How to deal with cultural differences in an international business environment

Sales Managers’ Club 2008Mallorca, May 19-21

By Vincent Merk

Game: “Tower for the Derdians”

Build a (paper) tower Objectives of the game:• Develop cultural awareness• Train intercultural

sensitivity • Train knowledge transfer • Develop group dynamics

and team spirit• Address some cultural

dimensions

Developing Intercultural Competence:the ability to reconcile seemingly opposing

values (by F. Trompenaars) - The 4 Rs:

• Recognise cultural

differences

• Respect cultural

differences

• Reconcile cultural

differences

• Realise and Root

A definition…

« Culture is a set of beliefs, values, norms or standards, shared by a group of people, which help the individuals to decide what is, what can be, how to feel, what to do and how to go about doing it. » Goodenough

But…• Culture is learned !

• Culture is forgotten - we stop being conscious of it

• Our culture follows us everywhere – we can’t just take it off and leave it outside !

“Culture is the way we do things here”(Deal & Kennedy)

Dividing “here” into 4 levels:

– The personal culture

– The national culture

– The professional culture

– The corporate culture

Corporate Culture

Person oriented Task orientedH

iera

rch

ical

Eg

alit

ari

anIncubator Guided missile

Family Eiffel Tower

ORG. CHAOSMBPLEARNING

STRATEGYMBOPAY FOR PERFORMANCE

NETWORKMBSPROMOTION/POWER

STRUCTUREMBJDEXPERTISE

The onion model

TROMPENAARS MODEL:Seven Dimensions of Culture

• RULES versus EXCEPTIONS AND RELATIONSHIPS– Universalism versus Particularism

• INDIVIDUAL versus GROUP ORIENTATION– Individualism versus Communitarianism

• EMOTIONS: CONTROLLING EMOTIONS versus EXPRESSIVE– Neutral versus Affective Relationships

• SEGMENTING versus INTEGRATING RELATIONSHIPS– Specific versus Diffuse Relationships

• STATUS based on: “What you do” versus “Who you are”– Achievement versus Ascription

• TIME– Monochronic versus Polychronic

• RELATIONSHIP with NATURE / ENVIRONMENT– Internal Control (dominate nature) versus External Control (part of nature)

You are riding in a car driven by a close friend. It is getting dark outside. He hits a pedestrian crossing the street. You know he was going at least 40 km/h in a residential area where the maximum allowed speed is 30 km/h. There are no witnesses. His lawyer says that if you testify under oath that he was only driving 30 km/h, it may save him from serious consequences.

What right does your friend have to expect you to testify to the lower figure? What do you think you would do in view of the obligation of a sworn witness and obligation to your friend?

UNIVERSALISM – PARTICULARISM: a case study

32

37

44

47

54

68

69

73

83

87

90

91

91

92

93

93

97

0 20 40 60 80 100

Venezuela

Korea

Russia

China

India

Japan

Singapore

France

Czech Rep

Germany

Netherlands

Australia

United Kingdom

Sweden

USA

Canada

Switzerland

UniversalismMy friend has no/some right and I would not help

%

RULES & SYSTEMS EXCEPTIONS AND RELATIONSHIPS

Obligation to universal systems, contracts

“It depends” - The particular situation

Positive connotation

Consistency Flexibility

Negative connotation

Rigidity Corruption

Issues/problems between the two:• The meaning of a contract• ‘Objective systems’ from headquarters: focus on global products, systems, documenting vs local adaptation and exceptions

Universalism versus Particularism

INDIVIDUAL ORIENTATION GROUP ORIENTATION

“I” comes first “We” comes first

Positive connotation

Personal initiative, Commitment,accountability teamwork

Negative connotation

Egoism, anarchy Conformism

Issues/problems between the two:

• Reward systems

• Decision making

Individualism vs Communitarianism

Encounter Specific and Diffuse

Public

Private

Danger Zone

Private

Intercultural communication is:

Verbal vs. non-verbal communication

Words, images, song & dance

High and low context

Create and maintain trust

Non-verbal communication - greetings

High and low context

High context cultures

Low context cultures

Information implicitlycontained

Information explicitlyconveyed

An example:A group of Dutch tourists asks a Malaysian if Lumpur is far from here. Seeing they look tired, he sympathises and replies: “No”. After 2 hours of walking, they still have not reached Lumpur. Reaction?

High and low context

High context cultures

Low context cultures

Information implicitlycontained

Information explicitlyconveyed

• Asian (Chinese, Japanese)• Arabic/ Mid. East• Latin-American• Italian, Spanish• Slavic• British English• French• American English• Scandinavian• German• Dutch• Swiss-German

Communication Commandments:

- Know (some of) the local language:"Impossible is nothing," a sign in Beijing's airport and one of those funny mistranslations of the common phrase, "Nothing is impossible."

- Know about the local culture, history, traditions, happenings, events, current news, etc.

- Know your partner: job, family, hobbies, background, etc.

- And finally… Wonder, observe, listen, absorb, ask, wait, expose, try out, honour, etc.

ANALYTIC, SEGMENTING HOLISTIC, INTEGRATED

Segmented relationships Connected relationships

Positive connotation

Easy contact Personal involvement

Negative connotationSuperficial Formal

Blunt Indirect

Issues/problems between the two:• ‘Losing face’• Explicit / implicit communication styles• Different ways of problem solving

Specific versus Diffuse

Achievement versus Ascription

STATUS ?

What You Do Who You Are

Ascribed Status

• Family

• Age

• Gender

• Education

• Position in hierarchy

Time perception

Monochronic Polychronic

External Control:Nature as an

organismSubjugation to

nature

Nature: Internal vs External Control

Internal control:

Dominance over nature

We control the environmentIn charge of our own destinyTechnology push

Harmony with environmentFate, luckMarket pull

Positive connotation

In control Adaptive

Negative connotationDominant, arrogant Fate used as an excuse

Issues/problems between the two:• Perceive the other as weak or as arrogant• Different ways of strategising, planning

Internal control vs External control

A few recommendations:

In international business, it always takes 2 to…

Tango!

Beware of stereotyping…

Don’t take too much for granted !

Don’t go native, trying:“When in Holland, do as the Dutch do…”!

But just be yourself…

…and adapt to the local situation!

And watch your language!

The language of international business is…

…BAD English!!