Managing Across Cultures

This is a book about managing across cultures: the threats and opportunities, the problems and possibilities. Rather than experiencing cultural differences as threats to be overcome or as unfortunate remnants of history to be endured, we challenge the reader to experience and enjoy the richness of cultural differences. Rather than creating a cultural melting pot, we need to design organizations as cultural mosaics in which each element preserves its unique value.\ Those concerned with managing across cultures are no longer just the jet-setting elite, the corporate trouble-shooters, and battle-scarred expatriates. International responsibilities and contacts are increasingly widespread through companies, and need not even imply international travel. The office of today (and even more so of tomorrow) consists of people of many different cultures working together. Appreciating and being able to manage cultural differences at home and abroad is becoming more and more a part of everyone's job.\ This book is not only for the novice preparing for the first time to jump into the sea of international business. It is also for those experienced swimmers who have ridden the waves and have battled the force that was trying to pull them under. Often the realization of the power of culture comes only in retrospect. Many of those who survived, and those who did not, can take this opportunity to reflect on their experience, to capture the learning so that it can be passed on to others.\ This learning can be used not only for helping to develop other international managers but also for helping teams and organizations to navigate better in global waters. Many experienced international managers are often quite frustrated with head office, and particularly Human Resource (HR) departments, in their lack of appreciation of what it takes to be effective in international business endeavors.\ In this book we draw upon a broad and growing literature on culture and management. Bringing together past observations and research, we discover national differences in management practice, which in fact, have attracted attention at different times in the international business community. For example, 'Japanese' emphasis on 'corporate culture' gained popularity in the 1980s as did 'just in time' and total quality management (TQM) in the 1990s. The 'American' practices of scientific management at the beginning of the twentieth century and performance management at its end have also been widely diffused. Indeed, in Europe, the current trend to implement performance management practices and to improve shareholder value is often critiqued and rejected as 'Americanization'.\ Given the dramatic changes in the ways of doing business, the economic and political upheavals, and the greater interdependencies called for in doing business across borders, there is the never-ending search for a 'new' model of management. Current contenders (in addition to the Japanese and American models described above) are the Chinese family business model for its use of networks, the 'northern European' model for its concern for employee and social welfare, and the 'Latin' model for its emphasis on flexibility and resourcefulness.\ However, rather than to name the winner in this 'best practice' contest, the book seeks to explore the cultural assumptions underlying these models. By exploring these assumptions we are forced to question to what extent these models can travel across borders. We have to consider whether these models should be introduced, if and how they have to be adapted, and to what extent they may even be refined and improved by local practice, thus bringing back to headquarters (HQ) something other than a contribution to profits.\ We need to recognize that these underlying, and often hidden, cultural assumptions give rise to different beliefs and values about the practice of management. These assumptions are also manifest in the behavior of managers and employees, as well as in our everyday working environment, from the design of the buildings we enter, the interior office, to the very design of job descriptions, policies and procedures, structures and strategies. We need to realize that these values and beliefs, behaviors and practices have different meanings making them more or less acceptable in different cultures. Different behavior and artifacts may be needed to produce the desired effect.\ Two potential traps in managing across cultures are to assume similarities and to assume differences. The first trap is often the case in British/American (US) collaboration, where shared culture tends to be overestimated on the basis of shared language, and perhaps even more so between North Americans: US and Canada. Also, managers who have been successful in 'dealing with the natives' on previous assignments in one part of the world may assume that the same behavior will be successful elsewhere. The second trap is to overestimate differences. For example, a German manager negotiating in Sao Paulo, Brazil, might assume that the culture will be very different, expecting a carnival atmosphere, having been briefed on Brazilian culture before leaving home.\ Our intent is not to rank countries on a set of cultural dimensions, nor to provide readers with handy tips for doing business in Paris or Tokyo. Arriving at headquarters in France, we cannot assume that because we are in a French company we can expect, for example, greater emphasis on formality and hierarchy. After all, this company may be atypical, or unique due to the influence of differences in regional (north versus south, Paris versus provinces), industry (cosmetics versus banking), corporate (marketing versus R&D driven), and functional (manufacturing versus finance) cultures. Culture can cut many ways. Rather than knowing what to do in country X, or whether national or functional cultures are more important in multicultural teams, what is necessary is to know how to assess the potential impact of culture, national or otherwise, on performance.\ With the aim of improving effectiveness in international business, this book focuses on national culture. Our purpose is to provide a framework for analyzing culture, a set of key dimensions which can nonetheless be used to diagnose culture in other contexts, as will be discussed in Chapter 3. The proposed framework provides a map, a guide, suggesting where to look, what questions to ask (how and of whom), and how to interpret the pattern of responses and observations. Only then can we x the implications for designing structure, strategy, and human resource management (HRM) and devise strategies to manage cultural differences as managers, as and as companies facing the challenge of globalization.\ While much has been written comparing management practice in the United States told Japan, we would like to focus mole attention on Europe. This is not just for the sake of Americans and Asians with an interest in Europe, to recognize the diversity within, but also for Europeans themselves, who often recognize these differences, but do not understand the reasons behind them and fail to consider the consequences.