Despite nearly two decades of corporate efforts, many organisations still struggle to find managers who are comfortable and effective in the increasingly global economy.
Most suffer both from a lack of cultural awareness when dealing with employees and partners overseas, as well as a lack of experience managing increasingly complex processes over long distances. While a few insightful corporate giants such as General Electric, Cisco Systems and Intel have made strides in developing successful global managers, many HR leaders and senior executives continue to be frustrated with the available skills and resources.

Why is it so difficult to develop effective global managers? The answer is as complex as the world’s geographies. Each company has its own specific needs and challenges and every country presents a unique and rapidly changing landscape in which work must be accomplished.

But even so, there are steps companies can take to better prepare for the challenges of managing globally. Our focus here is threefold: First, to develop a clearer understanding of the challenges of managing people across borders; second, to instill in new global managers an appreciation for the vast differences among the cultures in which they do business; and finally, to give global managers the tools and support they need to succeed. With the emergence of China and India as the newest and most daunting playing fields, experienced executives agree that softer cultural issues have become the source of notable management problems.

Cultural chasm

“Managing in a global environment means you manage people who are separated not only by time and distance but also by cultural, social and language differences,” says S. Devarajan, managing director of Cisco Systems global development centre in Bangalore, India. Cisco India has more than 1,500 employees and close to 3,500 partner employees.

“The main challenge here is to integrate and coordinate these individuals in ways that will ensure success. You need to build a relationship and have frequent interaction and communication among your team members,” he says. “You also need to be sensitive to and respect the cultural differences. People from different cultures tend to misunderstand each other’s behaviour or stereotype people from other countries. It is essential to recognise the discrepancies between cultures in order to work together effectively.” This, of course, is no simple task.

Embracing differences among cultures and taking advantage of them to build value begins by addressing what Mary Teagarden, professor of global strategy at the Garvin School of International Management, calls “a headquarter’s mindset”, which she believes pervades many global organisations.

Simply put: too many companies assume that they can do things abroad in the same manner as they do them domestically, says Teagarden. “When I see companies that are underperforming in the global environment, I hear them saying, ‘we have people who are just like me at home and we expect everybody else to be just like me’. People don’t work that way.”

Embracing empathy

Teagarden, who has spent much of her 26-year career analysing the challenges for managers in a global economy, believes these constraints can be overcome if leaders focus closely on the empathic qualities of prospective global managers. “What is essential in a global environment is the ability to work with individuals, groups, organisations and systems that are unlike our own,” she says. “We must understand what differentiates people and what unites them. Understanding that tension – how are we alike and how are we different? – is a critically important starting point.” At the very least, organisations need to ensure that managers have had the opportunity to build a basic understanding of the new cultures in which they will be immersed – with a particular focus on appreciating how behaviours differentiate.

Beyond this, Teagarden has identified a number of key characteristics that successful global managers possess. Among them are three that resonate loudly: a belief that differences matter; openness to new and different ideas; and cognitive complexity, or the ability to focus on both the ‘hard’ and ‘soft’ metrics in an organisation – the hard quantitative side along with the softer people side. These three success factors provide a useful framework for prospective global managers to use as they assess their skills and their preparedness for their new assignment.

“We must understand what differentiates
people and what unites them.
Understanding that tension – how are
we alike and how are we different – is a
critically important starting point”

Mary Teagarden, professor, Garvin School of International Management

When Pat Devaney, senior vice-president of production, sourcing, and development for Deckers Outdoor, arrived at Deckers’ China offices in Guongdong Province for a recent meeting, he stopped in the lunchroom to converse with a group of female workers. “These women come from all over China and each one orders a specific type of food depending on what region they are from,” Devaney says. “As part of the dialogue, they were talking about the different flavours of mountain rat. ‘Is grain fed better than fruit fed? Does it taste like cat? Are duck feet as chewy as chicken feet if cooked correctly?’”

Though the conversation was not work related, it illuminated a simple but profound truth about managing in a global environment for Devaney, who has worked in Asia for nearly 30 years. There are great cultural differences between the people who make up global companies. Understanding how people think, work, eat and interact in a foreign workplace is crucial to building a successful operation. Most managers, new to these exotic environments, are ill prepared for these nuances. As the Chinese market economy has developed, Devaney has taken countless American managers on their first visit to China and he has seen the importance of teaching them the subtle but crucial cultural characteristics of a new geography. “You have to realise the complexity that is involved in managing people in different countries,” he says. “What is important to them? How do they take information you give them and interpret it back to those who work for them?”

Tapping into talent

As emerging markets such as China continue to expand, executives must tap into the management expertise in these geographies and be willing to move international managers experienced in one country to other countries. Too many companies view globalisation as a one-way street, which Teagarden sees as a shortsighted view. The integration of international managers plays a big factor in developing global expertise.

“Moving US-based personnel overseas is one thing, but what about bringing some of the Chinese or Indian managers back here or to Europe or South America and plugging them into the mix?” Teagarden asks. While some large companies have had success with this cross-fertilisation, she says, very few small and midsized companies do it at all.

