Argentina: Crisis of Guidance
Argentina, “It is a difficult country” (Schvarzer, in Sábato, 1988, p. 7). Argentina had shown extraordinary growth at the start of the 20th century after stagnation for about 60 years. In the 1990s it underwent major structural changes by developing democratic practices and liberal economic policies. However, the reforms produced neither the economic nor the social results that were expected. The current situation (1995) is characterized by a major debt burden political and social uncertainty, corporate turbulence, and great personal strain, but growing exports and conservative fiscal policies that have helped ease the situation, and the economy is growing steadily, industrial and construction indicators have shown steady growth and unemployment has decreased sensibly. Explanations for the crisis comprise macroeconomic factors, lack of regulatory practices, political mismanagement, and administrative corruption. In May 2003, a new administration was elected which instituted plans and is developing a new balance of political, social, and economic goals and has since taken the country out of economic default, and in search of a new balance. Three major improvements are generally accepted: the renegotiation of the foreign debt, the strengthening of the Supreme Court, and the government's policy on human rights.
This chapter presents a synthesis of Argentine history, culture, and leadership that is meant to help develop an understanding of the idiosyncratic nature of management roles in Argentine business. In particular it deals with the dilemma of leadership that faces the task to develop coherent national and regional strategies in order to meet the global challenges after many decades of economic turbulence.
1. CURRENT DEMOGRAPHY
Located in the southern hemisphere of the American continent (Latin America), Argentina is the eighth-largest country on the planet. It shares borders with Chile, Bolivia, Paraguay, Brazil, and Uruguay and can be portioned into five geographic regions: The pampas and prairies in the north-east which form the economic center of the country, Mesopotamia, the central low lands, the Andean zone in the East, and Patagonia in the south. Most of the country lies in the temperate zone. The total population is 36.1 million and 34% of them inhabit Buenos Aires, the capital city.
Most Argentines come from European ancestry and few aborigines subsist as separate ethnic groups. At the turn of the 19th to 20th century, four million immigrants arrived, 45% from Italy, 32% from Spain, as well as from England, Germany, France, Switzerland, Denmark, Poland, Russia, the Middle East, and Japan; for the past 40 years, immigration from neighboring countries increased, driving a process of Latin-Americanization.
Quality of life may be measured by the facts that Argentina has the highest amount of telephone main lines, and is second highest in personal computers and mobile phones in Latin America. It has the smallest average family size in the region; has 2.7 physicians per 1,000 people, the highest rate for Latin American countries; and life expectancy is 73 years. Still, at the time of the research project, it has the highest rate of unemployment in the GLOBE sample with the exception of Morocco (House et al., 2004).
Argentina is self-sufficient in oil and gas; agriculture is its principal industry and it produces grains and cereals; cattle and sheep are raised on the vast fertile plains of the Central region. Revenues from tourism have grown significantly. Substantial quantities of sugar, fruit, wine, tobacco, cotton, and other internationally marketable products are also produced. Major manufacturing industries include agro industries, food processing, petrochemicals, textiles, chemicals, paper and cellulose, metallurgical (including steel), as well as trucks and automobiles. Between 1995 and 1999, Argentina had a trade surplus against Brazil (mostly manufactured goods), and a significant trade deficit with the United States and the European Economic Union, mostly for food and fuels (CEPAL Foreign Trade data base, 2001).
2. CURRENT POLITICAL SYSTEM
Argentina is a federal republic with 23 provinces and a Federal Capital. The government includes the executive, legislative, and judicial branches. National and provincial governments are democratically chosen and the Constitution of 1853, its latest reform dates back to 1994, is the oldest in Latin America and follows the North American model. Its executive branch includes an all-powerful president; the National Congress consists of two legislative chambers; and the judicial power is exercised by a Supreme Court and courts in the entire territory. Provincial governors are chosen by direct ballot. Women were granted the vote in 1951.
Education plays a high-impact socializing role. The work force has levels of competence comparable to those found in developed countries. Unions were created over sixty years ago and their power has decreased; they have a positive attitude towards foreign investment. Union membership is voluntary and collective bargaining is carried out freely. New ad hoc spontaneous forms of protest and redress have grown, however, since 2003, as has union activity.
3. HISTORICAL DEVELOPMENTS AND THEIR ECONOMICAL IMPACT
Independent Argentina emerged between 1810 and 1816 with a revolutionary war process against Spain. Efforts to institutionally organize the region failed due to an extended confrontation with influential porteños (i.e. inhabitants of Buenos Aires), who wanted to hold on to National political power, eliminate federalism and the political autonomy of provinces. Political fragmentation based on irreconcilable positions lasted until 1862, with cruel civil wars interspersed with periods of law and order. In 1853, the provinces agreed to sanction a National Constitution. A federal presidential republic was instituted, but the agreement was fractured and it took many years for the country to reach unification.
Provinces (i.e., the Argentine local political administrative units) were lead by caudillos, charismatic leaders who emerged during the wars of independence. Civil war gave them autonomy and made them warrantors of the provincial order. They were locally based, protected the population, owned land and cattle, and were supported by arms. As a product of the militarization of a period when city folk deferred to rural landlords, this process supported a personality cult around caudillo leaders, which influenced the societal culture and leadership practice.
In colonial times the local economy relied on a trade circuit that joined the Peruvian silver mines with Europe. The harbor of Buenos Aires complemented Spanish monopoly with smuggling. The wars of the 19th century destroyed this system, while the plains around the River Plate basin witnessed expansion due to international demands for hides. Cattle ranchers implemented a rational exploitation system called estancias, some including rudimentary salting plants. Lacking manpower and capital, landowners increased property size while provincial economies suffered a crisis, showing the unequal economic growth patterns between the prairies and the rest of the country.
After 1863, peace allowed the slow development of a National State and the establishment of a market economy. Political leadership was held by an elite of visionaries, intent on modernizing the country. Through a network of personal loyalties and electoral fraud, protected by power concentration and control of the State, this liberal group became a conservative regime which resisted constitutional norms and warranties until 1916.
Progress required the adaptation of the economy to world market needs. Relying on its natural competitive advantages and following criteria of international division of labor, the Argentine economy specialized in the export of agrarian goods. In the 1850s and 1860s excellent results were obtained by the persistent international demand for wool. In the 1870s decisive organizational changes were brought about, with a successful diversification process which significantly pushed corn, wheat and bovine meat production.
Renewal stimulated the growth of a modern infrastructure. Considerable foreign capital investments contributed to the development of transportation and ports, public, commercial and financial services. Argentina enjoyed exceptional prosperity until 1930. Auspicious circumstances added to sustained growth, trade complementation with England, both a capital and industrial goods supplier and the major market for consumption of Argentine goods. World War I altered this pattern and showed the external vulnerability of an economy based exclusively on food exports.
Major waves of European immigrants settled in the interior, contributed to urbanization and created a prosperous middle class. Producers developed many organizational and technical improvements that favored grain and meat exports. Landowners increased their capacity to accumulate capital, diversified, and introduced flexibility investing in other fields of business. In spite of progress, the conservative order could not resist democratic adherence to a new party, the Unión Cívica Radical, whose leader, Yrigoyen, was elected President in 1916. His party expressed the needs and desires of the rising middle class, formerly excluded from political power. His administration instituted respect for constitutional principles, although it held on to the existing economic and social structure.
Food and textile plants started; trade restrictions from World War I stimulated the emergence of workshops. Vigorous industrial growth and new industries sprouted in the 1920s such as, chemicals, paper, cement, and metallurgy. Manufacturing was oriented toward the local market and relied on imported equipment. Blue collar anarchist and socialist protests activated union growth, and were repressed. Subsidiaries of multinational firms developed as Argentina started oil production.
The world crisis of the 1930s pulverized the economic structures. Collapse contributed to the fall of the government and initiated a series of military coups. Conservative forces held on to power through fraud. Depression interrupted capital entry, international prices plummeted and profits reduced dramatically. The government was slow to apply interventionist measures. Pressures on the currency and fluctuations in exchange rates led to devaluation, and increased unemployment. Balance of payments and foreign trade demanded the establishment of a new relationship between England, the United States, and Argentina, but a weak government privileged English and local landowners’ interests.
Thus, Argentina lost the opportunity to open its economy. Although industry grew, protectionism and scarcity of foreign currency stimulated a manufactured imports’ substitution program. Industrial plants of medium complexity took advantage of an expanding internal market, which insured investment recovery and high profits. Businessmen disregarded efficiency and quality considerations. A small group of families dominated metallurgy, metal-mechanics, textile equipment, cement, and paper, that is, high profit, dynamic sectors, whereas small and medium-size plants profited through the extensive use of manpower. World War II reinforced this process.
Social unrest and the government's lack of popular support strengthened a group of Army officers who wanted an active and efficient State to promote a program of National industrial development. These ideas gained consensus and lead them to bring down the conservative administration in 1943. General Perón, a charismatic leader, organized blue-collar workers through a vertical union system which was the backbone for the popular movement which lead him to the Presidency twice. In 9 years of government, Perón promoted income redistribution in favor of the workers, strengthened the internal market, and created full employment. The State increased its influence over the productive system and displaced foreign capital. Its progressive welfare programs in education, health, social services, and labor legislation consolidated his power base.
Until the 1950s, global issues stimulated industrial expansion in consumer goods and light manufacturing. In the 1940s, manufactured products were exported, however, this did not last and the imports’ substitution approach was reinstated. Factory growth implied an income transfer against land products which continued to be the sector that most contributed to generation of funds needed for technology acquisition. The economy slowed down in the 1950s, with public deficit and inflation increasing. Union pressures deteriorated plant discipline, decreased productivity, and slowed down investments.
Political issues and economic difficulties resulted in Perón's downfall in 1955 and until 1976, the Argentine political process became intricate and unstable. Choices seemed restricted to alternating fragile semidemocratic administrations and military dictatorships, which became more violent as time passed. Argentina was influenced by continental issues. The United States created the Alliance for Progress, which promoted democracy, economic and social progress for Latin America; later the Cuban revolution and Communism affected this strategy, which backed authoritarian regimes through the doctrine of national security. Simultaneously, a new South American institution, the Economic Commission for Latin America, promoted modernizing structural reforms to overcome underdevelopment; at the same time, anti-imperialist feelings came to the fore.
