Leadership Essay: Management Of MNC’S subsidiary In Mozambique
One year after completing your post graduate study, you are assigned to take up the leadership of a Multinational Corporation (MNC) in your country of origin. (MOZAMBIQUE)
Your company owns a leading brand competing with other global brands in such items as premium quality shoes, bags, clothing and insurance policy for protection on valued goods such as gold and diamond ornaments. The Management of the brand takes place at your organizations headquarters in the United States of America (home country). As your Organization is a MNC, it recruits from many countries and cultures. Specialist skill in manufacturing and design is mostly undertaken by French and Italian nationals. Periodically these Italian and French nationals come to live and work in your home country where manufacturing and part retail is operationalized. These French and Italian employees, along with Americans, other third country nationals work alongside employees from your country (host country).
The office to which you have been appointed has
A total number of 100 employees. Understandably, 60% of the staff is citizens of your home country, while 40% are from ten different countries.
Your task is the following:
Drawing on knowledge developed within this module, your own experience and wider reading, you are requested to write a leadership essay of 3500 words where you engage and address the following aspects of your role:
Explore relevant theories on leadership and consider theories/practices/approaches that might be appropriate for leadership in this multinational and multicultural context. (Approximately 500 words)
Critically analyse theories and literature associated to organizational and national culture and outline possible culture-related challenges and consider how you would mitigate inevitable issues (500 words).
Communication will be another challenge which you will need to address. In your essay, critically reflect on ways in which you will manage communication barriers between employees. Also, elucidate how language difference could enhance a closer working environment (500 words).
You are advised to undertake a process of change that requires your subsidiary to show proof of awareness and application of ethical, moral and ecologically friendly approaches that enhance sustainability to boost the image of your company. Consider how to implement this demand.
At the time you are appointed, the motivation level of employees and the working atmosphere is tensional. Critically discuss how you will raise levels of confidence, motivation and ensure harmony and collegiality is established (500 words).
Critically engage with the literature on emotional intelligence to consider how you will draw on Goleman’s dimensions to achieve more collective leadership practice.
The research on leadership essay signifies that multinational companies (MNCs) consist of assets and facilities in at least one country other than its home country, and the leaders of MNCs are selected based on the ability to deal with globalized challenges (Ascani and Iammarino, 2018). This essay will be a reflection on the leadership qualities as a CEO of a US-based MNC’s subsidiary in Mozambique that can potentially help the MNC in terms of dealing with other global brands. The MNC mentioned in the essay is headquartered in the United States of America, and the company recruits employees from various countries and cultures. In addition to that, the MNC specializes in manufacturing and design that have been predominantly undertaken by Italian and French Nationals. Overall, the MNC has 100 employees, out of which 60% are citizens of Mozambique, and the remaining 40% are from 10 different countries. There are clashes in the working environment of the MNC, and this is potentially caused by cultural differences in the company’s working environment, as the culture of Mozambique is different from other countries.
The first section of this essay will explore the relevant leadership theories that are appropriate for leadership in this multinational context. The second section will be a critical analysis of the literature and theories that are associated with national and organizational culture along with possible mitigation of the inevitable issues. The third section will reflect on managing the communication barriers between employees, and the fourth section will undertake a process of change required to boost the image of the company. Lastly, the fifth section will be a critical discussion about the process of improving confidence level among employees, and the sixth section will critically engage with the emotional intelligence literature based on Goleman's dimensions that is effective in achieving collective leadership practice.
Relevant leadership theories that can be appropriate in the context of the mentioned MNC
Leadership theories matter because a good leader tends to fuel better performance, and since people are complicated, so the concept of leadership theories makes things a lot easier (Cox, Hannif, and Rowley, 2014). In the mentioned case study of a US-based MNC, the working culture of the company is quite diverse, and thus it is important for the company’s leader to follow relevant leadership theories that can prove to be effective in the mentioned multi-cultural context.
