Inspiring Innovation Across Global Teams

Hi, I’m Zacharias Beckman, president of Hyrax International. There are a lot of misconceptions about innovation, and what we can expect from our global teams when it comes to innovation. Here’s an example.

Jason has a technology company here in the U.S., and they’ve just expanded into Asia. Jason expected that the new team would integrate quickly, and start contributing. By adding another 8 hour shift to the day, he expected his firm to see a dramatic increase in output.

Instead, a few months in, the Asian team seemed to be underperforming. His U.S. managers complained that the new team didn’t produce new ideas. They weren’t even improving on existing ideas. Basically, they were doing what they were told… and if they didn’t have really clear instructions, they kind of did nothing.

What Jason and his management team didn’t realize is that it wasn’t a performance or motivation issue. The problem was with business culture.

Jason’s new Asian employees had been trained for task-based execution. It’s what they knew, all the way from their educational experience, to their most recent employment. The team was not accustomed to critical thinking, and the business culture didn’t support challenging authority. To make matters worse, the Western and Eastern teams weren’t communicating well. With the U.S. team’s low context communication style, they missed a lot of high context cues from their Asian counterparts. The high context communication, to the Western team, was just too subtle — and, it didn’t really come through on a conference, call anyhow.

With all this going on, the new team was set up to fail. They did not expect to be driving innovation. They expected to be told what to execute, and do an excellent job at it.

The unexpected cultural differences demanded a lot of changes in Jason’s strategy. He had to change his immediate goals for both teams, and change what the Asian team was working on. In the longer term, he had to launch a strategy that would get everyone to the same place. That meant a lot of cross cultural training and changes to their very Western, U.S. management style, and taking a much more mature, global approach to the business. Jason learned the hard way how critical it is to understand your partner’s business culture before engaging in business.

Organizing Overseas Teams

Hi, I’m Zacharias Beckman, president of Hyrax International. When it comes to coordinating international projects, one of biggest challenges we hear about is staying on top of the project.

As an international project manager, you have to know how to stay organized, and you need to know what your team is doing. When you have several different teams, all spread around the world, that’s not always easy. You also need to make sure that one of your teams isn’t being held up, waiting on another team.

This is what Tanya ran into, at one of our clients. She had been managing a U.S.-based team. Her company had just bought a smaller firm in India, intending to set up a “follow the sun” strategy. With teams in the U.S. and India, they could move faster because one team would hand off work, at the end of the day, to their overseas counterparts.

But there was a problem. After a few months efficiency was falling, not improving. Tanya found that the teams were poorly coordinated, and more often than not one would end up waiting on the other one. Tanya needed to change her strategy to accommodate a global team. She had to refocus, and figure out how to get these teams collaborating smoothly despite a separation of over 10 hours.

She made two major changes, both of which focused on improving coordination.

She took a critical look at their project management system, and decided that it wasn’t up to the job. It had worked great when everyone was in one office. But now it had to deliver a new level of coordination. She needed something that could better drive the process, improve visibility to her management team, and show dependencies between team members. It was absolutely critical that everyone know, at any time, who was waiting on them. They also needed better requirements management, and better collaboration tools. Her new system gave them the tools, but it couldn’t solve the communication issues on its own.

Tanya also changed the team schedule, setting up short, collective meetings every day. To avoid burdening one team, she set a rotating schedule: meetings where held at 9am in the US twice a week, and 7pm twice a week, with no meeting on Friday. Team members had to join at least two meetings each week, but it was up to them to pick which ones.

Tanya’s changes showed almost immediate results. The teams became more coordinated, and situations where one team was held up waiting for another pretty much vanished.

In a multinational organization, it’s important to remember that remote teams can feel like they are in a vacuum, lacking communication or cut off. To compensate, a good manager has to be extra vigilant and put in good processes, and good tools, and also make sure that no one team becomes the favorite. Tanya spread the meetings out to share the burden of after hours meetings. By doing so, she also sent the message that both teams are equally important.

This Is Horrible Management Advice

I’ve been seeing a lot of management advice lately — hopefully it’s a sign that the U.S. economy is starting to boom again, and projects are taking off. But the problem is, most of the advice I’m seeing is really horrible — at least, if you’re working anywhere outside of America.