Between 1958 and 1976, administrations adopted a modernizing approach to integrate an industrial economy, termed desarrollismo (i.e., developmentalism). It opened the local market to foreign investment, relied on State planning and on scientific and technical renewal. Considerable support was extended to local and foreign investment, which produced major achievements in chemicals, petrochemicals, steel, metal mechanics, automotives, machine tools, paper, cement, and self-supply in oil and energy. Looking backwards, however, one must temper these results. Growth generated industrial development and serviced unsatisfied local demands. Foreign industry introduced state-of-the-art technologies and management, even if imported equipment were expensive. Manufacturing expansion was quick and disorderly. Furthermore, foreign firms had greater productive capacity than required and this affected profitability.
Industrial modernization increased technical and management competence in local firms, many of which acted as suppliers and subcontractors for the foreign corporations. They made up a vibrant entrepreneurial group who built a strong productive network throughout the country. Small firms received active credit policies because they provided employment. Economic indicators show 6% annual growth in 1963/1974. Even in the 1970s, industries exported products and made investments abroad. Low productivity and efficiency were its major weaknesses, however. Businesses were protected, in a vibrant non-competitive market, with captive customers who paid generous prices for low-quality goods. Modernization also extended to the rural context, where after more than 30 years, cultivation and exports grew.
Expansion insured full employment and increased workers’ incomes. They benefited even if they did not participate beyond their unions, which retained considerable influence. Every administration acknowledged union power. This explains the relevance of Keynesian policy, although periodic crises emerged with the downfall of currency reserves due to major balance-of-payments deficits, which called for the application of orthodox monetary stabilization measures with authoritarian clout. State participation always was a decisive agent for the promotion of the economy.
In the years following the Great Depression, per capita income rose quicker in Brazil, Mexico, New Zealand, Canada, and Australia than in Argentina, which showed the failure of the imports’ substitution strategy to generate sustained growth. In the 1960s, productive forces started to develop, but the economy again stopped after 1975. An analysis of the Argentine case shows three major hurdles: (a) foreign dependency: minimal internal savings capability to finance investments provoked major problems in balance of payments and level of reserves; (b) sector rivalries: permanent conflict over income distribution, between agrarian and industrial sectors, and between corporations and workers; and (c) inflation: where Argentina had one of the highest rates in the 20th century.
The 1970s witnessed a revival of crude violence and authoritarianism. It worsened with the death of Perón during his third term in office. He left a power vacuum which opened the way to the military, which started the most tragic period in the country's history, between 1976 and 1983. An ignominious reign of terror paralyzed Argentina, even as it attempted to transform the bases of the economy. The financial and import sectors were privileged, while a fundamentalist approach opened the market to foreign products and provoked deindustrialization. Simultaneously, the liberalization of the financial market sparked speculative fever, which was exacerbated by inadequate currency exchange policies against the U.S. dollar. This led Argentina to an alarming level of foreign indebtedness. The economic establishment solidified in a group of highly concentrated national and foreign enterprises, diversified in their activities and integrated in their management. Closely linked to the State, these firms obtained lucrative deals. As a powerful business lobby, they became State suppliers and subcontractors. The ravages of inflation hurt employees, workers and small industries.
By 1983, Argentina found itself in a situation fraught with difficulties. Its military government was repudiated for major human rights violations and its wretched economic administration. Its fall was accelerated by the war lost to Great Britain in the Falklands/Malvinas, plus the impact of the crisis of the Latin American foreign debt that interrupted the flow of international loans to the region. A democratic system was instituted and President Alfonsín was chosen. Argentine society recovered its dignity and institutions, overcoming its inheritance of authoritarianism and intolerance.
Reconstructing its economy was one of the major assignments, a task that is currently under way. The new administration wanted to subordinate the economy to the logic of politics, becoming aware too late of the complex and delicate situation of State resources. It did not adequately measure the ability of the financial and monetary systems, nor the degree of power held by the major local and foreign economic groups. Decision making towards sovereign or regionally inspired initiatives was rigorously opposed by the commitments required by foreign debt creditors, in addition to the requirements of the International Monetary Fund.
The first democratic government instituted various economic programs with small successes and major failures. This translated into a learning process for Argentine society, until it finally understood the nature of the crisis and the scope and imminence of the required transformations. The economy became unsettled between 1989 and 1991, with gross price hyperinflation and abrupt devaluation of the currency. These lead to the fall of the government. A new administration took over, lead by President Menem, who expediently ruled during two consecutive periods, 1989/1999.
Increasing economic difficulties caused a loss of autonomy of Argentine rulers. Globalization added to this process, and the weakness of Argentine economy allowed for influence from outside. The economic uncertainty allowed the United States of America, the International Monetary Fund and the World Bank to exercise a monitoring role over the local administration. Control centered on the destiny of international loans, that is, goals and objectives; conditions, results, and periodic inspections to verify compliance. This implied establishing a new relationship with the U.S. government, aligning Argentine policies with its directives and strategies.
President Menem contained the inflationary debacle and solved state bankruptcy. The monetary system was stabilized in 1991, with the satisfactory application of the Currency Board measures. This cleansed the public deficit and gave way to an active program of State offices’ re-structuring. An over-arching program of privatization of public companies took place in the first years of his administration.
The scope and intensity of the privatizations were critical, but their results were positive and negative. Considerable investments arrived and technology was modernized, which improved the quality of the services transferred. Still, most privatizations were discretionally assigned and gave way to illegitimate projects resulting in large contingents of workers who lost their jobs and raised unemployment sky high. The rapidity of the process did not allow for rigorous implementation of control mechanisms over quality and tariffs. Besides, privatizations and reforms were carried out through capitalization processes, as well as through recovery of foreign debt titles, which 10 years later duplicated country indebtedness. Foreign commitments became critical with the deregulation and liberalization of the Argentine economy, which although integrated to the global market, is subordinated to the new world order that defines Argentina as a high-risk, emerging country. (1995)
Major macroeconomic achievements must be acknowledged, including real-term 34% gross national product (GNP) growth between 1990 and 1995; and a 22% annual accumulated level of growth since 1991. Market forces did not solve the problems of the Argentine economy. Much to the contrary, evidences show a deepening of the difficulties caused by the effects of adventure capitalism (Weber, 1992).
In 1995 conditions worsened. Unemployment, social marginalization and street violence have increased. A recession is in place since 1997; efforts to combat it only began to emerge in 2003 and are making headway. Depressive trends have not been reversed and major changes are not expected to occur shortly. The democratic election of a new President in 2003 and the need to redefine priorities, however, opened the way to a review of past practices and a search for more balanced forms of economic consolidation.
4. MANAGEMENT IN ARGENTINA
Contemporary Studies
We use two criteria to analyze management studies in Argentina, one chronological, concentrating on those written after the economy opened in 1989, and a second one defined by (a) cultural factors, that is, those centering on the values of the Argentine business leaders and (b) structural considerations, that is, those that govern the link between managerial behavior, and the macroeconomic and social conditions in the country.
Lewis (1993) lists the explanations given for the causes of Argentine decline. The most frequently cited are: (a) the resistance of the traditional oligarchy to accept social and political change; (b) military meddling which exacerbated instability; (c) exploitation by foreign capital; (d) the absence of an industrial class with entrepreneurial skills, (e) the machinations of Perón, and (f) the Argentine national character which impedes cooperation (p. 23ff).
Two interpretations are offered here that relate societal cultural and economic developments to managerial values in Argentina. The first focuses on the absence of an industrial bourgeoisie which is a result of the structural weaknesses of the Latin American economy (e.g., due to their colonial origins or their high vulnerability in the face of world markets given their being primary-goods producers). Within this conception, economic backwardness inhibited capital accumulation in the local markets and required State intervention to mobilize the needed resources to undertake industrialization processes already in place in other countries. The state became a decisive player in economic development and subordinated both the market as a resource allocator as well as the country's industrial strategies to its decisions. Consequently, the emerging and weak industrial bourgeoisies found their growth tied to relationships with the state, which postponed innovation, efficiency, risk taking, and competitive initiatives.
The second interpretation focuses on the basis of factors characteristic of the region and holds that the absence of industrial leadership was due to the fact that in those countries the traditional oligarchic landowning class effectively consolidated its position. Developmental attempts of competing industrial bourgeoisies were rigorously resisted, postponed and inhibited due to the exclusive access to the existing power structures, and the great privileges enjoyed during those decades.
In his analysis of Argentina's economic involution, Sábato (1988) holds that the dominant elite was present in a variety of economic endeavors, had attained unity as a group, and its control of financial and commercial opportunities allowed it to participate in a wide range of productive and speculative activities. In this sense:
To the degree that if the economy as a whole were subject to pronounced fluctuations or to uneven developments of its component sectors, its extraordinary flexibility to place its excess revenues tended to inhibit the development of specialized fixed investments, investments were only minimally channeled towards productive endeavors, thus postponing the development of the productive capacity of society as a whole and the organization of a capitalist system. (p. 109ff)
Waisman (1987) suggested that the reversal of development was due to the fact that in the 1920s, Argentine institution building was well advanced but the process was maimed by the surge of the Great Depression. The reversal is explained by the combination of structural factors, concentration of agrarian property, lack of manpower reserves, and erroneous political decisions, including indiscriminate industrial protectionism.
In his analysis of Argentine capitalism's future perspectives, Ferrer (1998) identified major trends in the international order, as well as the countries that overcame their relative backwardness and joined the ranks of advanced industrial economies (p. 13ff). He concluded that although the recent Menem administration established a political alliance between local interest groups, popular support, and international power centers, the incapacity to service foreign debt with exports made the country dependent on debtors’ decisions (p. 89ff).
Schvarzer (1996) completed a political and social history of Argentine industry and suggested the reasons for it not becoming an effective engine for economic development. More recently, Schvarzer (2001) showed that the poor results obtained in local growth dynamics and distributive equity show that the open economy model firmly implanted since 1975 has not produced desired improvements and new strategies must be evolved (p. 6).
