Edward Hall, a leader in the field of intercultural studies, famously said: “The single greatest barrier to business success is the one erected by culture.” Can cultural differences have as big an impact on international businesses as financial planning and visionary leadership? The surprising answer is: Yes!
A good example is the role of relationships in business dealings. While relationships play only a minor role in the business cultures of Western European and North American countries, they play a significant role in many Asian and African countries. In these cultures, fostering solid and trustworthy personal connections underlies the way for business to go more smoothly.
Let’s take the example of Kevin Johnston, a senior vice-president of a U.S. company specializing in hospitality management. Kevin was put in charge of finalizing a merger with a company in the United Arab Emirates (UAE). Virtually all of the complicated negotiations had been completed. What remained was a three-day trip to the UAE for face-to-face meetings between the partners to sign the paperwork and close the deal.
Kevin was determined that nothing would detain him from succeeding. He sent out a memorandum across his company, enthusiastically informing all the staff about the planned merger with the UAE partner. Having compiled all the necessary documents and graphs, with every figure and decimal in place, and having prepared a thorough exposition certifying the quality of his company, he packed his briefcase and headed for the UAE.
Kevin arrived in the UAE, excited to seal the deal. He was treated with extraordinary hospitality: an elaborate hotel, blue ribbon foods, elegant convertibles with drivers to tour the city, a parade of entertainment, and beautiful gifts to commemorate the visit. He tried repeatedly to bring out his files, open the conversation and get down to business. But, surprisingly, for the three days he spent in the UAE, none of his Emirate colleagues seemed ready to hear his financial briefing. Each time Kevin tried to speak about the deal, his prospective partners seemed to “kidnap” the conversation, diverting it to other topics. They would inquire about his health, family, or views on education and other important issues.
Upon leaving the UAE, Kevin felt exasperated and defeated. He hadn’t got an opportunity to receive the thorough “interrogation” of the materials for which he had so carefully prepared. His progress toward closing the deal was exactly where it was when he left the U.S.: nil.
The above case is a classic example of how friction between different cultural expectations causes delay that, if not handled appropriately, will bring the deal to an abrupt end and leave both sides reeling. The substantial loss of revenue can never be refunded and can leave a struggling company falling without a parachute.
Kevin made the mistake of assuming that the “certifications” involved in sealing the deal were in his briefcase. He charged into the meetings like a bull. For many cultures, a person’s certifications are established not only by their accomplishments, education, and abilities, but also more importantly by their personal connections. In this case, the UAE partners wanted to know if Kevin was a good man, a family man, and a trustworthy man. This type of rating establishes a trusting relationship for them. Had Kevin patiently taken the time to establish relationships, he would likely have been asked to share his carefully prepared documents and have closed the deal.
Sociologists agree that another key aspect influencing global business is the concept of face. Cross-cultural differences in the way we save face impact our perceptions of trust and respect, which in turn impact our relationships and group cohesion.
Take the example of Ann, a U.S. manager who took a reactionary approach to cultural differences. Ann thought being a nominee for the leadership position with a sales team based in Singapore was a climax of her career. All members of the team except Ann herself were from various Asian countries, and Ann tried to establish a working relationship with each of them. After a few weeks of working on team unification and solidarity, presenting guidelines, and offering sales advice, she carefully compartmentalized goals for each member of the sales team.
Later, when the team convened face to face for their first quarterly review meeting, Ann, after praising one team member, boldly criticized and questioned another, trying to extract the exact reason why he was lagging so far behind on his goals. The meeting immediately lost its groove. The entire group became solemn and, for the rest of the meeting, remained polite but largely mute.
Clearly, Ann was not familiar with the concept of saving face in other cultures. In U.S. culture, saving face exists – but only minimally, and instead tactful but straightforward language is highly valued. U.S. managers routinely speak freely about someone else’s accomplishments or failures in open, public settings, such as during meetings. This is different in many Asian cultures. Singling out an individual due to praise or criticism, a daily habit amongst American managers, may cause Asians to become uncomfortable or deeply embarrassed.
Ann needs to consider more culturally appropriate ways to support and motivate her team. Providing feedback, especially negative feedback, in more private settings will be helpful. Most of all, she should work on giving more courteous and supportive praise and encouragement, which will help her team move toward the unification and cohesion that high functioning teams need in order to be successful.
Around the world, deeper structures such as relationship building and face saving are embedded in the values, beliefs, and behavior of a culture. They are much harder to understand than the glossary of terms in any culture’s language phrase book. The advice is: Always ask for clarification and seek new insights. For business success, it is essential to learn to mediate these deeper cultural differences. Though it may be a little complicated to incorporate them into your way of thinking and communicating, it is well worth the effort!