Part 4 – Why Global Firms Need Cultural Competence

April 23, 2014

By Monica Marcel

This post is part 4 of 7, of the case study “Why Global Firms Need Cultural Competence.”

With the commitment and goals of intercultural competence clear to all—there are two seemingly contradictory rules for building intercultural competence in a global organization. But both rules are true, and the key lies in understanding the nuance between the two:

  1. Rule #1—Training is but one way to build intercultural competence, and often is overemphasized.
  2. Rule #2—Training is critical. You can’t achieve any meaningful level of intercultural competence without it.

Training is critical, but it must be the right amount and right kind of training, and the tipping point must be carefully monitored. Beyond training, best practice organizations build intercultural competence by tapping into on-the-job experiences that deliver meaningful cross-cultural encounters, and by introducing  intercultural competence as a framework for making operational decisions.

Cultural competence in key functional areas can provide powerful reach within an organization. Consider, for example, the pivotal role and thus, the positive impact of culturally competent recruiters and hiring managers, culturally competent sales people and compliance officers, or culturally competent people managers or project leads. By creating a link to a company’s operational and organizational development frameworks, intercultural competence can be promoted in ways that extend the reach far beyond what a half-day or even week long training session can do. See Sidebars B and C for more examples of how best practice companies have embedded intercultural competence into an organization’s DNA and business practices. Rather than just learning some tidbits about another culture, the name of the game is deep application of intercultural competence to enhance and evolve business and human resources processes to meet today’s new marketplace and global diversity talent challenges.  Alongside these embedded approaches, training is critical to building intercultural competence.

So let’s explore what a holistic learning and development (L&D)  five-dimensional framework looks like for building, leveraging, and sustaining intercultural competence across an organization:

 

1.  Recognize that everyone needs intercultural competence. We are all cultural beings, with identities that represent a blend of the cultural groups we belong to (national, organizational, regional, gender, etc.). Most people also are more likely than not to perceive their own cultural experiences as more real than others—sometimes so much so that they fail to ‘see’ their own culture as culture at all, but rather as ‘just the way things are.’ This introduces both blind spots and opportunities for growth.

Thus, a solid framework for building, leveraging, and sustaining intercultural competence begins with the concept that everyone needs intercultural competence and everyone—even the most experienced—should participate in helping the organization to build capacity in this area. Best practice organizations are sure to include a role for everyone in the L&D strategy, from individual contributors to project managers and from people managers to business leaders, and even senior executives and sometimes board members.

2. Segment audiences and determine the desired behavioral outcomes. For example, many companies   segment their intercultural competence-related L&D efforts by level, business unit, geography, and role. For each segment, they then determine what culturally competent behaviors look like in your organization for this segment.

3. Set priorities based on the organization’s business case for intercultural competence. Priorities will dictate where to target L&D resources first to produce the greatest organizational impact.  For example, many companies tend to start rolling out intercultural competence training with:

    • …business leaders and managers, before the general population. In this way, managers experience the learning and frameworks before their direct reports, and are better positioned to positively reinforce key concepts and ensure they are applied on the job.
    • …headquarters country operations, thereby modeling the need for intercultural competence and also making primary the need to identify where headquarter-centric approaches may permeate an organization’s corporate culture and undermine efforts at true cross-cultural collaboration and inclusion.…newly opening locations, where opportunities to introduce goals for intercultural competence can be embedded into other onboarding messages.
    • …particular business units or particular roles, where intercultural competence might prove a particular advantage. For example, some companies prioritize cultural training for teams involved in product or regulatory approvals in new world regions, or those charged with seeking out (and understanding) opportunities presented by new or emerging market segments.

4. Define requirements and content for intercultural competence-building programs. What are the necessary learning outcomes, and what are the knowledge, skills, and abilities (KSAs) that will be at the core of any content? Also consider what can be assumed regarding prerequisites and knowledge builds for these groups. Attention to these questions helps companies make decisions regarding what programs are needed, and whether their organization is best positioned to design its own, leverage existing programs, or go out to the intercultural marketplace to find the required solutions.

5. Develop a plan to include lower priority targets in the L&D strategy, to ensure they are not left behind or “forgotten.” Where might there be opportunities, for example, to infuse intercultural competence frameworks into existing L&D programs, such as new employee orientation, sales training, or annual code of conduct e-learning?  The principle that “everyone needs intercultural competence” remains true even for people in the organization who are not prioritized for L&D initiatives.