Argentina systematically has a great surplus in food and fuels and a deficit in manufactured goods. Bouzas and Fanelli (2001) believe Argentina must concentrate on multilateral liberalization and regionalism. They see Mercosur, the Southern Cone economic alliance, as a key developmental strategy to face the challenge of globalization and to build the shared economic space that will accelerate productivity growth (p. 250ff).
Developments deriving from the opening of the economy deserve attention: the internationalization of banking and commerce, the corporate purchase of local industries, the onslaught of worldwide competition, the development of communicational and systems technologies, the new legal framework, as well as the de-layering and restructuring of firms, impacted on management practices. However, two tendencies are at loggerheads: the development of organizational learning, as against a winner-take-all mentality.
López (2000) found that an uncertain and ever-changing context produces disciplined subjectivities, the obverse of what the management literature holds: autonomous, creative managers, self-motivated towards permanent growth (Bennis & Nanus, 1985; Schein, 1985; Senge, 1990). Participants defined success as the possibility to strike a balance between professional and personal lives. But instituting a new organization needs new technical contents, as well as the production of disciplined subjectivity. New organizational practices are instituted in a setting of high competitiveness with fierce and open rivalries for jobs; and are based on business criteria, where one may not be able to retain one's job even if one fully satisfies the requirements for the job. Gantman (1994) also points to a management paradigm that increases inequalities and legitimates a two-tier social order, with winners and losers, where total responsibility lies in each individual. A new individualism emerges side by side of a narcissistic paradigm. Etkin (1999) writes about institutionalized corruption: the destructive effects of pragmatism, amorality in management and ethical transgressions.
Corporations are hostile because they create a stage in which pragmatism is the predominant value, people are a resource for goal attainment, demands are exacting, and contracts are precarious. Still, corporate positions are valued because the inverse implies exclusion. Moreover, when interesting work and training is found in companies, growth is enhanced. People must therefore be docile. Future scenarios can only be conjectured. Participants express their hopes and fears; but seem incapable of delving into what is happening because they are overpowered by unpredictability, as well as by the dissolution of former references (López, 2000).
Organizational changes show this dilemma is faced daily by managers, that is, enlightened and narcissistic leadership patterns, at odds with one another. Executives attest to the growing interest in management as an authority system and to the need to institute leadership in complex organizations. Numerous conventions and consulting research projects identify obstacles and show progress made installing rule-oriented behaviors (IDEA, 1992, 1993, 1996, 1999). Still, the pace is slow and the vision emphasizes survival rather than growth. Participants point to contradictions between stated desires to institute empowerment and team work, and the lack of support for such practices. The economy is open, firms incorporate efficient methods, but authoritarian practices remain. Reference should be made to Weber's (1992) reminder to contrast the notions of “modern rational capitalism which has need not only of the technical means of production, but of a calculable legal system and of administration in terms of formal rules” as against “adventurous and speculative trading capitalism” (p. xxxviii) “bound to no ethical norms whatever” (p. 22).
5. RESEARCH RESULTS
Societal Culture: Results Derived From Quantitative Research
GLOBE Questionnaires were distributed during the most conflicting period since the promulgation of the Currency Board system, under which the local peso was tied to the dollar at par. At that time, managers and employees were under great strain. The Mexican financial crisis (December 1994) caused a decrease of economic activity and made access to credit impossible, which accompanied by privatizations, State reform and the incorporation of technologies, increased unemployment from 10.8% in May 1995, to 18.6% twelve months later. Industrial activity stagnated for 9 months.
Besides, it is unusual to carry out industrial research in Argentina, and conditions had to be generated. Preparation required patience and insistence. Purposes and action plans were carefully communicated. Information was circulated to 22 food industry and 20 financial firms; meetings were called to present goals and benefits; and interviews were held with top managers. As a result, 4 food-processing and 5 financial services firms participated: 217 questionnaires were distributed and 153 responses were tabulated, that is, 71% of invitees. The prestige of sponsoring institutions gave GLOBE credibility, but in the light of closings and deactivation of labor laws, it was thought that many would refuse, or would cooperate from fear. Demographic data collection were not collected because it was felt it would diminish participation. Still, an overall sample profile was gathered: All respondents are native Spanish speakers, in second- or third-generation Argentines, and have graduated from High School at least. Sixty-seven percent are under 35 years of age and 85% live in or close to Buenos Aires the capital city.
In the following, information is offered and discussed on each of the nine societal culture GLOBE dimensions (see Table 18.1).
Culture Scales on Society Level
Performance Orientation. The GLOBE aggregated scale scores indicate that Argentina ranks 52nd out of 61 countries in Performance Orientation: 3.65 for “As Is” and 6.35 for “Should Be.” The gap is large and significant. Performance Orientation is a key factor on which change is most desired. Switzerland is the country with the highest “As Is” rating, while El Salvador's “Should Be” values are close to Argentina's.
Argentina flourished taking advantage of its vast natural resources until the 1930s. Since then it tried out many competitive options. All these failed, and Argentines believe that the current downfall (1995) of the major efforts undertaken in the 1990s derive from the lack of a well-conceived and agreed-upon strategic plan. Decision makers, who have direct access to the sources of political and economic power, act barely within the borderlines of legality: “Our genes and our historical education have trained us to despise the law, or at least to handle ourselves subjectively, to speculate, and to try to take advantage of the rules” (Denevi, in Lóizaga, p. 93). Often, executives incorporate the concept of achievement, but it is not prevalent in society. Moreover, whenever mention is made of performance in a public statement, such a reference is suspect, duly interpreted to be inapplicable, and dismissed.
With developing democratic institutions and no inflation, two causes of anxiety have disappeared. Even so, the anomic component is still there in that Argentines are rule breakers (Isuani, 1998). Nino (1992) analyzed the link between inefficiency and underdevelopment and wrote “there is a recurring trend in Argentine society to anomie in general and to illegality in particular,” that is, towards the breaking of juridical, moral, and social rules. He considered Argentina “a country outside the law” insofar as “the anomic factor generates reduced levels of efficiency and productivity” (p. 25).
Competition makes it imperative to develop professional ideas in strategy development, goal establishment, resource allocation, time management, weighing of alternatives, results measurement and action plan adjustment. The current explosion in books, specialized magazines, seminars, and postgraduate courses in Business Administration testifies to the need for the assimilation of such criteria. The relevance awarded to the Performance Orientation “Should Be” dimension points to an emerging trend. It places emphasis on achievement and distinguishes power from authority. Argentines value performance and state that it is neglected and not appreciated. Argentines are adept at surviving by their wits. Respondents use them in their individual pursuits, but find they are not applied in Argentine society.
Future Orientation. Argentina ranked 60th out of the 61 GLOBE countries in Future Orientation “As Is” (3.08) and 19th for “Should Be” (5.78). The gap is again large and significant. Future Orientation is a second key factor on which a positive change is desired. Singapore is the state with the highest “As Is” rating, while Russia's “Should Be” rating is as low as Argentina's.
At the start of the century Argentina seemed destined to greatness, but the country slid into a permanent state of vulnerability, economic depression and political instability that gave way to the emigration, in the last 40 years of 2 million university graduates, artists, trades people, scientists, and blue-collar workers who started new lives outside their own country, due to political hardship and to intransigence (Bunge, cited in Barón, del Carril & Gómez, l995, p. 61).
Emigration is still a major concern and many emigrate. Fifty seven percent of the employed fear they may lose their jobs; and respected economists question the common sense behind the measures taken by the government (“They either devaluate or kill the population” Fitoussi, Clarín, June, 2001).
The relevance awarded to Future Orientation dimension merits attention because Argentines live through an apparently unsolvable crisis. The Economist (June 23, 2001, p. 11) stated that “Argentina's Currency Board precludes devaluation and puts monetary policy off limits. The country's debt burden leaves no room for looser fiscal policy.” This is a major plight as seen by the comment that follows: “Unfortunately, his (the Minister of the Economy) latest decision – to mimic a devaluation by offering exporters a subsidy and importers a tariff, may be a step too far.”
Assertiveness. Argentina ranks 24th out of 61 countries in Assertiveness “As Is” (4.22) and 51st for “Should Be” (3.25). Albania is the country with the highest “As Is” rating, while Sweden shows the lowest. The “As Is” score identifies a typical Latin American culture. The position of Argentina lies close to Colombia (25th), Brazil (26th), Venezuela (20th), México (16th), and Ecuador (32nd), and fits also within the Latin European cluster, represented for example, by Spain (17th) and Italy (34th) or France (30th).
“In other modern Western societies, intransigence suggests dogmatism and rigidity. In Argentina it is understood as principled, moral and a defense of the truth. It denotes such orthodox, correct postures that practically all transactions are excluded” (Shumway, 1993, p. 56). This difficulty to reconcile opposing goals is observed in most negotiations, where confrontation is highly valued. As Altschul (1999) observes, “Among us, negotiation defers to harassment and vanquishment, to ‘we had to give up,’ to ‘I couldn't have it my way,’ connotes pushy sales techniques, and evokes crooked dealings” (p. 16, 23ff).
Audacity is called for, rather than courage; adventurousness not bravery. Writing about Australia, Ashkanasy (chap. 9, this volume) say about Australia that there is a need to rely on an inspiring leader to carry them to the First World. The past histories of Australia and Argentina, which show parallels in their social development, egalitarianism, discrimination and changes, processes that ride on a history of elimination of aborigines, admiration for individualist leadership, and early women's suffrage, may explain the similar demand for a decidedly assertive style with authoritarian overtones.
Collectivism I: Institutional Collectivism. Argentina ranks 58th out of the 61 GLOBE countries in Collectivism I: Institutional Collectivism “As Is” (3.66) and 8th for “Should Be” (5.32). Sweden is the country with the highest “As Is” rating, while Greece's “Should Be” values are close to Argentina's. The “As Is” position of Argentina lies close other countries of the Latin American cluster, such as Brazil (52nd), Colombia (53rd), Guatemala (56th), El Salvador (55th), and Ecuador (48th), and also lies close to Spain (51st) and Italy (57th).
