1. (c) 2012, Mark Hehl, all rights reserved The Importance of Culture when Managing International Projects Mark Hehl Hehl & Associates Southbury, CT USA 203 982 6231 www.hehlassociates.com

2. (c) 2012, Mark Hehl, all rights reserved Agenda The Project Manager and Globalization The Project Manager and Globalization Cultural Mistakes – Disaster Examples Cultural Mistakes – Disaster Examples The Importance of Cultural Understanding The Importance of Cultural Understanding Why are people different? Why are people different? Are you the Ugly American? Are you the Ugly American? Various World Cultures Various World Cultures Applying Cultural Savvy Applying Cultural Savvy Enjoying the experience while achieving success Enjoying the experience while achieving success

3. What Cultures are you dealing with? List List (c) 2012, Mark Hehl, all rights reserved

4. Ignoring Culture Issues - Consequences can be deadly! Cultural misunderstanding Cultural misunderstanding Directing traffic Directing traffic (c) 2012, Mark Hehl, all rights reserved

5. What Problems are you facing? Relative to cross culture projects Relative to cross culture projects (c) 2012, Mark Hehl, all rights reserved

6. International Projects List Positives List Positives List Negatives / Challenges List Negatives / Challenges (c) 2012, Mark Hehl, all rights reserved

7. Globalization Cross Border Activity Increasing Cross Border Activity Increasing New playersNew players New culturesNew cultures Varied perceptionsVaried perceptions More complicatedMore complicated Greater challengeGreater challenge = Potential for enhanced performance / conflict = Potential for enhanced performance / conflict

8. (c) 2012, Mark Hehl, all rights reserved Cultural Sensitivity Critical to Success Critical to Success My Exposure My Exposure Growing upGrowing up AdulthoodAdulthood Professional SuccessProfessional Success Timex Timex China China

9. (c) 2012, Mark Hehl, all rights reserved

10. Lack of Cultural Awareness = Paying a Higher Price Asian customer – Chinese Supplier Asian customer – Chinese Supplier No understanding or engagement of Chinese culture No understanding or engagement of Chinese culture World recession – late 2008 World recession – late 2008 Material prices dropped significantly Material prices dropped significantly Refusal to lower kit price Refusal to lower kit price Reason – Cultural Difficulties Reason – Cultural Difficulties (c) 2012, Mark Hehl, all rights reserved

11. Cultural Savvy Aids Communication Aids Communication Establishes Immediate Rapport Establishes Immediate Rapport Enhances Team Motivation / Buy-in Enhances Team Motivation / Buy-in Builds Positive Relationships Builds Positive Relationships Enables Cooperation Enables Cooperation Postures the PM for Success Postures the PM for Success

12. Which is more accurate - in most cases? The average American knows more about the other culture that he/she is dealing with or is the opposite true? The average American knows more about the other culture that he/she is dealing with or is the opposite true? Why? Why? (c) 2012, Mark Hehl, all rights reserved

13. Testimonial “I would definitely recommend Mark for future projects. At the beginning of this project, I thought that his work plan was impossible within our required timeframe. However, he proved me wrong. He has phenomenal cross cultural skills and patience in developing the relationships which are required to get people to go the extra mile and exceed expectations.”

14. Unnecessary Confusion = Slow Progress E Mail Communication E Mail Communication No phone follow upNo phone follow up “I told you very clearly” “I told you very clearly” Not verifying understanding and assuming action Not verifying understanding and assuming action Duplicate requests Duplicate requests Overly demanding Overly demanding Intellectual Property (IP) Concern Intellectual Property (IP) Concern (c) 2012, Mark Hehl, all rights reserved

15. Not the best Cultural Reaction Family story example Family story example Concluded that something different was wrong Concluded that something different was wrong (c) 2012, Mark Hehl, all rights reserved

16. On Culture “It is not right or wrong, good or bad, “It is not right or wrong, good or bad, it is just different” it is just different” Mark Hehl - March, 1996 Mark Hehl - March, 1996