Western Management Is… Western

Western management theory works great if you’re managing a Western team. That means a team of people that are completely and entirely Western in terms of their culture and expectations.

For example, in this recent article, Lisa Evans reports that employers are “turning away from the traditional management style of hierarchies.” This is absolutely correct — in the United States. But applying this advice elsewhere in the world could be a huge mistake, especially in the highly organized and role-driven cultures throughout the East. Much of what Ms. Evans writes is sound advice across cultures. She writes that, “Recognizing these basic human needs can create a workforce of employees who are committed to working for their leader because of who they are and how they are treated,” a management principle that is a universal truth. But, as with most Western-oriented management writers, she also adds advice that will fall flat across Asia: “Empowering employees is one of the best ways to get commitment.” Unfortunately, this doesn’t work well in countries and cultures where explicit instruction is expected. In India, for instance, delegating and empowering your team usually backfires. The culture of India, one that produces great technical minds, is still focused on rote training and clear task delegation.

Adapt Your Management To Fit Culture

Don’t be scared of looking for advice online, though. There’s a lot of great advice — but consider the author and their audience. If the article seems to “American,” look for advice from a more International source. One great example is Donna Flynn’s recent article on Managing A Team Across 5 Time Zones. She writes that it’s important to share the burden of communication in a multinational team: “Several months ago we started a rotating meeting schedule.  Every month, each team member now has one evening, one mid-day, and one early morning meeting, and misses one meeting that falls in the middle of their night.  No team member is expected to attend a team meeting between 10 pm and 7 am.”

Ms. Flynn adds, “No tool can replace being together in the same room.  I bring my globally dispersed team together twice a year for workshops,” advice that I heartily agree with. It’s one of the key success strategies that I teach to our clients.

So choose your source. There are even products that focus on overly “Americanized” management techniques. One is The Time Timer. It’s a clock, big, bold, and designed to sit on a conference table and get people to stay focused on the agenda. The product pitch resonates with Americans: “You’re in a meeting, there are only two minutes left, and you’ve been talking around and around without even getting into the most important topic. There was no sense of urgency. And now it’s too late.”

But there’s a problem. This agenda-driven mentality is too Western. It only works in those Western cultures that prize time above all else — such as the U.S., Switzerland, Germany, and a handful of other European countries. But deploy this strategy in South America, and your partners will think you don’t care about getting to know them. Try it in most of Asia, and you’ll be labelled impatient and opportunistic, and they’ll think you don’t want to build a real business relationship. Most cultures around the world do not value time like Americans do. In fact, the most important business cultural preference for them: Relationships. That means taking time to build a relationship, and letting the meeting run long. Long meetings are prized because it’s a sign that everyone is getting to know each other. Short meetings send a different signal: “I don’t value this relationship very highly.”

The most important thing to keep in mind: Be aware of the business culture you are working with. Make sure that the management style you apply is going to be the right style for that culture, and for your team.

How Leadership Differs Around The World

British linguist Richard D. Lewis has explored in depth how leadership style differs across cultures and countries. His diagrams of Leadership Styles, published in When Cultures Collide, offer wonderful insight into why so many multinational efforts run into problems. Anyone doing business across borders needs to understand these differences and adapt their own style accordingly.

Different Culture, Different Leadership

Leadership Styles
Leadership Styles

The variation of styles — from structured individualism of America, to consensus rule of Asia — fit  preconceptions about foreign culture. Even so, it’s important to understand the meaning behind each model, and also be aware of individual variation. The models are not unilaterally true across a country. Every individual will have their own blended style of leadership.

See Lewis’ Leadership Styles diagrams, inset, but also be aware that stereotyping is risky, as Lewis himself warns: “Determining national characteristics is treading a minefield of inaccurate assessment and surprising exception. There is, however, such a thing as a national norm.”

Lewis also argues that these cultural characteristics won’t change anytime soon. He writes, “Deeply rooted attitudes and beliefs will resist a sudden transformation of values when pressured by reformists, governments or multinational conglomerates.” While the “Westernization” of many Eastern countries gets a lot of press, most of these changes are superficial. Cultural preferences are deeply rooted. We learn about our culture from birth. Especially in countries with thousands-years-old history and culture, changes are slow to emerge. Stated more directly: Individuals may jump at the chance to adopt foreign practices, such as capital investment, but this doesn’t mean they are also adopting Western culture.

