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The purpose of this study is to empirically compare leadership styles of two global business leaders belonging to two different cultures - Asian and American. Cultural differences influence leadership styles, norms, role expectations etc. These factors are strong determinants of effective leadership behavior as what constitutes a good leader in one culture may not constitute a good leader in another culture. Due to tremendous historical disparities between Asia and the West, the essay takes Ratan Tata, former chairman of the Tata group, and Steve Jobs, co-founder and former CEO of Apple Inc, as representatives of the Eastern and Western ways of leadership and analyzes the difference in their leadership styles.
Steve Jobs: Leadership style
Steve Jobs was already a legend long before he resigned from Apple in April 2012 owing to health problems. Apple Inc. has been the world's second-largest technology company by revenue after Samsung Electronics. It is the second largest publicly traded corporation in the world by market capitalization, with an estimated value of USD 414 billion as of January 2013. ("FT Global 500 2012", November 2012) If one takes into consideration the fact that he started Apple from scratch, these are feats that any business leader across geographies and ages will consider as outstanding feats.
Focusing on core strengths is one of the main factors that resurgence of Apple has been attributed to. In fact, Apple Inc. is not just the only beneficiary of Job's emphasis on focus, Jobs advised Larry Page that Google needed to figure out exactly what the company was good at or else it could risk heading the Microsoft way. It is probably no coincidence that Google announced a refocusing initiative few months later trimming down its offerings ("Google's 'Focus' A Nod to Steve Jobs' Advice?" - Karsten Strauss).
Apart from being intensely focused when committed, Jobs was also confident enough to execute moves considered risky by conventional wisdom. Even before iPod was launched, downloading and MP3 players were the talk of the town in the music industry. However, most of the existing players did not act on it immediately. Enter Steve Jobs. He did not need to make a fantastic leap of imagination into the future. He simply had to act quickly and launch a product by webbing together a set of existing ideas. (Business Maharajas by Gita Piramal)
Jobs, the leader was charismatic, to say the least, and his charisma largely banked upon his deep knowledge and understanding of technology he was immersed in. Jobs was never an "ivory tower" CEO. Rather he was someone who got his hands dirty at the design shop floorÂ spending time with the designing team and giving his opinion and guidance on their prototype. ("Steve at Work" By Romain Moisescot)
Many of the decisions taken by Jobs, the innovator, came from his urge to simplify things. When Jobs visited Xerox's Palo Alto Research Center and saw the plans for a computer, he noticed that the mouse had three buttons and priced USD 300; he went to Dean Hovey, founder of a local industrial design firm and asked him to design a simple, single-button model that costs USD 15. Hovey complied. ("The real leadership lessons of Steve Jobs" by Walter Isaacson)
When innovating, Jobs did not merely try to catch up to competitors; he looked for ways to leapfrog over them. When the original iMac was built, it did not have an inbuilt optical disk writer, which can burn a CD. Naturally Apple was caught wanting as users with standard PCs were ripping and burning their own CDs. So he created a platform where users can buy/share/store and play music with ease. Thus, the iTunes store was born. ("The real leadership lessons of Steve Jobs" by Walter Isaacson)
Jobs had an (in) famous ability to make people believe and commit to almost anything, including something apparently, with a mix of charm, charisma and bravado. This habit of distorting reality to suit his purpose was dubbed as Reality Distortion Field by his colleagues ("Notes from the Epicenter: Exploring the Reality Distortion Field" - Andrea Dudrow)
Jobs was widely regarded in Apple as a hard task master and somebody with questionable people skills. Jobs was famously impatient, stubborn, and hypercritical of the people around. According to Jobs, it was his way of preventing what he called "the bozo explosion" where managers are so polite that mediocre people feel comfortable sticking around. Jobs' people management modus operandi is perplexing yet fascinating. Hiring was actually one of his most important roles at Apple. He told Time in 1999: "My #1 job here at Apple is to make sure that the top 100 people are A+ players. And everything else will take care of itself" ("Steve at Work" by Romain Moisescot). Jobs had no tolerance for B people. The price that Apple paid for such behaviors was that people who aren't always self-driven and needed additional motivation or encouragement on the way were disillusioned. Also, the fact that he had around hundred people reporting to him directly indicates that he liked to hold all the strings in his own hands ("The Steve Jobs Way" - Jon Katzenbach). However despite all negative criticisms of Jobs' way of handling with people one cannot ignore the fact that even in his last year as CEO, he received 97% approval ratings from Apple employees on Glassdoor.com.
If other leaders emulate these traits - both the good and the bad- will they achieve similar results? The short answer is no. Applied to the wrong market or product, or at wrong time, it could sink a company. In the end, what made Jobs such a successful leader was his talent at envisioning and delivering breakthrough products. Very few top leaders pay as much attention to the ground realities - product and design as Jobs did.
