Cross-Cultural Management

This video describes the 3R approach to working effectively in a cross-cultural environment. The 3Rs consist of (1) Recognizing cross-cultural differences, (2) Respecting differences, and (3) Reconciling differences.

Transcript

A few years ago while working for a foreign company with operations in Serbia, I met with the plant manager for a tire manufacturer. My job was to help streamline operations and identify additional suppliers. The plant manager was cordial but distant. As the discussion began in earnest, he said, “You know very little about what’s going on here, don’t you?  You come here with your American mentality that what you do is always the right way to do things. Your country, along with NATO forces, bombed our country just a few short years ago, and you don’t even know why, do you?” 

After a moment of panic, I sketched what I knew and said, “But I’d like to hear your side of the story as well.” This put the manager in a less defensive position.  He pulled out multiple articles and a book he had written on the NATO bombings of Serbia. After a long conversation and an opportunity to share different perspectives, we each had a much deeper understanding of the other’s point of view and the different cultures and customs we brought to the table.  The common ground we built through this open and non-judgmental interaction improved our future communication and created a positive atmosphere as we bridged cultures.

There are three key stages in reaching this kind of mutual understanding. They help us move from ignoring differences to capitalizing on them.   

The first step is to recognize differences.    Before doing business with someone from another culture, ask yourself, “What do I know about this person’s culture?”  First select which cultural dimension(s) to examine, and then assess their impact on the specific business you are engaged in.

Suppose you are a U.S. employee of Amazon.com trying to negotiate a price for flip flops with Brazil’s Havaianas company. Someone from a highly collectivistic culture (like Brazil’s) will likely focus on the relationship and prefer to stay with the same negotiator throughout the process and in the future. Conversely, someone from a highly individualistic culture (like the United States’) will be comfortable swapping negotiators or using whatever short-term factors seem appropriate. Knowing this helps you predict what the negotiation will be like, so you can design the negotiation process to maximize value and minimize risk by, for example, designating a permanent negotiator.       

The second step is to respect differences.  Respect is esteem for the worth of a culture. Respecting differences thus consists not only of identifying and assessing another culture’s key dimensions, but of adapting your own views of the world to give them greater appreciation.

In working with top foreign managers at Samsung in South Korea, we found they were very good at recognizing differences, but they often used this understanding as a way to stereotype their local Korean colleagues. By relying on only one or two dimensions—“The Koreans are hierarchical and collectivistic,” for example—the foreign managers oversimplified and made erroneous assumptions about Samsung that got them into a lot of trouble. A better approach was to find and appreciate the positive in the differences between themselves and their Korean colleagues. They needed to see that what Samsung did worked and drove profits, even though it was different from what they were used to.

The final step, after finding common ground through recognition and respect, is to reconcile differences.  Here you apply knowledge and cultural empathy in order to bring differences into agreement or harmony and pursue your common goal or objective. How? Solicit uncommon information. Rarely does any one person have all the pieces of the puzzle, and when people from multiple cultures work together, gathering all the needed information can be a challenge.

One manager at Shell Oil commented, “We can get people to share knowledge across cultures all day long, but when it comes to actually implementing those ideas, they completely shut down.” People from one culture might be reluctant to implement practices from another culture due to the not-invented-here (NIH) syndrome.  To overcome NIH syndrome, in which a person or group resists new ideas from culturally different persons or groups inside the organization, help the group develop a shared understanding of what needs to happen so everyone can focus on the results, not on the process.

These three steps– recognizing differences, respecting differences, and reconciling differences– can help you improve your ability to manage diverse groups and teams and drive performance for your organization. Success comes not from suppressing differences, but from using them to gain new insights to solving problems.