17. American Culture Positive aspects Positive aspects Negative aspects Negative aspects (c) 2012, Mark Hehl, all rights reserved

18. North American Legal Legal The contract governs; not what is said / promisedThe contract governs; not what is said / promised Poor at negotiation Poor at negotiation Direct Direct

19. (c) 2012, Mark Hehl, all rights reserved North American Not warm and friendly at the beginning Not warm and friendly at the beginning Will not joke at the beginning Will not joke at the beginning Asks direct questions Asks direct questions Insular Insular Values hard work Values hard work Impatient with those who do notImpatient with those who do not

20. (c) 2012, Mark Hehl, all rights reserved North American Prompt and responsive Prompt and responsive Expects the same from othersExpects the same from others “Time is Money” “Time is Money” They really believe this!They really believe this! AdvantageAdvantage Restaurant bill exampleRestaurant bill example Wants to get down to business fast!

21. North American One language One language Not interested in learning languages Not interested in learning languages Straightforward Straightforward Challenges authority Challenges authority Assertive and forceful Assertive and forceful (c) 2012, Mark Hehl, all rights reserved

22. Obsolete Components Asian Division – US Fortune 500 Asian Division – US Fortune 500 Poor Performing Components Poor Performing Components Multiple requests for Inventory Balance Multiple requests for Inventory Balance No responseNo response (c) 2010 Mark Hehl, all rights reserved

23. Chinese Culture Positive aspects Positive aspects Negative aspects Negative aspects (c) 2012, Mark Hehl, all rights reserved

24. Chinese History Oldest continuous major world civilization Oldest continuous major world civilization Records date back 3,500-5,000 years Records date back 3,500-5,000 years Advanced civilization with a common written language Advanced civilization with a common written language Prosperity diminished during the 19th Century Prosperity diminished during the 19th Century Social strifeSocial strife Economic StagnationEconomic Stagnation Explosive population growthExplosive population growth

25. Chinese History Western penetration Western penetration Hong Kong (Great Britain)Hong Kong (Great Britain) Opium WarsOpium Wars The unequal treatiesThe unequal treaties Shanghai ConcessionsShanghai Concessions Communist GovernmentCommunist Government Hong Kong and Macau returned to ChinaHong Kong and Macau returned to China China is now a World Power!China is now a World Power!

26. Chinese Gifts to the World Gunpowder Gunpowder Fireworks Fireworks The compass The compass Paper Paper Natural gas used as a fuel Natural gas used as a fuel The seismograph The seismograph Contributions to science/mathematics Contributions to science/mathematics Second most popular cuisine in the world Second most popular cuisine in the world The graduate college The graduate college The formal educational evaluation system The formal educational evaluation system

27. Chinese Culture Education Education Written language memorizedWritten language memorized Entry competitive-examEntry competitive-exam High social pressure to excelHigh social pressure to excel High motivation to learn EnglishHigh motivation to learn English Native English Speaking Teachers Native English Speaking Teachers China graduates 6X as many engineers as the USAChina graduates 6X as many engineers as the USA

28. Languages Many spoken languages Many spoken languages Mandarin-Official Mandarin-Official Cantonese-Hong Kong & Macau Cantonese-Hong Kong & Macau Shanghaiese-Shanghai Shanghaiese-Shanghai Common written language? Common written language? Traditional CharactersTraditional Characters Hong Kong, Macau, Singapore & Taiwan Hong Kong, Macau, Singapore & Taiwan Simplified charactersSimplified characters Western (Arabic) number systemWestern (Arabic) number system

29. Confucian Precepts / Values Dignity Dignity Mutual respect Mutual respect Respect for authority Respect for authority ObedienceObedience Humility Humility Courtesy Courtesy Deference Deference FaceFace MianziMianzi

30. Mianzi (Face) Shame Shame Status Status Self respect Self respect Avoid Avoid InsultsInsults CriticismCriticism EmbarrassingEmbarrassing ShoutingShouting Proving wrongProving wrong

