Leadership is the most discussed and researched area in an organization. On the other hand, organizational culture is studied rarely and its interaction with leadership styles is studied even less. According to the current research studies, behind every successful leader lay a vibrant organizational culture that engages and energizes employees. There are two schools of thoughts completely opposite to each other in their view of the interaction between leadership and organizational culture. Most of the current researchers believe that the organizational success depends on the ability of a leader to change his or her leadership style in accordance with the existing organizational culture. On the other hand, the other school of thought believes that it is the responsibility of a leader to define a distinct culture in an organization that can differentiate itself from other organizations (House et al 2004). Examples of both these schools of thought are available in the marketplace. This essay will first define organizational culture and different styles of leadership and then will discuss how different leadership styles can beget a healthy culture within an organization.
Definition of Organizational Culture
It is difficult to define organizational culture as organizational culture has several dimensions. In a study conducted by Harvard Business School in 2002, it was found that organizational culture might have more than 200 parameters (Pennington, Townsend and Cummins 2003). The culture of an organization can be defined as the way an organization operates and does things. Though this definition nicely captures a complex concept, it is not detailed enough to evaluate how an organization does things. A more comprehensive definition of culture associates culture with a pattern of base assumption that an organization has discovered, developed, and invented in learning to cope up with its challenges of internal integration and external adaptation (Pennington, Townsend and Cummins 2003). Although this definition is more comprehensive, it is not easier for understanding. A pattern of shared values, norms, and practices can be defined as an organizational culture and it is also easier to understand (Pennington, Townsend and Cummins 2003). As per this definition, to understand an organization’s culture, one needs to understand the values, norms and practices of that organization. Understanding why an organization follows certain cultures may not be required by a leader unless the leader is trying to change that culture. Therefore, assumptions about why a certain pattern in an organization has been invented, developed and discovered are not relevant to the leader. On the other hand, for a leader trying to completely change an organizational culture, these assumptions and parameters become very significant (Pennington, Townsend and Cummins 2003).
Leadership style, like culture, is a multi-dimensional concept. Leadership is not only dependent on the leader’s beliefs and abilities, but also dependent on how employees view leaders. An autocratic leader may not viewed critically by the Chinese employees as people born and bred in Chinese culture are more accustomed to hierarchical structures and following orders. On the contrary, the same leader will not be viewed in a positive light by the French employees who like their leader to be more participative and team-oriented. Lord and Maher (1991) in their study titled ‘Implicit Leadership Theory’ covered 6 different leadership styles (House et al 2004). They have examined hundreds of cultural parameters and leadership traits to come up with these 6 different leadership styles. These 6 leadership styles include charismatic leadership, team-oriented leadership, participative leadership, human-oriented leadership, autonomous leadership and self-protective leadership. These six leadership behaviors also manifested in the Global Leadership and Organizational Behavior Effectiveness (GLOBE) study conducted in 2004 by House, Hanges, Dorfman and Javidan (House et al 2004).
The Interaction between Leadership and Culture
There are several theories that describe how organizational culture affects leadership effectiveness and also how leaders can create a healthy culture in an organization. Theories such as Implicit Leadership Theory, Value-Belief Theory, Implicit Motivation Theory, and Integrated Theory of Culture are the most popular ones (Pennington, Townsend and Cummins 2003). As discussed in the previous section that it is difficult to pinpoint whether leadership influences culture or culture influences leadership. In fact, as per the GLOBE framework, organizational culture and leadership traits continuously evolve and influence each other (Taormina 2008). There are several other factors that influence both the organizational culture and leadership. External factors that influence both organizational culture and leadership include social belief, strategic organizational contingencies, and socially accepted norms (Taormina 2008). These define the level of leadership acceptance and leadership effectiveness of an organization. Sometimes, an organizational culture is directly influenced by social and cultural norms, whereas in some other situations, organizational culture may be distinctly different than the local social norms. For instance, ARAMCO, a Saudi based Chemical company has a culture highly influenced by social beliefs and norms of Saudi Arabia. To be successful in this organization, a leader should understand the social cultures and norms of Saudi Arabia (House et al 2004). On the other hand, Schlumberger, the world’s largest oil-field services company, has a huge operation in the Gulf region, but its organizational culture is strikingly different from that of Saudi organizations. Schlumberger has a distinctly global organizational culture.
