Feb 01

Fortune Favours the Brave, but Global Leaders Need to Prepare

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As international companies face steadily increasing challenges from players in emerging economies, how can they ensure that they remain competitive? “Looking beyond the obvious: Globalization and new opportunities for growth”, a report from key business experts at Ernst and Young (EY), provides insights and recommendations on this topic.

In short, globalisation is changing; companies must understand the consequences and adapt to operate successfully in a world market, and global leaders who thrive at creating and leading culturally diverse teams will find greater long-term success by adapting their global mind-set accordingly.

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In the wake of the economic downturn in established markets such as Europe and the US and the slowing down of growth in emerging markets such as the BRIC countries, global organisations are operating in a world of increasing complexity, interdependency and risk. This environment requires businesses to become more resilient, and experts agree that business leaders need to be brave and consider the opportunities to be found in a growing number of emerging yet unpredictable markets.

So what has changed for leading organisations tackling growth in the globalised world? The EY report highlights that a shift has occurred in the relationship between the established markets and the emerging economies. An increasing number of companies from the latter group have now grown to rival long-established organisations on the world market – and across many sectors.

Examples abound in many countries. In Chile, LAN Airlines recently acquired TAM (Brazil) creating Latin America’s largest airline Latam Airlines Group. In South Africa, MTN Group has become Africa’s largest mobile operator. It has 183 million subscribers and licenses in 21 countries across Africa and the Middle East. In 2011 alone, about 60% of its revenues originated outside South Africa.

Key trend indicators also point to technology and the flow of ideas as the biggest game changer in the globalised market. Mindray is a case in point; they are China’s largest medical-equipment manufacturer and generate more US patents per revenue dollar than many global leaders. More than half its revenues of $900 million were generated overseas.

Another key trend is the steady increase in the flow of capital and finance out of emerging economies. Companies across countries as diverse as Indonesia, Mexico and South Africa are seeking to expand into the global market, and now have the capital to acquire businesses in established markets such as the UK, France or the US.

The global market is diversifying, and in order for companies to remain competitive, the need for their leaders to adapt in a rapidly changing global environment becomes paramount. Global leaders will benefit not only from an increased awareness of culture’s key drivers and their impact on doing business in other countries, but more importantly from adopting a fresh mind-set towards developing relationships with colleagues and contacts in a changing global market.

 

© Communicaid Group Ltd. 2013

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Jul 16

Implementing a Global 360° Feedback Process across Cultures: Will it Really Work?

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360° feedback is one of the most widely used performance management strategies in global organisations today.  In fact, research shows that approximately 90% of all Fortune500 companies use some kind of 360° feedback technique.  One of the fundamental objectives of any 360° feedback is to improve the individual performance of employees in line with the organisation’s global priorities and requirements.

The principle of running an evaluation process to review and improve an employee’s performance is an important one, however the way this process is carried out may or may not be effective depending on where and how it is implemented.  Organisations looking to harness the benefits of effective global leadership and management must consider the cultural factors that can negatively influence a performance management process of this kind.

Business Writing Viorika Prikhodko i Implementing a Global 360° Feedback Process across Cultures: Will it Really Work?

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So what is a 360° feedback process?

Before we explore what may or may not work across cultures, let’s first make sure we understand what a 360° feedback process is.  The process of using 360° feedback consists of providing an employee with feedback from different internal and external perspectives, in other words, it looks at feedback from a full 360° circle.  Each individual is objectively evaluated by colleagues both above and below their level as well as external counterparts to ensure a complete picture of their performance.

Once a combination of quantitative and qualitative feedback is collected, individuals will go through a series of review meetings to discuss the feedback and identify areas for improvement or reward.  During these 360° feedback review meetings the employee and their manager will share feedback, both positive and constructive, in order to highlight specific short and long-term actions to improve their performance.

What are the potential problems?

So what makes the implementation of a global 360° feedback process so difficult in a multicultural environment?

In many individual, task-oriented and egalitarian cultures like the US, UK, Finland or Germany, 360° feedback processes such as this can be very well received and effective.  In more collective, relationship-oriented and hierarchical cultures, this evaluation system is often extremely ineffective.  Although people from cultures like India, Spain and China will go through the process if required, the feedback collected and results of the meetings will not always be an accurate representation of the individual in question.