31. Guanxi Relationships between people Relationships between people Good social relationships are a symbol of personal ability Good social relationships are a symbol of personal ability Develop relationships first Develop relationships first Enquire about family and personal life Enquire about family and personal life Expect personal questionsExpect personal questions Salary Salary Invest in this up front Invest in this up front It will pay dividendsIt will pay dividends

32. (c) 2012, Mark Hehl, all rights reserved China Dignity Dignity FaceFace “Mianzi”“Mianzi” Mutual respect Mutual respect Respect for authority Respect for authority ObedienceObedience Humility Humility Courtesy Courtesy

33. (c) 2012, Mark Hehl, all rights reserved China Considerate Considerate Polite Polite Well-mannered Well-mannered Modesty Modesty Do not show emotion Do not show emotion Will not use “No” Will not use “No” Decisions come from the top Decisions come from the top

34. What does YES mean? I hear you I hear you It may not mean It may not mean AgreementAgreement UnderstandingUnderstanding That action will take placeThat action will take place How does one handle this? (c) 2012, Mark Hehl, all rights reserved

35. China Develop relationships first Develop relationships first “Guanzhi”“Guanzhi” Chinese do not like to do business with strangersChinese do not like to do business with strangers Enquire about family and personal life Enquire about family and personal life Expect personal questionsExpect personal questions Invest in relationships Invest in relationships It will pay dividendsIt will pay dividends

36. Kegi Considerate Considerate Polite Polite Well-mannered Well-mannered Humbleness Humbleness Modesty Modesty Do not show emotion Do not show emotion

37. Using Kegi Avoid Avoid BraggingBragging EmbracingEmbracing Being too carefreeBeing too carefree Political discussions to avoidPolitical discussions to avoid The Province of Taiwan The Province of Taiwan One Child Policy One Child Policy Social unrest Social unrest The Environment The Environment

38. Yes & No??? NO = hostile/disrespectful NO = hostile/disrespectful One may not hear itOne may not hear it Yes may not mean agreement Yes may not mean agreement UnderstandingUnderstanding That message was heardThat message was heard ProbeProbe Read between the linesRead between the lines

39. Chinese Culture What problems does the Chinese respect for authority and not saying “NO” create for Westerners trying to implement business process improvement? What problems does the Chinese respect for authority and not saying “NO” create for Westerners trying to implement business process improvement? How does one overcome these? How does one overcome these?

40. The First Meeting -Introductions -Name cards -Personal distance (c) 2012, Mark Hehl, all rights reserved

41. Avoid These! Western gestures that are taboo in China include: Western gestures that are taboo in China include: Pointing the index finger--use the open hand insteadPointing the index finger--use the open hand instead Using the index finger to call someone-use the hand with fingers motioning downward as in wavingUsing the index finger to call someone-use the hand with fingers motioning downward as in waving Finger snappingFinger snapping Showing the soles of shoesShowing the soles of shoes Whistling is considered rudeWhistling is considered rude

42. Expect These! Chinese customs that are annoying to Westerners: Chinese customs that are annoying to Westerners: Belching or spitting on the streetBelching or spitting on the street Lack of consideration when smoking and failure to ask permission to smokeLack of consideration when smoking and failure to ask permission to smoke Slurping foodSlurping food Talking while eatingTalking while eating Spitting out bones while eatingSpitting out bones while eating ToothpickToothpick

43. Chinese Culture Multi-lingual Multi-lingual Will not challenge authority Will not challenge authority Seeks friendship Seeks friendship Knows Western culture Knows Western culture Limited resources Limited resources Humble Humble

44. Mandarin Basic terms Basic terms Ni Hao--Hello, Good Day, How are you?Ni Hao--Hello, Good Day, How are you? Xie Xie--Thank YouXie Xie--Thank You Gahn Bay-- “Dry Cup” Toast at mealsGahn Bay-- “Dry Cup” Toast at meals Do not drink alone Do not drink alone Be careful! Be careful!

