Part 2 – Why Global Firms Need Cultural Competence

February 24, 2014

By Monica Marcel

This post is part 2 of 7, of the case study “Why Global Firms Need Cultural Competence”:

The best way to illustrate global firms need cultural competence is to review the case study of a multinational that nearly failed, and yet is now soaring because it turned its initial neglect of intercultural competence into a cornerstone of its entire globalization strategy.

See if this sounds familiar: A large global firm (we’ll call it MFM) called LCW after dysfunctions involving their Indian and Polish operations began to take their toll. LCW was engaged to conduct a cultural audit through a series of interviews with the Indian and Polish team. The audit surfaced story after story of not only cultural misunderstandings, but also mistrust and project breakdowns. The common reciprocal complaints heard were the Poles mistrusting the quality of their Indian counterparts’ contributions, and the Indians finding the communication style of their Polish counterparts overly harsh, at times even demoralizing.

Ironically, many of the India-Poland cross-border issues uncovered were reminiscent of what MFM had experienced in the early years of opening its India-U.S. collaborations. Then, as now, the data revealed that a profound lack of understanding was present regarding the local context of one’s cross-border team members at MFM, regardless of whether that team member sat in Poland, India, or the United States. And in the misunderstanding, judgmental stereotyping was running rampant.

If this part of the MFM case frames what it looks like when a company is operating without intercultural competence, what then does it look like with intercultural competence? Before we go further, let’s define, intercultural competence. LCW’s definition is: “The ability to navigate your
own and others’ worldviews (perspectives, interpretations) in ways that allow you and your colleagues to be more successful.” Looking at intercultural competence in this context, we see it as skill-based, long term in nature, and focusing on aptitude over attitude. When truly embedded in an individual or an organization, intercultural competence becomes sustainable and portable across contexts; once built it can be leveraged in any new cultures encountered.

Consider again MFM’s crosscultural experiences—first with India, and then during new experiences with Poland. When it first began operating in India several years earlier, MFM had experienced a series of crosscultural breakdowns between all its U.S.-India teams almost identical to the ones that surfaced years later between the Polish and the India teams.

After undergoing quite a bit of relational and business pain in establishing its India center, MFM realized it needed to build intercultural competence deeply into the organization. So MFM engaged its India-based and U.S.-based business leaders to help set strategic priorities in partnership with the company’s global chief diversity officer.

MFM worked at defining what cultural competence would look like for everyone, from individual contributors to project managers to people managers to business leaders in both the United States and India. A multi-stage framework for measuring culturally competent behaviors was also put in place, and members of these India-U.S. cross-cultural teams were prioritized for intercultural competence building initiatives as they were put together and launched. The result was a much improved atmosphere of collaboration for teams that held through all initiatives.

Ironically, this powerful lesson did not carry over seamlessly when the center was opened in Poland.  The Americans actually did pay attention to their own cultural competence in relating to the Poles, similar to the way they learned to relate to the Indian teams. But their blind spot was not taking into account the horizontal cultural dynamics between the Poles and the Indians.

Despite initially being caught off-guard, once it had its déjà-vu moment, MFM was able to quickly mobilize and leverage for the India-Poland team the cultural tools and frameworks built for and proven successful earlier for the U.S.-India teams. Precisely because MFM had already put these intercultural competence, tools, and processes in place organizationally, MFM was able to deploy its strategy for building intercultural competence with Poland much earlier in the lifecycle of that operation, and much more quickly, than was true with the launch of the India Center.

This shorter turnaround time for the Poland project resulted largely from  the portable nature and sustainable quality of the intercultural strategy MFM had built. The organizational frame for building intercultural competence was readily adapted to help MFM succeed with whatever “new” culture—in this case, Poland—it was now absorbing into the larger global operation.


When Corporate Culture Limits Possibility

February 11, 2014

By Rebecca Parrilla

Have you ever heard anyone in your workplace say that a new employee hasn’t been “your company name here-ized” or “your company name here-ed” yet?

Typically this is said when someone hasn’t been at an organization long enough to have learned its processes, protocols, key people, proper channels, important symbols, standard practices, how to win, how to fail, its unwritten rules…in a word, its culture (otherwise known as “how we do things around here”).