The assumption that feedback is welcomed and viewed as constructive is sometimes a one sided cultural perception.  In fact, people from collective cultures like those in Asia will often avoid criticism and refrain from negatively assessing an individual’s performances for fear of hurting the group harmony and causing loss of face.  This is particularly the case if the feedback is being requested by someone more senior than them, especially in cultures where hierarchy plays a key role in business and social interactions.

Asking for feedback from direct reports and superiors is just one cultural challenge of the 360° feedback process.  Sharing the feedback with the individual can be equally, if not more, challenging.  People from collective cultures like China may perceive the information as negative and embarrassing and may as a result feel isolated and depreciated in the workplace.  People from individually-oriented cultures like the US value honesty and since they believe that they have considerable control over their own behaviours and outcomes, they value direct feedback which will help them to improve their performance.

Cross-cultural challenges of 360° feedback

When you combine the potential cultural challenges of requesting and giving feedback with certain cultural attitudes without adapting the approach, you may waste considerable time and effort on a process that will not give you the desired results.

Here are two specific examples of how a 360° feedback process can be challenging across cultures:

  • Where the process is implemented directly from a culture like the US to a hierarchical and relationship oriented culture like India, you may have problems collecting valid feedback which is truly reflective of employee performance in that location.
  • Where the process is implemented between two people of opposing cultural approaches, such as in the case of a British manager and Thai subordinate, there is a risk of not only failing to collect legitimate feedback but also of causing offence and damaging the relationship.

How can we improve 360° feedback across cultures?

With the right cultural understanding and effective global leadership skills, there are many things that global managers can do to ensure the successful use of this evaluation system.  Here are a few simple ideas:

  • Amend the process so the upwards feedback is guaranteed to be anonymous
  • Make sure that you know what to ask for and be specific and clear in your requests
  • Clarify what kind of information you want to get and explain how you expect the feedback to be received or acted upon
  • Define the different grades on the scale to avoid initial misunderstandings and diverse interpretations
  • Ask your employees how they interpreted the feedback to check the accuracy of the assessment and whether the action plan correctly addresses the issue
  • Be a live example of how feedback should be shared and used

Despite the challenges that a 360° feedback process may present across cultures, organisations that take into consideration the cultural factors will see a significant difference.  Not only will they get the information they want but they will develop a pool of talented employees with a high level of performance and enhance positive interpersonal relationships among employees.  Considering how this process is impacted in a different cultural context will also help organisations to reduce confusion around expectations, motivate their employees’ professional and personal growth and improve everyone’s job performance.

Implementing a 360° feedback process can offer great results around the world, but only when culture is taken into account right from the outset.

© Communicaid Group Ltd. 2012

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Jan 10

Effective Global Leadership: Leading in Asia

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Asian countries such as India, China and Japan are fast becoming some of the most successful global players in international business. Not only have their businesses recovered more steadily from the challenges facing the global economy, but many have experienced higher growth and performance than any other region in the world. Many western businesses are now looking to Asian companies to see what they are doing that brings them such international success. In particular, there is an increased focus on those individuals leading across cultures as they are the ones making such immense strides in international business.

Asian Lantern espion i Effective Global Leadership: Leading in Asia

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What is it that makes Asian businesses and leaders so successful? In 2010 the Hay Group conducted a survey in which they gathered information from 1,827 organisations worldwide to try to determine what made companies or leaders so successful. Interestingly, the survey found that Asian companies tend to be more willing to implement new ideas or best practice and change the way the business functions.

Samsung, one of the most successful companies in Asia, runs a series of special programmes for the top leadership team on subjects such as art, music and history to transform their members into ‘world-citizens’. By focusing on areas such as these, Samsung’s leaders are developing a broader suite of skills and knowledge that they can tap into as they develop new strategies for the company to ensure they stay at the forefront of their competition.

This is also part of the overall attitude that Asian companies convey when doing business across borders. Organisations in Asia Pacific spend more time visiting and learning from their peers than their Western counterparts. This has a strong influence on the way companies in the region manage their own employees as well. The survey showed that Asian organisations tend to transfer this curiosity to their subsidiaries, give them more autonomy and accept their ideas more readily.

The openness to new ideas and ways of thinking is definitely one aspect that makes leaders in Asia increasingly successful, however some argue that their leadership style may not be that transferable when leading across cultures. The survey showed that about half of the Asian leaders from the top five companies in Asia prefer a directive and authoritarian leadership style which respects hierarchy. While this can work in some cultures, it can also have the potential of being counterproductive to the performance and innovation of the company.

