POINT OF VIEW THE SURVEY SAYS:
POINT OF VIEW — INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT
RICH WELLINS, PH.D. SENIOR VICE PRESIDENT
INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT Both countries have populations of over a billion people. Their economies are poised to grow two to three times the rate of the United States, and up to five times faster than Europe. Neither country will rest on their past success. They are striving to move their products and services up the innovation value chain. Both will realize gains, not only in export markets, but in serving the rising needs in their own domestic markets, and will continue to find that their success will depend on the quantity and quality of talent, especially at leadership levels. Of course, we are talking about India and China. In our fourth of a series on leadership analytics, we will explore which country currently has a better leadership pipeline and how their leaders differ.
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In DDI’s recent Global Leadership Forecast1, we sampled HR executives and line leaders from over 2,000 companies. Compared to China, leaders in India are 100% more likely to report they have a sufficient leadership pipeline to meet their future business challenges. And, India leaders rate themselves as far more effective in just about every major leadership skill area. Survey data, while useful, is also subject to biases. Sample size, along with the type and quality of companies involved, vary. All the data is self-report. And, we have found that populations in countries like India, Mexico and the Philippines, survey participants may inflate reality (they are more optimistic) while other country populations (like Japan and China) may deflate reality (they may be less likely to “publically” assign a high rating to certain types of survey questions). Assessment Center data, on the other hand, which is the basis for this piece, is far more reliable and valid. It is based on observations of real behavior exhibited in the same set of assessment center simulations used across both countries. And, assessment center outcomes have been shown to predict leadership performance in countless studies.
WHAT WILL LEADERS IN CHINA AND INDIA DO? In the first part of our insight series, we discussed the relationship between competency ratings in an assessment center and a leader’s ability to exhibit the same level of performance on the job.
Boatman, Jazmine and Wellins, Richard.“Global Leadership Forecast 2011: Time for a Leadership Revolution”
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Table 1 below lists the most commonly measured competencies for leaders in China and India. The rating represents the percent of assessed leaders who have a development need in a particular competency (the higher the rating, the higher the need for development).
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India’s leaders have significantly more development needs than do their Chinese counterparts.
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Indian leaders tend to think more strategically and entrepreneurship, which is strong, is the foundation of success of many Indian corporations. They are also likely to look at the bigger picture in determining the talent required to grow in the future. On the other hand, competencies in which Indian leaders do not perform as well as their Chinese counterparts (10 percentage points or more) include, coaching, business acumen, driving execution, passion for results, customer focus, leading teams, and global acumen.
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In contrast, Chinese leaders tend to be good at bringing people together to execute an established strategy and meet the needs of their customers. On the other hand, they have an inordinately strong drive for results. They are less likely than their Indian counterparts in establishing strategic direction, entrepreneurship, building organizational talent, and selling the vision.
The assessment data paints a bit of a different picture that the Global Leadership Forecast survey data with some interesting contrasts between the two populations. Some high level conclusions: >
In most of the competencies, one-third or more of the assessed leaders have development needs. Regardless of country, there is ample room for significant improvements.
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In future releases, we will compare multiple countries against overall global assessment data. However, in a majority of the sixteen competencies, the sample of all global leaders combined outperforms leaders in either China or India.
POINT OF VIEW — INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT
Table 1. Competency Performance for India and China
CHINA
63% 35% 35% 21% 12% 22% 36% 54% 56% 20% 37% 40% 23% 27% 9% 68%
Building Organizational Talent Business Acumen Coaching-Developing Cultivating Networks Customer Focus Driving Execution Empowerment Delegation Entrepreneurship Establishing Strategic Direction Global Acumen Influence Leading Change Leading Teams Operational Decision Making Passion for Results Selling the Vision
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47% 60% 50% 22% 29% 40% 35% 38% 35% 44% 34% 41% 41% 29% 35% 47%
INDIA
In the second release of our series, we looked at personality patterns that are most typical of leaders and how they relate to leadership performance. Tables 2 and 3 below show the median personality enabler and derailer scores from our India and Chinese leader samples. The higher the derailer score, the
more likely the personality factor will interfere with senior leadership performance. The reverse is true for the enabler scores; the higher the rating, the more likely the personality factor will facilitate effective leadership performance. A square indicates a significantly higher score for Chinese leaders, while a circle indicates that India have higher scores.
