Where Are the Asian Business Leaders?

As Western multinational corporations (MNCs) turn to Asia for business growth to make up for weak economies in the United States and Europe, their challenge is not just opening up the marketplace. It’s also finding and building ranks of ethnic Asians who can lead within their organizations.

Powered by the twin engines of China and India, nearly every major global MNC from GE to Google is eyeing the region’s middle class and spending power. However, many global CEOs lament how few Asians they have in their ranks to fill top executive positions. According to a 2010 report by Leadership Education for Asian Pacifics Inc., less than 2 percent of all Fortune 500 board members are Asian or Pacific Islanders, and those numbers are similarly low within the executive ranks.

Western corporations have dominated the global marketplace for the last 50 years. Their financial strength, brand values, corporate cultures and global reach are far ahead of most Asian companies. Except for a handful of Japanese and Korean global names such as Canon and Samsung and some emerging Indian technology majors like Tata, few Asian corporations can claim to be global MNCs.

Western MNCs’ talent leaders consistently but quietly complain about the lack of leadership talent among non-Caucasians, even in Asia itself. For example, interviews with 83 human resources professionals involved in hiring the 3 million or more annual university graduates in China revealed that less than 10 percent of graduates were capable of working in an MNC, according to a 2005 report by McKinsey Global Institute and McKinsey & Co.’s China office. The report also highlights that of 75,000 globally savvy managers required by Chinese companies to compete in the global market during the next 10 to 15 years, less than 5,000 are available. In the six-plus years since then, those numbers have not changed as much as they likely need to. The shortage is coming at a time when MNCs need these leaders most as business expands and increasingly shifts to Asia.

Top of the Class
Asians often top the dean’s lists of Ivy League colleges, according to the book Top of the Class: How Asian Parents Raise High Achievers — and How You Can Too. Asians and Asian-Americans make up 4 percent of the U.S. population and 20 percent of the students at the nation’s Ivy League schools. They are 18 percent of Harvard’s population; 25 percent of Columbia’s; 42 percent of Berkeley’s; 24 percent of Stanford’s; and 25 percent of Cornell’s.
Despite being armed with the best degrees, Asians are often perceived to lack the “X” factor — the ability to communicate confidently, connect personally and stand out — and the global executive mindset needed for executive roles in MNCs.

“I can’t understand it,” said Pete Bassi, a retired senior executive with PepsiCo and Yum Brands who worked many years in international operations. “Asians have most of the attributes I looked for. They are respectful, hardworking and very smart. They just don’t have the confidence to stand out from the crowd and be visible enough.”

This gap appears to come from the same cultural norms that have contributed so much to Asian cultures and to the continent’s growing success in the global marketplace. Growing up, Asians are often taught to be humble, to listen to the teacher, sit and stay quiet. After a decade or so of such schooling, most Asians become naturally self-effacing without knowing it. The child who displays even a bit of swagger is often chastised by parents, teachers or peers.

Asians are taught to think carefully before speaking up, and to only speak when spoken to. Have something worthwhile to say. If not, be quiet. Asking a difficult question or challenging the norm is viewed as disrespectful or “not giving face” to the teacher or elder. Essentially, the cultures that emphasize humility, respect for elders, rote learning and academic grades appear to have led to Asians falling behind in the emotional quotient scale, especially in the MNC environment.

Further, many Western leaders have found that Asian managers often do not develop the leadership, communication and behavioral skills of their Western counterparts. They may stick to themselves, be unwilling to relocate or seem uninterested in activities that are part and parcel of daily Western life such as Little League baseball or soccer, the Super Bowl in the U.S. or theater in Europe.

Asians who are competent but perhaps not promoted quickly enough may ask, shouldn’t my work ethic and results suffice? The answer is no. John Staines, a senior global HR executive with several MNCs who has worked for many years in Asia, said: “Many Asian leaders need to learn to feel more comfortable outside of their home environments, and those that do can get to move ahead in large global corporations.”

How to Effect Change
So what do MNC bosses look for beyond technical competence and hard work? The answer can be found in this revised adage: “All roads lead to Rome. But away from Rome, Romans look for Romans.” Essentially, MNC bosses look for managers who can be a little gregarious, communicate effortlessly, take ownership of challenges and carry the organizational culture.