Critical questions

According to Mary Teagarden, companies do not do a good job of training people or even choosing the right people before sending them on overseas assignments. One core reason is decision makers in global organisations often dismiss or under appreciate the difference soft skills can make in a global enterprise.
She points out that companies tend to select or recruit managers for international assignments based overwhelmingly on their technical skills.
The top accountant, engineer or quality-control expert gets tapped to go abroad because of their effectiveness within their disciplines, but rarely because of their extraordinary people skills.
And once these managers are sent abroad, when sustained and effective support is required, they are often left adrift. “We can identify that Fred has to go to Brussels. But how can we make Fred effective in Brussels? We rarely go that far,” says Teagarden.
Working with a raft of corporations on these global issues, Teagarden provides a set of questions that management should be asking when considering how to train and support effective global managers both in their work on virtual global teams and in full overseas assignments. These questions include:
Are people receiving the kind of training and participating in the general knowledge sharing necessary to develop and hone the interpersonal skills they will need in a global setting?
Are we doing process management on our virtual teams? Are we providing the correct blocking and tackling processes for getting things done within an organisation but in a global context?
Are we giving virtual teams the functional and technical support they need?
Once we get people into new geographies physically, are we supporting them by providing the ongoing learning, language training and interpersonal skill set development required in the new culture?
Are we providing them with a cultural mentor?

Companies would be better off still, Teagarden says, if they changed the criteria for selecting managers for global assignments. Instead of focusing on business accomplishments, they should identify prospective global managers based on their passion; their ability to navigate through stressful, ambiguous waters; and finally, their enthusiasm for taking on pioneering roles in a new country or region.

But this can achieve great things. Mary Kay Cosmetics, for example, set up operations in China and discovered that it was not allowed to sell door-to-door as it did in the rest of the world. The Chinese government decided it had had enough salespeople invading the country and called a halt to such selling. So Mary Kay’s Chinese managers came up with a new distribution system in China and a savvy marketing manager there led the development and introduction of a new midrange product that sold well in Chinese department stores.

Mary Kay brought the Chinese marketing manager to its Dallas headquarters to replicate what she did in China and help managers see how it could be replicated elsewhere in the firm’s global operations. “That is how you use the human supply chain very effectively,” Teagarden says. This kind of cross-fertilisation helps domestic managers think more flexibly and to appreciate how incorporating different perspectives is good management and good business.

Among the rarest of traits is the ability to balance the need for consistent corporate practises with the need for regional uniqueness – both in terms of respecting cultural differences and seizing the unique advantages of each market.

Charles Giancarlo, Cisco Systems’ senior vice-president of development, feels his firm has learned some important lessons in this regard. In the early stages of Cisco’s global expansion, Cisco’s senior management allowed managers from different departments to establish their own connections in other countries, including India. The idea was to save money up front by avoiding Cisco’s corporate bureaucracy and taking best advantage of the local opportunities.

It also served to create a distinct shortage of consistency or a lack of a single corporate culture for employees in other countries to embrace. Giancarlo says: “It’s important for local employees to get the benefits of clear reporting structures and of uniformity in processes that a company like Cisco offers. You also want them to feel a sense of pride and a commitment to the larger organisation. Otherwise, the cost savings you thought you had could be short lived. It’s also very hard to consolidate later.”

Teaching new global managers how to balance corporate philosophy with the unique circumstances of the local market is not easy. It requires an awareness of cultures in the midst of dynamic change.
It also demands a healthy dose of independent thinking among some very unfamiliar surroundings. Inexperienced managers may end up clinging to the practises they know and, as a result, fall prey to the ‘headquarter’s mentality’ Teagarden warns of. Or they may succumb to a form of cultural intimidation in which they allow whatever the local team is used to. In doing so, they open their organisation to the problems Cisco once faced.

One way companies can help is to allow new global managers to immerse themselves in their assignments slowly. Teagarden suggests that companies commence a new manager’s global assignment by having him work on a virtual team – that is, managing an overseas project while still stationed in his home country.

By allowing people to learn to work together digitally, companies provide an opportunity for managers to hone the skills they will need to draw on when they are on the ground in a foreign country – but to do so while still in familiar territory. Diving in headfirst has not shown itself to be a particularly effective approach. In a similar vein, Cisco India’s Devarajan says that his company is addressing the marriage of cultural diversity with consistent management practises by employing ‘cultural ambassadors’. They help coach the engineers and software developers about both company and country cultural issues, before being sent on assignment.

"You have to realise the complexity that is involved in managing people in different countries"

Pat Devaney, senior vice-president of production, sourcing, and development, Deckers Outdoor

“It is a cultural mind shift,” Devaney says. “Even the very small things when you arrive, like where the leader sits at a lunch meeting or where to sit in the car. We might assume riding shotgun next to the driver in front is where the big boss sits, but in fact, the seat of power is in the back behind the passenger seat. As the economy grows, the relations will worsen because so many people arrive here completely unprepared for what they are up against. Teaching people to understand what is going on around them makes an impact as you build relationships.”