By Larry W. Stout, Ph.D., MBA, Associate Professor of Psychology
Stockholm School of Economics in Riga

Several years ago I was invited to be a guest speaker at a Baltic Conference of Muskie Fellows (the Edmund S. Muskie Fellowship Program selects outstanding citizens of the New Independent States and the Baltics to receive scholarships for Master's-level study in the United States in the fields of business administration, economics, law, and public administration.) Before I was to speak, a representative of the program from each of the Baltic countries was to asked to relate a short five-minute talk on their experience in the United States. The Latvian representative stood up and admitted that he had not prepared any remarks in advance, and then proceeded to expound on a multitude of different issues related to the cross-cultural matters. The moderator finally got him to finish after he went over his time allotment by about fifteen minutes and it was the turn of the Lithuanian representative. This was a woman who opened her remarks by admitting that she had been robbed at the Vilnius train station the night before and was still getting over it. In spite of her disorientation, however, she used her five minutes to clearly and concisely cover three main points she had learned from her study experience in the USA with helpful and colorful illustrations. Finally, the Estonian man who spoke admitted that he was not the person who was supposed to speak (that individual was sick), but nevertheless, presented a masterful overview of the benefits of the Muskie Fellows Program and presented a proposal for continuing it.

I watched with fascination this microcosm display of the differences in Baltic leaders. As an American who has lived in Riga, Latvia for the past twelve years, I have been continually amazed at the cultural and traditional distinctives of these three countries. As associate professor of psychology at Stockholm School of Economics in Riga, I have had the opportunity to quantify my interest into empirical data.

My serious study in the area began when my students at Stockholm School of Economics in Riga asked me in 1997 to teach them about leadership principles. The request represented their desire to excel. The student body of the school, approximately 340 undergraduate students, are recruited from among 1500 applicants throughout the Baltic countries. The students study in English and their math abilities must be exceptional. The curriculum in all of our programs is intended to radically transform the students' thinking. I determined that if I was going to teach them about leadership theory, I needed to dig deep in order to give them the best possible information.

To my surprise, I discovered that the field of leadership is one of the most ill-defined fields in psychology. According to David Gergen of Harvard University, there are some 250 different definitions for leadership itself. Bernard Bass, one of the leading experts in the field, admitted that there are almost as many different definitions of leadership as there are persons who have attempted to define the concept.

Most programs on leadership development focus on improving particular technical skills, but we desired to study the subject scientifically. It is generally accepted that a good theory has three primary components; it is descriptive, meaning that it can explain the phenomenon being studied, it is predictive, in that it can tell what should happen in the future, and finally, it should be somewhat concise. We realized that there was no theory in leadership that matched these criteria.

Almost everyone could recognize leadership after a person was a leader, but no one was able to pinpoint the embryonic elements of leadership in an individual before they actually became one. Further, the fact that someone was in an authority position did not guarantee how effectively they would lead today or what they might be doing that would plant the seeds for failure tomorrow.

For the better part of two years, we studied and experimented with various components that could be used to examine leaders. We focused on the Baltics' most successful emerging leaders as well as those who failed to measure up. Using a carefully designed "Leadership Assessment" measurement tool, our investigations eventually led us to formulate a developmental approach that we term the Inter-Disciplinary Leadership -- or IDEAL Leadership -- Model. This model identifies six critical capabilities that we group under "Leadership Capital" and four capacities we term "Leadership Conditions."

The six critical leadership capital capacities are the (1) vision and (2) values that constitute the leader's philosophy; the (3) wisdom and (4) courage that compose the leader's personal composition; and the (5) trust and (6) voice that enables them to influence others. The four vital leadership conditions for these capacities to make a difference are (1) a place where the leader can hold sway, (2) a period that calls for his or her leadership, (3) a position that conveys leadership authority, and (4) people who are ready for leadership.

These two primary components; Leadership Capital and Leadership Conditions - are the elements that cause an individual to ascend into a position of impact and influence. The Conditions are what put the person in that place; they are at the right place at the right time doing the right thing for the right type of people that would follow their direction. However, what determines whether they will be an effective leader or not depends directly upon the level of competence in Leadership Capital.

Students of the Stockholm School of Economics at Riga are using this model to study leaders in various institutions throughout the Baltics, and our faculty is drawing on it to design both undergraduate courses and executive programs. Our research within the Baltics has revealed some interesting distinctives about managers of enterprises within these three neighboring countries.

First, the common traits revealed that Wisdom was consistently the highest rated of the six leadership competencies, and Values ranked lowest. I have found this to be true at the teaching level as well. For years my executive education participants have consistently resisted my emphasis on the importance of moral leadership. Now that accounting frauds among firms in the United States have shown how dangerous an amoral position can become, the argument has been a bit more muted. However, this is an area that continues to be a struggle for most Baltic leaders.

Encouragingly, there was little if any significant difference between male and female leaders revealed in the researched. The explanation for the greater numbers of males in leadership positions can directly be attributed to more favorable Leadership Conditions rather than a meritocracy. Also encouraging was that Baltic-wide, the majority of leaders are fairly 'balanced' in all six areas.

But the research did reveal some differences. In Lithuania, for example, we found the strongest female leaders. Lithuanians appeared the strongest of all Baltic leaders in the Trust and Voice competencies. They were weaker than other Baltic leaders in Vision and to a less extent, Values. The trust issue was worth noting, as trust is the 'glue' in all interpersonal interactions. Lack of trust works like a computer virus - it slows everything down with controls systems and disciplinary safeguards. Lithuanian businesses have shown success on many fronts and much of it can be attributed to their higher-than-others Trust competency.

Latvian leaders were shown to be strongest in the Wisdom competency and just slightly higher in the Courage competency. They were exactly the opposite from their Lithuanian counterparts in that they were weakest of all Baltic leaders in Trust and Voice. Latvian leaders are concentrated more in Riga, which comes as no surprise, given it is the capital and center of virtually all major business and commerce.

The Estonians ranked highest of all Baltic leaders in Vision and Values and in fact, in terms of statistical analysis, Estonians measured the best overall. To be fair, however, the sample from Estonia was the smallest sample, approximately 14 percent of the 250 leaders surveyed in total. Further research will be needed before any really accurate quantitative assertions can be made.

The Baltic leaders study is one of five major studies that have been conducted in the past two and a half years on the Ideal Leadership Model, and the evidence to date has given strong credence to its accuracy and veracity. As more research is conducted, hopefully we can remove some of the mystery from what constitutes sound leadership. The growing interest from many international practitioners in the field of leadership reveals that many in the world are searching for these answers. It is our hope and dream that Baltic leadership could be a model for the world!

Reprinted from Saldo, no. 4, May 2003, pp. 15 - 16.