There are many Asians who have dispelled traditional myths around their self-effacing behavior. But a much larger cadre of confident and outgoing Asian leaders is needed to make an impact across cultures and in the boardrooms of major U.S. or European corporations. Those who do will have one immediate advantage: If an Asian manager communicates as confidently as a Western executive, the effect is often more pronounced because it is unexpected. He or she likely will be immediately marked as a leader.

According to research conducted in 2011 by Krempl Communications International with more than 100 Western corporate leaders, leaders want Asian managers who can:

• Instinctively lead and take ownership of projects and teams, instead of waiting for instructions.

• Take a position and articulate decisions effectively, not be a yes-man or yes-woman. Many cultures will respect a point of view held firmly even if they disagree with it.

• Build trust and influence at all levels. Be genuine and reach out to all types of employees, even the janitor — word gets around.

• Communicate clearly, spontaneously and confidently. Also, have something meaningful to say and say it with poise.

• Deliver direct feedback and disagree with appropriate assertiveness. Give an opinion if something feels wrong or inappropriate.

• Connect personally at all levels. Know how to develop relationships at formal and informal meetings; don’t just mix with fellow Asians; participate in local cultural or sporting activities.

• Willingly develop teams, share knowledge, and recognize and reward individual efforts openly. Be genuine in helping to groom junior staff and give them due credit.

Asians who work on these things need not fear losing their identity; they are developing dormant or underdeveloped facets of their personality and skill set. Asian leaders may need to be more outspoken with their Western colleagues to overcome preconceived ideas and perceptions. Diversity executives can help by encouraging Asian leaders to:

• Be willing to defend valid ideas without backing down or fading into the background.

• Be able to respond spontaneously to questions posed by authority figures.

• Mingle with the bosses when they fly in from headquarters.

• Inject a little more zest into presentations when addressing a crowd at corporate headquarters.

Asians can develop the global executive mindset today’s senior executives are looking for. But it takes effort to get out of the comfort zone and focus on new behaviors that will better enable corporate success.

Lai Kwok Kin, managing director for WeR1 Consultants Pte. Ltd, recounted a situation in which an Asian company that wanted to list on an international exchange had a costly delay caused in part by a senior finance manager. Technically competent but soft-spoken, the Asian manager struggled to handle questions on the fly from advisers and lawyers. The bankers feared he would fumble during investor road shows, endangering the deal. Earlier this year, the manager resigned; he could not handle questions confidently on conference calls with those same advisers. Because of that ill-timed resignation the company had to scramble to find a replacement, another Asian with more self-confidence, which delayed the IPO and created missed opportunities to raise funds.

Corporations may pay a heavy cost because of technically competent executives who lack basic communication and rapport skills with a wider range of audiences. Because of the rapid economic growth in the region, many Asian corporations and MNCs have been promoting people quickly to C-level positions based on the usual prerequisites around work experience and track record. But often, these executives lack self-confidence and the ability to articulate with partners, customers and investors at a time when their higher positions demand it.

Diversity executives have to direct efforts to develop high level interaction skills among top Asian talent. While most management trainees or mid-career entrants are recruited for their academic background of work experience, few are selected because of their personal verbal engagement skills. A focused curriculum on how to enhance one’s ability to hold an engaging conversation, or to speak off-the-cuff or draw attention instantly is required.

Second, there is a need to consciously train these executives formally and informally in the art of verbal sparring, or confidently debating diverging points of view. Further, they may need to address cultural blocks, many of which are roots of the problem.

In November 2011, when Asian leaders across the Asia-Pacific region at staffing provider Kelly Services prepared their final presentations on how their projects were going to help grow the business within their countries, almost all concurred that implementing their respective projects and obtaining initial results was easy. Even the presentation, for which they each spent a lot of time preparing, went smoothly.

However, during the Q&A session after the presentations, the lambs were separated from the lions. It was not how well participants prepared the slides and statistics, but how confidently they were able to respond to tough comments, divergent opinions and pointed questions from the senior executives that made the difference. It was immediately clear who would make it to high office or could be sent on the next challenging assignment.

The executive who can take the heat and parry tough questions with poise, confidence and even humor almost always gets the nod. This skill is not dependent on talent alone. It can be taught. With a little drill and practice, an executive who appears mediocre can be trained to sound and look confident. Instead of the stage being dominated by Caucasian peers, Asians also can stand out at the next global leadership meeting. If they are prepared.

Stephen Krempl is CEO of Krempl Communications International LLC, which helps clients work more effectively in MNCs. He can be reached at editor@diversity-executive.com.