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ARTICLE 

The Challenges of Leadership in Latin America

By Daniela Imaña Álvarez, Business Innovation and Organizational Change Consultant, Agile Practitioner, Team and Executive Coach, Coach ICF-ACSTH, Business Coach, PNL Practitioner, Trainer at Toolkit Innovation and Certified Training Partner at Enterprise Agility University Bolivia

Leadership in Latin America exhibits certain patterns that make organizational change a particularly difficult, but not impossible, challenge. If leadership levels in the region understood the weaknesses of their idiosyncrasies and leadership characteristics, they could adapt their strategies for organizational change to work more effectively and practically.

Organizational culture is an important factor in the company change. Some companies are more open to change than others because of their culture. However, it is important to understand what we mean by culture.

Professor Geert Hofstede, the founder of Hofstede Insights,
one of the leading consulting firms in the field, defines culture as “the
programming of the human mind by which one group of people is distinguished from another group of people.
”  

According to Hofstede, culture consists of several layers, which include symbols, heroes, rituals, and what he calls the core of culture, values. 

In order to achieve organizational change, practices must be introduced in the organization that takes into account the above aspects. The people who are to lead the change are the leadership levels of the organization.

There are several qualities that they must-have for this purpose, for example: leadership, communication skills, motivation, strategic thinking, risk-taking and teamwork. Leadership is probably the trait without which it is virtually impossible to achieve change. There is a big difference between a leader and a manager. The vast majority of leadership levels in the region have characteristics that make them more like a manager than a leader, and it is these characteristics that make organizational change in the region particularly challenging.

Hofstede Insights conducts a study that assesses six dimensions of leadership and allows us to compare them across countries. Three of these dimensions, Power Distance, individualism, and uncertainty, show very different average scores within the region compared to more developed countries such as the United States and Germany, where organizational change is more rapid.

 

Daniela Imaña presenting at an event

The dimension “Power Distance” is defined as the extent to which members with less power within organizations understand that power is unequally distributed. The average Power Distance index in the region is 68, compared to 40 in the United States and 35 in Germany. 

It appears that most leaders in the region are more managers than leaders, and this finding is not entirely surprising. Being more managers than leaders is a major obstacle when it comes to achieving sustainable organizational change, as it means that organizational leaders exert influence for key people to become leaders as well. 

A manager does not want to have more managers; a leader works hard to create leaders and spends more time on strategy than execution, learning from others, and achieving self-management in the organization. The best way to improve the perception that power is unequally distributed is to distribute power and delegate effectively. To delegate power, it is important to be a good communicator and facilitator.

Another dimension of leadership that is very specific to the region is “individualism“. The average index in the region is 20, while in the United States it is 91. Leadership that is not so individualistic seeks affirmation from others, as opposed to individualistic leadership that risks being the only one out of line. Organizational change involves risk, and in many cases is about being first in your particular industry. Leaders in our region, because of their characteristics, tends to have a certain reticence about being first and taking risks. To become more individualistic, a leader must learn in small steps to be different and feel more comfortable about being first.

The last leadership dimension that is particularly pronounced in the region is “Avoiding Uncertainty“. The average in the region is 84 compared to 46 in the United States. Leaders in the region are used to avoiding uncertainty and taking calculated risks. This is quite understandable in a society where mistakes are punished and where companies cannot afford to fail due to limited financial resources and highly regulated labor markets. This is an aspect that is rapidly changing in Latin America. Companies have begun to accept risk and uncertainty as part of innovation and change. Organizational change is a difficult task that involves a high degree of uncertainty. Leaders who are more accepting of uncertainty can manage organizational change more effectively.

In summary, leadership in Latin America can achieve sustainable change if it recognizes its limitations and admits that it is necessary to change certain attitudes and behaviors that are embedded in the culture of our environment. Leading instead of being a manager, trying to stand out and be individualistic as an organization, and embracing uncertainty are factors that will facilitate effective organizational change.

Daniela Imaña Álvarez is a Business Innovation and Organizational Change Consultant, Agile Practitioner, Team and Executive Coach, Coach ICF-ACSTH, Business Coach, PNL Practitioner, Trainer at Toolkit Innovation, and Certified Training Partner at Enterprise Agility University Bolivia.

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