This paper, written by Filip Moriau, looks at ways to build and scale a company culture, and then apply this to an international team. To do that we need to understand the deep-felt needs of team members, and how they perceive colleagues from other cultures. How do we resolve negative feedback?
We end by examining the role that HR can play in retraining people to avoid common pitfalls, such as ignorance, apathy and malice. And how the company can facilitate, organize and accommodate upcoming internationalisation.
1. How to manage International Diversity in your Team?
International Diversity is a given in today´s business world. Successfully leading and managing a team composed of people from different cultures or simply doing business outside of your own country requires a new management approach. It requires a style and sensitivity of unfamiliar methods and ways of thinking. Understanding and embracing those cultural differences provide an opportunity for broader thinking and alternative management solutions that may enhance your overall performance and the performance of the team.
Different cultures apply behavioural and organisational codes that are not written in any document or explained to the outsider. Consequently, the coding of cultures as well as the de-coding take tremendous time and effort. Yet, they have a huge impact on the business as they can make or break a deal and can make you successful & integrated or locked out & isolated from a culture when not properly understood.
2. How to internationalise your workforce?
Internationalising your workforce is a practice that has been aimed at for a long time now. Preparing your staff to interact internationally and with people from other backgrounds is well documented. Yet how to internationalise your workforce is a deeper dimension. Not only does it require preparing people on how to interact with others from a different background, with varying degrees of similitude to the way of working they are used to within their own culture. It goes beyond that. It requires workers to embrace those foreign individuals as their equals, their colleagues, making them part of the same team. Yet the behaviours of these individuals may be mutually difficult to understand. The differences may blur the similarities and peer pressure within one culture or another may make it impossible to create a `one team’ approach.
Consequently, in how to internationalise your workforce, a number of key elements should be looked at to guarantee the highest possible success rate in the internationalisation process.
The first basic question is how to organise the organisation itself. Perlmutter’s (1969), Bartlett and Ghoshal’s (1989) classifications of subsidiary building in ´The Tortuous Evolution of Multinational Enterprises’ provide a good insight:
- ethnocentric, global strategy: control is centralised and subsidiaries resemble the parent company;
- polycentric, multi-domestic strategy: control is decentralised and subsidiaries conform to local practices;
- geocentric or region-centric, transnational strategy: subsidiaries and headquarters alike adhere to worldwide (or regional) standards as part of the organisational network.
Put more simply.
These forms of organisation therefore foster different mindsets and lead to a different type of internationalisation and, ultimately, a different organisational culture. During the ongoing process of internationalising your workforce, Management needs to make choices on how to approach the design of the overall structure and HR Practices as clearly described by Taylor in the Academy of Management Review in 1996:
- adaptive: low internal consistency with the rest of the firm and high external consistency with the local environment – little transfer of practices;
- exportive: high integration of subsidiary HR Management systems across the company – replicating practices developed at head office;
- integrative: substantial global integration with an allowance for some local differentiation – two-way transfer of HRM practices between HQs and subs.
This choice is often a hard one to make. Management often doesn’t consciously opt for one but just stumbles into the internationalisation of their workforce through growth. In many cases, this process is driven by immediate needs and business factors that push the organisation into a certain form of internationalisation. The business develops and the workforce is hired in ways that practically support the business. Often only at a later stage, Management starts wondering if the organic internationalisation fits the organisational strategy and what the strategy regarding the internationalisation of the workforce should be.
3. New role of international HR-manager as a ‘cultural’ agent.
Toward Maturity, a UK based organisation focused on research in Learning & Development (L&D) published an interesting report in 2015 about “aligning learning to business”. Towards Maturity have been digging deeper into the behaviour of the top learning companies to isolate 7 habits of highly aligned L&D teams:
1. Actively involve business leaders in learning decisions
2. Use strategic business objectives to determine learning priorities
3. Focus on the end result
4. Integrate with HR and talent strategy
5. Demonstrate business value
6. Ensure staff understand their contribution
7. Enjoy proactive management commitment
This need for alignment is clear for the L&D function but can be extended to HR as well. The role of the HR manager is changing all the time, and will only accelerate as HR tries to keep up with what CEOs expect HR to do.
It is here that the role of cultural agent comes into play. A trend that is becoming very clear is the need for HR to play a significant role in the globalisation of business. By showing personal insight into how global teams can be integrated and being close to the workforce cultures they can help the business to understand how the workforce behaves or what impact this behaviour may, in turn, have on the business.
