Winning Leadership For A Globalized Economy (Part 2 of 2)
By Ernie Chen

Organizations leading the twenty first century organizations must be able to secure sustainable competitive advantage through a culture of competence in its’ leadership, human capital and the degree to which the corporate culture fosters and maximizes competence. Culture is defined as the way of life of people that is transferred from generation to generation.

An organizational culture defines what an organization is, what it does, what the organization believes in and how the organization does what it does. Creating a culture of competence is the biggest challenge that most organizations face in the global economy. A culture of competence is about creating an organization in which employees are learning and growing, working together and doing their best. It is the job of leaders to analyze the current state of the organization and its environment, envision the ideal state, and define a set of pathways to move the organization towards the ideal.

The aspects of corporate culture include the values and behaviors associated with organizational improvement. It is becoming more customer-centric, more efficient, cutting cost, becoming more team-oriented and moving towards thinking globally. The demand of today’s fast changing marketplace has created a downward pricing that has never been seen before. In the past economy, organizations would raise wages to attract highly skilled and knowledgeable workers and would then raise prices to cover the increased wages. Today, with markets full of products that are produced by many countries with much lower labor costs, organizations can no longer raise prices based on internal margin and profit concerns. Customers will simply go elsewhere. Organizations will need to get more results from their resources, more revenue per employee. This requires a change in corporate culture.

We cannot be telling our employees to increase their productivity by doubling it or else get fired. Our employees are not machines and treating them as such seldom works very well. Like us, employees have emotions, feelings and their own dreams. They have their own motivations and want to feel cared for. They will not assist the organization to achieve its’ goals if their personal objectives are not synchronized with the organization’s objectives. Herb Keller the co-founder and CEO of Southwest Airlines said, “Southwest has its customers, the passengers; and I have my customers, the airline’s employees. If the passengers aren’t happy they won’t fly with us. If the employees aren’t happy they won’t provide the product we need.”

We are serving a global economy and that requires us to be leaders in our very own way, serving both our internal and external customers to achieve sustainable competitive advantage.

Last updated - 31 August 2004