Hofstede (1984) categorized Argentina as individualistically oriented, and GLOBE scale scores place it at the end of the Collectivism spectrum. This may be attributed to an entrenched feeling of abandonment present in Argentine society. The Menem administration used plenipotentiary powers and promised a future of splendor as a result of the privatization, deregulation, and opening of the economy. The continued demands of new adjustments, a euphemism for junk-job creation, delayering, salary cuts and firings, the Currency Board system had created a sense of despondency; and the repeated schisms in political life contributed to detract from the actual benefits of the program. People feel that society and its structures were destroyed and their values have been laid to waste. People are anxious, feel alienated, feel there is nobody to turn to, or to listen to. They feel menaced by failure. People feel they do not belong, vent their anger after soccer matches. This has improved since the advent of the Kirchner presidency, however. “Cambalache,” a popular tango from the 1930s, repeatedly recalls loss of values.
Fundamentalist churches and New Age cults spring up in poorer districts, while 91% say they “believe in God,” although only 22.5% are regular church goers. Moreover, 83.7% of Catholic women and 88.1% of Catholic men believe in UFOs and extraterrestrial beings; 60.0% believe in magic-spells, curses, and charms (Baamonde, 2000). Argentine society perceives itself as apolitical: “We have an immature democracy” (74.6%); “We lack years of democracy” (27.3%); “No politician satisfies me” (71.3%).
Gender Egalitarianism. Argentina ranks 26th out of 61 countries in Gender Egalitarianism “As Is” (3.49) and for 12th for “Should Be” (4.98). Hungary is the country with the highest “As Is” ranking, while South Korea ranks lowest. Hofstede (1984) placed Argentina in the middle of the spectrum, though closer to masculinity (20th/21st among 53 countries). Today the gap between the “As Is” and the “Should Be” value stands at 1.49. Altogether, it seems that Argentine managers with mainly urban background feel they are reasonably egalitarian.
Answers correspond to a society with a diminished sexual role division. Today 91.8% of people polled say that a woman may fulfill herself at work and professionally, while 50 years ago only 16.4% thought so; “may go out with her friends or alone” passes from 12.3% 50 years ago to a current 77.9%; and questioned on adultery: “Do you believe men are less loyal than in the past?,” 50.8% agree, while the same question on women produces 70.5% agreement, which shows a perceptual change on autonomy.
Significant changes in women's social incorporation include young women leaving parents’ homes before young men, contributing significantly to the family budget, and raising families without men's help. Women make up close to 60% of all university students, and they are hired in professional positions previously limited to men. Women occupy more political positions since the Quota Law, in the development and leadership of nongovernmental organizations, and in public welfare institutions. Since October 2001, Argentina has been a country with very high representation of women in legislature (Clarín, July 4, 2001). Furthermore, the paradigmatic role of the Mothers and Grandmothers of Plaza de Mayo in their search for “the disappeared” during the military dictatorship, as well as in social protest manifestations commands respect. In the work environment, women represent 40% of the labor force in Buenos Aires and its outskirts, although this growth is limited to short-term, low-qualification jobs (INDEC, 1999).
Humane Orientation. Argentina ranks 32nd out of the 61 GLOBE countries in Humane Orientation “As Is” (3.99) and 20th for “Should Be” (5.58). Zambia is the country with the highest “As Is” rating, while former West Germany ranks lowest.
Argentina has a long tradition of charitable institutions that maintain continuity by patronage, many of which emerge to complement tasks left unfulfilled by the state. Parents’ cooperatives exist in schools and hospitals, neighbors’ contributions supplement police stations’ and firemen's budgets, and sundry nongovernment institutions subsidize community projects in backward areas whose legitimate revenues do not cover the needs of their inhabitants.
More recently a great diversity of neighborhood, municipal, provincial and national solidarity institutions were created to gather and manage funds for welfare purposes, structured around specific needs of each population: unwed mothers, retirees, AIDS patients, street children, Falklands/Malvinas ex-combatants, and so on. Mostly in silence, they have built a solid reputation, and are now courted by the media, because throughout the years, diverse public institutions had absconded with voluntary contributions.
Argentines value their current level of Humane Orientation, desire to uphold and increase it. Related to the weight assigned to Performance Orientation and Future Orientation greater emphasis is required on developing “crecimiento con equidad,” growth-with-fairness mechanisms (Fanelli, 1999).
An interesting opposition emerges from relating the answers to the Humane Orientation and Collectivism I: Societal Emphasis dimensions. Argentina is rated among the most individualist countries in the project but rates high on Collectivism II: Family Collectivism. This is consistent with experience, as for example when the Divorce law was enforced in 1987, the figure for new wedding ceremonies increased in comparison with that of divorces, as a greater quantity of couples legalized their situation, whereas distanced couples had already separated independently of the law (INDEC, 1999). At the same time, executives interviewed define their success primarily in terms of balance between family satisfaction and professional success, and not on the basis of their work performance (López, 2000).
Power Distance. Argentina ranks 5th out of the 61 GLOBE countries in Power Distance “As Is” (5.64) and 56th for “Should Be” (2.33). This is the dimension with the largest gap between current and desired values. Morrocco and Nigeria are the countries with the highest “As Is” ratings, while Denmark has the lowest ranking. The other Latin American countries, with the exception of Bolivia, which often parallels Argentina's data, cluster around these figures.
Argentina is politically and economically a centralized nation. The essayistic literature holds that the leader manipulates through charisma. Denevi quotes Marañón, a Spanish thinker, as saying that “a good politician should combine lack of scruples, an exaltation of ideas, coolness, obduracy and malice” (Denevi, in Lóizaga, p. 88). The relationship between the leader and the community answers to a direct and informal content. That helps explain why even the most temperate politician adopts a populist style; a feature that extends to the business environment and generates the model of the patrón, very much the lord of the manor. Thus great oversized confrontations, never continuities, persist in Argentina, and divisions circumscribe objectivity, balance, and tolerance.
Within the 53 countries studied, Hofstede (1984) categorized Argentina near Brazil, and far from other Latin American countries. Argentina's GLOBE scale scores display a more central position within Latin American countries. In spite of major macroeconomic achievements, the 1990s show arbitrary use of political and economic power in Argentina: GLOBE responses show this when middle managers interpret that “people in positions of authority wish to exercise power for power itself.”
Argentines feel attached to the barrio (neighborhood), where a person grew up and where public reputation is anchored. In this context, the escrache, which involves soiling a person's house front, searches for reparation by affecting his family reputation. It is a social manifestation that developed as a tool for redress, an ephemeral and preannounced enactment with which a group shames a person held responsible for an injustice or a collective abuse, and constitutes a symbolic action of censure, vilification, and amends. It publicizes indignation in the light of repugnant actions and exhibits moral judgment because existing due process is insufficient to mete out sanctions.
Collectivism II: In-Group Collectivism. Argentina ranks 28th out of the 61 GLOBE countries in Collectivism II: In-Group Collectivism “As Is” (5.51) and 7th for “Should Be” (6.15). The Philippines is the country with the highest “As Is” value, while Denmark's has the lowest. Argentina is positioned within the Latin American culture cluster on the “As Is” Collectivism II, for example, Costa Rica (33rd), El Salvador (32nd), Bolivia (29th), Venezuela (24th), and not too far from Brazil (38th) and Guatemala (17th), and also close to Spain (30th) and Italy (41st).
In Argentina the family constitutes a vital center of social activity; besides being highly media oriented as five of the major pastimes take place in the home, and 50% of people consulted watch between two and three hours of TV per day.
This is extended to the context of friendship, and valued institutions such as the ronda del mate, the drinking of maté tea, where the tea is sipped through a bombilla, a metal tube: the gourd being again replenished after each person drinks, the next person sips through the same bombilla, as well as the asado, a barbecue where the man of the house prepares food for family and friends. An unobtrusive measure of In-Group Collectivism is seen in airports where it is usual for entire extended families to see a relative off or to wait for them upon their return from a trip: the emotions displayed being independent of the fact that whoever leaves or returns may have been away for a very short period. Recent findings (Markwald, 2005) confirm the strength of this trait. They show that children from Argentina, as compared to those in Brazil, Colombia, Chile, and Mexico, share more activities with friends and that these relationships are critical in the upbringing.
As Cozarinsky (1995) writes: “Every time I go to Buenos Aires I run into the extraordinary human quality of the Argentines. In Argentine society one immediately and very firmly feels the presence of individuals. One is put in contact with the others. They immediately embrace, kiss, touch. It's not something that I particularly enjoy but it expresses enormous affect related to behaviors of archaic Mediterranean societies. Unfortunately these societies are fully incapable of organizing daily lives” (Cozarinsky, cited in Barón, del Carril, Gómez, 1995, p. 149).
In the face of globalization, the tendency is to leave the public scene and retreat to the private fold: 78.7% consider that happiness means having a nice family, 50.8% having a nice (marriage) partner; 44.3% having many friends.
Uncertainty Avoidance. Scale scores rank Argentina 47th out of the 61 GLOBE countries on Uncertainty Avoidance “As Is” (3.65) and 36th for “Should Be” (4.66). The gap is large and significant and change is highly desired. Switzerland is the country with the highest Uncertainty Avoidance “As Is” rating, while Russia has the lowest. Again, on “As Is” scores, Argentina is well positioned within the Latin American cluster, for example, Brazil (51st), Colombia (52nd), El Salvador (50th), and not far from Costa Rica (40th), Ecuador (43rd), Bolivia (57th), Venezuela (55th), Guatemala (58th), and lies close to Spain (36th) and Italy (41st). GLOBE figures show a small gap (1.01) between the “As Is” (3.65) and “Should Be” values (4.66).
Improvisation and short-term actions are major part of public and private life, and explain failures in complex endeavors that require a careful evaluation of goals, means, stakeholders, and deriving critical learning from experience. The ability to deal ingeniously and extemporaneously in the face of uncertainty is a prized attribute: from a positive angle it builds flexibility, whereas, from the negative side, it favors makeshift solutions and trickery. These are complementary features that help to construct an identity. This also postpones decision making, which in a changing context implied taking on risks and helps zafar, that is, shunning.
