dynamics and discuss how teams are
managed across cultures.

MGT 361: CHAPTER 8_FPP UITM

Individual Behavior in International Business
Individual Behavior in organizations is strongly influenced by a variety of
individual differences—specific dimensions or characteristics of a person
that influence a person. Most patterns of individual differences are, in turn,
based on personality. Other important dimensions that relate to individual
behavior are attitudes, perception, creativity, and stress.

INDIVIDUAL INDIVIDUAL
DIFFERENCES BEHAVIOR
Personality Differences Across Cultures
Personality is the relatively stable set of psychological attributes that distinguishes
one person from another.

Biologically Inherited (“Nature” Argument)

Personality Attributes “Nature v s Nurture”
e r s u

Nurtured (“Nurture” Argument)

Figure 8.1 The “Big Five” Personality Traits
 Other Personality Traits at Work
Locus of Control
The extent to which people
believe that their behavior has a
real effect on what happens to
them. People who maintain that
individuals are in control of their
lives are said to have an internal
locus of control. People who
think that forces beyond their
control dictate what happens to
them are said to have an external
locus of control.
Self-efficacy
A person’s beliefs about his or
her capabilities to perform a
task. People with high self-
efficacy believe that they can
perform well on a specific task,
whereas people with low self-
efficacy tend to doubt their
ability to perform that task.
Authoritarianism
A person believes that power and
status differences are appropriate
within social hierarchies. A
person who is highly
authoritarian may accept
directives from someone purely
because that person is “the
boss.” On the other hand, a
person who is not highly
authoritarian may carry out
appropriate directives from the
boss, but he or she is also more
likely to question the boss or
refuse to carry out orders.
Self-esteem
A person believes that he or she
is a worthwhile and deserving
individual. A person with high
self-esteem is more likely to seek
higher-status jobs and be more
confident in her ability to achieve
higher levels of performance and
greater intrinsic
accomplishments. In contrast, a
person with less self-esteem may
be more content to remain in a
lower-level job, be less confident
in his ability, and focus more on
extrinsic rewards.
Attitudes Across Cultures
Attitudes are complexes of beliefs and feelings about specific ideas, situations, or
other people. While some attitudes are deeply ingrained and persist over time, others
can be formed or changed quickly.

 Job-related Attitude
Job Satisfaction: This is an attitude that reflects the extent to which
an individual is gratified by or fulfilled in his or her work.
Organizational Commitment: Reflects an individual’s identification
with and loyalty to the organization. An employee who has made major
personal investments in an organization will be more committed to that
organization than an employee who has not.
Perceptions Across Cultures
Perception is the set of processes by which an individual becomes aware of and
interprets information about the environment. An individual’s cultural background
plays a role in shaping how the person’s filtering mechanisms work.

 International Business
 Perceptual Process
 Stereotyping: It occurs when inferences about people are made because of
the characteristics they possess. While stereotypes may sometimes be useful
as cultural generalizations, all managers should be aware that everyone is
unique and may or may not fit preconceived impressions.
 Cultural Background: An individual’s cultural background plays a role in
shaping how the person’s filtering mechanisms work.
Stress Across Cultures
Stress is an individual’s response to a strong stimulus. This stimulus is called a
stressor.

Stress Two different perspectives on stress

Optimal versus Too Much Stress International assignments

“Good” versus “Bad” Causes Differences across cultures
Motivation in International Business: Needs and
Values Across Cultures
Motivation is a set of forces that cause people to choose certain behaviors from a set of
available behaviors. An appreciation of these individual differences is an important first
step in understanding how managers can better motivate their employees to promote the
organization’s goals.

Needs Values
What an individual must have or wants to have. What people believe to be important
 Primary Needs: Instinctive and physiologically
 Learned
based
 Developed
 Secondary Needs: Psychological in character and
are learned from the environment and culture in
which the individual lives.
Motivational Processes Across Cultures
 Modern Theoretical Approaches
Need-Based models: are those that attempt to identify the specific
need or set of needs that result in motivated behavior.
Process-Based Models: focus more on the conscious thought
processes people use to select one behavior from among several.
Reinforcement Model: deals with how people assess the
consequences of their behavioral choices and how that assessment
goes into their future choice of behaviors. This model incorporates
the roles of rewards and punishment in maintaining or altering
existing behavioral patterns.
Need-Based Models Across Cultures (1 of 5)

Geert Hofstede’s Dimensions of National Culture

Abraham Maslow’s Hierarchy of Needs

David McClelland’s Learned Needs Framework

Frederick Herzberg’s Two-Factor Theory

Need-Based Models Across
Cultures (2 of 5)
 Geert Hofstede’s Dimensions

Insights into how need-based models of

motivation are likely to vary across cultures.
Social Orientation
Power Orientation
Uncertainty Orientation
Goal Orientation
 Need-Based Models
Self-
Actualization Across Cultures (3 of
5)

Self Esteem  Abraham Maslow’s

Hierarchy of Needs
 Self-Actualization
Social
 Self-Esteem
 Social
Security
 Security
 Physiological
Physiological
Need-Based Models Across
Cultures (4 of 5)

 David McClelland’s Learned Needs Framework

Relevant findings for international managers
 The need for achievement exists in many
different countries
McClelland’s needs are not likely to be
constant across cultures
Need-Based Models Across
Cultures (5 of 5)

 Frederick Herzberg’s Two-Factor Theory

Satisfaction and Dissatisfaction
Fails to yield consistent results
Process-Based Models Across Cultures
 Expectancy Theory

The theory suggests that people are motivated to behave in certain ways to
the extent that they perceive that such behaviors will lead to outcomes they
find personally attractive.