Ratan Tata: Leadership style
The rapid economic development of South Asia with its changing economic regimes in recent decades is one of the most important events of history. In these times of changing economy and changing regulations, leading a century-old conglomerate of large companies accustomed to the old socialist world would be tough challenge for many. Leading the firm through these uncertain times, ushering in an era of culture change and simultaneously improving the revenue by 300% would be an impossible dream for many. But, not for Ratan Tata, the adoptive great grandson of the Tata group founder, Jamshedji Tata.
When Ratan Tata took over Tata Group, though it a vast empire, it had hardly any presence outside India. He had the vision to realize that the company had to expand its business overseas soon in order to reduce the risk of dependence on a single country's economy. In the next decade he went on a wave of aggressive acquisitions in order to expand the group's business base. Under his stewardship, Tata Tea acquired Tetley, Tata motors acquired Jaguar Land Rover and Tata Steel acquired Corus, which have turned Tata from a largely India-centric company into a global business, with 65% revenues coming from abroad. ( Leadership Lessons from India by Peter Cappelli, Harbir Singh, Jitendra V. Singh, and Michael Useem).
Unlike Jobs, whose strategy was always to focus on the "things we do best", Ratan Tata has significantly diversified the group into different fields - information technology; engineering; materials; services; energy; consumer products and chemicals. In 1996, the group set up Tata Teleservices Ltd. to operate both mobile and fixed-line phone networks in India. Ratan Tata, in December 1998, unveiled India's first indigenously built car to take on larger overseas rivals. The Indica is now the third-largest selling passenger vehicle in India. Tata group purchased a majority stake in state-controlled VSNL, the nation's largest overseas phone call service provider. (India's Tata Takes Leap with $7.6 Billion Corus Bid - By Subramaniam Sharma) While most family businesses find it extremely difficult to relinquish tried and tested business models, Tata has ventured into several new markets. One such example is Ginger Hotels launched with the idea of offering budget accommodation for the business traveler, a market which never existed in India before. Launched in 2004, the chain has now grown to 26 hotels across the country. ("Cheaper Sleeper" by Megha Bahree)
As part of India's oldest business house, the Tata Group carries a lot of legacy from the past. The group consists of huge sets of people extremely reluctant to change. One of Ratan Tata's most significant achievements is to create a parallel face of the Tata group - a new young energetic group of managers who don't hesitate to embrace change under the benign gaze of the chairman. ("At heart a hobbyist" by Gita Piramal)
Similar to Steve Jobs, Ratan Tata puts extreme emphasis on design and it is not uncommon of him to spend time at the shop floor brainstorming with technicians over design. Despite inheriting the family run business, he had his baptism by fire - Ratan Tata started his career at Tata Steel with other blue-collar employees, shoveling limestone and handling the blast furnace. The trial by fire at the bottom of the pecking order would stand him in good stead and keep him aware of the ground realities. ("Man of the year? It's Ratan Tata" by Chidanand Rajghatta)
While Jobs' management style was more autocratic in nature, Tata was more democratic. He defined the limits but let the group take the decisions. Recently, in the latest edition of the Tata Group's internal publication Tata Review, many senior executives have showered praises on the leadership styles of Ratan Tata. According to them Tata is a 'terrific combination' of the four necessary leadership characteristics -- character, commitment, competence and courage. ("The many hues of leadership", Tata Review)
While Jobs was a production-oriented leader who often indulged in micromanagement, Tata is widely recognized as an employee oriented leader with constant focus on employee needs and concerns. Even in 2008 when rightsizing was the talk of the town, the Tata Group never indulged in a layoff thus creating a loyal workforce for the future ("Ratan Tata: Responsible leadership, conscious capitalism" - Santosh Babu) This perhaps stems out of a culture difference between the East and the West.
Humility is a very uncommon trait in the modern day Western CEO. However, that's a highly noticeable trait in Ratan Tata. The 26/11 Mumbai terror attack targeted the Taj Mahal Hotel owned by the Tata group. In this attack, entire families of many hotel staff and guests were wiped out. Not only did Tata extend a helping hand to the family members of the victims, but he also personally visited each and every victim of the terror attack at the hotel and helped them come to terms with the ordeal. He had no legal responsibility to do this. Yet he chose to do this purely out of moral obligation ("Taj Public Service Welfare Trust" - Synthia Rodrigues)
While both Steve Jobs and Ratan Tata are visionary leaders in the true sense who had the ability to foresee what no one has imagined before, one sharp contrast between their leadership styles is in the people management aspect. While Jobs, a product of Western management culture, followed transactional leadership style - motivating employees to act in the interest of business by striking a deal with them whereas Tata followed transformational leadership style designed to encourage employees to care about the goals of the leader and the organization. However, despite their difference in leadership styles, if the legacy of a true leader is to have made a difference, then both Steve Jobs and Ratan Tata have demonstrated leadership qualities of the highest standard.