Management gurus have time and again tried to quantify and distill the secret of successful management into an easily followed formula. Peter Drucker, James Champy, Frederick Taylor, Henri Foyal, Frederick Brooks, and Mike Hammer have all put down their thoughts on the topic. But each has placed a Western emphasis on their particular management magic (and, except for Foyal, a very American emphasis).

As I’ve pointed out many times, cultural conflict is common across multinational organizations. Learning how to avoid the conflict — misunderstandings, misinterpretation, and direct cultural incompatibility — is the first step.

Multinational Leadership Success

There is no single management tool that can work in the global landscape. The cultural intricacies that define how people interact, both in a business setting and a social setting, run far too deep. And, just as management styles depend on environment, so do our relationship-building tools. Creating a successful International business relationship depends so strongly on cross-cultural awareness, in fact, that without extensive exposure to foreign culture most efforts are rife with failure.

Check out this short six-part series that talks about how business cultural preferences affect 27 project management disciplines.

The Global Opportunity

Global activity has broadly strengthened and is expected to improve further in 2014-15, according to the April 2014 World Economic Outlook (WEO). Much of the impetus for growth is coming from advanced economies. As the global economy returns to growth, it’s clear there are expanding international opportunities. Businesses are focusing on global economic strategies and new, emerging markets.

But outsourcing, forming a joint venture, or extending supply chains across the globe isn’t easy. Engaging with your partner is, in many respects, like hiring new staff located on the other side of the planet. How do you manage these new employees that aren’t in the office, don’t speak the same language, work a different shift, and will probably never meet your customer or understand the local market? More than likely, they are accustomed to doing business in a completely different way from what you find normal and acceptable.

Doing Business In The Global Economy

Understanding the strong cultural biases and preferences of our counterparts overseas is critical to success. I run into these differences all the time when working internationally. Here’s an example: In a survey conducted across Western and Eastern businesses, respondents were asked to choose whether they strongly agree or strongly disagree with the following statements. Consider your own answer to these questions:

  1. At work, we do business with the firm that has the best product, regardless of our relationship with them.
  2. To avoid a conflict of interest, I avoid doing business with someone solely because of a personal connection.

When presented to Western business people, responses tended toward agreement with these statements. More so, when presented to American business people, the score is almost always very strong agreement. It demonstrates the strong Western preference to be unbiased in the evaluation of products and services. In fact, in many Western companies, there are rules and regulations that specifically forbid preferential treatment because of personal relationships. These companies go out of their way to completely remove personal preference from any buying or hiring situation, making the process one that is as objective and fact-based as possible.

But when presented to Eastern business people, respondents registered strong disagreement with the statements. In India, the Middle East and China, the response is almost uniform: Intense disagreement. These cultures are strongly relationship oriented, and that cultural preference permeates the business environment. A business person making decisions in the BRIC (an acronym for Brazil, Russia, India, China) will focus on how well they know the person or group they intend to do business with. Strong personal relationships are an integral part of doing business. These strong relationships are what keep things moving smoothly. For instance, Japanese business contracts are much shorter than those drafted in the United States. This is because many of the expectations of the business environment are so deeply embedded in the culture that long, detailed contracts are unnecessary and even offensive. Furthermore, the value of “face” and one’s reputation is so intrinsic that it provides a much stronger motivation than a legal document.

Business Culture And Conflict

These fundamental differences in values and business practices lead to huge misunderstandings in the business world. Just some of these differences include how we manage people, what kind of relationship a boss and a subordinate have, and how we communicate.

Studies conducted by KPMG and Standish reported that 70 percent of projects are failing to meet their goals when it comes to quality, budget, and time — and nearly one quarter (24%) of all projects can be counted as complete failures. These projects are either cancelled outright, or are so off the mark the customer never even uses the finished product.

Frank Ridder, research director at Gartner, has commented that, “[We] found that 55 per cent of global organizations manage their sourcing activities tactically and at an operational level, failing to add a strategic management layer and invest enough in developing critical multisourcing competencies.” In other words, these organizations fail to effectively manage outsourced projects because they don’t plan far enough out, and they don’t take the time to understand the markets they’re developing.

These figures are becoming more and more widely accepted. According to Brandi Moore, a respected consultant on multicultural projects, fully two-thirds of outsourced projects are unsuccessful, and at the same time 65% of Western managers cite culture as their biggest challenge in multinational organizations.