Globalisation is one of those areas where a deep understanding is needed of how the workforce reacts to global change. As different departments integrate, employees suddenly receive input from colleagues a thousand miles away and this can be destabilising if they don´t recognise the input they’re getting or if it’s unfamiliar from a cultural perspective. HR could contribute by analysing & assessing these social and people trends. If they work closely with the business they could alert the business to when integration is taking place in the right way or when it is insufficient. They could pinpoint stresses inside the organisation based on current integration status and recommend programmes that alleviate those stresses and further the process of internationalisation.
Management sometimes may see internationalisation as a matter of adding numbers into a spreadsheet, but HR can make a difference by bringing the ‘people factor’ into the discussion. It may require more investment in training & development in cross-cultural communication programmes or merely a cross-cultural team discovery to see who is out there, what the values are by which these teams operate and how they can merge their competencies together into a truly global and aligned team.
At first, business may think this doesn’t really matter and see it as an expense rather than an investment so it may be up to HR to make it really matter to the business, by showing how it can increase employee buy-in into the internationalisation. Often small programmes fostered by a local HR Manager and sponsored by local business management make such a difference that they are re-implemented in other parts of the organisation as we can read in Bob Sutton & Row´s book[ii] “scaling up excellence, getting to more without settling for less” so they can be implemented on the front lines.
“An obvious condition to scale excellence is to have excellence to scale”, according to Sutton & Row. So projects need to show they are excellent before they are singled out as the right projects to scale. This is sometimes misunderstood by HR Managers who think about scaling massive programmes quickly across the organisation and overlook the need to get the buy in across the different departments and geographies. In scaling internationalisation, this is a key point to keep in mind. In addition, just making a rational argument to spread good projects is usually not enough. Sutton & Row talk a lot about the importance to get emotional arousal or excitement around scaling projects. For internationalising teams, this is even more the case than for local projects as the initiator of the project may not be sitting in the same office so the project may suddenly look intangible & far away. For the HR Manager to successfully scale projects, this excitement may be the key to success for international teams to work effectively.
4. How to manage an international team?
In managing an international team, various strategic questions pop up. We will look into how we could develop strategies to answer these questions.
Globalised businesses often face an uphill battle to adapt the organically grown structure into a global business with truly international teams that uphold the business´ global standards in all its geographical locations.
In the SHRM Workplace forecast of 2013, “Increased global competition for jobs, markets and talent” had become priority issue number 3 from not even showing up in the top 10 the years before.
It therefore becomes apparent how important managing international teams is becoming in today´s fast-moving business environment.
So in essence, managing an international team is not only an HR responsibility but a responsibility across the entire business that HR can help to address. How could this be done?
We find some insight in Anthony Tjan´s book `Heart, Smarts, Guts & Luck from HBR Press in 2012 which describes a number of interesting actions an organisation can take to scale a business internationally and foster a global cooperation culture.
One thing that becomes apparent is the need to embrace people at the front line who act like cultural ambassadors. In a further HBR article on ‘six rules for building and scaling a company culture’ Tjan points out:
“Every organization I’ve worked with has people throughout the employee base who are unsung heroes of brand and cultural ambassadorship. These are people who love the company and its core purpose. They are your best cultural cheerleaders. They may be the folks on the shop floor trying to solve a product issue, an assistant talking to countless stakeholders, an analyst crunching the numbers, a customer service rep empathetically talking with customers, or a mid-level manager developing other people every day. When they tell friends and family about where they work, they don’t talk about a workplace but a work story, with a voice that comes from the heart. You know them when you see them, but as a company grows, it can take more effort to identify them. Do you know who these people are? Have you rewarded them and thanked them? At a time when outsourcing functions such as customer service or automating checkout procedures are becoming more common, the role of frontline cultural ambassadors does not diminish, but rather disproportionately increases and can become a real competitive advantage.”
In the end managing an international team is about having the right culture, and having the right culture is very much about people and character. We can have all the processes we want in place, if we don´t have people who can think outside of their current home thinking, we are bound to run into cultural misperceptions and misunderstandings. Consequently, when managing an international team, recruiting the right people onto the team is essential.
As Tjan points out “When recruiting folk, spend more time screening for character than you do screening for skill. While skills can be learned, it is much harder to cultivate attitude and character.
Whether you are hiring based on competency or character, remember that A’s will always attract other A’s — but B’s will attract C’s. Bottom-line: be super greedy with the talent you bring in to make sure you get the A players. Compromising on talent that is good enough but not necessarily the best you think you can get, especially in pivotal job roles, is a sure formula to short-circuit your own culture and long-term performance. Once you’ve hired the right people, treat them right. The best long-term retention strategy is to mentor people toward meaningful roles. I’ve found that what matters more than any extrinsic rewards — like compensation and title — is pushing and developing people towards their full potential.”
