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 To Go Global

How do you learn to “go global” and take your product, and your company, to an International scale?

Hi, I’m Zacharias Beckman, President of Hyrax International. I founded this company because I believe that American businesses, in particular, are really embracing the global economy. That means learning how to adapt products to different cultures around the world; changing a business’s internal culture in order to be compatible; changing how projects are managed, because the traditional Western management style that most of these American businesses employ, those styles are not going to work in Asia or South America or the Middle East. So, American businesses need to start to adapt.

Adapting To “Global”

A new level of business cultural awareness is needed. We need to understand how to communicate with each other, how to adapt to each other’s way of thinking about time, how to manage people with a different concept of power distance or the separation between a boss and an employee. It’s a complex landscape.

Taking a product into another country means adapting that product so that it fits well with the culture there. For example — lets say you wanted to take a product that was a four pack of golf balls, here in the United States, and sell it in Japan. It’s probably not going to work — because the word for “four” in Japan sounds very much like the word for “death.” So taking that product and simply slapping a new label on it in Japanese and shipping it over there — that’s not going to work.

This is why we created the Global Project Compass (see our six-part article on the Compass). It’s a map that takes 27 different project management verticals, things like quality assurance; time estimation; acceptance testing, and it maps them to business cultural preferences. And we see how, for example, communication is going to change each one of these 27 different project management disciplines.

We are global project experts. We understand the technical execution and we understand the cultural implication. Our programs will make sure that you succeed taking your products overseas and building a multinational organization.

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.

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.

6 Tips For Successful Global Expansion

Exporting is an opportunity that many small and medium sized firms should be taking advantage of to expand and grow to their full potential. Yet, fewer firms are exporting than one would expect. For instance, in this 2013 Canadian study, less than 2 per cent of such businesses are exporting. At the same time, recent import and export figures at the United States’ largest port, the Port of Los Angeles, point to considerably lower export volume than in previous decades.

These figures are mirrored in the U.S. by McKinsey’s Global Institute study, which points at a mere 5% of businesses exporting. But there is growth. According to the report, “Global flows are growing and contribute to GDP growth. Flows of goods, services, and finance in 2012 reached $26 trillion, or 36 percent of global GDP — 1.5 times as large relative to GDP as they were in 1990.”

With such a low percentage of firms exporting goods there is huge opportunity abroad — a gap that will likely be filled as the global economy recovers.

The Globe And Mail’s Michelle Little, in a recent article, also points out the high potential for returns by “creating a borderless product, networking to make key contacts abroad and embracing technology to both reduce costs and reach out to potential clients.” According to the Globe article, one firm to take advantage of export opportunities was Imprint Plus, specializing in name badge systems and boasting 35,000 customers in 75 countries. But it wasn’t always so: The firm can attribute much of its success to a strategic shift. When CEO Marla Kott saw the opportunity, she made the decision to refocus the business in a much more international direction.

Other firms, including Foxy Originals and Procurify.com, have realized similarly successful results by leveraging a global strategy.

As Ms. Little writes, “With a whole world outside our Canadian borders, opportunities are there for those willing to embrace technology, create key social networks and see past the headaches of patent infringement and ever-changing regulations.”

And, Imprint Plus’ Ms. Kott provides the following six strategic tips for businesses seeking to expand globally and leverage the potential of an international market:

  1. Innovate and create mighty products or services that are unique.
  2. Do an extensive competitive analysis and don’t stop at the U.S.
  3. Speak to prospective customers.
  4. Be fearless and look at money spent attending trade shows as education funding.
  5. Educate yourself continuously through government programs, trade commissioners, and business intelligence.
  6. Join an international networking organization.

For the complete article, see Three Companies Offer Advice for Successful Global Expansion in The Globe And Mail.