The emerging global economy is creating challenges that Western and Eastern business are just learning how to deal with. As Geert Hofstede, of the Hofstede Institute, aptly wrote, “One of the reasons why so many solutions do not work or cannot be implemented is that differences in thinking among the partners have been ignored.” It’s impossible to build a global organization when each of its parts operates in a cultural vacuum, unaware of how the other parts work.

Identity And International Success

If you missed the first part of this six-part series, see: Part 1 of the series, Creating An International Culture Of Success, or see the entire series right here.

Identity is how we perceive ourselves in relationship to our family, associates, and friends. The individualist focuses on the personal. Such a typical Westerner might think about how they can “get ahead” of everyone else, “stand out from the crowd,” and show off their individual capabilities.

But the vast majority of cultures don’t prioritize the individual. Where the Westerner might think of “I,” someone from a collectivist culture would often think “We.” The group comes first, and is placed ahead of the individual. There is a core belief in the power of the group, and a corresponding feeling that individuals can only play a useful role in society through group involvement. Rather than stand out, the collectivist wants to be a part of the group and support common group goals. In this case, “standing out” is actually a bad thing.

Understanding this is absolutely essential to healthy team dynamics.

Why Identity Matters

Roy, a project manager in the United States, learned about identity the hard way. He had been overseeing work with a partner firm in Japan. The partner firm, responsible for tailoring Roy’s product to fit into Japanese culture, had done a great job. In particular, Roy felt that Masakuni, one of the product designers, had really done exceptional work. He wanted to reward the team, and he wanted to show everyone what a great job Masakuni had done.

As a reward, Roy called the team together to celebrate. He told everyone that the product redesign was a success, and he asked Masakuni to step forward. He told the team that because of Masakuni’s exceptional efforts, their U.S. employer was particularly happy. He went on to add that everyone would be receiving a bonus, but that Masakuni could expect “something extra” for all of his hard work.

Roy shook everyone’s hand. There were smiles all around and it seemed to Roy that he had done the right thing — until the next day. Masakuni did not come to work. Roy had an unexpected meeting on his calendar with the Japanese firm’s general manager. The general manager — fortunately, someone that was very multicultural, and who understood American culture — explained the problem. Masakuni had resigned because he had failed his coworkers. Roy’s congratulatory speech had in fact singled out Masakuni as someone that had not supported his own team. He had not shown them how to excel, just as he had. And by keeping that knowledge to himself, it was self serving: Masakuni had lost face with his group, and with his employer.

The Global Project Compass identifies the following management disciplines as being most directly affected by identity:

  1. Team & Human Resources Management
  2. Training Needs Assessment
  3. Independent Verification & Validation
  4. Assessing Outcomes

Team & Human Resources Management

As Roy learned in the story above, team dynamics is complicated in a multicultural situation. How we motivate team members, how we communicate with them, and how we expect them to communicate with us is essential to good management. Without understanding the more subtle aspects of business culture, managing a team becomes impossible.

Training Needs Assessment

All employees expect to have opportunities for growth. But people in different cultures anticipate receiving these opportunities in varied ways. For example, in many collectivist cultures the boss is expected to look out for employees, and provide guidance regarding a career path. But individualists expect to take action on their own, let their boss know what they would like, and push for what they want. If you don’t understand the right approach, team members will soon be left wondering if there is a future for them at the firm.

Independent Verification & Validation

Independent expertise can be highly valued. But, trusting a third party to ensure the success of a product or service is rife with cultural implications. The individualist approach tends to favor unbiased service providers with a strong track record, and no connection to the firm. The collectivist approach tends to favor trusted, well-known partners with strong connections within the group. It’s a different point of view that can lead to internal conflict in multinational organizations.

Assessing Outcomes

When assessing outcomes, a skilled multicultural manager needs to understand the dynamics of the team. A manager accustomed to individualist teams will naturally look to identify high performers. The individualist team, while working to succeed as a group, will ultimately be motivated to achieving individual goals (such as career advancement). But the collectivist manager will instead assess the team as a whole, understanding that individual performance (whether strong or weak) is, in many regards, left to the group to manage.