Once the team is in place, managing it becomes a key task and not something to do on a side. It means spending enough time and effort in being in touch with the team members and organising things so that the team members can also work together and transfer skills to each other in peer to peer learning. Often this last element is overlooked and the organisation organises the interaction focused on team leader to team members interaction and team group interaction, underestimating the value of peer to peer interaction within the team.
Research has shown that this interaction is actually very valuable and can be a key differentiator in team dynamics, especially when the team is international and working across different locations.
Author and Professor Mary Shapiro refers to this research in her work at the Simmons Business School when she mentions the difference between task goals and process goals. We think and talk about the metrics of success that are focused around the outcomes. We think about deadlines and what we want to accomplish.
We don´t usually spend a lot of time on how we are going to accomplish that. Process goals are about describing the types of relationships the team members will have, how they will interact with each other and how they will cooperate to reach the task goals. An example of this would be how the transferring of skills will be organised within the team.
So, by organising the process goals, by discussing and describing them, it becomes clear how the cooperation within the team will be organised. Different cooperation styles will come to the surface allowing the team and the team manager to discuss and decide on cooperation styles.
Hence, organising the process goals and having the conversation about what cooperation styles will be used to accomplish the team tasks are a key element of a team´s success. All of this is especially true of international teams as they have to overcome the geographical distance and cultural gaps that may exist between them. In order to avoid the ´us versus them´ thinking, having process goals and discussing cooperation styles are key to the success of managing an international team.
1. Leadership as crucial factor in an international workforce and the role of HR herein
Leadership is a crucial factor in managing an international workforce. It is a crucial factor in managing a workforce in general, but even more so in an international setting for some of the reasons we have already discussed in the other items above: geographical distance, the risks of cultural misunderstandings & misperceptions in a situation where there is a lack of leadership and so forth.
Roger Schwartz gets to the bottom of this in his book `Smart Leaders Smarter Teams’ in which he describes a situation with a lack of leadership or rather a failing mindset from the leader of a team which he calls ´unilateral control´. This mindset as described by Schwartz “is one in which a leader attempts to make others do what the leader wants them to do – unilateral control. Leaders think they’re acting in the best interests of their organization. Yet unilateral control consistently generates sub-par results.”
So this could even be seen by some leaders as a sign of leadership as Schwartz points to the fact that “unilateral control is especially vexing because most leaders are not consciously aware that they’re using it. And while unilateral control behaviours are sometimes blatant, often they’re subtle”.
Roger’s leadership solution is what he calls “Mutual Learning, a comprehensive approach that enables leadership teams to get to the heart of their toughest challenges. Mutual Learning is based on five core values that are common sense, but not common practice. These values fundamentally change the way the team thinks and acts and the results they get. The values are:
- Informed Choice
A key element, especially in managing an international team, is the value of curiosity as leaders often have less difficulty in being transparent than applying a value such as curiosity.
They are often not very interested in how other people think. Yet this is the way a leader can find out what the team members are thinking, what is on their mind, how they function, what motivates them. Leaders need this information to build and adapt their team strategy so without curiosity, the strategy is at risk.
Curiosity means the leaders need to replace ego with empathy and focus on the team members instead by being curious and asking questions.
Curiosity can lead the team members to share their way of thinking and how they got to this way of thinking, making their reasoning public. Once the reasoning of team members is clear, it becomes easier to understand where the team stands, where it is heading and what is needed to get optimal accountability.
In an international environment this curiosity becomes a very important – if not the most important- element as per definition the geographical distance will make it harder for team members to fully share their way of thinking & their reasoning. So without curiosity, this information will not surface.
By showing curiosity, the team leader can build and adapt the right team strategy to achieve optimal results.
Julian Birkinshaw writes extensively about the different types of management you need in each situation & stage of the organisation in his book `Reinventing Management’. He predicts a new approach in managing people due to many factors of which globalization and the rise of emerging economies are the most important. Birkinshaw writes about different views on how current management may not be fit for purpose in a networked, global, well-informed & diverse workforce.
Birkinshaw, however, points out that Management doesn’t necessarily need to be revolutionized but rather that it needs to adapt to the business model it is trying to manage and that this is constantly changing.
Back to Tjan and his article `Six rules for building & scaling a company culture’.