In the last decade, and as a result of inflation control, two contradictory processes have arisen in Argentina: a greater degree of planning in the face of uncertainty. However, given the impossibility to conceive the future, skepticism takes over: little credibility is awarded to whatever public figures state and the young identify with pop idols rather than with politicians, business leaders, or intellectuals.
6. REGIONAL AND CULTURAL CONSTELLATION
Argentine scale scores coincide with those of participants of Guatemala, El Salvador and Bolivia, and with those of other Latin American countries, which present a homogeneous cultural cluster in answers to Collectivism I: Institutional Collectivism; Collectivism II: In-Group Collectivism and Uncertainty Avoidance. This attests to the process of Latin Americanization of Argentina (Ogliastri et al., 1999a).
In earlier times, public jobs in health, education, and construction warranted Argentine social mobility. Besides, immigrant communities had founded well-established hospitals, schools, sports, and mutual help associations. Argentina had a large middle class and the quality of its public health and education were superior to those in other countries in the region.
This has changed for the worse. Public opinion speaking of a culture closer to those of neighboring countries is supported by further GLOBE data which shows homogenization of cultural practices and values within Latin American cultures (Ogliastri, et al., 1999a). Middle managers indicate that they live under extremely uncertain conditions with little control over circumstances, and indicate a preference for Uncertainty Avoidance; elitist values predominate, and there is desire to reduce them; Collectivism I and II values are among the highest within GLOBE, and they wish to uphold them; their societies are individualistic, they value social well-being over individual benefits; their societies are reasonably oriented towards performance, but would like to see this enhanced; their societies discriminate against women and egalitarianism should be increased; their societies are present oriented, and would prefer a greater Future Orientation; they prefer a humanist society, whereas the current situation ranks below GLOBE average; they desire to maintain a high degree of interpersonal contact.
In line with societal cultural values (“Should Be”), Latin American middle managers prefer high performance, collaborative, team integrator leaders, and those who are administratively competent and ready to commit themselves to the organization (Ogliastri et al., 1999a, p. 1). In contrast, as will be detailed out in a later section of this chapter, the Argentine concept of leadership runs somewhat “countercultural.”
7. SYNTHESIS FOR SOCIETAL CULTURE
A major societal change took place in Argentina: Latin Americanization is driven by immigration from neighboring countries, plus the effects of changes, characteristic of the times, similar to those taking place world-wide are being felt. García Canclini (1995) analyzes the current conflicts in the region as tradition in the face of emergent modernization. Hobsbawm (2000) describes the dilemmas inherent in the “small global world” (p. 82ff). With the onset of new technologies, societies become de-traditionalized. Capital assets fly by night; factories move across continents, foreign financial crises impact globally. Furthermore, social norms are weakened, a sense of the ephemeral prevails, families disintegrate, individualism grows, life is secularized, employment is precarious, and public figures are distrusted. Under these conditions, it is hard to define autonomous national policies, and this influences the behavior of executives and managers who must adapt to perform. This new conjuncture requires attention to be paid both to factors intrinsic and extrinsic to each situation, and makes participants reflective. GLOBE methods capture this richness empirically. This is shown in world wide comparison: Autonomous leadership is highly endorsed in Argentina; within Argentina, it is Participative, Team Oriented and Charismatic Leadership that is most prototypical for outstanding leaders; Self-Protective and Humane leadership are least endorsed.
GLOBE results signal a close relationship between the Argentine profile and those of less developed Latin American nations in Collectivism I: Institutional Collectivism; Collectivism II: In-Group Collectivism, and Uncertainty Avoidance. Facing conditions beyond control, management chooses survival against growth, structural mutilations ensue, and middle managers answer with responses closer to those of traditionally less developed societies.
8. LEADERSHIP IN ARGENTINA: LEADERS AS FIGURAS SEÑERAS
In Spanish, figuras señeras refers to solitary, single, unique, unequaled individuals. Argentina lived through three periods of political pluralism: the constitutional period from l853; the popular opening of the society from l916, and the return to democracy from l983. Intolerance and confrontation predominated at all other times (Massuh, in Lóizaga, 1995, p. 187). This history of discord and rivalries is currently under scrutiny. The present crisis helps the dust settle: it is difficult to further demonize. More reflexive practices are necessary. Leaders need to understand what is happening and why. Still, personalism (Sartori, 1989) persists. Sartori believes that in Latin American democracies people identify with an individual and not with a program. Trust is reposed in a prominent individual who can channel popular will. The emergence of protagonists such as Moreno, San Martín, Rivadavia, Rosas, Urquiza, Alberdi, Sarmiento, Roca, Yrigoyen, Perón, Alfonsín, and Menem, and Kirchner may be explained by the fierce factional confrontations that ended in the death or exile of the contenders throughout the history of the country.
Goldman & Salvatore (1998) indicate that “during Independence, a military career was the shortest road to leadership. Provincial caudillos gained preeminence. They firmly defended the territories they ruled over, did not submit to the rule of law, and ruled each region singularly” (p. 8ff). However, this has changed. Currently, Argentine presidential democracy retains unique characteristics: the concept of control and balance between powers does not exist as rulers see themselves as accountable only to their party, with no institutional accountability towards Congress or the judiciary. With law decrees, the president may disregard the legislature, pay little heed to judicial decisions he deems inconvenient, provoke critical media, and feel free to antagonize others.
The need to synthesize may dramatize the contents. Nonetheless, cacique and caudillo are Americanisms that distinctly express the overruling leadership mode: the cacique leads his people; a caudillo takes over in times of war. To govern and to acaudillar, to rule as a caudillo (strong man politics)-are never far apart. Thus major contradictions exist, fierce confrontations take place, there are few continuities, and such schisms detract from objectivity, balance, tolerance, and have ominous social consequences. The leader manipulates and his vision fascinates his followers. Graumann (l986) talks of the meneur, the jefe, the Fuehrer, images that connote directive leadership.
In Argentina the resultant relationship between the leader and the community responds to a direct and informal content. That may be why even the most self contained and austere politician adopts populist tactics; and why such a pattern may even extend to the private sphere where the image of the patrón, the lord of the manor, persists.
Argentina has produced several dominating figures, yet no books are devoted to Argentine leadership with the exception of Goldman & Salvatore (1998). It may be that “one does not write about the obvious.” Lozano (1999) recalls that, whereas Protestant traditions posit a distance between a subjective internal experience and norm ruled external experience, Catholic countries don't separate the personal and social spheres. In the first case, personal self control exemplifies domination over egoistic desires and a balanced external self. However, when Catholicism arrived in Latin America, aborigines were associated with demonic forces, and priests and conquistadors came to redeem them. They were the mythical heroes meant to chastise and conquer barbarism. Contrariwise, Germanic mythology presents the benevolent hero incorporated by Western philosophy, which makes man the subject of history, and interprets confrontation as a transgression against rules drafted by the Creator or the state. This romantic figure reappears in the transformational leader (p. 4).
Popular wisdom may say that mismanagement was explicable in the public sphere where institutions were not expected to deliver, but the current state of competitiveness makes it imperative to identify specific dimensions of Argentine leadership to institute the changes that may help improve motivation and achieve higher performance.
9. RESULTS OF THE QUANTITATIVE STUDY
Mean values of the empirical dimensions of leader behaviors describe respondents’ perception of the complexity of the managerial construct in Argentina (see Table 18.2). Distinct sub-constellations are distinguished: responses do not invoke a messianic leader, nor can they be summarized as a management / leadership opposition (Kotter, 1988).
The mean values of the behaviors are patterned, with two extreme clusters and four dimensions that cover a wide mid-range. Malevolent (1.59), self-centered (1.66), nonparticipative (2.02), and autocratic (2.22) all fall below the mean (4.55) and allude to negative behaviors— noncommitted, passive, alienated. They describe sovereign, intemperate, arbitrary, divisive behaviors. This is the image of the abusive leader, who considers himself invested with supreme powers and is narcissistic (Conger, l989). Within this scheme, malevolent, hostile, dishonest, vindictive, irritable, cynical, undependable, noncooperative, egotistical, unintelligent, self-centered, self-interested, nonparticipative, loner, and asocial are the most critical and can be related to managers who benefit personally from access to positions of authority: “Leaders who serve others, or in the service of their own greed?” illustrates the degree of disbelief. Likewise, autocratic, dictatorial, bossy, elitist, ruler, domineering, nonparticipative, nondelegater, micro manager, nonegalitarian, and individually oriented evoke a “show of epaulettes.”
Positive behaviors are above the mean: humane orientation (4.65); modesty (4.68); autonomous (4.68); charismatic III: self-sacrificial (4.85); administratively competent (5.53); collaborative team orientation (5.68); diplomatic (6.07); team integrator (6.08); decisive (6.11); integrity (6.15); charismatic I: visionary (6.17); performance oriented (6.19); charismatic II: inspirational (6.34). They define committed, active, involved behaviors, and as such would comply with organizational and followers’ expectations. The fact that most GLOBE countries crowd up to two thirds of all 21 dimensions in this sub-constellation allows us to posit this as “a pipe dream,” “an expression of fine desires.” Besides, subjects recall that “a company pays a salary for your work, it never promises justice.”
Argentinian GLOBE Leadership Survey
Thus, internal consistency can be attributed to the ends of the continuum and it becomes easier to assign meaning to the remaining four dimensions in the middle range: face-saver (2.97); procedural (3.75); conflict inducer (4.26); and status oriented (4.49). The sparsely occupied continuum shows a degree of role complexity that rejects self evident conclusions, unless the definition is adapted to our reality, because “to understand us you have to live with us, share our lives, learn how we feel, what we must tolerate.” How should one account for these behaviors? Are they the exception that confirms the rule, or do they represent something different? And if they do lead elsewhere, do they indicate a stage on the road to the desirable end, or do they constitute an adaptive response?
