Leadership and Innovation at Sumato Motors: A Case Study Report

This report analyzes the leadership of Hiroto Sati, former CEO of Sumato Motors, focusing on his strategies for international business management. The report examines Sati's approach to culture management, highlighting his blend of Japanese and Western business practices, and his ability to foster a global work environment. It delves into Sati's leadership styles, including democratic, charismatic, transformational, and authentic leadership, and how these styles contributed to Sumato's success. The report also explores the application of the path-goal theory, detailing how Sati used directive, supportive, participative, and achievement-oriented behaviors to motivate employees. Finally, the report assesses how Sati stimulated innovation within Sumato Motors through leadership, setting challenging goals, and implementing a recognition and reward system. The analysis is supported by academic references and provides insights into effective leadership in a global business context.

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INTERNATIONAL BUSINESS MANAGEMENT
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Introduction
The success of any international business calls for unique leadership that is focused on
meeting the needs of global stakeholders (Beamish and Lupton 2016). Therefore, international
business leaders need to adopt strategies that serve globally. This report is based on a simulated
case study about Sumato motors. The case study features Hiroto Sati the leader of the automobile
manufacturer. The report covers the following concepts in relation to the case study; first, culture
management issue. Second, Hiroto Sati’s leadership styles. Third, the path goal-theory and how
Hiroto Sati applied it. Fourth, how Hiroto Sati mobilized innovation at Samuto motors.
Question 1
Hofstede introduced a framework for measuring the average values of a particular group
in 1982. This framework is based on the following dimensions; uncertainty avoidance,
masculinity, individualism, power distance, and long-term orientation (Venaik and Brewer
2013). These dimensions faced criticism and that resulted in the Globe research in the 1990’s.
The research aimed at enhancing the Hofstede model. Globe research has the following
dimensions; future orientation, power distance, human orientation, institutional collectivism,
performance orientation, assertiveness, uncertainty avoidance, and gender egalitarianism (Venaik
and Brewer 2013). Drawing from the two models, Sati’s work culture can be described as a
combination of both Japanese and western culture. This can be justified from the case study as
follows:
In relation to power distance which is common in both the Hofstede and Globe research
program (Shi and Wang 2011), the case study states that in the Japanese culture power was
wielded in an invisible way and unspoken to the public. However, the case study further states

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that Sati was an outspoken leader. This shows that Sati was not a strict observer of the Japanese
work culture and also incorporated some part of the western culture in the company. The
outspoken nature of Sati was a good way of culture management within the organization.
The case study states that Sati promoted people according to their abilities and
performance. This was in accordance with the western culture and against the Japanese culture.
The case study states that the Japanese culture was one in which the senior and older workers
were promoted over the younger workers. The Globe research program captures this in the
performance orientation dimension (Shi and Wang 2011). This promotion policy created a level
and fair playground for all the workers regardless of their age. The case study further discusses
that one of Sati’s successes is shifting Sumati’s work culture to one with more global flavor and
not being extremely eastern or western.
In relation to institutional collectiveness and individualism which deals with
teamwork (Venaik and Brewer 2013), Sati embraced both the Japanese and western ways of
doing things. According to the case study Sati always encouraged teams to compete against each
other and the winning team was rewarded. Teamwork is embraced in both traditional Japanese
culture and western culture. Robbins et al. (2013), argues that ability to manage diverse teams
can unleash high potentials within an organization since each worker has unique abilities.
Therefore, Sati’s ability to incorporate both cultures in managing the teams contributed a lot to
the success of Sumato motors globally.
Question 2
Hiroto Sati portrays the following leadership styles; first democratic leadership style. A
democratic leader is one who engages the subordinates in decision making in order to get their

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views on what s/he is planning (Bhatti et al. 2012). The case study records that Sati always
consorted his workers about the changes he was about to make so that he can get their views. In
so doing he broke the bureaucratic nature that was present before his reign. Also, the case study
records that majority of the new innovations were ideas generated by the workers. This
demonstrates that Sati was highly engaging his workers in making even very critical decisions.
Second, Sati portrayed the charismatic leadership style. A charismatic leader is who has a
vision that promises a better future and is able to demonstrate the importance of the vision in a
manner that is understandable to others (Nanjundeswaraswamy and Swamy 2014). The leader
pays attention to the abilities and perceptions of others. A charismatic leader is also willing to do
all that it takes to achieve the vision (Robbins et al. 2013). The case study records that Sati was
not inhibited by family loyalties and traditions in forging forward new vision and new strategies
to achieve high market share and new vehicle models.
Third, Sati showed transformational leadership traits. A transformational leader is one
who encourages followers to be more creative and innovative (Robbins et al. 2013). The leader
brings notable change to the organization. This style of leadership empowers employees to take
more challenging personal goals (Yeh and Hong 2012). According to the case study, Sati created
a culture of innovation and creativity within Sumato motors. He did so by encouraging
employees to be more innovative and highly recognizing those who initiate new ideas. This
brought about notable changes which include; the Sumato brand became a strong brand
internationally, Sumato’s work culture was changed, and the electric car was implemented.
Fourth, Sati applied authentic leadership style. An authentic leader is one who knows
his/her values and beliefs and acts and acts on them frankly. An authentic leader is highly trusted
by the followers since he/she is transparent and is believed to be ethical (Wong and Laschinger