45. Meals / Banquets Chopsticks Chopsticks Wait for host to seat you Wait for host to seat you Seat position at tableSeat position at table Never leave your plate clean! Never leave your plate clean! Leave room for the next course Leave room for the next course Toasting-no need to “Dry Cup” Toasting-no need to “Dry Cup” Drink slowlyDrink slowly Good opportunity to introduce/discuss new initiatives Good opportunity to introduce/discuss new initiatives

46. China - Other Items Red = Good Luck Red = Good Luck The Green Hat Story The Green Hat Story Covering one’s face = embarrassment or disagreement Covering one’s face = embarrassment or disagreement Sticking chopsticks in rice = Death Sticking chopsticks in rice = Death If you do not know what a food is -ASK! If you do not know what a food is -ASK! Unless you can handle the result- do not look in tanks & cages at restaurants Unless you can handle the result- do not look in tanks & cages at restaurants

47. China - Other Items Birds and fish are served with the head Birds and fish are served with the head Ok to do in China Ok to do in China Using a toothpick at the tableUsing a toothpick at the table Spitting bones on a plateSpitting bones on a plate Making noises while eatingMaking noises while eating Putting one’s elbows on tablePutting one’s elbows on table Reaching across the table for foodReaching across the table for food Smoking during a mealSmoking during a meal Picking up a bowl of rice to one’s mouthPicking up a bowl of rice to one’s mouth

48. Potential Problem Areas China China (c) 2012, Mark Hehl, all rights reserved

49. Modified Behaviors China China (c) 2012, Mark Hehl, all rights reserved

50. Protecting a Bad Design Western Parent Company / Asia Division Western Parent Company / Asia Division Design not Working Properly Design not Working Properly Re-Design in Europe Re-Design in Europe Intentionally providing incorrect detailsIntentionally providing incorrect details Intellectual Property (IP) Issue Intellectual Property (IP) Issue Lost Sales / Customer Goodwill Lost Sales / Customer Goodwill (c) 2010 Mark Hehl, all rights reserved

51. Indian Culture Positive aspects Positive aspects Negative aspects Negative aspects (c) 2012, Mark Hehl, all rights reserved

52. Indian Head Shaking Agreement Agreement Source of confusionSource of confusion Project Manager –Faux Pas! (c) 2012, Mark Hehl, all rights reserved

53. India Caste System Caste System Be on time Be on time Slow decisions Slow decisions Family orientation Family orientation The boss is right The boss is right Relationship value Relationship value

54. (c) 2012, Mark Hehl, all rights reserved India Women Women Shaking Hands???Shaking Hands??? Head Shaking Head Shaking Develop Trust Develop Trust Accept refreshments Accept refreshments Double Standard??? Double Standard??? On timeOn time

55. Potential Problem Areas India India (c) 2012, Mark Hehl, all rights reserved

56. Modified Behavior India India (c) 2012, Mark Hehl, all rights reserved

57. Missed Opportunity for Cost Savings / Sales Increase Latin American Supplier to a Fortune 100 Corporation Latin American Supplier to a Fortune 100 Corporation Opportunities identified / demonstrated Opportunities identified / demonstrated 23% productivity improvement23% productivity improvement Not implementedNot implemented No follow up to ensure implementation No follow up to ensure implementation (c) 2010 Mark Hehl, all rights reserved

58. Lost Investment Potential New Asian Supplier Potential New Asian Supplier Site visit scheduled for a Friday Site visit scheduled for a Friday Government Blackout Government Blackout Supplier Unwilling to Challenge Fortune 100 Corporation Supplier Unwilling to Challenge Fortune 100 Corporation Project Cancelled Project Cancelled Investment wastedInvestment wasted (c) 2010 Mark Hehl, all rights reserved

59. Process Improvement? Asian supplier to a US Fortune 500 Asian supplier to a US Fortune 500 Enhanced process controls needed Enhanced process controls needed Performed for the wrong reason Performed for the wrong reason IneffectiveIneffective (c) 2010 Mark Hehl, all rights reserved

