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Regional facets of Leadership

Almost the entire discussion of leadership in the business press focuses upon one

leadership style, "charismatic" leadership, a leadership style that is evidenced when an

organization is fueled by the personal energy and vision of a single individual, a larger-

than-life figure. While other common leadership styles like transactional (use of rewardsand sanctions to motivate employees), autocratic (use of authority and coercion to

motivate employees), and empowering (encouraging individuals to set their own goals,

self-monitor behaviors, and develop intrinsic rewards) are frequently overlooked.

Again while identifying individual factors that are predictors of leadership qualities there

is an over-emphasis on psychological characteristics. It is assumed that if an individual

has appropriate psychological traits he / she will demonstrate suitable leadership

behaviors, and achieve desired goals. Such simplistic hypotheses underestimate the

influence of external contextual factors, like the social, political and economic

environment, on leadership behaviors. In the Middle East unique contextual factors have

an overarching influence on prioritizing leadership behaviors based on what is importantfor success of business. The character of regional retail business is trade structured as

exclusive distributorships. The distributors develop a mind set of monopolists, and

overemphasize the need to manage brand owners, and underemphasize human resource

management to improve staff productivity or supply chain efficiency. In the Gulf it is a

lot more financially efficient to replace under-performing staff than spend time in

boosting morale and productivity. The large educated labor force in the region is an

accessible low cost resource.

Organizational factors that exert an influence on leadership behaviors are the degree of 

standardization of operating procedures, the centralization of decision-making, and

differentiation of operational tasks. Regional businesses are primarily sellingorganizations, require very low levels of task elaboration, are flat organizations

dominated by the entrepreneur, and strategy is created by the entrepreneur for execution

by others making it primarily a top-down process.

It is also necessary to re-evaluate traditional leadership theories since most regional

businesses are owned and operated by entrepreneurs. In public companies the leadership

question is usually, “What leadership is good for the organization?” since public

ownership can exert pressure for change, whereas in private companies what's best for the

entrepreneur is what's best for the organization as a whole. An entrepreneur’s first

obligation is to himself or herself, and if this obligation isn't satisfied, none of the others

[to customers, employees, and so on] can be satisfied, either.

Before we identify leadership qualities, let us define outcome of good leadership as being

successful. A regional entrepreneur buys and sells products with little or no value added

within the organization, and success in business is about generating an adequate trading

profit on every sale with no dilemma in dealing with the conflict of good short-term

performance and good long-term performance. Success in the long term is equal to profit

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five years in a row. A trading entrepreneur will rarely sacrifice short-term performance

for long term performance.

Entrepreneur leaders recognize the importance of selling in whatever they do. Unless the

business has positive cash flow before it runs out of capital, it won't survive. And the

only way to get positive cash flow is to get orders for whatever product or service yourcompany is offering. The regional economies being mercantile, there is an over emphasis

on selling and negligible emphasis on innovation, with a reduced sensitivity, priority, and

importance to value of the human side of enterprise. In the mind of the entrepreneur

success is attributed to a resource like a brand or a store location, and not to

organizational processes and people.

For a regional entrepreneur pricing is a fundamental strategy of the business and

understanding customers to charge them an appropriate price is a key leadership quality.

They are sensitive to the fact that customers don't make their purchase decisions based

upon price; they make them based upon value. And value has two components - benefits

and price, not price alone. The alternative to value is that the offering is identical to thecompetitor, and then the only option to generate more sales is to lower your price, a sure

road to self-destruction.

A leader knows that success requires hiring intelligent people to form a team. The

regional entrepreneur seeks team members to have a judicious balance of thinkers

(brains) and doers (experience). With only thinkers, execution of tasks become difficult

and time consuming. With thinkers it is necessary to engage in dialogue to achieve a

sense of understanding and commitment before actual action occurs to achieve goals.

With doers execution is lot easier. The entrepreneur seeks people who can do the job and

deliver results, and the right people in the region are sales driven. To achieve the right

blend of doers and thinkers, entrepreneurs will keep churning the team till the right mix isachieved by eliminating marginal performers.

Entrepreneurs also have to have the judgment to determine when the solution or a

possible option to a problem is good enough. They know when the solutions to problems

are adequate; they usually prefer to take action and tweak the execution till success is

achieved. For them a bad decision is better than procrastination, since a bad decision can

be corrected.

Leadership in the Gulf is no different from entrepreneurial leadership anywhere else in

the world. It is about team building, customer understanding, and emphasis on results.

But leadership behaviors are outcome-driven and not means driven with a very much less

emphasis on softer skills of management.