How to Navigate Cross-Cultural Differences

Q & A with Prof. Yih-teen Lee

18/11/2013 Barcelona

Yih-Teen Lee

In today’s global world, international mobility continues to be on the rise. The process of building the cultural competencies necessary to manage an international career or a cross-cultural team can be a tall order, even for the most experienced managers.

Yih-teen Lee, Associate Professor of Managing People in Organizations, helps executive education participants navigate the complexity inherent in cross-cultural management. Together with his extensive research on leadership in multicultural teams, cross-cultural management and HRM selection and training issues, his own global trajectory – from Taiwan to Spain through Switzerland and France – gives him particularly keen insights to share in the classroom.

He speaks to IESE’s Impact@Work about issues relating to fit that HR managers and potential hires should keep in mind before extending or accepting an offer.

Q. What key issues surrounding the concept of fit should hiring managers take into account?

First of all the term "fit" itself has multiple dimensions: person-job, person-supervisor, person-group or person-organization. When formulating an overall feeling of fit, individuals have expectations and demands along each of these dimensions, with more or less weight given to satisfying a dimension based on their culture.

Speaking generally, we can think about the different expectations of a potential hire from a collective versus an individualistic culture, or how comfortable or uncomfortable an individual might be with varying power distance.

For example, a job candidate from North America might determine his or her fit with a job based on whether they possess the appropriate skills, attractive compensation and the possibility of promotion. For this person, these factors often outweigh a positive dynamic with their group and the supervisor or identifying with the organization’s values.

On the other hand, the fit criteria for someone from Asia is inverted: If they don’t fit in with their supervisor or peers, they may feel like something is amiss, in spite of ideal skills and competencies to carry-out the jobs demands.

How people react to their fit or manage it also varies based on culture. Do they change jobs or do they modify their expectations? When it is the former, there are important costs for the employer. Hiring systems that take the impact of culture on various dimensions of fit into account are generally more successful in recruiting shoe-ins and avoiding high turnover.

Q. Do companies actually use cultural criteria in their hiring processes and training programs?

Some companies are indeed beginning to do so. In fact, we are now starting to see the use of frameworks such as cultural intelligence (including metacognitive, cognitive, motivational, and behavioral dimensions), global mindset (including intellectual, social and psychological capital) in assessing and developing executives with international responsibilities.

Though some companies are doing better in selection by using these frameworks in combination with other practices, we find that there is still somewhat of a gap in training. Even large MNCs have not yet integrated effective training for their employees on foreign assignments. A bit more work in this area could reduce the struggle and allow the employee to become more effective more quickly.

Q. What would a more effective cultural training program look like?

Ideally, training should have two parts. The first would be general cultural awareness and the techniques necessary to navigate in any new environment. The second part would deal with the cultural aspects specific to the employee’s or new hire’s destination or placement. Best practices would combine both, and sort of teach the employee "to fish" rather than just giving him or her the fish.

Q. Executive education participants often come to IESE with quite a bit of international experience. What are some of the challenges they face in leading multi-cultural teams or managing cultural differences, despite their global exposure?

Executive education participants generally have three interesting challenges in this realm. The first is when the cultural complexity goes beyond a bi-cultural situation. This type of situation is, for example, a French manager working in Spain where most of his team or group is Spanish. He or she must only navigate the differences between two cultures and can adapt him or herself to the host country.

A larger challenge arises when he or she finds that they need to manage multiple cultural differences on their team, often times virtually as much as in the office, or that they are in a matrix organization with no clear lines of authority. Here, satisfying multiple differences is a huge challenge, and especially, learning the cultural skills necessary to influence people of diverse backgrounds and varying expectations.

The second challenge comes when someone is already quite worldly but they are over-confident about their ability to navigate different cultures. Often times they are not aware of their own cultural constraints and barriers and need to learn to be more mindful and insightful of the complex myriad and subtly of cultural differences.

Finally, the third challenge is quite the opposite. In other words, the manager is already culturally savvy, but they are in awe and overwhelmed by the complexity in multi-cultural contexts. In other words, the more they know, the more they are aware that they don’t know. They need some solid tools to gain confidence and navigate in new contexts.

Q. What sort of insights do you offer in your courses that can help them succeed in getting the most out of their teams on the job?

In my courses, I try to give students certain insights that they can continue to develop on the job. Not only do we bring into their awareness the fact that cultures differ and these differences span a range of interpretations about roles and concepts (for example the expectations of a "leader" and the term "project" have varying meanings), but that these differences have an impact on management.

I also help them to develop deeper cultural knowledge beyond business etiquettes and dos and don’ts. While it is hard to teach the gray areas of cultural interpretation - these you often need to experience - we can and do address concrete issues such as history, differences in labor, etc. In addition, we discuss cultural knowledge such as the new, abbreviated "generations" in China, where attitudes shift every 10 versus every 20 years, and how these create part of the mosaic of historical and cultural roots that influence institutions and ultimately business interactions.

Finally, what many participants come to class wondering is how to adapt, and who should adapt to whom. Well, it certainly depends on the situation, and we discuss how to use a better understanding of culture in the context of management to assess each situation.

Q. Are there any specific characteristics that help leaders fit in a global role and achieve corporate success?

Research is ongoing in this area. We are exploring how leaders need to focus not only on others and how they are different, but also on developing an internal sense of self. This is crucial to their success on the job. Possessing a greater awareness of yourself is particularly important when it is not just a country manager in a bi-cultural situation, but in a multi-cultural situation where he or she needs to learn to connect with people from many different backgrounds.

Some research suggests that bi-cultural marginal - the "culturally homeless" who have lived in more than one culture but don’t identify with either - may be effective at leading multi-cultural teams. Often people who possess this background have the ability to project cultural neutrality, something that is very effective when leading multi-cultural teams.

Carlos Ghosn, CEO of Nissan-Renault, is an excellent example of someone who embodies this ability. He is French-Lebanese-Brazilian and was accepted in Japan because he is not perceived as being from one specific culture.

But not every successful global leader has been brought up with two or more cultures. Some have learned to achieve the cultural neutrality to interact as cultural insiders by working on their sense of self, and identity structure.