Transformational leadership theory: This leadership theory is based on the concept of leaders working with teams for identifying the required changes along with creating a vision to guide the changes through inspiration and executing the required change in tandem with the committed group members (Lai et al., 2020). Therefore, this leadership theory can be considered as an integral part of the Full Range Leadership Model that will allow the leaders of the mentioned MNC to implement transformational leadership style at various levels of the business operation. The leaders of the mentioned MNC can effectively influence its team members to follow the practices that will benefit the organizational goals rather than individual interests based on this theory.
Charismatic leadership theory: This leadership theory relies on the persuasiveness and charm of the leader as charismatic leaders are driven by their own commitment and convictions (Sacavem et al., 2017). The leaders of the mentioned MNC will possess immense confidence based on this leadership theory, and this will help in making the employees believe in the vision of the leaders. As per the given scenario of the US-based MNC, 40% of the employees hail from 10 different countries, so it has become extremely important to develop the qualities of being appealing and reactive to the team members. Overall, based on the charismatic theory of leadership, the leaders of the given multi-cultural context will be able to develop better communication among the team members, which is extremely crucial given the diverse working environment of the company.
Relational leadership theory: This leadership theory emphasizes the relationships among people while leading an organization by valuing the aspects of empowerment, inclusion, ethical behaviors, purposefulness, and process orientation (Sim, 2018). The leaders of the mentioned MNC can potentially develop better relationships among the Italian, French, American, and other third-country nationals with the employees of Mozambique so that a better working environment is created where employees will possess respect and compassion for each other.
Therefore, by combining the aspects of transformational, charismatic, and relational leadership theories, the leadership style in Mozambique's business operation of the company can be influenced to ensure that the diverse employee backgrounds work as a collaborative unit and helps the company run its business operations smoothly in Mozambique without any cultural clashes. Overall, the business operations in Mozambique will require efficient leadership qualities that will be appropriate in the leadership management of the MNC’s subsidiary in Mozambique.
Literature and theories associated with national and organizational culture along with related cultural challenges and their mitigation
In today’s business environment, national and organizational culture requires tremendous skills and efficiency in the aspect of leadership to manage the global workforce (Tanner, 2019). Organizational culture can be placed between the organization and occupational level, whereas national culture differs at the value level.
Hofstede (1980) – five dimensions: This cultural model or theory distinguishes cultures according to the five dimensions of power, identity, gender, time, and uncertainty (Beugelsdijk and Welzel, 2018).
Figure 1: Hofstede’s five cultural dimensions
Source: (Soares, Frahangmehr and Shoham, 2019)
The main strength of this model is based on the perspective of groups and individuals in terms of decision-making along with playing organizational roles that are analyzed on the factors of influence group and dynamic individuals. This cultural model can serve as the base of other researches for the CEO of the US-based MNC’s subsidiary in Mozambique. Since this theory is a framework of cross-cultural communication, so based on this, the CEO of the MNC's subsidiary can improve cross-cultural communication among the diverse team members, which will lead to better business functioning, especially in the manufacturing department where there is a domination of the French and Italian nationals.
Schein (2004) – visible and invisible cultural aspects: In the majority of cultures, the invisible aspects tend to cause or influence the visible ones, and Schein's cultural model or theory enables organizations to recompose their culture by applying the concepts of the proposed model (Cotter-Lockard, 2016). The shared basic assumption level of an organization that is the bedrock of an organization culture will be crucial for the CEO of the MNC's subsidiary in Mozambique as based on this; the cultural values can be shared to develop mutual respect among the team members. In addition to that, since the MNC's subsidiary in Mozambique consists of a diverse workforce, so the cultural aspects will always be a cause of concern as some cultural differences are visible, and some are hidden. The visible cultural elements for the MNC’s subsidiary are color, language, dress, traditions, and social etiquette, whereas the hidden differences include assumptions and cultural values. The CEO of the MNC’s subsidiary can consider Schein’s visible and invisible cultural aspects to develop a sense of mutual understanding and respect among the team members regarding the diverse cultural factors.
