A high degree of managerial mobility can be an asset for a company, but it can also be a disadvantage. Managers who are often transferred from one company to another may lack a shared perspective. Companies may have a high power distance rating, or they may be located in emerging markets with an emphasis on individualism.
Managing a high degree of managerial mobility in countries with high power distance rating
Managing a high degree of managerial mobility in countries with a high power distance rating can present a number of challenges to multinational companies. This distance can affect the power relationship between managers and subordinates and the ways in which these factors are communicated. In countries with a high power distance rating, managers need to be more direct, clear, and confident in their authority and knowledge. In addition, subordinates expect clear and direct instructions from their managers, especially the senior ones.
High power distance countries tend to have paternalistic societies in which firms and governments control many aspects of society. These countries include Malaysia, Indonesia, the Philippines, China, Russia, and the United States. In contrast, countries with low power distance ratings have cultures that value equality and encourage equality.
Countries with low power distance ratings treat their employees as partners. They are usually involved in key decisions and consult their employees. Moreover, salary ranges are narrow and all employees are treated as equals. Thus, a culture of low power distance is very different than that of a country with high power distance. By understanding these differences, managers can better manage the power distance and make their companies more competitive.
While a low power distance requires individuals to justify their superior positions with merit, a high power distance may allow power to be distributed without any merit or accountability. Unlike countries with a low power distance, in which managers must be accountable for their decisions, a high power distance rating can make it difficult to implement changes and foster employee autonomy.
There are some cultural differences that can affect the degree of managerial mobility. A culture with low power distance allows employees to have more freedom and control over decisions, while a culture with high power distance encourages people to respect and defer to their superiors.
Managing a high degree of managerial mobility in emerging markets
Internationalizing companies in emerging markets face multiple challenges that may make managing a high degree of managerial mobility challenging. One of these is the increasing pressure of governments to enforce more stringent laws. Another challenge is identifying specific managerial experience that is specific to a market. This experience can be difficult to measure, but it is important to understand if it is relevant to internationalization efforts.
In this study, business management students from Spanish and German universities were compared to each other and assessed for their geographic mobility readiness. The results revealed significant cultural differences. For example, German students were found to score higher on vertical individualism and lower on horizontal collectivism. However, they were also more willing to relocate geographically if they were offered material and social incentives. The researchers also found that an individual’s uncertainty tolerance influenced geographic mobility readiness.
While mobility is an appealing development strategy for developing leaders, it can have risks. In order to reduce risks, organizations should consider hiring midcareer managers and enhancing their skills and experience. Moreover, managers should consider formal training to complement internal mobility. The former can enhance diverse skills, while the latter can help a firm develop a strong leadership bench.
While international assignments continue to increase, assignments into emerging markets present unique challenges for global mobility leaders. According to the 2015 Global Mobility Trends Survey, the top emerging markets include India, Brazil, and the UAE. Respondents list these countries as the most challenging locations, due to issues regarding security, quality of life, and governmental regulation.
The company’s geographic readiness largely depends on its strategy. For example, ProfessionalCo promoted cross-segment initiatives and highlighted opportunities for people to move across businesses and locations. However, many moves were geographically driven, where geographic preference trumped the goals of the company.
Managing a high degree of managerial mobility in countries that emphasize individualism
In the United States and other Western societies, the emphasis on individual performance fosters a high level of entrepreneurial activity. These individuals create new products and ways of doing business. This entrepreneurial attitude has contributed to the dynamism of the US economy. However, it can also have its downsides.
The emphasis on individualism is a problem for firms because it makes it difficult to form teams within organizations. Individuals are competing with one another for their own performance, which makes cooperation difficult. According to a recent study from MIT, lack of cooperation in US firms hurts their overall performance. This can affect internal functions, labor-management relationships, and intercompany relationships.
Another problem with high managerial mobility is group identification. Group identification can hinder the creation of teams within an organization and discourage innovation. This can also lead to higher costs of doing business. When workers and managers do not know each other well, collaboration and teamwork will suffer.
A study by H.C. Hofstede between 1967 and 1973 revealed four major cultural dimensions that can affect organizational performance. One of these dimensions is the power distance, which measures how much individuals respect power differences. Those societies with high power distance are likely to accept inequality and special benefits for the powerful. On the other hand, societies with low power distance consider all members to be equal.
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