Face saver, indirect, avoids negatives, evasive, alludes to the fear of humiliation and to failure due to non-compliance with expectations in the exercise of a position. This translates into maintaining a front and refers to covering up a situation or a feeling so as not to cause a scandal. It alludes to low credibility and inconstancies, and recalls the frequency of unfulfilled promises and the repeated use of euphemisms. With procedural, ritualistic, formal, habitual, cautious, conflict inducer, normative, secretive, intragroup competitor, status consciousness, status conscious, and class conscious constitute a subconstellation that identifies entry-level requirements. These are threshold capabilities, socially validated attributes and behaviors, adaptive in that they discriminate merely technical aspects from that which a person must learn what to do upon occupying a position of authority (Heifetz, op cit. 1994). They assume that, to perform within the requirements of the role, a person must exhibit such traits, as they have been found to help based on past experience in similar situations.
Culture Dimensions on Industry Level
| Finance “As Is”/“Should Be” | Std. Dev. | Food “As Is”/“Should Be” | Std. Dev. | |
| Performance Orientation | 3.54/6.37 | 0.15/0.29 | 3.88/6.40 | 0.48/0.13 |
| Assertiveness | 4.44/3.67 | 0.16/0.41 | 4.31/3.35 | 0.36/0.37 |
| Future Orientation | 3.01/5.69 | 0.20/0.15 | 3.12/5.79 | 0.19/0.27 |
| Gender Egalitarianism | 3.46/4.93 | 0.12/0.23 | 3.42/5.06 | 0.37/.09 |
| Humane Orientation | 3.82/5.43 | 0.29/0.41 | 4.16/5.65 | 0.29/0.28 |
| Institutional Collectivism | 3.62/5.33 | 0.09/0.34 | 3.74/5.23 | 0.22/0.23 |
| Power Distance | 5.69/2.34 | 0.24/0.11 | 5.35/2.89 | 0.48/0.17 |
| In-Group Collectivism | 5.44/6.05 | 0.27/0.24 | 5.47/6.26 | 0.22/0.06 |
| Uncertainty Avoidance | 3.61/4.69 | 0.37/0.46 | 3.69/4.47 | 0.31/0.55 |
Thus, GLOBE respondents construct a complex conception of the leader. The three-pronged constellation signals a change. Whereas the positive end of the spectrum may point to socially well-reputed attributes, and the negative end suggests experienced abusive traits, the middle range identifies adaptive behaviors in the light of major corporate changes that give rise to top management/shareholder discretionary behaviors. The responses differ from Haire, Ghiselli and Porter (1966) and Altschul (1970), and indicate a level of complexity that has not been documented earlier.
10 FINDINGS OF THE ETHNOGRAPHIC RESEARCH
Nine focus groups were held, lasting 45 minutes each with 8 to 10 people, as well as 21 individual interviews of 20 minutes each. Participants were middle managers from leading firms in different industries, each group from one company, with 78% of the participants under 30 years old, representing a broad spectrum of functional areas. “Managerial Effectiveness Exercises” were completed and subjects participated actively in the subsequent ethnographic interviews (Agar, 1994; Agar & McDonald, 1996; Thomas, 1996). All phrases in quotations are comments made in the focus groups.
Focus groups participants were informed of the GLOBE purposes and conversations were held on management, leadership and managerial practices. Participants described the conditions under which Argentines have lived and suggested distinctive attributes and behaviors understood as adaptive responses. They indicated that change is under way: “Now, we live in freedom.” They described a history of abundance, of confidence in riches; a young society, with an incipient identity: “This was a politically unstable society, with dictatorships, repression, high inflation and constant change. Abuse of power was expected. However, we had work and upward mobility.”
Comparison of Culture Dimensions Between Society and Industries
Democracy is struggling, because justice is corrupt and inefficient, technical progress dehumanizes, competition provokes social instability, the gap between the poor and the rich increases, and, therefore, a selfish culture flourishes. Advances are being made: one ex-minister in jail for a year, others suffer detention while due process advances, and former President Menem was placed under house arrest and restricted from leaving the country under suspicion of illicit association to conspire.
As a consequence, Argentines develop a strong relationship with family and friends: “We are in solidary with our next of kin,” an attribute that generates affect, sociability, passion, expressiveness, and informal behaviors. On the basis of uncertainty, Argentines became competitive, ingenious, flexible, capable in the face of adversity and new situations, but “incapable of establishing long-term goals; they devote little effort to a job. They adapt but don't commit themselves.”
A second task required the participants to “think of a person with great motivating power, a capability to influence you and to allow you, or your area, to contribute to the success of your business. How would you call such a person? Think of a specific circumstance and describe the person who you are thinking of.”
Stimulated by generic questions, the ethnographic method made it possible to sift singular aspects of the culture. Although no formal typology was developed, discrete and repeated mentions were made of the terms dueño, owner; jefe, boss; buen jefe, good boss; gerente, manager; and líder, a term used to refer to popular figures, who lead by their example. The term gerente excepcional (exceptional manager) came up seldom. These were used as mental composites, were spontaneously repeated in all groups and structured the exchange. We call them icons. Moreover, in the cases in which the use of the term did not correspond to the culturally validated meaning, the speaker would include circumlocutions and clarifications to transmit his ideas.
Prior to describing the icons with illustrative vignettes, the rhetoric used is shown to be consistent with the Collectivism I and II dimensions.
Participants spoke assertively as most information was self referenced. They emphasized their knowledge of the case and its contingencies. They approached phenomena through anecdotes, not data. Rational presentation was accompanied by emotion. Non sequiturs are to be understood as said.
Focus groups devoted 83% of their total time to negative experiences. Only 17% of the protocols refer to gerentes or to buenos jefes, both required leaders. One participant asked if the research project would take into account “what really happens, as against what management books say.” They expressed doubts as to the possibility of change, as well as to the potential impact of the research project.
At first, participants conceptualized in dichotomical terms, not on the basis of dynamic, complex processes; they referred to expressions of whatever is primitive, what emerges naturally, is essentially unchanging and accounts for an observed reality which seems difficult to change. Differences of opinion were dealt with through generating more options and not by overlooking the differences. Once dialogue ensued, participants developed refined categories.
The dueño/owner icon: Dueño refers to a proprietor, or members of a family structure, and recalls the term patrón de estancia, homestead owner. Thus, headship, not professional leadership, is implied. Authority is vested in the individual, and does not imply role performance. Little competence or maturity is attributed to the dueño, and it connotes exploitation. Such people “can only tell the difference between making or losing money.” A representative vignette is: “The dueño here doesn't give a damn. Happy faces, sad faces, they are all the same to him. Wear a happy face, but don't believe his answers. Because when he's happy, he won't tell you anything because he's afraid you might ask for something, and on the day he's made up his mind to fire you, he'll tell you ‘we don't need you any more.’”
The characterization emphasizes “here and now,” and, in a society that normally prides itself on relationships, for the dueño, the other person is unworthy. Thus, the dueño icon alludes to absentee leadership and deference implies acritical obedience.
A second example accounts for the complexity of the process. An intermediary figure appears between patrón and peón: “Out in the country it's different. Out there punishments have no value. When I started fresh out of college, the owner introduced me (to the men) and left me alone. That's where it starts. Because a gaucho knows everything! He can drive a herd, build a mill, tighten the wires, shear the sheep, geld, even play the guitar. So you have to hold your own. Because you may have the job, but until you earn it and they acknowledge you as one of them, nothing happens.” This vignette introduces the possibilities opened up by the role of an intermediary, the supervisor, who may end up as either jefe or buen jefe, as will be seen. The speaker acknowledges the difficulty of supervisory work with farm laborers with multiple technical and human talents, and stresses that he will be accepted when and if he contributes with his work. The turning point is established: headship is one matter; but leadership cannot exist without followership.
The buen jefe/good boss icon: The buen jefe occupies a supervisory position and maintains personal relationships with his wards, that is, he is formally charged with a responsibility but keeps in touch. He “develops chemistry, people follow him,” performs within a system of rewards and punishments, is technically competent and sensitive. “The buen jefe provides backing, acts as an example, provides work.”
Most participants said that they never had a buen jefe: “If a fire breaks out the buen jefe stays calm, solves problems, shows himself, congratulates. He is interested in people, but his hand doesn't tremble when a person must be fired because he did something that shouldn't have been done.” This is critical in times of stress: “If you go right up to him, the buen jefe protects you. But in my twenty years I'd have to choose the least bad one. Because jefes here have a sense of royalty.”
Participants value discerning capabilities: The buen jefe knows he is a part of a project in a complex structure. “The buen jefe is flexible. He knows how to close his eyes. He has his own merit system, and he evaluates everybody every week end. He uses a points system and he puts them on a tablet so everybody can see.”
Interpersonal dynamics make him special: “Above all, the buen jefe is tops. And he can tell people apart, knows that a machinist is not a pick and shovel man.”
The jefe/boss icon: Emphasis on consideration produces two conceptualizations in the supervisor's role. Consequently, two alternative icons are used, jefe and gerente. Jefe involves the occupant of a position that confers privileges, connotes autocratic style and emphasizes policing behaviors. It is the extension of the shadow of the dueño, while gerente alludes to a supervisory role in a management system. The jefe takes advantage of a slot in a structure where subordination is prevalent; the gerente handles himself within the framework of a contract that includes dialogue.
Jefes are overbearing, distance themselves, and keep information to themselves. “Argentines fly as soon as they have a post, or a uniform. They ask for exceptions, they feel free from norms. They make you stay in after hours. And as things stand now, who would dare go home?” And again: “They tell how to behave, but you know what's going on. Still, the jefes tries to be at all places, what gets done starts and finishes with him. He often opens without knowing how, not knowing how to follow through. He uses the structure to uphold the fantasy of his leadership.”
Impression management places him as a jefe: One comment stresses this point: “I suffered under different styles of management. But I make people participate. Other styles never felt good. I replaced a manager who was a jefe. He was authoritarian. With him I had to maintain a double standard. I didn't follow his instructions. He said: ‘Go kick the shit out of that son of a bitch.’ In Argentine firms it is accepted that one has a godfather. You have tactical complicity between the people who have worked together long. It's a mafia.”
The gerente/manager icon: The gerente emerges as a business becomes an organization. Management means “doing things as they should be done,” “knowing that a good manager doesn't do everything well.” Thus they suggest that a third party establishes goals that the manager must reach. “He is given objectives and can make mistakes.” To satisfy this need, the manager “innovates, but not like crazy.” Like the buen jefe and unlike the jefe, the gerente includes the notion of an authority system: a gerente knows his decisions imply costs and benefits and incorporates feedback.
