In developed markets, the Great Recession shredded income statements, shuttered factories, and trimmed workforces. While its effects were less severe in developing markets, the downturn still sent shock waves through China, India, and other emerging economies.
For several months spanning 2008 and 2009, the global economic system was teetering on the edge. Employees everywhere were looking to their leaders to make sense of the chaos. Leadership was then—and remains—a huge challenge, even for companies relatively unscathed by economic turmoil. Today, employees continue to seek guidance from their leaders, who must find time to reassure their people while trying to establish a pole position for the future.
Over a six-month period, as the economy started to stabilize, we talked to leaders from around the world about leadership in order to understand how they led through the Great Recession and whether they see leadership roles and styles changing.
Leaders are stuck in the middle of a rapidly changing world: Government intervention and protectionism are rising; employee engagement and trust are declining. So did the leaders we interviewed tell us that they feel the need to change their style and way of leading?
Not really. James M. Cornelius, Bristol-Myers Squibb’s chairman and former CEO, explains that “good leadership is the same in good times and bad and in changing environments.”
The nine leaders we interviewed serve in a wide range of industries and both developed and developing markets. Despite the relatively small sample, key themes nonetheless emerged: Chief executives in China and India are concerned about accountability, communication, motivation, and talent development. So are their peers in the West. Furthermore, even though leaders in diff erent industries may require unique knowledge, all the interviewees share common leadership qualities.
The developed and developing markets, of course, differ— and leaders need to tend to those diff erences. Leaders of companies in developed markets, for example, will likely need to chase growth in places such as China and India. Conversely, leaders of companies located in those emerging markets will need to defend their local businesses against Western assault.
Strategies for leadership succession also diff er widely, depending on the age of the company. The leaders we spoke with in developing markets are running young companies, while the leaders in developed markets oversee established institutions. The Chinese and Indian leaders worry about leaving a permanent legacy. They want to create the next Microsoft , not the next Netscape.
These corporate leaders navigate in economies where government involvement, uncertainty, and volatility are ways of life. As Jeff M. Fettig, Whirlpool Corporation’s chairman and CEO, puts it: “I used to tell our Brazilian employees that some day, as the country emerges as a market, it will become more like the United States or Europe. The reality is that the rest of the world is becoming more like Brazil.”
The demands of the job are clearly greater than ever. Indra K. Nooyi, PepsiCo’s chairman and CEO, explains, “Aspiring CEOs have to understand that they are signing up for a lot more than CEOs did in the 1970s, 1980s, 1990s, and even four or fi ve years ago.”