Identity is core to a person’s view of self image. The strong individualist employee will look for validation of their abilities, performance, and self worth. The collectivist employee will instead perceive their value in terms of how their work benefits the social “in group,” including family and associates. Benefits and rewards must be appropriate. For example, offering a great opportunity at a new company may not be exciting to a group-oriented person. Such a change means leaving their “in group” behind. It might be viewed as a loss of face — whereas the individualist is more likely to see it a chance to excel.

Cover graphic attribution: The artist and visual designer Yang Liu was born in China and lives in Germany since she was 14. By growing up in two very different places with very different traditions she was able to experience the differences between the two cultures first-hand.

Engagement Style And International Success

If you missed the first part of this six-part series, see: Part 1 of the series, Creating An International Culture Of Success, or see the entire series right here.

Engagement Style

Do we get right down to business, without knowing much about the other person — or, do we build a strong and trusting relationship, only talking about business after we know each other well?

Sending a delegate to represent an American company must be well thought out before departure. This delegate must have authority as well as longevity in the organization. Replacing delegates during the relationship should be done with care and planning. The new contact will need to be brought in slowly to transition the relationship. It is wise for American firms to engage more than one delegate to a relationship with the BRIC or they risk the business leaving with a delegate who departs. — Moore, Brandi, The Little BRIC Book.

Most cultures throughout the world choose the latter path: A relationship-driven engagement style. Conducting business outside of the “in group,” the trusted circle of family, associates, and professional contacts that you know well, is unheard of. It is far better to go into business with someone that you know well, even if the price or product isn’t the best. You know what you’ll be getting. Furthermore, the combined influence of your in group means everyone will do their best for you — and if they don’t, there are always solutions to improve the situation.

The Western, venture-driven style is very different. It’s found in relatively few cultures — probably less than 10% or so of the world. America is perhaps the most dramatic example of a culture that believes in doing business first. It’s a message driven culture, promoting products, uniformity, and a “best product and best price gets the business” ideal. Some of this ideal is beginning to leak into other cultures, but culture doesn’t change quickly.

The Global Project Compass identifies the following management disciplines as being most directly affected by engagement style:

  1. Accounting Policy & Costing
  2. Risk Management
  3. Procedure & Outsourcing Management
  4. Business Continuity & Recovery
  5. Information Assurance & Security

Accounting Policy & Costing

Policies regarding accounting and cost management are deeply affected by engagement style. Strongly relationship driven cultures tend to support more relaxed, flexible policies when it comes to managing the flow of money. This flexibility affords hiring family members, awarding favored contracts to close allies, and giving favors such as gifts for professional favors.

Unlike relationship driven cultures, many cultures focus on cost and performance first, and enact policies accordingly.

Venture driven cultures tend to support stronger accounting and cost management policies, leaning more heavily on the rules of business. This is particularly true in countries such as the United States, Switzerland, and Germany. In such cultures, the favoritism afforded by strong relationships is regarding as nepotism or corruption.

It’s important to remember that both systems are unique and both kinds of cultures feel their system works very well.

Risk Management

Different cultures approach risk from very different perspectives. Cultures that prioritize relationships tend to view those relationships as a means to avoid risk. Awarding an important contract to a close relative or friend provides security. The close relationship helps eliminate unknowns. While price and performance may not be the best, they are known. The strong “in group” network that defines the relationship means everyone will want to support the in group. Performance becomes a matter of saving face.

Venture driven cultures tend to equate risk reduction with choosing the best performer. Giving favored treatment to friends and relatives is viewed as a risk, and potentially disastrous. This usually means taking as objective an approach as possible. Contracts are awarded based on price/performance analysis, and risk is reduced by evaluating past performance. Contingency plans for poor performance generally involve financial penalties or having a contract revoked (not something a relationship driven culture is comfortable with).

Procedure & Outsourcing Management

As pointed out above, the typically “Western” venture driven style eschews anything that seems like favoritism. When talking about outsourcing this is probably one of the biggest differences between venture driven and relationship driven culture. The relationship driven culture will stick to its in group, favoring existing relationships. The venture driven culture assumes that every project must be objectively awarded based on performance criteria.

This also shows up in organizational procedures. Venture driven cultures tend to have written procedures that are enforced through business mechanisms (such as forms, systems, and policy review). Relationship driven cultures, on the other hand, rely more on informal, cultural procedures. Important policies are enforced not by forms and systems, but by the peer network and cultural environment.

