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Managing Across Borders

Failure to manage projects involving global employees and customers can cost millions and drive talent from the corporate ranks.

January 1, 2007
Related Topics: Strategy and Management
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As recently as a decade ago, only a fraction of the American workforce participated in international work teams either virtually or through expatriate assignments. Today, just about every organization faces global integration.

Foreign employment by U.S.-based, multinational companies has grown at a faster rate than their domestic employment, and foreign-based multinationals increased their employment in the United States by 3.1 million from 1998 to 2002.

Think this global-work trend doesn’t include your organization? Think again. Do you have suppliers or customers in a different part of the world? Do you outsource some services to another country?

With technology you can be a “global worker” without ever leaving your hometown. Failure to manage projects or processes involving global employees, suppliers and customers easily can cost millions and derail careers while driving promising talent from the corporate ranks.

It would be easy to assume the best candidates for global assignments would be those whose who are open-minded and accepting of other cultures. Except, as the song says, it ain’t necessarily so. While being open might make the experience more enjoyable, it does not necessarily lead to greater effectiveness in global assignments.

That surprising finding came to light in a far-reaching, five-year study by Personnel Decisions International (PDI) that explored the personality traits that characterize managers and executives across the globe. The study set out to discover the fundamental personality differences that often lead to miscommunication and misperceptions among members of cross-cultural teams.

My own curiosity on the subject arose when I was working with a client in Saudi Arabia in 2000. Before going there I dutifully studied “The Rules”: Don’t cross your legs. Don’t pass things with your left hand. Expect to be kept waiting for every appointment. I felt confident that my own tolerant, flexible nature, plus knowing the rules would prepare me for a successful consulting engagement.

Yet I was disabused of the importance of these “rules” when each was violated by the hosts during my first morning there. It was then I learned that cross-cultural engagement involved much more than minding your manners or adopting a “when in Rome” attitude.

The research team at PDI followed up this hunch with a major study of the issue. Over five years, we collected global personality inventory data from more than 12,000 managers and executives who worked for our clients in 12 distinct locales: the United States, Canada, China, France, Germany, Hong Kong, India, Japan, Mexico, Saudi Arabia, The Netherlands and the United Kingdom.

It was the industry’s first long-term, cross-cultural research on leader personality traits, and it yielded some important insights and some directions for further analysis.

We found, for example, that the corporate world might be placing too much blame on family conflict for all-too-common expatriate-placement failures — what appears to be a family’s inability to adjust might in fact be more about a poor, but preventable, personality match between the breadwinner and the assigned workplace culture.

It’s not hard to imagine how an unhappy, frustrated employee thousands of miles from the home base could begin to experience family stress.

• Personality fit is crucial – Because few “global” workers receive any training, and the nature of ad hoc teams is that they form and disband quickly, most organizations, without realizing it, are placing more emphasis on the personality traits of their employees. Measuring personality traits and using those data to drive selection, placement and coaching/training decisions yield much better results than “gut” decisions.

• Two personality factors are key – Our research indicates two of the “Big Five” personality factors are of primary importance:

Agreeableness and emotional balance account for 85 percent of the differences among managers and executives across countries. Unsurprisingly, perhaps, Japanese and Saudi managers and executives tend to be high in agreeableness (that is, they place a high value on maintaining group harmony), while Germans and Dutch tend to score at the opposite end – indicating they value individual expression and directness. What might be surprising is that Japanese managers and leaders are at the low end of the emotional balance scale, meaning they feel significant highs and lows, even though they don’t express the feelings, because of cultural norms.

• Success factors vary by culture – Executives and managers vary greatly in how they define successful performance based on their predominant culture. For instance, whereas managers and executives in the United States value equally fundamental (basic blocking and tackling), results-oriented and business knowledge leadership styles, their counterparts in India express a clear preference for business knowledge leadership, followed distantly by results-oriented leadership, followed more distantly still by fundamental leadership.

The implications for organizations hoping to send a U.S. executive to India are clear: Send the person with the strongest business and technical knowledge possible — definitely don’t send a generalist with strong basic skills but not specific business or technical knowledge/expertise.

