#Strategy - Going International & Cultural Differences.
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#Business101 - First article on the #Business101 series, a hopeful start with an introduction to the cultural differences accompanying international business assignments.
Handling cultural differences is a skill. Understanding the other side can make a big difference, allowing steering the communication towards a win-win for both sides.
Alright, you are a young woman in your company's 'High Potential Program,' holding a master's degree in engineering with expertise in mining and drilling. Your company, a big player in natural resource exploration, is making efforts to work with local mining companies in various countries to get important minerals. Your job is to sign a project contract for a joint venture in Temporiana (fictional name for a country), alongside settling the technical challenges in the project.
Your company is known for giving young, capable staff challenging yet interesting responsibilities, and despite your age, you're leading the project in the Republic of Temporiana. Your company has a flat hierarchy and is known to give its young professionals the chance of going on important international assignments. It is an interesting task, and it comes with no surprise to you.
You have scheduled a meeting with the CEO of the local mining company during your trip to the country's capital. This marks your inaugural visit to the country. Upon arrival at the meeting time, you're informed that the CEO is currently in another important meeting, and you are kindly requested to await their availability.
The secretary requests your business card. However, after enduring a lengthy wait of 1.5 hours, frustration sets in. You're then informed that the CEO is away attending an external meeting, and instead, you're offered a discussion with a staff member regarding technical aspects of the mining operations. With patience running thin after the prolonged delay, you bypass small talk and swiftly transition into technical discussions following a few courteous remarks. However, your counterpart seems disengaged and mostly unaware of the business opportunities at hand.
Finally, the meeting concludes with assurances from your counterpart to relay your thoughts and concerns to the CEO.
You are disappointed by your visit's lack of success. Over the next two days, you try to reach the CEO on his mobile phone, but he doesn't answer. His secretary takes your calls at the office and says he's not there but promises he'll call you back later. However, no call comes, and your email remains unanswered. You wonder what went wrong.
Alright, a fictional story for exemplary purposes. Yet so common in your daily business? But hey, some cultural aspects might have contributed to the disappointing outcome of this visit, no?
In some societies, certain situations are seen differently than in others. For instance, it feels normal that being a young professional doesn't stop you from leading a project overseas, whether in Asia, Africa, or anywhere. Modern multinational companies often send young experts to tackle business issues. However, in other cultures, seniority has more importance.
Therefore, if you want to talk to the CEO, it's crucial that you hold a similar position or role as your counterpart. Otherwise, it might seem disrespectful if your company sends someone lower in the organizational hierarchy to meet with the CEO.
Another topic is punctuality. In your organizational culture, time is important and essentially linked to the valuable concept of efficiency. In other different cultures, time could be less important than personal relationships.
It could be interpreted as discourtesy when you show signs of impatience and jump directly to the topic you came for. In other cultures, this could mean not taking your counterpart seriously.
One might think that the engineer from the ‘Temporianian’ company couldn't grasp your offer due to technical limitations or might not even be part of the joint project. Instead, he could be connected to the CEO and serve as a unique contact. This individual might have a say in decisions due to informal connections that go beyond the official company structure.
This situation illustrates some of the cultural challenges that may be experienced when engaging in international business operations.
The Six Cultural Dimensions Theory
Image source: Toolshero
When discussing cultural differences in business operations, the name of Dr. Geert Hofstede comes directly to mind. Hofstede developed what is known as ‘The Cultural Dimensions Theory’. Hofstede was a Dutch social psychologist. His research on cultural dimensions has been influential in the fields of international business, organizational behavior, and cross-cultural psychology.
Hofstede conducted one of the most comprehensive studies on how values in the workplace are influenced by culture, analyzing a large database of employee value scores collected within IBM between 1967 and 1973. From this research, he identified and defined six dimensions of culture:
Masculinity vs. Femininity
Power Distance
Individualism vs. Collectivism
Uncertainty Avoidance
Long-term vs. Short-term orientation
Indulgence vs. Restraint
For example, the dimension of “Uncertainty Avoidance” can be applied to the story in the beginning of this article.
Cultures with high uncertainty avoidance tend to have strict adherence to rules, timing, and schedules, including time punctuality. In such cultures, there is a preference for clear guidelines and structured routines, which often translates into valuing punctuality as a means of reducing uncertainty and maintaining order.
Germany? Yes. That sounds reasonable ..
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Germany is typically considered to be high in uncertainty avoidance according to Geert Hofstede's cultural dimensions theory. German culture tends to value stability, predictability, and clear guidelines in various aspects of life, including work, social interactions, and decision-making processes. On the other hand, the fictional ‘Republic of Temporiana’ would score low in the example story in the beginning.
In high uncertainty avoidance cultures like Germany, there is often a preference for well-defined rules, procedures, and schedules to minimize ambiguity and uncertainty. Punctuality is highly valued in German society, both in professional and social contexts, as it contributes to the overall sense of order and reliability.
Furthermore, German culture places a strong emphasis on planning, risk avoidance, and adherence to established norms and traditions, which are characteristics commonly associated with high uncertainty avoidance cultures.
Hofstede‘s work has provided a framework for understanding cultural differences and their impact on various aspects of society, including management practices, communication styles, and decision-making processes. Hofstede's cultural dimensions theory continues to be widely referenced and applied in cross-cultural studies and international business contexts.
However, it is critically important to understand that there is hardly right or wrong when it comes to cultural differences. What may be seen as the norm here might be considered irregularity there. Your social intelligence and willingness to understand the cultural differences can play a vital role in your successful career journey!
More on The Cultural Dimensions Theory to follow in the coming articles. Your feedback and thoughts are so welcomed!
Warmest Regards!