Business Continuity, Recovery, & Security

Who is responsible for the continuity of the business? Many venture driven cultures will push for a separation of concerns, using an objective, often outside third party. This might be a service provider responsible for auditing and securing an information network.

Relationship driven cultures tend to prefer a more closely-held approach. Sensitive information is often controlled internally, and important individuals within the organization are tasked with ensuring continuity.

Each culture’s approach to security and information management can be very different. Probably the most dramatic example of this is the American view on intellectual property protection versus that of Chinese culture. While China is definitely changing, the American perception that intellectual property is owned and protected by law is not commonly shared in China. We routinely hear stories about how products are copied in record time in the Chinese market — and U.S. firms are constantly evolving strategies to stay ahead of the Chinese copycats.

Cover graphic attribution: The artist and visual designer Yang Liu was born in China and lives in Germany since she was 14. By growing up in two very different places with very different traditions she was able to experience the differences between the two cultures first-hand.

Communication Style And International Success

If you missed the first part of this six-part series, see: Part 1 of the series, Creating An International Culture Of Success, or see the entire series right here.

I’ve posted a lot about how communication style varies dramatically from one culture to another (including this great infographic on how different cultures negotiate). It’s both very obvious, a clear variation in how we interact, and at the same time deviously subtle in how quickly it can derail an otherwise healthy team and project.

Different Styles Of Communication

Low context cultures, most often associated with Western, industrialized countries, pride themselves on a directness that is unparalleled in other cultures. Lack of subtlety and being “honest and straight-shooting” is the norm. But these cultures end up missing most of the conversation when confronted with high context, rich communication styles.

High context cultures (especially Middle Eastern and Asian, but also South American, some European, and African countries) don’t know how to communicate in this simple, direct style. Confronted with direct, low-context partners, it’s as if 90% of their vocabulary is stripped away. The rich subtlety conveyed in circumstance, timing, silence, body language, story telling, deference, saving face, and tone are missing — leaving behind nothing but blunt, inelegant words (often, to make matters worse, in a second or third language on top of it).

Communication Style: Expressing Opinions (East vs. West)
Communication Style: Expressing Opinions (East vs. West)

Understanding one another’s communication style and being able to adapt, and interpret signals from both cultures accurately, is critical.

The Global Project Compass™ (introduced in Part 1)  identifies the following management disciplines as being most directly affected by communication style:

  1. Continuous Improvement Plan
  2. Segregation of Duties
  3. Project Management Plan
  4. Project Monitoring, Execution, & Control
  5. Change Control & Management
  6. Communications Plan
  7. Performance Measurement

Continuous Improvement Plan

Your continuous improvement plan is absolutely affected by other business cultural preferences, but communication style has a huge impact. Continuous improvement relies on understanding each other without ambiguity. Anything that stands in the way will throw sand into a delicately working machine. Processes like CMMI (the Capability Maturity Model) rely on putting complex, integrated processes into action. Everyone has to understand the process, support it, and pursue it’s objectives.

Segregation of Duties

The Compass also identifies segregation of duties as highly affected by communication style. Clearly defined roles are important in any organization. Segregation of duties is intended to create checks and balances to enforce standards or, in some cases, prevent fraud or malfeasance. One way of looking at this is whether control is unchecked in one person (or one office). A common reason to separate quality assurance, giving it authority on its own, is to support a separate office that has the authority to enforce quality (or at least, stop a project that is not going well).

For this to work, communication lines must be clear. How can quality assurance know how the project is going if there is limited, inaccurate, or unclear communication?

It’s important to note that power distance also deeply affects segregation of duties. The political alignments and often muddied visibility of some organizations create complex, co-dependent relationships. These relationships interfere with the goals of segregating duties.

Project Management, Monitoring, and Change Control

Excellent project management relies on clear communication as well. Across a culturally diverse organization, “clear communication” can mean many things. How does the American manager interpret his Chinese subordinate’s silence, when critical feedback is expected? How will an Indian employee react to the direct communication of a German boss causes him to lose face? Building a project management plan that works well within the multiple, diverse cultural environments of a multinational organization is a challenge.