These six rules are:
- Start with purpose
- Define common language, values and standards
- Lead by example.
- Embrace your frontline cultural ambassadors.
- Seek, speak and act with truth
- Be greedy with your human capital – then treat them right
All of them really interesting for managing an international team. Yet, we will focus first and foremost on starting with purpose. Tjan describes it as follows: “The common theme … is that you need to begin by understanding your “why” — from the inside out. This is about mission, not marketing. What calling does your business serve? This should feel authentic, inspirational and aspirational. The companies with strong purpose are the ones we tend to love best because they feel different – Chipotle, Pret à Manger, Ikea, Container Store or Apple, to name a few. Whether it’s trying to just offer better food or democratize great design, the cause behind the brand is clear.”
Applying this to managing an international team, we focus on the ‘why’ of the team. What is the purpose of the team, why are they there? Sometimes teams don´t actually know the answer to the question and it then becomes quite hard to successfully manage them.
Katzenbach & Smith deliver good insight into the basics you need to put in place to get a team to start performing. They mention the deep-felt needs of the team members. For instance, the more affinity with the group, the more you feel part of the group and the harder you will contribute to the result of the team. They call this mutual accountability. So, as a team leader, you can apply leadership by creating conversation opportunities and you often need to start at the very beginning of the team set-up, long before conflict starts. In this way, the team members hold each other accountable and ensure team harmony autonomously through group interaction.
One of the most powerful ways to do that is for each team member to express what they feel other team members have done recently that they have really appreciated and if there is a behaviour trait that they could think of another team member should change so that they could contribute more fully to the task.
This type of group interaction doesn’t take away the accountability for the team leader to be leading the team but it does contribute to the self-regulatory mechanisms a team can exhibit to perform better.
Every team member hearing from the others what they could do to improve their own performance and, as a consequence, the team’s performance is a very powerful psychological motivator to get people to change.
A common language
Tjan refers to this when he speaks about defining common language, values and standards and how he was taught by one of his great mentors, Tsun-yan Hsieh, the framework of ‘common values and common standards’.
Tjan writes “great cultures need a common language that allows people to actually understand each other: first, a common set of values, which are the evergreen principles of the firm and second, a common set of standards by which a business will measure how they’re upholding those principles. Only when you have common language, common values and common standards, can you have a cohesive culture?”
Aaron Meyer, affiliate professor of organisational management at INSEAD and author of the book `the culture map’ writes about the deep cross-cultural knowledge that is required nowadays to manage international teams. Do business leaders know how to adapt their Chinese employees more than their employees from Brazil, for example? Do business leaders know how to differentiate between managing their staff in Sweden from those in Japan?
The criteria she uses lead to a very interesting approach. She is very specific in the concepts that they could apply in their management style, what they could do differently in their day-to-day work to be more effective across cultures.
People have the tendency to typecast cultures on just one or two scales, which leads them into traps and twists them. She mentions the example of an American who is working with a French person, thinking the French are very implicit, thinking that this would lead them to be implicit with negative feedback. Yet French are very direct with negative feedback so when the French receive one negative feedback with three compliments – which would be the typical American way – it leads the French to be confused.
Management’s view on HR
In essence, the expectation of the business is that HR Managers revise their strategic focus to facilitate, organise and accommodate upcoming internationalisation, in line with the strategic choices an organisation may take on the internationalisation of the workforce.
It became clear also that CEOs value HR´s input and consider it part of the decision-making process on these very choices.
Once the choices are made, they expect HR to apply their competence and personal styles to facilitate acceptance by the workforce. They see HR as a strategic partner to implement these choices and to support the workforce and Management in the process. They also think that HR should help in obtaining or maintaining good working relations with colleagues and counterparts abroad and proactively work to internationalise the workforce.
HR Managers can help others to avoid jumping to wrong conclusions when the internationalisation of the workforce goes through phases of turbulence that are bound to take place. Mixing established workforce populations will unavoidably lead to unfamiliar behaviours of a business associate and may need HR facilitation and support through further training & development programmes.
That unfamiliar behaviour is often put down to ignorance, apathy or malice. The training & development programme ensures that forging relationships with key customers and suppliers in other cultures is not undermined.
Filip Moriau is Founder & Managing Director of Agilon and lecturer at Kluwer Opleidingen of ‘HR in an international context: communication and reporting’.
Watch the video where Filip Moriau has a blind date with Hubert van Hoe.
Attend the MPM Conference on 20 November, where Moriau will speak on ‘International Diversity in your Team’.