and procedures , decides what goals are to be achieved , and directs and controls all activities without any meaningful participation by the subordinates .” Autocratic leaders focus on obtaining short-term efficiency , rather than having a vision or strategy for the future ( De Aguirre ). Their authority comes mainly from the position giving to them within the company ; thus , they are very “ status conscious ”.
On the other hand , we have the paternalistic style of leadership , which the Business Dictionary defines as “ A type of fatherly managerial style , typically employed by dominant males where their organizational power is used to control and protect subordinate staff ” This style is easily seeing in small and medium businesses , which is the majority in Guatemala . Paternalistic leaders are very emotional when dealing with employee ’ s issues ; thus , the working environment may become tense and competitive since inequality and favoritism tends to emerge . They look forward to establish a strong bond with their subordinates and gain their trust , which is why they value the views of their workers and pay attention to their social needs . Overall , attaining efficiency in a business with a paternalistic leader becomes a challenge due to their personal attachment to it and the lack of innovation when it comes to new managerial techniques ( De Aguirre ).
It is important to note that Guatemalans acknowledges the need to create new types of leaders ; it is understandable that neither autocratic nor paternalistic leaders truly satisfy their expectations of how “ true ” leaders should be . Guatemalans consider that applying the democratic leadership style , in which leaders and followers collaborate in the decision-making process , is the most likely solution . However , accomplishing this will be very challenging for this country considering that their current political leaders are working in a government system that is considered halfauthoritarian and half-democratic , which gives a
8 | L A T I T U D E 0 4 / 0 1 / 2013 feeling of uncertainty and political instability ( Fuentes ).
MANAGEMENT : SMB IN GUATEMALA
Guatemala ’ s economy is highly influenced by its informal sector . According to the Center of National Economic Investigations , 95 % of the businesses in Guatemala are micro-companies . This large percentage shows that small and medium businesses ( SMB ), located both in rural and urban areas , have become the trend after the crisis of 1979 – 1985 ( Walter and Rosales ). As seeing in the following chart , the majority of these businesses do not have many employees , which leave us to wonder , what is the business management style in Guatemala ?
First , I think we take a look at the structure of the businesses in Guatemala and the way they are organized . Most of the companies in this country have an autocratic hierarchical organization ( Intercultural Management ). This means that companies have a strict vertical structure in which the decisions or orders flow from top ( CEO or owner ) to bottom ( subordinates ). Each layer or departments of the organization tend to concentrate on achieving their functional goals and not necessarily the general goals of the company . Crossfunctionality is not much likely to occur since all divisions of a company tend to work as functional silos .
Taking in consideration that the organizations in Guatemala follow a hierarchical structure , it is no surprise that managers in this country are autocratic - more so than in other countries of the region . When it comes to decision making , there is no such thing as consensus or having open discussions about it , since all the orders are given by the top managers and decisions are taken in a centralized way . Employees need to be careful as to whom and how they express their ideas about a decision or initiative taken , since hurting egos or challenging someone ' s authority can be dangerous ( Cultural Information ). One of the key tools for a manager to succeed in the