Understanding Cultural Differences for Today's Business Leaders

Understanding cultural differences is an essential leadership skill in today's business environment. Whether you're an executive traveling overseas to negotiate a deal, an expat managing a footwear brand's supply chain in a foreign country, or a team member working in an organization that fosters diversity, equity, and inclusion, it's time to up your knowledge and understanding of cultural differences. This tour guide brief provides real world examples of cultural differences so you come across like a cultured individual in today's global business environment.

Understanding Important Differences to Be Successful in Today's Global Economy

Ethics is critical to business, yet, ethical beliefs are different across societies because of cultural norms, political ideology, and belief systems.

When I arrived to India, I met a developer who was building schools to get children out of poverty; one of his schools actually sends kids to Harvard, so his model clearly works. Standing in the elevator, he reached into his pocket to show our group stacks of money while telling us that this money was going to be used to pay for the water system for his newest school, and that if he went to the local government for the permitting process, it would take years and the money would not end up in the right place. The question is, is this ethical? Should he go through the government process that would keep kids out of an education and out of a school with running water for years, or should he handle things as he knows in his culture to create the needed change in a country desperate for education at this level to transform the slums?

Boarding the plane, I set off to another destination. Visiting Thailand, one may wonder why there is a picture of a certain man in every local shop and board room of major companies. Well, that picture is The King of Thailand and his image is intended to reflect the country's devotion, loyalty and respect to the monarch. In fact, speaking out about the monarch will get you into big trouble, so don't do it. This is far different from America where memes are generated on social media to make fun of our political candidates without repercussion. When you understand Thai culture, you will also understand the importance of reverence, the deep respect for something. This is palpable when you ask for directions or help in Thailand, also known as the land of smiles.

This brings us to the importance of belief systems. What you believe in your short time on this planet is not the same as what others believe. Our belief systems are shaped by numerous things, including: religion, nationalism, social media, money, education, diversity, travel, mentors, personal relationships, family, security, law, spirituality, lived experiences, political ideology, and more.

We've seen how the American government goes to war when belief systems surrounding political ideology are at play, as was the case for the Vietnam War and longstanding treatment of Cuba. We've also seen how we turn the other cheek as people in Africa are killed daily without much intervention on our behalf. The American belief system, rooted deeply in the belief of freedom and capitalism, also has its challenges. In my hometown of San Francisco, we see how the laissez-faire mindset works as the homeless are walked by daily without much support from the multi-millionaires driving the new tech economy. While some view homelessness as a choice, there are many who are forced out of their homes through rising rents and other factors that are counter to the stronghold belief of the free market vs. that of a social democracy. In a nation with so much wealth as America, is it ethical to let those with less suffer because they aren't "strong enough" as other individuals to be afforded their liberty?

The American belief system has its pros and cons just like every other nation in the world; one must know how the system works in order to be successful.

Venturing to the land down under, Australia, I was shocked at the prices for a meal. $25 for a breakfast? Meeting up with my coffee friends, I griped and moaned a bit at the cost of things until I shifted my mindset back to that of the curious traveler to get out of the my country mindset so I could understand the differences. As a social democracy, you don't see a ton of mentally ill people harassing tourists like you do in downtown San Francisco, and I surely did not see tent cities in the urban core due to Australia's belief in the tall poppy syndrome, where hoarding wealth is frowned upon. What I learned is that everyone has access to healthcare, baristas make a living wage where they can buy a home, tips and tax are included, the food is cleaner given the access to quality foods and a smaller population, exercise is reinforced with public pools located on beautiful coastlines, and their advertising is downright hilarious.

You see, traveling will expose you to learn more about how others think if you put on the veil of ignorance.

Returning back to India, I was amazed at the noise, density, and poverty at the same time I was amazed at the energy, community, and vitality. Yin and yang.

Walking down the streets of Mumbai, my paramedic hat went on for a second as I asked "what happens if you need to call 911? I don't see many ambulances nearby or hospitals." My host laughed and said "Drew, we believe in Hinduism. We believe that this is not the final life, so we do not invest the crazy money you do into healthcare. If something happens you will go to the local clinic and hope they keep you alive in the golden hour. From there, they will get an ambulance and the doctor will go if they can. In America, you believe you only get one life until you go to heaven, so you put a lot of money into staying healthy for this one time. We do not live in the same fear that you do about life and death."

Traveling can be scary for business leaders who have never left the country. They often cling to fear based "facts" that are simply not true. While healthcare is vastly different across each country, developed nations will keep you alive. A great way to look at things is to look at the average life expectancy where you will notice, the United States does not even come close to the Top 10. While our people are living longer, we are not living healthier lives because stress, rooted in our belief system, is killing us as we trade off quality time for capitalism's sense of urgency.

Meeting travelers from Europe, I learned that they work for some of the same corporations we have in the United States, yet, they receive one month of holiday compared to our two weeks vacation. Work is work, my friends and time is our greatest gift. Knowing this made me stronger for my next job as I negotiated from a better lens.

Holding hands with another man, I was walked across the frenzy of a busy Indian street. Back at home, people would have mixed emotions, while in India, it is perfectly normal to see men holding hands as they walk the town showcasing genuine care.

Grabbing a cup of coffee with my Brazilian friends at a coffee conference, I offered the standard American greeting of a handshake and was also given the unique Brazilian greeting of a light kiss on each cheek. Whoa! Hold it, a kiss? Yes, it is harmless, yet if one does not know about things like this, or if it is the first time, things may arise like "oh no, my wife is going to kill me!" Well, your wife might kill you, but just know this is perfectly normal in Brazilian culture and no way does it seek to destroy your personal relationship.

Reading is key to becoming a well informed business leader, and knowing the works of Geert Hofstede is critical to doing business abroad or managing teams from different cultures. Hofstede's theory identified six dimensions of culture, which are power distance, individualism vs collectivism, uncertainty avoidance, masculinity vs femininity, short-term vs long-term orientation, and indulgence vs self-restraint.

From a management perspective, it is important to know about these areas. You can compare countries to learn more about each culture in order to have effective communication across multi-cultural teams.

In looking at the Power Distance below, we see Saudi Arabia is at the highest, meaning people are largely uncomfortable speaking directly to authority and may be limited in their ability to offer direct criticism compared to their American counterpart who has the lowest Power Distance ranking, making them more comfortable with challenging authority.

In looking at masculine vs. feminine values, this research compares a nation's driver of competition vs. care. When we look at South Korea, we learn that Koreans value quality of life in comparison to Americans value independence and standing out from the crowd.

Long-term orientation is also driven by a nation's collective values system, and we see that in Asia, there is more focus on steady long-term growth compared to quarterly results that must be delivered in American businesses that report to Wall Street.

While managers use numerous tools from Success Factors to DiSC assessments for sales teams, it is critical that global managers learn how to use this information to develop high-performing multi-cultural teams. While the challenges of running a global business can be tough, today, it is easier to understand our differences and ways we can learn about each other to have rewarding relationships aligned with our goals.

I hope this overview on understanding cultural differences sparks a conversation within your circle on ways you can seek to understand others at a higher level instead of reacting with biased views.

There are billions of people on this planet with different beliefs in our limited time that we are present in this exact body, so do you, and get to know why other people think what they think. You'll be surprised at the growth you'll achieve as a leader with this approach to understanding other humans!

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© 2019 by Drew Aversa