Performance Measurement

Knowing how your team, and your company, is doing demands no ambiguity. You’ve got to be able to assess performance accurately. For business performance, that means getting accurate, timely information. To assess your team, you need to understand and assess your team member’s contribution. That means understanding what everyone has to say, in their own subtle or not-so-subtle communication style.

Western-style “360 evaluations,” where employees critically evaluate their peers, subordinates, and superiors, rely on American-style direct communication. When used in other cultural settings the 360 evaluation completely fails. When compared to typical American feedback, French and German respondents more easily criticize, but hold back compliments — so evaluations appear much less positive. In many Asian cultures, the idea of openly criticizing is taboo. Here, evaluations come back with seemingly perfect marks — and that can lead to incorrectly concluding that the Asian office is perfect.

Communication: The Tip Of The Iceberg

Most often, problems between multinational teams get put down to bad communication. It’s true that communication is important. It’s also true that most cross cultural situations have communication barriers (and often serious problems). How well people communicate — or, how poorly your team is communicating — is a very visual indication that there are problems.

Just like an iceberg floating in the ocean, this visual indicator usually means there is more going on beneath the surface. When your team isn’t communicating, it’s time to look for other problems too.

Cover graphic attribution: The artist and visual designer Yang Liu was born in China and lives in Germany since she was 14. By growing up in two very different places with very different traditions she was able to experience the differences between the two cultures first-hand.

Power Distance And International Success

If you missed the first part of this six-part series, see: Part 1 of the series, Creating An International Culture Of Success, or see the entire series right here.

I’ve posted in depth on power distance and how it varies from one culture to another. To recap, power distance, or “PDI,” is the degree of inequality in society and the emotional distance that separates subordinates from superiors.

Many Western cultures thrive on very low power distance principles. Since most of today’s modern management theory has come directly from the West, this means these theories work great in Western cultures but tend to have problems in the East.

Most modern management expects employees to think independently, be honest and critical, question the status quo, and openly voice disagreement. Many recent management tools, such as Scrum and Agile methods, empower the employee so much that the line between “boss” and “employee” becomes blurred and — sometimes — almost eradicated.

Across much of the Middle East and Asia, this approach fails miserably. Traditional organizational structures don’t tolerate this approach. Direct criticism and questioning tends to be viewed as dissent. Respect for seniority, wisdom, and age play into it. Decision making happens at higher levels in the company, and decisions flow downward. Employees are expected to act in unison, provide information when requested, and respond like a well-oiled machine to the strategic decisions of their senior management.

The Global Project Compass™ (introduced previously) covers 27 project management disciplines. It identifies the following management disciplines as being most directly affected by power distance:

  1. Goal Setting
  2. Organizational Structure & Policy Setting
  3. Standard Compliance
  4. Business Case Validation
  5. Positive Assurance of Compliance

Goal Setting

As pointed out in the introduction, different cultures have different expectations about where their goals come from. Employees that are used to low power distance will feel slighted if they are not closely involved in setting goals, or if their voice is not heard. On the other end of the spectrum, those accustomed to being told what to do may conclude that their boss doesn’t really know what’s going on if too many questions are asked or if the boss seems to rely on subordinate opinions.

Organizational Structure & Policy Setting

Closely related to goal setting is policy setting, and that includes the hierarchy (or lack of hierarchy) in an organization itself. Employees from high power distance cultures tend to feel far more comfortable in an environment that provides clearly defined roles. That translates into greater hierarchy, and more clearly responsibilities. As Honeywell learned, without adequate training and management programs, their Chinese R&D department really had no idea how to go about inventing truly new products.

Standards Compliance

Compliance is an interesting topic to explore, because it shows off a reversal of competence along the power distance spectrum. Employees accustomed to high power distance and being given clear guidelines tend to flourish when it comes to compliance. Such standards provide a clear set of instructions, set boundaries, and make the job an easy one to follow (at least, when the standards are well documented).

Unfortunately, with poorly defined or conflicting standards, problems occur. Poorly written rote instructions rapidly lead to chaos when those instructions are in conflict — and high power distance cultures also tend to demonstrate little critical thinking or problem solving here.

On the other hand, with a team that is used to low power distance, standards can become a “thorn in the side.” These teams — trained to think critically and voice their opinions — often struggle to see the rationale or validity of standards. They might push back against them, although when the standards themselves are questionable this can be a boon: Those same teams will quickly point out flaws (and perhaps push to have the standards disqualified).