Despite this leadership style, Asian leaders seem to have developed pivotal skills in establishing external and internal relationships that enable the long-term good of the company. For example, Indian CEOs manage complex webs of external relations with the media and government while Chinese CEOs appear to be experts in the concept of personal relationship building referred to as ‘guanxi’. The importance many Asian leaders place on personal relationships, such that legal arrangements come second, can be quite a different approach to that of many western leaders.

While Asian companies stand out in contrast to other global companies in their way of networking, they also shine in how they promote or reward their employees. This can help to explain some of the vast growth and success of these top Asian companies, however they need to be cautious as promoting employees too quickly might also turn out to be counterproductive when employees don’t experience any room to develop their competencies fully or learn new business capabilities.

The hunger and curiosity for new ideas and best practices seen in Asian organisations shows a unique management style which is often extremely effective. Though the authoritarian leadership style and approaches found in many Asian cultures may be perceived negatively in some cultures, their overall interest for innovation is something that more Western countries should be tapping into and also applying to their own styles.

When leading across cultures, particularly in markets such as Asia, global leaders need to understand how the approach differs and adapt their own style to find the best of both worlds. A combination of each cultural leadership style can give global leaders and organisations a competitive edge in this increasingly challenging market.

© Communicaid Group Ltd. 2011

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Dec 05

Effective Global Leadership – Have You Got What It Takes?

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In an increasingly interconnected and multicultural world, we are constantly challenged when interacting with individuals from different cultural backgrounds. Cultural differences can create significant misunderstandings and conflict that can negatively impact global business. However, cultural differences can also be a resource that can add enormous value to any global organisation. Effective global leadership requires a global mindset. In other words, effective global leaders have the ability to identify and successfully manage and harness cultural differences.

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Global leaders who demonstrate a strong global mindset will be better equipped to maximise cultural differences and perspectives which can lead to increased opportunities, value and innovation in their teams. As Jim Turley points out in a recent article in Bloomberg Businessweek about the ‘new global mindset’, “Developing an inclusive culture where all team members can successfully bring their perspectives to the table becomes essential. The research is clear: Well-managed, diverse teams will outperform homogenous teams.” Global leaders who thrive at creating and leading culturally diverse teams around the globe will find greater long-term success.

What is a ‘global mindset’?

A global mindset is what global leaders need to make the most of the cross-cultural diversity of both the company and of the global market where it does business. A global mindset involves three key characteristics: psychological, intellectual and social.

Someone with a global mindset will be passionate about diversity, enthusiastic about new adventures and capable of adapting in unfamiliar global environments. This motivation to try new things is helped by their existing intellect and knowledge of the cultures they are operating in as well as their interest and ability to constantly learn more about them.

Leaders with a global mindset have the ability to look at things from other perspectives and adapt their behaviour accordingly. This in turn helps them to effectively interact with culturally and linguistically different people through actively listening, showing them respect and empathy and building trust.

How do you develop a global mindset?

International exposure, internal mentoring programmes and cross cultural training courses like Effective Global Leadership all contribute to the development of a global mindset. Here are just a few ways you can develop a broader global mindset:

  • International exposure can be achieved through personal research on cultural subjects and world economic and political issues. Reading international newspapers, speaking to international counterparts and keeping updated about global issues can help you to better understand differences across cultures.
  • Short and long-term international travel can be a great way to develop a better understanding of the world. Keep your eyes open for new projects at work where you could get involved with colleagues or counterparts from other cultures. Organisations with a matrix structure or a wide global presence usually have plenty of opportunities for cross-cultural collaboration. Make sure the right people know you are interested in getting involved, either through formal or informal channels, and you never know what may come along.
  • Internal mentoring programmes are also a great way to get advice and tips for expanding your global mindset. Moreover, they provide you with the chance of meeting other leaders acting in a global environment who can share inspiring experiences that you can learn from.
  • A cross-cultural training course like Effective Global Leadership can also help you to develop the skills you need and build relationships with people in international roles. An Effective Global Leadership course gives you opportunities to develop your cultural knowledge and understanding to help you to face any cross-cultural challenge more effectively.

Stay ahead of the game and get involved at a more competitive level by working on developing your global mindset little by little. The combination of informal initiatives that take a few minutes a day with more formalised methods such as training or a mentoring programme can enable you to create a world of global opportunities!

© Communicaid Group Ltd. 2011

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