Professional management is an emerging concept, “He had to renegotiate a contract to establish new prices. He instructed two of us to find fields of mutual benefit, that the others would be interested in. We understood him, saw the mission and the goal, and we did it and it worked.” The example shows that even having demonstrated benefits, new practices are not universally adopted.
Gerentes know that norms expect them to include consideration. “This manager had a temp, and it was a bad relationship. But when she got sick, he got her medical coverage, got her a full time position with him, and gave her time to recuperate. He did it because it was expected.” He “was a tough cookie” but performed within expected policies and procedures.
Ethnographic data collection reinforced the need for decisiveness, diplomacy, inspiration, vision, integrity, and performance orientation; and the media content analysis added further to this conception. Still it is recalled that in day to day matters decisiveness goes hand in hand with lack of scruples and action orientation can be ruthless. Because “our culture places everything on the man at the top. Everything is asked of him and he is criticized for everything. There is little sense of community and organization, less leaders come up, and jefes think that leadership implies opportunism.”
In a period of business transformations, strikingly few examples were given of individuals with professional, managerial, and social competences, action oriented persons. An invitation to think of exceptional managers produced few testimonials, and these referred to foreign managers in local endeavors. Exceptions were references to the Minister of Economics of the first years of the Menem administration. “Cavallo is an exceptional manager. He grabbed the country, implemented the Currency Board and is making major changes in the economy. He did what had to be done when the time was right. He has a solid team, he does not improvise. He is capable and committed.” But the word líder is only used to refer to politicians and soccer coaches, popular leaders with special gifts.
The líder/maverick icon: In Argentina líder is reserved for public figures endowed with unique gifts, identifies whoever heads a complex process, embodies the masses, needs no intermediaries. “Perón was the only indisputable líder. He stayed in people's hearts.”
Brief comments refer to the construction of the image of the local leader, as for example: “A leader who ‘makes things happen’, doesn't seem Argentine.” There are some, but very few are commented upon. “We think of people who return us to a time of splendor.” In this sense, participants were skeptical as to the existence of this figure, as explained by the only comment on the heroic component in leadership: “The guapo (the maverick) goes it alone; he walks forth with his back uncovered. Here, to be a guapo you have to be against (them) and you don't last. The guapos are in the Chacarita (the popular cemetery).” Boldness and daring are desired but carry huge penalties.
The líder is expected to break rules and, alternatively, he will be admired and despised. Participants use líder for a person capable of facing a crisis, intimating that crises bring forth the complex relationship between the leaders and the led. Thus a líder is relied upon when major changes are needed, “he understands the emotions of the masses, is a trickster, knows how to channel emotions towards a goal,” which clashes against the nature of the instrumental relationship required in organizations.
The líder recovers territory and imbues it with new meaning. He produces identification because “he does what we like to do ourselves.” He becomes an idol, which reinforces the perception of his infallibility. As “he can lead because he is allowed practically everything.” Moreover, “he demands exceptional conditions, and as he gains favor through his initiatives, he is awarded more space, but if he fails, he must disappear.”
The líder is a demagogue and communicates his vision passionately. He develops new tracks, but is trapped by his own rhetoric. “Everybody knows he does not say everything he thinks, nor will do everything he announces.” The political líder acquires mythical dimensions but “is reviled when he breaks his promises.” “Líder refers to inborn qualities, to the charisma of the macho. Who does what we would like to do but don't dare.”
GLOBE research was conducted during the Menem administration. “I saw President Menem. He talked serenely. He said what people wanted to hear. What had to be done and how. More than a thousand people reacted enthusiastically. They were ready to back him at whatever cost.” A complementary vignette: “I don't know Menem personally but he deactivated the power factors that could face him in his desire to accumulate personal power indefinitely. He acts before others, advancing with what the most powerful factions want, and concedes of his own volition, pardoning the military, privatizing and following the dictates of the World Bank to satisfy the owners of the foreign debt, and ceding privatized corporations to local groups. His pragmatism and image as a moral rule breaker fascinate us, and weaken everybody who stands in his way, reinforcing his own power.”
The sample included few women. One comment on women as leaders was, “Evita promoted cultural change communicating with the people. She gave a voice to those who didn't have one. She brought a vision, an intuition and feeling to public life in Argentina. People were loyal to her. She was the first woman who put ideas of organization into social work.”
Soccer coaches are popular leaders: “Menotti is a coach. His leadership capability is seen in the way the players reacted when he took over. Before he took over, the team played without a plan and lost. Fans and newspapers pressured them. He imposed his method and talked a lot. Generated trust so even in interviews the players talked differently. This self confidence and his technical knowledge helped.”
In synthesis, in a context where the State and organizations are illusions, the inclusive leader/follower relationship exists in the buen jefe, gerente (including gerente excepcional) and soccer coach as líder icons, while the dueño, jefe and politician as líder icons reflect an asymmetrical, excluding relationship. Ten years after the ethnographic data were collected, Menem and Cavallo are reviled.
11 FINDINGS OF THE MEDIA ANALYSIS
Media chosen for content analyses of the written press were: (a) La Nación, the traditional daily newspaper; (b) Clarín, the largest circulation daily; and (c) El Cronista Comercial, a business daily. All enjoy wide circulation and a solid reputation, cover national and international issues, are widely read by middle managers, and include a diversity of opinions, levels of editorial sophistication and control.
Research was carried out in September, 1995. Media data collection was carried out on news printed during the first fortnights of September 1995 and September 2000. In both periods a major crisis was given front page attention. In the first, a dispute between President Menem and his Economics Minister; in the second a scandal in the Senate. They both give evidence of key components of the prevalent leadership model, that of key players in open confrontation.
Leadership issues were chosen, analyses identified the leader mentioned, what he/she did, and enacted behaviors (Ogliastri, chap. 19, this volume). Key paragraphs were chosen and classified by categories. A distinct change is evidenced comparing the 1995 and 2000 data collection periods.
For Clarín, leadership implies power brokerage. Relevant behaviors are backing, stalling, closing rank, denying having said what had been recorded, changing sides, maneuvering and persuading. Conflict management is the prevalent mode of exchange. Personality issues are presented in all walks of life. Politicians, ambassadors, policemen and sports figures are key exponents of this dramatic approach. One article in the 2000 period talks of the survival of man who got lost in a snow-storm in Patagonia and survived because “he didn't give up.”
Ever more space is devoted to the management of complex governmental or business issues, whereas the intricacies of an instrumental relationship are developed in discussions between football players and their coaches, for example, between the player Maradona, who threatened not to play if his coach was fired, and his coach Bianchi, explaining his leadership model, are extensively given their due. The exception was the case of the crime against María Soledad, where it is reported that after 5 years nobody is held accountable and the article pinpoints the protagonists: the girl's parents and the Catholic nun who headed a new form of protest, the Silent Marches that toppled the governor.
During the first period, from 86 comments on leadership, Clarín includes 21 references to the replacement of the minister of the economy and its consequences on the economy (24.5%). In the second, a Senate scandal gets a lot of attention and is discussed in depth. In both cases, emphasis is placed on institution building, and the balance between technical and political considerations in the exercise of authority vested in the functionaries. Negotiation practices are mentioned in two pieces during the September 2000 period, whereas these practices were absent in the September 1995 period. Topics related to Uncertainty Avoidance and Power Distance dimensions are stressed as for example: “I am willing to let you participate in transcendental decision making” (said the Minister of the Economy). “Cavallo left an unusual opening of the Palacio de Hacienda for the business community. His goal was obvious, to consolidate the unprecedented political backing that the establishment gave him through an institutional formula and so remain firmly in his post in spite of the attacks of Ultra-Menemism.”
Corruption and misdemeanor issues add to 10 references in the first period, and accounted for over 30% of the headlines during the second, where a major bribery scandal was the focus of public attention. In both La Nación and Clarín, news included analytical pieces by Argentine intellectuals on the strengthening of institutions if the Senate scandal was investigated and due process followed. Simultaneously, the Army proclaimed contrition “for its responsibilities in the dramatic and cruel events of the past,” and the local Catholic Church “confessed its faults and asked for forgiveness.”
Performance and Future Orientation topics were practically absent during the 1995 period, but entrepreneurial, scientific and artistic pursuits received more space in the 2000 period with major articles printed on pioneering work in surgery, a major award in literature and the pluck of “Pope John XXIII, a Catholic Church revolutionary.”
Humane Orientation and Collectivism I-Institutional Collectivism issues, were expressed by union and church topics (7.0%); and the assassination of a girl in the province of Tucumán occupied 2.4%, the crime of María Soledad. A governor was brought down and 80 Silent Marches were carried out. Five years after the assassination, no one was guilty and there was no one to judge them. On September 10, 1990, the body of a girl of 17 was found in an abandoned lot. She had been beaten and raped. The case moved the country and changed the history of Catamarca.
Beyond soccer results, papers regularly devoted space to players’ thoughts and ideas. Transformational leadership concepts appeared in an interview with Bianchi, a coach under the heading; “A winner's prescriptions: Orderliness is the hardest.” “We managed by all of us pulling together.”
La Nación understands leadership as the exercise of authority. Comments refer to the institutional background within which interactions occur in a complex, changing context. Articles deal with the structure of the economy, concerns about the future, current trends. Two articles in the first period addressed the human aspects of leadership. In the second period, a major article was devoted to an Argentine entrepreneur who successfully developed and sold his company to a German concern.
Out of eight articles on leadership in La Nación, seven referred to Power Distance, e.g.,: Diagnosis to foreign investors, the difference between Cavallo's Currency Board and others, is that he relies on his person and is not supported by an institutional framework.
To El Cronista Comercial, leadership implies the alignment of third parties to decisions arrived at. It has a financial approach, quotes figures, debates laws and regulations, discusses the actions of shareholders and executives, but devotes little attention to decision making. In both periods, the paper ponders on the costs of depending on the talent of select protagonists for the continuity and well-being of political and economic programs.