Business Case Validation

Critical thinking, scenario planning, and a talent for seeing the future are traits needed when validating a business case. These skills tend to flourish at the executive level in high power distance cultures, while the critical thinking of low power distance teams can be incredibly valuable to examine every aspect of a business model.

Positive Assurance of Compliance

Making sure that you are complying with standards is often the responsibility of the quality assurance department or a separate standards body. Power distance and organizational structure play a huge role. Assurance of compliance carries with it a need for authority. Failure in compliance means, potentially, putting a stop to project activities, and challenging the organization and the team (at least, in so far as ensuring products conform to agreed standards). Organizational structure is important, but often the standards compliance body is not set up with adequate authority — in some cases, being subordinate to conflicting objectives (such as project management). Ensuring that the right structure exists; that there is a separation of concerns; and there is authority to act, is critical, and very dependent on the cultural biases at play.

Cover graphic attribution: The artist and visual designer Yang Liu was born in China and lives in Germany since she was 14. By growing up in two very different places with very different traditions she was able to experience the differences between the two cultures first-hand.

Creating An International Culture Of Success

The International Business Dimension

Multinational teams present new challenges for the International manager. There are logistics problems: How do you coordinate teams that work in different time zones? What kind of collaboration can you create in a team that rarely sees one another?

As well as the logistic problems come cultural problems. For example, successfully creating a culture of innovation can be a challenge. Honeywell experienced this, according to a November, 2013, Time article, when Rameshbabu Songukrishnasamy began working as general manager of the company’s R&D centers in Shanghai and Beijing. He found his employees were not innovating. They weren’t tinkering or inventing on their own — not a positive sign in an R&D lab! “They were happy just doing what they were asked to do,” Rameshbabu says. The problem is, R&D is about doing something new.

A project manager for a large corporation in Brazil recently told me that the PMI Book of Knowledge is used infrequently at best inside Brazilian projects. He also warned against assuming that someone with a PMI certification has extensive experience, as is the case in the US. — Moore, Brandi, The Little BRIC Book.

Rameshbabu found that his Chinese workers had a fear of failure. They worried that the company would be upset if their work did not yield positive results, so they didn’t experiment. Another problem is that some Chinese engineers “tend to shy away from critical questioning,” a process that is fundamental in R&D. “The reason they are able to make so much innovation in Silicon Valley is that people question the status quo and find alternative ways,” says Rameshbabu. But he found that Chinese culture and education focused on rote learning, not critical thinking.

Creating A Culture Of Success

Creating successful International programs requires understanding and adapting to different business cultures. Applying Western management practices in Asia will fail, just as surely as transplanting Western employees into an Eastern environment. Imagine an independent, critical thinker from Silicon Valley landing in Foxconn, Shenzhen — where challenging the status quo is forbidden.

Team dynamics play a huge factor in management style, objectives, and capabilities. Building a culture of innovation is just one example of where these dynamics become complicated. Power distance will affect everything from goal setting to how problems are socialized. Communication style can quickly lead to misunderstandings. Differences on the fluidity of time can mean completely missing the mark with customer deadlines. And differences in identity and engagement style can lead to initial confusion, bad first impressions, or distrust.

This is why understanding business cultural practices is so important. Hyrax International LLC has a program that explores each of these five preferences. The program examines each of 27 different management disciplines, such as goal setting, risk management, change management, and assessing outcomes. The affect of business culture on each discipline is explored and explained, providing a road map to success on the International management scene. The company also offers many free resources to explain and explore International project management, and is also sponsoring Successful International Project Management, an in depth book that maps project management processes to cultural preferences.

We’ll be posting five more parts to this article (read Part 2, or see the entire series right here) in the coming couple of weeks. Each post will look at one of the five business cultural preferences, and briefly introduce how that preference impacts and affects the 27 management disciplines.

Hyrax International LLC’s Global Project Compass™ is the only visual map that clearly shows the connection between business culture and business process. This is what makes Cross Cultural Management™ so much more effective than traditional management.

The Compass maps 27 project management disciplines directly to business cultural preferences, and shows how these preferences affect business. The goal of the Global Project Compass, and Hyrax International’s associated management program, is to show how culture affects businesses worldwide — and to provide a clear map on how businesses can adapt successfully.