\ Furthermore, we draw upon our own experience of living with cultural differences on a daily basis, through either personal circumstances — born and raised in one country but now living in another, having lived with parents and partners of different cultural backgrounds, or professional circumstances — working at INSEAD (European Institute for Business Administration) and at HEC University of Geneva, where multiculturalism is a way of life, interacting with students, managers, and professors from around the world, and where multiculturalism is considered to be a competitive advantage. This experience has forced us to challenge our own assumptions, to consider how our culture influences our behavior, and to anticipate the reactions of others.\ As teachers and researchers in the field of cross-cultural management, we must constantly confront how culture influences our own work, and, in particular, the writing of this book. Our own cultural footprints can be detected in what follows. Sometimes we are aware of them, but not always. They are particularly evident in our prescriptions, such as the emphasis on the importance of self-awareness, the value of diversity, making culture explicit, confronting and negotiating differences, and looking for win-win solutions in responding to both global and local interests.\ For many, this book will seem too instrumental in stressing the impact of culture on the effectiveness of organizations and managers. The very notion that culture can be 'managed' is, in itself, culture-bound. For example, in discussing corporate culture, American managers tend to see culture as something organizations have; European managers are more likely to see it as something that organizations are and are thus more dubious about being able to change it. The American assumption of being able to control one's destiny and the propensity to take action have created quite a market for how-to, self-improvement books and for books about managing across cultures, like this one. For all our attempts at impartiality, our own American (US) and Anglo-French footprints can be traced.\ In writing for an international managerial audience, we are acutely aware of the conflicting demands and expectations of our readers. American managers tend to be more pragmatic, and want to know implications for action, 'what to do'. French managers want to know more about the context, including the history and theory behind these ideas. What British managers may recognize as an obvious implication for management, Americans may want more clearly spelled out. Thus we must navigate between the theoretical and the practical, the abstract and the concrete, the implicit and the explicit.\ Given our training and experience, as academics and clinicians, we are less interested in providing recipes of 'how to'. We believe that the insights derived from observing behavior, from questioning values and beliefs, and from challenging assumptions will better equip managers to think through the consequences of their actions and allow them to frame their responses and actions better within different cultures.\ The book is divided into three parts. Part I argues why we need to know about culture and provides a framework which helps not only to organize what we already know (previous cross-cultural management literature), but can also serve as a guide for how to go about discovering and analyzing culture. This framework can be applied not only to national culture, but also to other cultural spheres — regional, industry corporate, and functional/professional. Any business encounter, in effect, represents the interaction of several cultural spheres. This is particularly the case, for example, of strategic alliances where distant industry or corporate cultures, in addition to national cultures, meet head on. The challenge is even greater for the cross-functional teams charged with making that strategic alliance work! Managers need to evaluate the ways in which these interacting spheres of culture can provide a potential source of competitive advantage or disadvantage. Thus while our focus throughout the book remains primarily on national culture, it is important to keep in mind the influence of these other spheres. This helps us to appreciate better the differences found between companies in the same country, and/or in the same industry.\ Part II demonstrates how national culture influences management practice: organizational structure, strategy, and human resource management. Here we integrate the evidence from research in order to describe how these practices differ across countries and then to explain why — what are the possible underlying cultural reasons for these differences. We also discuss the implications of what these differences mean for managers and their companies, for example in considering the transfer of so-called 'best practice' across national borders, and in appreciating the potential value-added of alternative models, or other ways of managing.\ Part III focuses on how to manage cultural differences more effectively. Managers, teams, and organizations have to confront cultural difference, to learn from them, and to devise ways of utilizing them creatively in order to benefit from their potential value-added. Here we highlight the role of the manager and the organization as global citizens in creating a better world through economic development.\ Finally, it is important to realize that one's world-view is conditioned from a very early age. Try to remember the world map that hung on the wall in your school. How does that compare with the map shown opposite? Most likely it looks different. Most likely your country was in the middle, with the rest of the world distributed somehow around. The world seen through the eyes of an Australian or Korean, an Argentinian or Canadian, an African or Greenlander looks very different. Only by realizing that we cannot take our way of seeing the world for granted can we begin to recognize and appreciate how others see the world, and what that might mean for our working together.\ The book aims to develop the reader's understanding of how culture influences management practice and how managers perceive their organizations and their careers. It also raises awareness of how culture guides the way managers look at problems, the solutions they find, the way they deal with others, and how others may react. Besides providing insight into other cultures, it will provide managers with something more precious — an increased awareness of their own culture. Exploring culture is an exciting endeavor, as it involves a never-ending process of discovery. Not only is it the discovery of others, but in that discovery of others, a rediscovery of self.

PrefaceAcknowledgementsPt. 1The Meaning of Culture11The undertow of culture32Exploring culture203Interacting spheres of culture51Pt. 2Culture and Management Practice814Culture and organization855Culture and strategy1186Culture and human resource management148Pt. 3Managing Cultural Differences1837The 'international' manager1858The 'multicultural' team2169The 'global' organization25310Citizens of the world: business ethics and social responsibility290Index321