ALL LEADERSHIP OCCURS in cultural
contexts that cannot be ignored. That
is especially true for today's Venezuela,
where the environment is the very definition
of the VUCA attributes of volatility,
uncertainty, complexity, and ambiguity.
At the Instituto de Estudios Superiores
de Administración (IESA) in Caracas, we
convey to our students that, while turbulent
business environments present
profound challenges, organizations can
succeed with the right leadership.
We admit the challenges are daunting.
The country is governed by an increasingly
autocratic regime that demonstrates
hostility toward business. Elected
in 2013, President Nicolas Maduro faces
growing opposition to his authoritarian
policies. After opposition candidates
won control of the National Assembly in
2015, the Supreme Court operating under
Maduro cut the assembly's powers.
In August 2017, Maduro convened a
Constitutional Assembly, in effect
replacing the National Assembly, which
sparked protests that were violently
suppressed by armed forces.
The government's actions have
affected operations of both foreign and
domestic businesses. International
companies such as McDonalds, Coca-
Cola, Delta Airlines, and American
Airlines have lost billions of dollars. In
April 2017, the government seized the
plant operated by GM, and it's slowly
taking control of local companies.
As a result, Venezuelan citizens are
struggling. Venezuela's inflation rate was
estimated to be 1.7 million percent at the
end of 2018-the highest in the world.
Unofficial figures show that 87 percent
of Venezuelans say they do not have
enough money to buy food. In November
2018, the United Nations reported that
3 million Venezuelans had left the country—almost 10 percent of the population.
In early 2019, opposition leader Juan
Guaidó, an elected representative and
President of the National Assembly,
assumed the interim presidency of the
country and called for new elections.
He did so under the authority of articles
233 and 333 of the nation's Constitution
and with the support of the National
Assembly. The U.S. quickly recognized
Guaidó as Venezuela's president,
followed by other democratically led nations
such as Argentina, Brazil, Canada,
and those in the European Union.
This is the environment in which
IESA works to fulfill its mission "to
prepare individuals capable of assuming
leadership positions as professionals,
managers, or entrepreneurs, in order to
contribute to the success of private, public
and nonprofit organizations." These individuals include approximately 500
students enrolled in our MBA, master in
public management, master in finance,
and master in marketing programs, and
about 9,000 participants who attend our
executive education courses.
As the country's situation deteriorates,
the needs of IESA's students and
partner organizations become increasingly
distant from the interests of the
region and the rest of the world. However,
we maintain close corporate connections
that have helped us maintain
our programs and overcome the effects
of political turmoil. The Venezuelan
businesses have demonstrated their
commitment to the school. Some have
pre-purchased services; financial institutions
Bancaribe and Banco Mercantil
contributed to the Student Financial Assistance
Program that we put into place
in 2015 to help students afford their
educations, given the difficulties of obtaining
foreign currency to study abroad.
However, we suspended the program in
2017 when hyperinflation forced IESA
to review tuitions on a monthly basis.
We also expose students to ongoing,
live pedagogical cases of Venezuelan
companies, such as Ron Santa Teresa,
a rum producer located in the state of
Aragua. This region is one of the most
complex in the country due to political
polarization, as well as high rates of
homicides and other crimes. Ron Santa
Teresa has become a primary promoter
of the social welfare for the community.
In these ways, we strive not only to
teach students how to lead, but also to
lead by example. First and foremost, we
want students to learn to avoid clinging
to a sense of certainty or resorting to old
schemes that are no longer useful. Instead,
we want them to view leadership
through three primary lenses:
We teach students that the fundamental role of a leader is to ask difficult questions whose answers present difficult consequences.
Leadership as a collective act. We
teach MBA students to view leadership
as a group phenomenon, not a solitary
activity-a process of mutual influence
between leaders and followers.
Our leadership programs are based on
shared experiences, such as case study discussions. We invite experts to speak
to students about Venezuela's culture,
politics, and economy, paying special
attention to how social psychology and
anthropology can be applied to our
country's current circumstances.
For example, the deputy director of
a research center that specializes in the
study of Venezuelan society spoke to
students about the value of conviviality
among our citizens, information that
our students will be able to draw on to
support their performance as leaders.
Leadership as an Investigative act.
We teach students that the fundamental
role of a leader is to ask difficult questions
whose answers present difficult
consequences. For instance, are traditionally
useful managerial practices
still valid? What responsibility, if any,
do business leaders have for what has
happened in Venezuela? Can we induce
positive change through our example?
Our faculty explore these questions
in greater depth at IESA's seminars and
conferences, where they meet with leaders
to share best practices, make policy
recommendations, and explore the
impact that events such as elections and
new regulations could have on organizations.
We also explore issues of national
and regional interest in the school's
magazine Debates IESA.
Faculty promote national debate
through interviews, panel discussions,
and publications in print and digital media
to the extent that government
restrictions on media allow.
Government has closed nearly
75 percent of independent
media outlets; this has
led journalists to publish
online, where their sites are
often blocked. El Nacional
is our only independent daily
newspaper still in circulation.
Leadership as a hopeful
act. We highlight to
our students the sparks of
resilience in our business
community, and we seek
out ways to support that resilience. For example, last November,
Citi Venezuela and the Citi Foundation
recognized 12 Venezuelan entrepreneurs
with the Microentrepreneurs
2018 award for "their determination and
perseverance to overcome the adversities
that their businesses face on a daily
basis," according to the foundation. The
winners were chosen from among 158
ventures nominated by 29 micro finance
institutions and public development
groups. IESA professor Rosa Maria Rey
delivered a workshop called "Financial
Strategies to Survive in Inflation" to the
winners, as a way to help them succeed
in the local economy.
From the rule of Maduro and the rise
of Guaidó, we believe our students can
learn valuable lessons about leadership.
First, Guaidó's approach demystifies
the vision of the charismatic leader.
Rather, he represents well the concept of
contingent leadership, which holds that
great leaders match their actions to the
cultural context. In this case, Guaidó,
a liberal politician and the son of a taxi
driver, has stepped in to lead the Venezuelan
people at a very troubled time.
Second, both Guaidó and Maduro show
our students that the greatest strength
of leaders is also, paradoxically, their
main weakness—they are only as strong
as the trust of their followers.
Our school is living through one of
the most difficult periods in its 53-year
history. During this time, it can be
tempting to seek or invent saviors,
so IESA's priority is to teach our
students to fight against the
deification of leaders. Rather,
we want to encourage them
to become leaders who are
independent thinkers, ready
to work with others—because,
when needed, we all must be ready
to participate in the reconstruction
of the country.
Gustavo Roosen is president
and Rosa Amelia González
is a professor at IESA in
This article originally appeared in BizEd's March/April 2019 issue. Please send questions, comments, or letters to the editor to [email protected].
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