Data are critical – Sound data from personality and competency instruments can drive better staffing decisions. Core competency as a business leader is necessary in every culture, but it needs to be paired with personality analysis through validated tools for predicting the ability to work quickly and productively with people from other cultures.

As mentioned, PDI’s testing instrument in this study focused on the set of personality dimensions often called the Big Five: openness, conscientiousness, extroversion, agreeableness and emotional balance. Their definitions and relative importance for the study purposes follow.

A reminder: None of these traits is “good” or “bad,” per se. Nor is a low scoring on one a negative indicator

 

— it’s just a descriptor. One person’s reserved, diplomatic manner, for example, might be another’s aloof, “hard to read” quality. A person who is forthright and candid to some might be regarded as rude and pushy in a different cultural context.

 

“Big Five” Personality Dimensions
Openness: Tendency to seek experience and novelty versus adhering to status quo. Doesn’t predict who is effective in other cultures or distinguish managers or executives by culture.

Conscientiousness: A preference to be diligent, persistent and focused on deadlines versus being spontaneous and unconstrained by goals. High conscientiousness is common among virtually all managers and executives and is part of high performance across cultures. For that reason it isn’t particularly helpful in distinguishing cultures.

Extroversion: Extroversion does not equal sociability here but instead refers to a tendency to seek out others’ data and insights in problem solving, such as brainstorming, versus a preference for closing the door and working solo on an assignment. Significantly more common among executives than managers in the countries studied except for Germany and China. In China both managers and executives tend to be introverts.

Agreeableness: The tendency to seek harmony and put group needs above the individual, versus a preference to put the individual’s needs above those of the group. Matchups on the agreeableness scale turned out to be a critically important dimension in successful staffing in countries where those traits reflect cultural norms.

Emotional Balance: The tendency to have quick and deep emotional reactions to events (e.g. peaks and valleys) versus the tendency to have muted emotional responses and a calm emotional comportment. This is not emotional expression (which is often a cultural characteristic) but emotional feeling. Emotional balance joins agreeableness as the most salient of the Big Five in sorting candidates for best fit by country.

PDI’s large pool of test data across the 12 nations enabled researchers to build a personality “map” based on their respective scores. Emotional balance is mapped on the vertical axis and agreeableness on the horizontal axis.

The low end of the emotional balance scale represents the “peaks and valleys” emotional reaction, while the high end indicates the “emotional calm” reaction. The low end of agreeableness represents the “value individual over the group,” while the group is more valued by those at the high end of agreeableness.

 

The following is a snapshot of some interesting findings:

• The Netherlands and Germany score highest on the emotional balance scale, meaning their employees have steady emotions. To some, this means they are predictable and not easily thrown off course. To others, they are unfeeling.

• Japan and Saudi Arabia score highest on agreeableness. This means their employees will put their own emotions aside for the sake of the group.

• Mexico is an outlier, scoring low on both agreeableness and emotional balance, meaning there is a tendency for its employees to both speak their mind as individuals and stress group cohesion through a preference to hear out others as individuals.

The real power in creating this map is giving HR managers a quick and powerful visual representation. A candidate who scores in the upper-left quadrant, for example, might not be the best bet for work with Saudis or Japanese, just as a person who scores in the lower-right quadrant might be taken aback by the direct manner of managers in Germany and the Netherlands.

Where the gaps are less extreme, HR might want to expose the selected candidates to training aimed at reinforcing what the destination culture would regard as their strengths and their awareness of where they might rub their new co-workers the wrong way.

If they’re going to Japan, for example, they might need special coaching on alternatives to confronting colleagues when they’re unhappy.

It also would be ideal to train the workers in the destination country or other members of the cross-cultural team in each other’s tendencies. Everyone should recognize that troubles often arise in these situations because of personality-based perceptions rather than substantive business issues.

What is the Next Step?
Clearly explore the potential for identifying in-company cultures. If companies have a large enough staff and sufficient data on their employees, it might be possible to identify a corporate culture and to staff accordingly.

In the old days, for example, it was believed that IBM employees were more like one another than the people in their respective countries.

Now we have the capability to verify that information. And, if it’s deemed optimal to achieve a preponderance of “XYZ culture” in a workgroup either on location or virtually on a project, that can be done.

It’s a powerful new tool.

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