The Modus Operandi of a Leader to Create a Successful Organization
After acquiring the position of a leader, many leaders often try to impose a culture that is conducive to frictions. The interplay of leadership, followership, management, and other key organizational actors is important to accomplish goals and objectives. Therefore, the first step towards shaping a healthy organizational culture is to understand and appreciate the diversity attributes of an organization. Things such as diversity of thought, experience, age, race, and gender should be taken into account to perceive the current organizational culture (Pennington, Townsend and Cummins 2003). Leaders should also understand that there is no single best style of leadership. Based on the current situation prevailing in an organization and the desired future state, leaders should assume a leadership style that is more effective for the organization. Successful leaders also demonstrate a consideration for the well-being of the employees (Pennington, Townsend and Cummins 2003). Until and unless a leader can create an environment of trust, it is impossible for the leader to shape a healthy organizational culture. Finally, leaders should understand that specific situations call for different leadership styles from the leader. In fact, contingency situations provide the most suitable opportunity for the growth of a leader and evoking trust in employees.
Leadership Parameters that Influence Organizational Culture Most
In the book ‘Who Says Elephants Can’t Dance?’, Lou Gerstner, the former CEO of IBM, clearly showed that culture can bring in a huge competitive edge and also create obstacles for an organization. Lou Gerstner gave several examples of how leaders can influence a change within an organization (Taormina 2008). Companies like IBM under Lou Gerstner, Apple under Steve Jobs, GE under Jack Welch, and most recently Microsoft under Satya Nadella showed how effective leadership can create a healthy and successful organizational culture. These examples also demonstrate how different leadership styles are effective in making changes successfully within an organization. For instance, when Steve Jobs returned to Apple in 1998, it was going through a trying period. Recovery from that trying situation required a visionary and authoritative leader, the role which was perfectly played by Steve Jobs and that made Apple one of the most profitable organizations in the history today (Taormina 2008). On the other hand, when Satya Nadella assumed the leadership role in Microsoft, it was already an established organization doing well, but the organization required a huge shift in the way business is done. In a successful organization, authoritative leadership often fails. Satya Nadella is using a participative leadership style to bring Microsoft back to its hey days.
Although there are numerous parameters that influence the relationship between organizational culture and leadership, there are only a few parameters that leaders should address to change the organizational culture effectively. These parameters are stated below:
Leader’s role in crisis situation
Leader’s process of allocating different resources
Leader’s attitude towards measurement control and attention to detail
Role modeling, teaching and coaching of leaders
Leader’s style of distribution and status (Taormina 2008).
If a leader can effectively execute the above-mentioned parameters, then he or she can easily influence and steer the organizational culture to a healthier state.
Leaders can have effective vision and superior execution ability, but they can completely fail if they are unable to respect and understand the organizational culture. Organizational culture forms basis of organizational beliefs and norms and its way of operation. To become effective as a leader, it is important that leaders change their leadership style according to the existing organizational culture. It is also possible for the leaders to change the organizational culture but they first need to understand the present culture and then win the trust of employees before steering them towards a healthier organizational state.
House, Robert; Javidan, Mansour; Hanges, Paul and Dorfman, Peter. “Understanding cultures and implicit leadership theories across the globe: an introduction to project GLOBE”. Journal of World Business, 37(1), pp.3-10. 2002. Web. 22 Jun 2015 <http://www.iuc-edu.eu/group/sem1_L3/2013%20CCAINT/reading/Understanding%20cultures%20House%20Javidan.pdf>
Jones, Marshall. “Leadership’s Role in Shaping Organizational Culture: The Key to the Future”. University of Central Florida. 2012. Web. 22 Jun 2015 <http://futuresworkinggroup.cos.ucf.edu/docs/Volume%206/vol6Jones.pdf>
Hillis, Laurie. “Culture Follows the Leader”. Banff Center for Arts and Education. 2010. Web. 22 Jun 2015 <http://www.banffcentre.ca/leadership/library/pdf/culture_28-29.pdf>
Pennington, Penny; Townsend, Christine; and Cummins, Richard. “The Relationship Of Leadership Practices To Culture”. Journal of Leadership Education 2.1 2003. Print.
Taormina, Robert J. “Interrelating Leadership Behaviors, Organizational Socialization, and Organizational Culture”. Leadership & Org Development J 29.1 .2008. 85-102. Print.