12 SYNTHESIS FOR LEADERSHIP
Argentines are habituated to a form of deference based on audacity, lack of scruples and oversimplification. This is accompanied by the self-deprecating “roban pero hacen,” “they steal but at least they get things done.” Leaders become grandees, heroes, idols, semigods, dictators, and, as such, are inviolate. Action is inhibited by the acritical acceptance of such behaviors, and the ignorance as to how they are built and reinforced.
Friedrich (1961) suggests that political science “makes sense as long as it differentiates Luther's leadership from Hitler's.” Without reaching such extremes, oversimplification clouds the issue of management, which deals with complexity; while leadership deals with change (Kotter, 1988). Current idealizations of leadership lead to value judgments wherein management deals with the past and is negatively connotated, whereas leadership deals with the future and is positively connotated. Attention should be devoted to the fact that most countries award malevolent the lowest mean values and place visionary and other such behaviors as high mean values.
Analysis of the Argentine distribution of mean values shows that the middle range mean values express cultural idiosyncrasies and adaptive practices. Moreover, GLOBE quantitative and qualitative data converge to offer an innovative reading into the components of leadership in Argentina and suggest a hypothesis.
To interpret a group's statements, Hofstede (1997) separates desirable from desired: how people believe the world ought to be as against what they wish for themselves. In the case of the desirable, the norm is absolute, while in the case of the desired, the patterns are statistical, because they show majority choice. Similarly Argyris (1992) differentiates between espoused theory, which refers to what a person claims to follow, and theory in use, which may be inferred from action.
Within these frameworks, (a) GLOBE lower mean values refer to abusive leaders, (b) higher mean values refer to a legendary figures, and (c) attributes in the middle range refer to the tolerated leader. Heifetz (1994) reminds us that “scholars might usefully consider that leadership is less an ‘As Is’ than a ‘Should Be’” (p. 286). Our hypothesis holds that the middle mean values are of special interest because they describe a leader who is tolerated within prevalent conditions.
This may be upheld by the fact that all countries place close to two thirds of all leadership dimensions in this high mean category, a matter that merits attention. Within this context, comparing country mean values could suggest expectations placed on vision. For example, the mean value for Albania is 5.02, implying an inordinate degree of hope placed in leadership, whereas the mean value for the United States is 4.52. In comparison, the mean value for the Latin American group of countries is 4.61, and for Argentina it is 4.58.
The distribution of mean values for all the Latin America countries identifies differences tolerated, that is, mid-range behaviors. This pinpoints country peculiarities. The majority coincides in most dimensions, but specific distinctions are to be researched, as for example, autocratic and nonparticipative behaviors seem to be tolerated in Mexico and Venezuela; in Costa Rica decisiveness seems not to be tolerated; in Argentina, Bolivia and Mexico modesty seems not to be tolerated; in Brazil, autonomy and self-centered behaviors seem to be tolerated.
13 SYNTHESIS: THE GLOBE CONTRIBUTION
GLOBE offers empirical dimensions to understand social behavior in Argentine management. Middle managers categorize leadership behaviors through the icons líder/politician, dueño, and jefe, which refer to abusive leaders. Buen jefe and gerente include significant others but only the first includes attributes that the management literature associates with a leader (Bennis & Nanus, 1985; Schein, 1985; Senge, 1990). The social contract has been broken and skepticism prevails. Respondents think the behaviors of the transformational leader unlikely. Altschul and Carbonell (2003) document how change processes carried out in corporate settings in recent years may balance this view.
14 ADDENDUM
This paper was written in 1995, referee reviewed and corrected in 2003 and in 2005. The downfall of the Argentine economy has been the subject of manifold interpretations. To the authors, the strength of the characteristics of the abusive leader, and the tolerated management behaviors, that is, face saver, procedural, conflict inducer, and status oriented, can best be understood through Weber's notion of the capitalistic adventurer (1992), a figure that can well typify the Argentine context of the 1990s.
15 SUGGESTIONS FOR VISITORS
Argentines say they “descend from the ships.” This image illustrates the immigratory composition of the society and may explain why Europeans and North Americans feel at ease. Argentines are educated and identify with Western European values. The high educational level they enjoyed made them cosmopolitan and progressive. Five Nobel Prize winners in the sciences and peace, outstanding opera houses, and active theater and entertainment make Argentines proud of their cultural tradition. People enjoy the amenities of life in a contemporary society: the infrastructure is modern, and computer and communications technologies are extensively applied. Still, Argentines retain their family rooted traditions, where self validating social mores define decision making.
Centuries of Spanish domination left their traces. Spain transferred its institutional system and people considered themselves part of the mother country, not colonizers. In Latin America, status was attained by adapting to such standards. Economy was based on the manorial lifestyle, where status was connected to birth and bloodlines, profit was based on annuities, and loyalty was owed to individuals rather than to laws of the land.
The Latin view of individualism emphasizes each person's uniqueness. The person is valued for who he is, not for what he does. Within this tradition, Argentines are rule breakers, improvise and enjoy the unusual aspects of any event and the free-wheeling discussions that ensue. Debates are charged with affect. Overall, Argentines are ethnocentric, proud of their own country more than of the region.
Leadership is often understood as supremacy. Hegemony is claimed by many that hold public positions and is upheld even through confrontation. This often leads to authoritarian behaviors. Growth crises that in other societies may be understood as stages within a transition cause distress. Argentines find it hard to establish societies and teams. Alternation, or the creation of options are difficult to institute and survive after repeated upheavals.
Power Distance is strong. Upper-status people expect to deal only with individuals of their own standing. Decision making is top down, spontaneous, and impulsive, with an emphasis on concepts. Support from a superior may change if circumstances suggest it, so lower-status persons use caution and do not put forward conflicting ideas. Professionals may not question their superiors although they may know them to be wrong.
Argentines are emotionally sensitive. Words and actions may be interpreted as offenses to a person's inner worth. Argentines use euphemisms and double entendres. They tend to read between the lines, and are good at interpreting messages in their many derivations, and their conclusions are often extreme. They exhibit a refined approach towards reality. They are aware of the “here and now” aspects of an issue, and feel that most matters may change due to actions of third parties beyond their control. This creates a social modality of permanent declamation which translates into poor performance.
Argentines feel that things happen. They conceive of time as abstract, as a resource that helps build relationships, not events in terms of hours and or minutes.
A strong emphasis is placed on personal associations. Networks serve as safety nets and facilitate mobility. When a person needs something done, he will resort preferably to someone he knows. Relationships take precedence over formal contact with institutions, laws and regulations. As such, due process may be regarded with suspicion because it could override informal understandings. The influence of special interests on decision making is expected and condoned.
Participation is vibrant in ongoing discussions on soccer and politics, for example. Expressiveness and emotion in verbal communication are tied to concepts of individualism. The Argentine will impose through eloquence and wit, will rely on charm, and believes that no task is above him. Argentines interrupt as an indication of eagerness to share opinions and enjoy argument. This may dilute efforts to reach concrete simple goals.
Argentines are gregarious. Men, who maintain eye to eye contact, embrace with physical demonstrations of affect. Relationships, based on reciprocity, are informal and stable over time. Visitors are greeted warmly. The expectation of extending a relationship to parties’ mutual advantage is present. Personal relationships are established with ease. This does not carry over to the business sphere, however.
Currently, after more than 20 years of democratic regimes committed to low inflation, a free economy, and open trade, Argentina shows change. In the cities, people are always in a hurry and remain active throughout long hours of the day. A feeling of loss of privacy and control of their personal destiny prevails, because, after radical free marketers introduced their normative strictures, the income gap widened, a percentage of Argentines benefited, cities were modernized, and tourism has increased significantly. The middle class is definitely pauperized as expected trickle-down effects of the inclusion of free-market economics had suggested but did not materialize. Civilian governments have not found equitable balances between democracy and efficiency, organizations have become more rigid rather than more flexible, courts are ineffective and corrupt and, with penury, street violence increased. The inability to develop a competitive strategy produced stagnation and frustration. Pessimism ensued and many emigrate: they “return to the ships.”
16 A BRIEF COMMENT ON THE LIMITATIONS OF THE CURRENT STUDY
For an analysis of Argentine management practices, purposefully devoid of demographic data collection, we chose the title: “A Crisis of Guidance: Argentine Leadership Icons and Middle Managers Adaptive Responses.” Findings need replication but a crisis of leadership can be hypothesized.
Data collection was carried out in 1995, and the downfall of the Argentine economy, after following the prescriptions of international agencies, occurred in 2001. Moreover, the cases of Enron and Worldcom (“Capitalism and its troubles,” 2002, “Fallen idols,” 2002, Mintzberg, Simons, & Basu, 2002) signaled critical incidents that cause more than attention.
Simultaneously, many transformation projects developed in Argentina (Altschul & Carbonell, 2003) and much has happened since, most especially after 2003: fiscal goals are being met, reserves and industrial productivity have increased year after year since then, and unemployment has decreased significantly.
Further research should relate market conditions and economic guidelines on the emergence of national adaptive behaviors.
ACKNOWLEDGMENTS
Flavio Ruffolo wrote the economic history of Argentina; Mercedes López was instrumental in drafting the final version; Marina Altschul researched and wrote key papers on the development of the banking and food industries; María Marta Preziosa was instrumental in data collection, interviews and revisions.
Special thanks are due to colleagues for the careful review of the first drafts by Héctor Bozunovsky, Claudia d'Annunzio, Victor Lidejover, Juan Magliano, Vicente Miñana, Zita Montes de Oca, Julio Neffa, José Luis Roces, Monique Thiteux; to Adriana Cristensen, Ernesto Gantman, Laura Golpe, Fernando Isuani, Nora Gorrochategui, Marcela Jabbaz, Claudia Lozano, Francisco Suárez and Jorge Walter, researchers at the Instituto de Investigaciones Administrativas, School of Economics, Universidad de Buenos Aires; and to my students in the post graduate programs in Human Resources, School of Economics, Universidad de Buenos Aires, and at the Universidad Siglo XXI, Córdoba for their critical suggestions. Johannes Adams helped make the text readable.
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