Sales Managers’ Club 2008 Mallorca, May 19-21 By Vincent Merk How to deal with cultural differences in an international business environment Sales Managers’ Club 2008 Mallorca, May 19-21 By Vincent Merk

Game: “Tower for the Derdians” Build a (paper) tower Objectives of the game: Develop cultural awareness Train intercultural sensitivity Train knowledge transfer Develop group dynamics and team spirit Address some cultural dimensions

Developing Intercultural Competence: the ability to reconcile seemingly opposing values (by F. Trompenaars) - The 4 Rs: Recognise cultural differences Respect cultural Reconcile cultural Realise and Root

A definition… « Culture is a set of beliefs, values, norms or standards, shared by a group of people, which help the individuals to decide what is, what can be, how to feel, what to do and how to go about doing it. » Goodenough But… • Culture is learned ! • Culture is forgotten - we stop being conscious of it • Our culture follows us everywhere – we can’t just take it off and leave it outside !

Dividing “here” into 4 levels: “Culture is the way we do things here” (Deal & Kennedy) Dividing “here” into 4 levels: The personal culture The national culture The professional culture The corporate culture

Corporate Culture Incubator Guided missile Egalitarian Person oriented ORG. CHAOS MBP LEARNING Egalitarian STRATEGY MBO PAY FOR PERFORMANCE Person oriented Task oriented NETWORK MBS PROMOTION/ POWER STRUCTURE MBJD EXPERTISE Hierarchical Family Eiffel Tower 4

The onion model

TROMPENAARS MODEL: Seven Dimensions of Culture RULES versus EXCEPTIONS AND RELATIONSHIPS Universalism versus Particularism INDIVIDUAL versus GROUP ORIENTATION Individualism versus Communitarianism EMOTIONS: CONTROLLING EMOTIONS versus EXPRESSIVE Neutral versus Affective Relationships SEGMENTING versus INTEGRATING RELATIONSHIPS Specific versus Diffuse Relationships STATUS based on: “What you do” versus “Who you are” Achievement versus Ascription TIME Monochronic versus Polychronic RELATIONSHIP with NATURE / ENVIRONMENT Internal Control (dominate nature) versus External Control (part of nature)

UNIVERSALISM – PARTICULARISM: a case study You are riding in a car driven by a close friend. It is getting dark outside. He hits a pedestrian crossing the street. You know he was going at least 40 km/h in a residential area where the maximum allowed speed is 30 km/h. There are no witnesses. His lawyer says that if you testify under oath that he was only driving 30 km/h, it may save him from serious consequences. What right does your friend have to expect you to testify to the lower figure? What do you think you would do in view of the obligation of a sworn witness and obligation to your friend?

Universalism My friend has no/some right and I would not help % 1

Universalism versus Particularism Issues/problems between the two: RULES & SYSTEMS EXCEPTIONS AND RELATIONSHIPS Obligation to universal systems, contracts “It depends” - The particular situation Positive connotation Consistency Flexibility Negative connotation Rigidity Corruption Issues/problems between the two: The meaning of a contract ‘Objective systems’ from headquarters: focus on global products, systems, documenting vs local adaptation and exceptions

Individualism vs Communitarianism Issues/problems between the two: INDIVIDUAL ORIENTATION GROUP ORIENTATION “I” comes first “We” comes first Positive connotation Personal initiative, Commitment, accountability teamwork Negative connotation Egoism, anarchy Conformism Issues/problems between the two: Reward systems Decision making

Encounter Specific and Diffuse Public Private Private Danger Zone

Intercultural communication is: Verbal vs. non-verbal communication Words, images, song & dance High and low context Create and maintain trust

Non-verbal communication - greetings

High and low context High context An example: Information cultures implicitly contained explicitly conveyed An example: A group of Dutch tourists asks a Malaysian if Lumpur is far from here. Seeing they look tired, he sympathises and replies: “No”. After 2 hours of walking, they still have not reached Lumpur. Reaction?

High and low context Asian (Chinese, Japanese) High context Arabic/ Mid. East Latin-American Italian, Spanish Slavic British English French American English Scandinavian German Dutch Swiss-German High context cultures Low context Information implicitly contained explicitly conveyed

Communication Commandments: - Know (some of) the local language: "Impossible is nothing," a sign in Beijing's airport and one of those funny mistranslations of the common phrase, "Nothing is impossible." - Know about the local culture, history, traditions, happenings, events, current news, etc. - Know your partner: job, family, hobbies, background, etc. - And finally… Wonder, observe, listen, absorb, ask, wait, expose, try out, honour, etc.

Specific versus Diffuse Issues/problems between the two: ANALYTIC, SEGMENTING HOLISTIC, INTEGRATED Segmented relationships Connected relationships Positive connotation Easy contact Personal involvement Negative connotation Superficial Formal Blunt Indirect Issues/problems between the two: ‘Losing face’ Explicit / implicit communication styles Different ways of problem solving

Achievement versus Ascription What You Do Who You Are STATUS ?

Ascribed Status Family Age Gender Education Position in hierarchy

Time perception Monochronic Polychronic

Nature: Internal vs External Control Nature as an organism Subjugation to nature Internal control: Dominance over nature

Internal control vs External control Issues/problems between the two: We control the environment In charge of our own destiny Technology push Harmony with environment Fate, luck Market pull Positive connotation In control Adaptive Negative connotation Dominant, arrogant Fate used as an excuse Issues/problems between the two: Perceive the other as weak or as arrogant Different ways of strategising, planning

A few recommendations: In international business, it always takes 2 to… Tango!

Beware of stereotyping…

Don’t take too much for granted !

Don’t go native, trying:“When in Holland, do as the Dutch do…”!

But just be yourself…

…and adapt to the local situation!

And watch your language! The language of international business is… …BAD English!!