Overall, corporate culture is not confined to a set of beliefs, but rather it comprises behavioral patterns, a set of values, artifacts that have expanded across the globe (Groysberg et al., 2018). Therefore, the synthesis of the mentioned MNC subsidiary’s corporate culture will require effective management styles, communication, and values that will help in overcoming potential cultural clashes in the company’s working environment. The CEO of the MNC subsidiary in Mozambique can effectively emphasize cross-cultural communication to mitigate the issues of cultural clashes that are inevitable based on the diverse working environment of the company.
Critical reflection on managing communication barriers between employees along with analysis of language difference enhancing the closer working environment
In the mentioned US-based MNC’s subsidiary in Mozambique, 60% of the employees are Mozambique nationals, whereas the other 40% hails from ten different countries. This has resulted in massive communication barriers based on language and cultural differences. It has thus become essential to manage the communications barriers so that the working environment is efficient and effective. Communication is one of the most important fundamental aspects of leadership and management, and a diverse work environment tends to create communication barriers between employees (Luthra, 2015). Good communication helps employees to be more involved in their work process, along with developing a better understanding of their roles and responsibilities. Communications thus involve sharing of ideas, opinions, facts, understanding, and information. The CEO of MNC’s subsidiary in Mozambique can promote knowledge sharing as a basic approach to manage communication barriers as establishing clear communications will ensure that the employees understand the expectations from them. In addition to that, the CEO must also strive to build effective teamwork that will allow the employees to look beyond the self-interests along with focusing on the best objectives of the team. Team building effectively helps in breaking communication barriers and simultaneously allows the employees to find innovative ways of working together (Fapohunda, 2013). It is important to consider the abilities and skills of employees before placing them to ensure that the assigned responsibilities meet the standards. Communication among the team members can also be improved by planning various team activities outside the work, such as after-work events or group lunches. All these measures can potentially manage the communication barriers among employees that might occur under the mentioned multi-cultural or multinational context of the US-based subsidiary in Mozambique.
Language difference is a major factor in terms of causing communication barriers in the workplace (Kumbakonam, 2016). In the mentioned US-based MNC’s subsidiary in Mozambique, the company operates with a diverse workforce, and 40% of its workforce speaks differently as they come from different countries. However, language difference sometimes enhances a closer working environment by adding a sense of curiosity among the team members in terms of learning another language. It is the natural tendency of human beings to find foreign or unfamiliar things interesting, so in terms of a diverse working environment, the employees get attracted in terms of learning foreign languages and cultures. Interests in language difference sometimes lead to compassion among the team members and ultimately results in a close work environment. It is evident that diversity leads to innovation and a diverse workplace sometimes fosters innovation and ideas that are a major driver in terms of creating a productive working environment. Being an MNC, the mentioned company needs to be fully equipped to serve global clients, and language differences in the workplace makes employees help each other out in terms of their known language. Overall, uniquely diverse languages can help a team understand different cultures and experiences that tremendously help in building an organization that works collaboratively by providing services at various levels.
A process of change based on moral, ethical, and ecological approaches for enhancing the image of the MNC along with the implementation
Implementation of organizational changes initiates by defining the changes or shifts that are required in a business (Terrel, 2019). A process of change sometimes creates a process and strategy to achieve the goals. As per the mentioned US-based MNC’s subsidiary in Mozambique, the CEO of the subsidiary can use the six methods proposed by Kotter & Schlesinger, and this will help facilitate the required changes along with overcoming resistance. Generally, changes can be based upon planned change, emergent or unplanned change, incremental change, and radical or quantum change (Yi, Gu, and Wei, 2017). However, based on Kotter’s eight steps Change Model, the CEO of the MNC’s subsidiary can enhance the image of the company that will be crucial to make the business function run smoothly. There is tremendous competition in the modern globalized business environment, so the aspect of enhanced reputation plays a decisive role in terms of driving large traffic of customers. There also lies tremendous opportunity to bring about a change in the concept of a diverse work environment, as based on the diverse working culture of the company, the CEO can utilize different skill levels that will ultimately make versatile contributions to the company's business process. The Italian and French nationals can form a cross-functional group that will create the best manufacturing unit, and a leader among them can be chosen to ensure that all the necessary changes are lead properly.