Now I don’t mean to badmouth corporate culture.  Having a strong culture that guides an organization, that engages its employees, and that delivers bottomline results obviously has numerous pros.  Look at Google, GE, Southwest Airlines, Zappos and many others who are known for both their strong cultures and strong financial performance.  So when we say that the new employee hasn’t been “your company name here-ized” yet – it’s usually in a well-intentioned and matter-of-fact spirit.   I mean, as employees of our organization, we usually prefer things to be “your company name here-ized”, don’t we? It’s what works, it’s comfortable, it’s been proven effective, efficient, and profitable.

So what’s the down side of assimilation into a corporate culture, especially when that culture is working well?

If you work for an organization that actively seeks diversity of thought, backgrounds, perspectives, and approaches to spur innovation and boost profitability – that means that you have diverse top talent knocking on your door.  But if our recruitment, interviewing, and evaluation process sends a message that if you want to be a part of our company you have to change to be more “like us” (the implication being, because our way is better) this may on its face invalidate your stated goal of increasing diversity!

And if you work for an organization that values inclusive behaviors and systems, and views inclusion as vital to employee engagement, then effectively telling your workforce that you have to be “your company name here-ed” to be real part of the team or to get ahead then you’re discrediting your stated goal of inclusion.

Many companies take this approach and verbalize it as “cultural fit” – the implication being, if you don’t conform to our culture you’re probably not going to feel very welcome because we’re not very open to different ways of doing things.

When it comes to the benefits and advantages of diversity and inclusion, most everyone is usually in agreement – until people who act or look differently (for example, have a direct or blunt communication style, wear their hair in dreadlocks, work less than 60 hours a week, text during meetings, don’t check their email on the weekend, or work from home a couple of days a week) are assessed to be ‘not a cultural fit’ and as such are shut down or shown the door. They’re being evaluated through a very specific corporate cultural lens and thus being evaluated negatively when they don’t conform.

So how do we balance a strong corporate culture with our strategic goal of diversity and inclusion? In other words, how do we inject intercultural competence to our own corporate culture?

We do it when our corporate culture truly supports diverse perspectives and approaches – when “cultural fit” in your organization means: “Don’t suppress who you are, keep doing what you’re doing, and also expand your options to give a chance to our way. We will in turn also expand our options to give your way a chance.” In this scenario, there’s a mutual adaptation to what’s great about each other.  There is the expectation that in the process of the person becoming “your company name here-ized” we’re willing to be OK with them disagreeing with some of the unwritten rules and OK with creating new ones. This is how we welcome and encourage the diversity of thought, perspectives, and approaches that will keep our possibilities unlimited and our people engaged.


Part 1 – Why Global Firms Need Cultural Competence

February 4, 2014

By Monica Marcel

The following is a 7-part series on LCW’s work with a US-based client, we’ll call MFM Inc., in identifying and mediating issues between two teams, one in Poland and one in India. This first post is a general overview of the teams and their issues.

MFM Inc. established a global research and customer service center in Eastern Europe with support from the few-years-old Indian center.  But it wasn’t ready for the breakdowns that proliferated between their Polish and Indian teams. The India-Poland teams at MFM partnered and shared in revenue goals as well as project deliverables. Over time, the myriad cultural misunderstandings emerging between the Polish and Indian team members led to missed deliverables and quality gaps that had customers complaining to MFM’s senior business leaders. Things got so bad, in fact, that on conference calls with the customer the Polish and Indian members of MFM openly argued with one another.

This was a case of cultural differences being much more than about dietary preferences between kielbasa or chapatti. In fact, the differences were so profound they went beyond interpersonal dislikes. The lack of understanding and the inability to manage the diversity of this global team was undermining the company’s ability to deliver on business promises.

Today’s wild economic globalization is generating hundreds of thousands of business interactions across cultures that are simmering under the surface or blowing up in major conflagrations. This is as true for U.S.- and European-based multinationals as it is for the multinationals rising out of the emerging countries.  Of course, diversity and inclusion strategies and practices come into play as D&I contextualizes itself to address global diversity issues. But, let us make it plain: Without intercultural competence to manage these differences, both diversity and inclusion and the business practices they are intended to support will fail.

But those who seize the need to build the intercultural competence of their employees and to embed it into their systems and processes will have a powerful competitive advantage. In the next post, I will explain the business case for intercultural competence, and how to go about developing it throughout organizations.