Table 2. China and India Derailer Personality Data
Table 3. China and India Enabler Personality Data
PERSONALITY THEMES
PERSONALITY DERAILERS
MEDIAN PERCENTAGE China India
MEDIAN PERCENTAGE China India
Volatile
81
81
Adjustment
49
49
Argumentative
72
72
Ambition
55
74
Risk Averse
69
69
Sociability
59
59
Imperceptive
46
59
Interpersonal Sensitivity
26
39
Avoidant
71
72
Prudence
67
58
Arrogant
86
77
Inquisitiveness
62
69
Impulsive
86
85
Learning Orientation
58
69
Attention Seeking
67
66
Eccentric
80
69
Perfectionistic
59
59
Approval Dependent
55
37
CHINESE LEADER PERSONALITY SUMMARY
POINT OF VIEW — INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT
PERSONALITY ENABLERS
Chinese leaders tend to be reasonably self-confident. They will accept leadership roles without being overly competitive. Interpersonally, they will appear somewhat outgoing but may retain an argumentative style. They tend to be conscientious to a fault. They can be open to the ideas of others, but will be very slow to implementation. They will stay relatively current and up-to-date. They may be highly volatile, which means they may often push people away. But they are likely to more easily find fault in others. They may be thought of by others as inter-
esting and having many ideas or unique ways of looking at things. Finally, they may micromanage tasks, demand they be done a certain way, which will likely be the way they have been asked to do so by their superiors.
INDIAN LEADER PERSONALITY SUMMARY Indian leaders are also relatively self-confident without raising the line into arrogance. They are likely to be very competitive in seeking out leadership roles to the point where they want to climb the ladder. Interpersonally, they will appear more outgoing. They are very conscientious and planful, but can still be flexible. They are open to the ideas of others, and will cau-
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tiously consider changes or implementation of new ideas. They are keenly interested in staying current and up-to-date and place a high value on formal education. On the other hand, they tend to put distance between themselves and can be highly volatile.They too are likely to be critical of and at times, they will seem out of tune with the needs of those around them.They may be thought of by others as interesting or a bit charismatic, and will have ideas that are practical or doable.They too will micromanage tasks and demand tasks be done a certain way but, unlike Chinese leaders, are not as overly dependent on guidance from superiors.
CONTEXT IS EVERYTHING In the third of our series on leadership insights, we explored how leaders perform against business drivers. Drivers are really
outcomes; they are the things leaders must do to achieve high levels of team and organizational performance (e.g., process innovation, enter new global markets). Assessment center ratings of drivers are calculated using a proprietary algorithm combining particular competencies with personality factors. Each client unit we work with identifies their own relevant drivers. For purposes of this paper, we will compare/contrast performance of all Chinese and Indian leaders against the most commonly selected drivers. To establish context, we looked at the top business challenges faced by Indian and Chinese CEO’s and then matched them to the drivers we typically assess. The challenges originate from the Conference Board’s annual survey of CEO’s around the world (CEO Challenge, 2013, Conference Board, NY).
Table 4. CEO Challenges and Business Drivers CEO CHALLENGES (CONFERENCE BOARD) Human Capital *
LEADERSHIP READINESS China India
Enhance organizational talent
NR
NR
Engage employees
NR
R
Product innovation
NR
D
Process innovation
D
D
Engage employees
NR
R
Create alignment/accountability
NR
NR
Drive profit
D
NR
Drive efficient execution of business process
D
D
Customer relationships
Cultivate customer focus and culture
R
D
Global expansion
Increase global focus
No Data
D
Enter new global markets
D
D
Enhance the brand
NR
D
Innovation * Operational excellence* POINT OF VIEW — INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT
DDI BUSINESS DRIVERS
Corporate brand/reputation
NR = Not ready D = Development needed R = Ready * Top three overall challenges
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We selected those challenges (six out of ten) for which we had comparable business drivers with corresponding leadership assessment data. Those with asterisks were at the top of the CEO Challenge rankings for both Indian and Chinese companies. (Note: DDI has data on 26 business drivers, only a portion of which were used in this analysis).
CONCLUSIONS At the end of the day, India’s leadership quotient appears to be a bit higher than that of China. However, neither of the countries get bragging rights. Their stellar business success over the past decade appears to behave happened in spite of extraordinary leadership rather than because of it. As one Indian CEO put it to me,“high growth economies can cover up a multitude of sins.”
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From our perspective, there are three key concerns based on the analysis. First, leaders at all levels and in both countries will face a continuing need to operate in a high growth global environment where cost of labor may
no longer be a competitive advantage. It is an area that is relatively weak. We expect the challenge will be tougher for Chinese leaders where there are fewer examples of best-inclass multinational operations. Second, tomorrow’s currency of competition rely on innovation. The profiles (both behavioral and personality-based) paint a picture of leaders who are risk aversive and not overly open to change, not good innovation signs. And, many lack the skills to foster a highly innovative work environment. Finally, Indian and China CEO’s who participated in the Conference Board survey, ranked Human Capital at the top of their list of challenges. Almost all of the top challenges are highly dependent on the ability of companies to attract, develop and retain highly capable people. And, a highly capable workforce, is, in turn, largely based on highly capable leadership. Having the right leaders in place at the right time remains both the biggest barriers and biggest threat to both economies.
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POINT OF VIEW — INDIA VS. CHINA: HOW LEADERS MEASURE UP IN BEHAVIORS, PERSONALITY AND BUSINESS CONTEXT
Rich Wellins, Ph.D., with Audrey Smith, Ph.D., Jazmine Boatman, Ph.D., Rodney Warrenfeltz, Ph.D. (Hogan Assessment Systems)
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