The CEO can potentially consider socializing change that will help the diverse workforce to understand, accept, commit and embrace the changes in the current business environment based on the implementation of CSR (corporate social responsibility). CSR implementation will show proof of the company's awareness regarding eco-friendly business approaches (Zelazna, Bojar, and Bojar, 2020). In addition to that, CSR implementation can tremendously increase consumer appeal by making the consumers interested in a patronizing business that supports value addition. However, the main role of CSR in the business practice of the mentioned US-based MNC's subsidiary in Mozambique will be the establishment of codes of conduct that will influence the attitude and behavior change required for making a diverse working environment deliver the best results. Implementation of CSR demand is quite challenging, as it requires adherence to economic, social, environmental, and human aspects. The company must thrive to ensure that its employees feel safe, happy, and healthy at work, along with investing more in the professional and personal development of the employees. Therefore, the mentioned MNC must establish a well-developed code of conduct so that the achievement of certain moral, ethical, and eco-friendly missions fosters a sustainable boost to the company's image, which will be vital for continuous growth. Overall, the implementation of the change process based on CSR implementation will establish a behavioral code of conduct that will ensure all employees irrespective of their nationality, work as a collaborative unit and contributes heavily to the business operation of the company, which is facing global challenges.
Critical discussion about rising confidence level among employees along with the motivation to ensure the establishment of collegiality and harmony
The working atmosphere of the company has been quite tensional given the 40% workforce of being selected from ten different foreign countries. The motivational level among employees is drastically low due to communication barriers in the diverse workplace environment. As per Maslow's theory of motivation, motivation is the result of an individual's attempt to fulfill five basic needs that includes safety, psychological, social, self-actualization, and esteem. In addition to that, these needs sometimes potentially create internal pressures that influence a person’s behavior. Therefore, the CEO of the US-based MNC can utilize Maslow’s theory of motivation to ensure that appreciation works as a major booster for a rising confidence level among the employees. The aspect of intrinsic motivation comes from within, whereas the aspect of extrinsic motivation arises from outside sources. The employees of the US-based MNC’s subsidiary can enjoy both the motivation based on the rewarding system implemented by the company’s human resource management. Based on the diversity of the working environment in the mentioned MNC, there is a tremendous requirement of maintaining collegiality and harmony. Since the employees of the company lack motivation and confidence, even the smallest of mistakes are affirming inadequacy feelings. Therefore, it will be important to communicate with the employees and make them realize that failure is a step to success (Obi, 2018). Increasing motivation and building confidence require significant energy and time, and if implemented properly, it can create a long-term impact for an employee and the team as a whole. High motivation is a crucial factor that enhances work productivity and quality along with helping in retaining talent. The mentioned US-based MNC’s subsidiary in Mozambique is facing a massive risk of losing out its employees due to a lack of confidence and motivation. It is the natural tendency of people to stick around more when they feel confident and happy. It will be thus vital to compliment and offer praise to the employees for their dedication and hard work.
The ideas presented by the employees must listen so that their confidence level increases and ensure that there is no office conflict (So, Djunggara and Farhobi, 2018). In the competitive working environment of an MNC, goals are an integral component of business operation, but while presenting goals, it should be ensured that the goals are achievable. Sometimes, unachievable goals tend to de-motivate the employees and hamper their confidence level by making them feel that they are incapable. Therefore, in the mentioned US-based MNC’s subsidiary in Mozambique, the employees must be regularly encouraged with challenging but achievable goals that will also establish harmony and collegiality among the employees. Overall, based on the cultural sensitivity that prevails in the working environment of the US-based MNC subsidiary, the CEO can potentially consider motivation based upon food, friendship, and relation by making the foreign nationals learn the culture of Mozambique and vice-versa. It will be thus beneficial for the US-based MNC subsidiary in Mozambique to consider both extrinsic and intrinsic motivation for ensuring that the employees feel appreciated for their work.