Process View of Motivation

Behavioral Choice
Cultural Dimension of Social Orientation
The Reinforcement Model Across Cultures

 Behavioral Choice
Positive Outcome (Reinforcement)
Repeated Behavior
Negative Outcome (Punishment)
Different Behavior
Leadership in International
Business

 Leadership (Non-Coercive Influence)

Shape The Goals
Motivate Behavior
Determine The Culture
Contemporary Leadership Theory (1 of 2)

Contemporary leadership theories recognize that leaders cannot succeed by always

using the same set of behaviors in all circumstances. Instead, leaders must
carefully assess the situation in which they find themselves and then tailor one or
more behaviors to fit that situation.

 Common situational factors

Individual Differences Among Subordinates
Characteristics of the Group, the Organization, and the Leader
Subordinates’ Desire to Participate
 Leadership Behavior and Hofstede’s Cultural Factors
Contemporary Leadership Theory (2 of 2)

Figure 8.2 The Role of Managers Varies across Cultures

“It is important for a manager to have at hand precise answers to most of the questions that
subordinates may raise about their work.”
(Percentages refer to those in agreement.)
Source: Based on International Studies of Management and Organization , vol. XIII, Nos. 1–2 (Spring–Summer
1983), by permission of M.E. Sharpe, Inc., Armonk, N Y 10504.
The Globe Leadership Project

1. Charismatic/value-based leadership: The ability to inspire, motivate, and promote high

performance.
2. Team-oriented leadership: Emphasizes team building and creating a sense of common
purpose.
3. Participative leadership: The extent to which leaders involve others in making
decisions.
4. Humane-oriented leadership: Being supportive, considerate, compassionate, and
generous.
5. Autonomous leadership: To being independent and individualist.
6. Self-protective leadership: The behaviors intending to ensure the safety and security of
the leader and the group; include being self-centered, status-conscious, conflict-
inducing, and face-saving.
Decision Making in International Business: Models of
Decision Making
Figure 8.3 Models of the Decision-Making Process
The Normative Model Across Cultures
Steps in the Normative Model Cultural Implications
1. Problem Recognition Social Orientation

2. Identifying Alternatives Power Orientation

3. Evaluating Alternatives Goal Orientation

4. Selecting the Best Alternative Social Orientation

5. Implementation Power Orientation

6. Follow-Up and Evaluation Power Orientation

The Descriptive Model Across Cultures

FEW RESEARCH HARD TO PREDICT POTENTIAL

STUDIES INFLUENCE LIMITATIONS
Groups and Teams in International Business: The
Nature of Group Dynamics
Group versus Team
A group is any collection of people working
together to accomplish a common purpose.
A team is a specific type of group that assumes
responsibility for its own work.
Mature Team
Well-Defined Role Structure
Established Norms for Members
Team Members Are Cohesive
Informal Leaders Direct the Team
Managing Cross-Cultural Teams (1 of 2)

Dynamics Heterogeneous Team Homogenous Team

Conflict Higher Lower

Communication Lower Higher

Creativity Higher Lower

Norms Weaker Stronger

Cohesiveness Lower Higher

Informal Leadership Ambiguity Clarity

Managing Cross-Cultural Teams (2 of 2)

Social Power Uncertainty Goal Orientation

Orientation Orientation Orientation
In an individualistic In a power-respecting If a task is vague, Teams in an aggressive
culture, establishing culture, team members ambiguous, or goal behavior culture may
shared norms and should be from the same unstructured, an work together more
cohesiveness may be level of the organization, uncertainty-avoiding effectively if their goal
somewhat difficult, since members from lower group may be unable to has financial implications.
while in a collectivistic levels may be intimidated by function effectively; in On the other hand, teams
culture, team those from higher levels. In a contrast, an uncertainty- in a passive goal behavior
cohesiveness may power-tolerant culture, accepting group may culture may be more
emerge naturally. variation in organizational thrive. motivated by quality-of-
level may be less of a work outcomes.
problem.
Review Questions
 Define personality and explain how personality differences affect individual behavior.
 Explain how attitudes vary across cultures.
 Discuss the basic perceptual process and note how it differs across cultures.
 Explain how attitudes and perceptions can affect each other.
 Discuss stress and how it varies across cultures.
 Identify some of the basic issues managers must confront when attempting to motivate
employees in different cultures.
 How do needs and values differ in different cultures?
 Summarize the steps in the normative model of decision-making and relate each to
international business.
 Why are teams so important? What are the basic implications of teams for an international
business?
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END OF SLIDE

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MGT 361: CHAPTER 8_FPP UITM