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2013). The case study records that Sati enhanced communication within Samuto motors to the
extent that even the low cadre employees could easily communicate to him. This resulted in
more engagement between managers and subordinates. The case study further records that Sati
used to visit workers in the factory, attended departmental meetings and also held parties with
the subordinates. This proves how authentic Sati was as a leader.
Question 3
The path-goal theory was developed by House in 1971. The theory asserts that the
leaders’ functions consist of defining goals for the subordinates, as well as defining the path to
be followed in order to achieve these goals (Alanazi, Alharthey and Rasli 2013). The path-goal
theory, therefore, proposes a contingency approach to leadership. Thus, leaders should select a
leadership style that best fits the prevailing condition. The main aim of the theory is to increase
the employees’ satisfaction, empowerment, and motivation so that they can be more productive.
The theory basically follows the following steps; determining the employee and environmental
characteristics, selecting a leadership style, and focusing on motivational factors that will help
the employees to succeed (Alanazi, Alharthey and Rasli 2013). The four leader behaviors
described by house are discussed below.
First directive: the leader makes it clear to the followers about what they are expected to do.
The leader may do so by informing the followers what to do, how to do it, and planning work
schedules (Polston-Murdoch 2013). This behavior is used to eradicate any uncertainty especially
when people are unsure about what is expected of them. The behavior also gives unity of
direction and purpose in the organization. Sati has demonstrated this behavior since the case
study records that he set goals for each team and also personal goals for each individual.

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Second, supportive: the leader makes the work to be pleasant to the employees by being
approachable, friendly, and showing concern. This behavior is more effective in scenarios where
the tasks being done are very challenging (Malik 2012). A supportive leader makes the
employees have more empowerment and certainty that the leader shares the same conditions as
them (Robbins et al. 2013). This instills concentration on performing the task rather than
considering the complexity of the situation. Sati demonstrated this behavior in several ways
which include the following; he created an open communication system where employees could
communicate their concerns to him, instead of being always in the office he often went to the
factory floor to interact with workers, and he held weekend parties with his workers.
Third, participative. This is just like democratic leadership in which the leader consults
with the followers before making a decision. This consultation gives the followers a chance to
express their ideas and to contribute to decision making (Bhatti et al. 2012). Participative
behavior reduces resistance to change in an organization since even the workers feel that they are
part of the change. From the case study, it is recorded that despite being against the Japanese
work traditions Sati always consorted his workers to get their feedback about his plans. This
highly demonstrates that Sati possessed this participative behavior.
Fourth, achievement. This is the behavior in which the leader sets challenging goals for
the followers. The leaders also demonstrate high levels of confidence in the employees’ ability
and rewards high achievers (Alanazi, Alharthey and Rasli 2013). This behavior highly motivates
employees to be more productive and makes the job to be more enjoyable. According to the case
study, Sati set goals for each team and each individual and encouraged the teams to compete
against each other. He then rewarded the best performing teams. This is sufficient evidence that
Sati possessed the achievement behavior of leadership.

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Question 4
Hiroto Sati stimulated innovation at Sumato in several ways which include; first, good
leadership. Robbins et al. (2013), argues that leadership is the central point of failure or success
of any organization since leaders are the vision careers of the organization. Based on the case
study, Sati demonstrated a combination of several styles of leadership. These styles of leadership
reinforced each other to create a habitable working environment. Through democratic leadership,
Sati was able to get the opinions of the workers (Latham 2014). He also encouraged the workers
to implement the ideas. This resulted in innovation at Sumato. This can be justified by the case
study which records that many of the innovations at Sumato were employees’ ideas.
Secondly, setting challenging goals. According to Chang and Hughes (2012), challenging
goals compel workers to think rationally and be more creative in order to achieve them. This, in
turn, translates to innovation in an organization. The case study records that Sati set clear and
compelling goals for every worker in the organization thus making them put extra effort. The
consolidation of individual goals resulted in an overall organizational goal of being more
innovative.
Third, Recognition and reward system. Employees highly value recognition for their
achievements. When they are well recognized they become more empowered to achieve more.
This leads to innovation and creativity within the organization (Gorodnichenko and Roland
2011). Sati used this strategy as the case study records that during the organization’s parties he
used to personally call the names of the high achievers, shook their hands, and rewarded them.
This created a culture of competition within the organization which then translated to innovation
and creativity.

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Conclusion
From the above discussion, it is clear that Hiroto Sati the leader of Sumato motors was a
good leader. He has demonstrated the ability to manage culture issues within the organization
through creating a global flavor of a combination of eastern and western culture. Secondly, he
demonstrated admirable leadership styles which included; democratic, authentic, charismatic,
and transformational leadership styles. Third, Sati showed possession of the four leadership
behaviors discussed by House in the path-goal theory. Fourth, as a leader he was able to foster
innovation at Sumato motors by adopting good strategies that empowered employees to be more
creative and innovative.
References

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