Critical engagement with emotional intelligence's literature along with a drawing of Goleman's dimensions for achieving more collective leadership practice
Little emotions form a great part of our lives, and we obey them without many realizations. Since human beings are complex species of reason and emotions, so in the mentioned US-based MNC subsidiary in Mozambique, the aspect of emotional intelligence will be a vital factor in the leadership practice. According to Goleman (1998), emotional intelligence has got five dimensions, namely self-regulation, self-awareness, empathy, motivation, and relationship management (Nnah Ugoani, Amu, and Emenike, 2015).
Figure 2: Goleman’s five dimensions of emotional intelligence
Source: (Ugoani, Amu and Kalu, 2015)
In the multi-cultural context of modern-day MNCs, the aspect of emotional intelligence is essential for success because true leadership skills are displayed in emotional situations. The CEO of the MNC's subsidiary must be able to recognize and understand the moods, drives, and emotions of its diverse workforce that tends to affect business practices as this self-awareness skill will ensure more collective leadership practice. The next component, as per Goleman, is based on self-regulation, and this ability will help in controlling or redirecting the disruptive impulses and moods of the various employees that are bound to happen given the significant cultural differences that persist in the company’s working environment (Nnah Ugoani, Amu and Emenike, 2015). The component of motivation will help the CEO of the MNC's subsidiary to develop a passion for the work that goes beyond the aspect of status or money, and the employees will feel motivated as well by seeing the dedication of their leader. The next dimension of empathy will help in developing the ability to understand the emotional makeup of the employees by ensuring that the CEO possess the skills of treating employee according to their emotional reactions, which will be crucial given the fact that 40% of the employees hail from different nationalities. The last dimension of social skill will help in achieving collective leadership by ensuring proficiency in terms of managing relationships and building networks. Since the foreign employees might feel disconnected while working in Mozambique as the culture, tradition, and language of the country is completely different, so the CEO must develop the ability to find common ground along with building rapport to ensure that the employees feel connected with each other despite the cultural differences.
Overall, the leadership style of the CEO must ensure proper connection of the employees by encouraging inclusion and resolving of conflicts as, given the extreme diversity of the company's workforce, it will be important to value the emotions of the employees. In the existing tensional working environment of the mentioned MNC, the employees lack confidence and motivation, so the CEO can effectively utilize Goleman’s five dimensions in terms of motivating the employees in stressful times along with addressing the challenges that are inevitable due to the diverse working environment of the MNC subsidiary. Therefore, the emotional intelligence of the MNC subsidiary’s CEO will play a vital role in terms of generating collective leadership practices.
In the end, it can be concluded that leadership is the most crucial factor that determines the proper working environment of an organization. The above essay has reflected upon various leadership theories and styles based on a given US-based MNC where the working culture is extremely diverse. The leadership recommendations for the mentioned MNC have been accomplished through extensive research on the fundamental aspect of leadership. The main objective of this essay is to understand the potential cultural disputes that can occur in the multi-cultural or multinational working environment so that effective mitigation strategies can be developed.
Overall, future studies of leadership strategies must emphasize developing further attributes and skills that are required for a leader in terms of ensuring proper function of a diverse workforce, where there is more dominance of the home-country nationals in the proportion of the total employee strength. Since, in today's business environment, collegiality and harmony among the employees, so future research must emphasize framing effective strategies that can potentially be implemented by the leaders of MNC to ensure smooth functioning of the business activities despite the cultural differences. Therefore, in the end, it is evident that sustainability of any business operation relies heavily upon the aspects of change process and leadership, as the dynamics of the business environment keeps evolving rapidly and there is a continuous requirement to adapt to the latest trends that include managing a diverse workforce.
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