 

Part 3 – Why Global Firms Need Cultural Competence

April 1, 2014

By Monica Marcel

This post is part 3 of 7, of the case study “Why Global Firms Need Cultural Competence”

Inventorying the critical “mix” of cultures that impact your global organization is an important step, as is clarifying what it means for your organization to navigate its particular cultural mix with competence. In MFM’s story, the role of national culture differences revealed themselves clearly as the managers and teams in the United States, Poland, and India each tended to apply their own national worldviews and contexts, without necessarily considering or addressing the conflicting needs of the other cultures involved.

A few companies equate “culture” with nationality, as in the nationality of the headquarters operations or the national origin of its global workforce. Best practice companies, however, know a multitude of cultures that go beyond national cultures impact any organization both internally and externally. These cultures can be organizational cultures, generational, regional, LGBT, gender, religious, language-based, nation of origin, ethnic cultures, etc. Understanding how to successfully navigate these various cultures is an imperative for surviving first, then thriving, in today’s diverse, global marketplace.

Examples of cultural groups typically having a major impact on global companies are provided in Tables A and B.  Table A shares how cultures external to the organization (for example, the marketplace or customer base) can impact business goals, and Table B shares examples of how cultures internal to the organization can have an impact.

Table A: Cultures impacting a company’s external business case for intercultural competence

Cultural Group

Example of culture’s impact on the company’s business case

Example of  business opportunity present if intercultural competence is leveraged with this cultural group

Gender

Buying power of Asian-American professional women is at an all time high

A study of cultural influences shaping this group’s buying patterns, or focus groups with customers representing this demographic, is used to uncover market segment strategies.

Regional:

Low brand identification among Quebecois customers in Canada

French-language based television advertising and marketing campaigns are added to those in English, to build brand recognition and increase nationwide market penetration.

Sexual Orientation:

The UK’s LGBT community presents an opportunity to gain customer loyalty without impacting other market segments in a negative way

Promotions (LGBT loyalty rates), targeted advertising in national gay publications, and charitable contributions are used to anchor LGBT-friendly initiatives. LGBT sensitivity training is launched (from managers to front line.)

Table B: Cultures impacting a company’s internal business case for intercultural competence

Cultural Group

Example of culture’s impact on the company’s business case

Example of  business opportunity present if intercultural competence is leveraged with this cultural group

Organiza-tional: 

Leadership from the acquired company has been trained to value work styles that conflict with the acquiring company’s corporate culture

Due diligence is done to identify cultural gaps in what constitutes ‘good performance’ in both companies, then a task force including members of the legacy organization is charged with updating and implementing new leadership expectations that bridge the corporate culture gap

Regional Origin: 

Salespeople from northern India face obstacles selling to customers in Southern India

Salespeople based in Southern India prep colleagues from Delhi prior to customer visits to familiarize them with the local requirements and key phrases in the local language

Generation: 

Annual turnover of high potential employees under age 30 in China is more than 60 percent a year in some industries

Young, high-potentials are targeted for training and development opportunities with a minimum commitment to ongoing employment required upon their return

Nation of Origin:

More than a dozen national cultures are represented at a particular UAE location of a Danish-headquartered company, and each group would like to have celebrations on the day of their national holidays

An HR team (or employee resource group) is created to recommend options for HR and leave policies that allow for employee flex days as needed; reward and recognition budgets are aligned to celebrate key holidays during working hours

Religion: 

Top performers who are Muslim and who wear head garb have been leaving a German company and joining the competition

Network groups and mentoring programs are established to help retain top performers from the Muslim community and help them identify visible career paths

Ethnic: 

Manager candidates in South Africa are increasingly available from the black African population, a group whose members the company has not sought out in the past

Black Africans are recruited aggressively in order to make the company an employer of choice with this important segment of the local workforce


Once the business case and particular cultural mix have been identified, best practice companies also focus on communicating a clear message regarding the importance of intercultural competence within the organization. CEO townhalls, blogs, newsletters, and intranet channels are used to deliver the message both internally and externally (for example, to customers, suppliers, industry leaders, and talent recruiters). These communications need to have a compelling answer to the following questions:

  • What is the opportunity (or business case) for building and leveraging intercultural competence—in financial terms and in qualitative/differentiation terms?
  • Why will the company invest significant amounts of time and money on building and then sustaining intercultural competence?
  • What will company priorities be regarding cultural understanding—different business units, different locations, different staff levels?