THE NEW EUROPEAN BUSINESS LEADER 271that might have moved to Asia previously are now moving instead to
Eastern Europe, where there is a well - educated workforce that speaks
multiple European languages, but still costs considerably less to employ
than workers in the home country.
Krakow in Poland, for example, has been chosen by the German
airline Lufthansa as the site for its European accounting center, because
this university city offers a relatively low - cost, well - educated workforce
capable of speaking many European languages. Diageo, a British drink
company boasting such brands as Johnnie Walker and Guinness, has
established its European back - offi ce support in Budapest, Hungary, for
similar reasons. State - of - the - art new industrial facilities create employ-
ment opportunities in the new member - states of Eastern Europe, forcing
workers in ‘ older ’ Europe to tighten their belts in order to keep their
jobs. Thus, Volkswagen and DaimlerChrysler have recently struck deals
with the initially reluctant trade unions that would slash labor costs in
exchange for not moving jobs to the East. Similarly, Siemens introduced
longer working hours without extra pay to let its people keep their jobs
at home.
With external competition, the situation is more or less clear — com-
petitors are well - known, and the threats are easily understood. But
intra - European competition presents a much bigger challenge for both
leaders and followers. People in Europe have to overcome a serious case
of cognitive dissonance: on the one hand, an enlarged, unifi ed Europe
will help Europeans, as it opens new opportunities and makes the totality
stronger and more successful. On the other hand, the direct consequence
of the enlargement of the European Community for a particular employee
in the older EU countries is a threat of job loss, or a perceived deteriora-
tion in working conditions (increase in working hours, lower pensions,
etc.). Two such incompatible cognitions will be diffi cult to reconcile.
All of a sudden, organizational leaders are deprived of an external threat
or enemy: a lever that has been used for centuries to motivate, unite,
and energize subordinates. With increased competition from within, as
well as without, this lever requires much more delicate handling.
IS A SINGLE MODEL POSSIBLE?
All these differences between and within European countries and their
organizations, combined with the challenge of external and internal
competition, raise the questions of whether Europe can and should be
treated as a uniform entity, and whether a single model of European
leadership is real or illusory. The answer to the fi rst question is quite