Russian Business Leaders: Values, Competencies and Development Needs

A series of studies of Russian business leaders and their subordinates, conducted by the first author of this chapter in late 1990s to early 2000s showed that at that time authoritarian and transactional leadership styles were predominant, and participative and transformational leadership approaches, while being recognized by some study participants as important, were not widely used in practice. Thus, when asked which leadership behaviors are most often used by managers and executives, respondents assigned low scores to three out of four transformational leadership behaviors. Only inspirational motivation received a relatively high score. At the same time, the highest ranking was assigned to the transactional leadership behavior of contingent reward (Ardichvili, 2001; Ardichvili & Gasparishvili, 2001). Another study, conducted by the second author of this chapter in 2005 demonstrated that by mid- 2000s, Russian managers and executives still preferred authoritarian and transactional leadership styles. This preference was observed at various organizations regardless of the form of ownership or industry sector (Zavyalova, 2006).

A more recent study, conducted in 2009-2010 by RosExpert, a research and consulting organization, largely confirmed the persistence of the trend for predominance of transactional leadership and hierarchical leadership styles. This study showed that Russian top executives felt that it was important to project an image of self-confident, tough and selfreliant leaders. They believed that they could not afford any public display of doubt, acknowledgment of their mistakes or confession that they did not have answers to their subordinates’ questions. The study authors concluded that this resulted, among other things, in the lack of recognition of the need for continuous LD. Furthermore, the study showed that executives lacked communication skills. In negotiations they attempted to dominate the conversation, were not inclined to listen to others’ opinions, were not willing to compromise and find mutually beneficial solutions, and preferred top-down management styles.

In the area of employee motivation, they used mostly negative feedback and punishment strategies and did not believe that it was necessary to acknowledge employees’ achievements and praise them in public. Low priority was given to value-based leadership, inspirational motivation, participative approaches and mentorship. In most cases, organizations either did not have clearly formulated mission and value statements, or treated these only as espoused values, thus creating double standards and discrepancy between declarative statements and actual behavior. The study authors observed that, as a rule, the participating executives were highly intelligent and technically competent but lacked interpersonal skills and emotional intelligence, were unable to evaluate and acknowledge their own weaknesses and were reluctant to show their emotions in public. They were also ambitious and highly motivated by status and material gain. As a result, they tended to quickly lose motivation and loyalty to their companies in times of economic downturns and crises (Sicheva, 2010).

Yachontova (2008) conducted a study of leadership behaviors of 221 Russian managers and executives and concluded that Russia was experiencing a crisis of leadership. She believed that the roots of the crisis could be found in growing discrepancy between societal values and the demands of the new knowledge-based economy. Yachontova listed the following symptoms of the crisis of leadership in Russia:

  • • The individual value systems of the majority of Russian leaders were inconsistent and contradictory, which negatively affected their ability to lead effectively. An example was the lack of commitment to inno?vation: Under pressure from the public opinion, leaders often paid lip service to this trend but were not convinced that this activity was really necessary and beneficial for their organizations.
  • • There were widely held negative societal stereotypes of leaders, largely due to a growing gap between the affluent and poor groups of population, and the existence of the small elite of super-rich oligarchs, who have built their fortunes in astonishingly short periods of time. As a result, the level of employees’ respect and support for organizational leaders was low.

Yachontova (2008) also found that the authoritarian leadership style was predominant in organizations, which, among other things, led to negative consequences for organizations’ ability to develop intellectual capital. There was a serious discrepancy between espoused value of developing human capital in organizations and the realities of organizational practice. In many organizations the importance of leadership, especially participatory leadership, was not acknowledged, and priority was given to traditional management approaches. In addition, Yachontova’s study identified that there was a discrepancy in understanding what leadership was when comparing opinions of organizational leaders and their employees. For example, employees believed that such qualities as “stress resistance” and “energy and resilience” were on top of the list of leadership competencies that were needed in their organizations, while leaders listed “strategic vision” and “ability to build top leadership teams” as the top priority items. Only communication skills and ability to organize and prioritize one’s work were listed as some of the most important competencies by both groups. Yachontova concluded that, to combat the above-described negative trends, organizations need to prioritize investment in leadership training and in organization development interventions aimed at creating more leadership-oriented organizational cultures (Yachontova, 2008).

A large-scale survey of LD professionals, conducted by the Malakut consulting company, showed that, while the emphasis on interpersonal skills, individual motivation and emotional intelligence was growing, a large percentage of respondents still believed that leadership is mostly about organization and coordination skills and related competences (Grishakova & Sorokin, 2012).

In summary, the above review leads us to conclude that Russian executives and managers may have sufficiently well-developed traditional management and organization skills, but lack competencies necessary for successful functioning in the new globalized and knowledge-based economy. Among other things, such leadership competencies as the ability to provide individualized motivation and intellectual stimulation, emotional intelligence, empathy and interpersonal skills, and self-understanding and self-regulation need to be further developed through LD programs.

Leadership Development Programs and Approaches

This section is divided into two subsections. The first of these subsections traces the development of LD between 1991 (the first year of the market reforms) and 2007 (the last year of the period of rapid economic expansion that started in early 2000s). The second subsection provides an overview of the developments after the economic crisis of 2008-2009 that resulted in a number of serious structural and fiscal changes in the LD systems of Russian business organizations.

 
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