60. Time Reduction = Lost Sales US Corporation US Corporation – Chinese Suppliers - Assembly plant in The Philippines Arbitrary lead time reduction Arbitrary lead time reduction Delivery not possible Delivery not possible Silence from suppliers Silence from suppliers $15 million in lost sales $15 million in lost sales (c) 2010 Mark Hehl, all rights reserved

61. The Philippines Foreign Influence Foreign Influence ChinaChina SpainSpain The United StatesThe United States (c) 2012, Mark Hehl, all rights reserved

62. The Philippines Positive aspects of the culture Positive aspects of the culture Negative aspects of the culture Negative aspects of the culture (c) 2012, Mark Hehl, all rights reserved

63. The Philippines Warm Warm Friendly Friendly Laid back Laid back Positive outlook Positive outlook Good during a crisisGood during a crisis Prevention?Prevention? Eager to please foreigners Eager to please foreigners

64. The Philippines Non Assertive Non Assertive Eager to learn Eager to learn Reluctant to use “No” Reluctant to use “No” Inferiority complex Inferiority complex Sometimes provides too much information Sometimes provides too much information May not be relevantMay not be relevant Too much detailToo much detail (c) 2012, Mark Hehl, all rights reserved

65. The Philippines Potential Problem Areas Potential Problem Areas (c) 2012, Mark Hehl, all rights reserved

66. Modified Behavior The Philippines The Philippines (c) 2012, Mark Hehl, all rights reserved

67. Latin America Is the culture the same in all of Latin America? Is the culture the same in all of Latin America? Is the language the same? Is the language the same? (c) 2012, Mark Hehl, all rights reserved

68. Latin America 20 Spanish Speaking Countries 20 Spanish Speaking Countries Various dialectsVarious dialects Some words can be offensive is some countries where they are not in othersSome words can be offensive is some countries where they are not in others The Language of Brazil is Portuguese (c) 2012, Mark Hehl, all rights reserved

69. Latin America Regionally Diverse Regionally Diverse Not all the same!Not all the same! Warm/Friendly Warm/Friendly Begin with social conversationBegin with social conversation Tactile Tactile “Abrazo”“Abrazo” Personal spacePersonal space Time Attitude Time Attitude

70. (c) 2012, Mark Hehl, all rights reserved Latin America Formality Formality Señor, Ing., Lic., etc.Señor, Ing., Lic., etc. SpokenSpoken WrittenWritten Avoid using first names at the beginningAvoid using first names at the beginning

71. Latin America Meet with Decision Maker Meet with Decision Maker Authority may not be delagatedAuthority may not be delagated Avoid pressure tactics Avoid pressure tactics Relationship Orientation Relationship Orientation Social Conversation First Social Conversation First Ask about familyAsk about family Remember detailsRemember details (c) 2012, Mark Hehl, all rights reserved

72. No Action - No Product US Importer – South American Supplier US Importer – South American Supplier Agreement from Purchasing Agreement from Purchasing No ActionNo Action Communicate with Boss for action Communicate with Boss for action Autocratic environmentAutocratic environment (c) 2010 Mark Hehl, all rights reserved

73. Quotation Problems (c) 2010 Mark Hehl, all rights reserved Latin America Latin America Oral indication Oral indication Quotes not received Quotes not received Issues Issues CultureCulture UnderstandingUnderstanding CompetencyCompetency Unwilling to say “NO”Unwilling to say “NO”

74. (c) 2012, Mark Hehl, all rights reserved

75. Regulatory Information US Fortune 100 Corporation US Fortune 100 Corporation Asian Plastic Supplier Asian Plastic Supplier Material Data Required Material Data Required No Response No Response CommunicationCommunication IP ConcernIP Concern Additional Travel Cost Additional Travel Cost Schedule impactSchedule impact (c) 2010 Mark Hehl, all rights reserved

76. (c) 2012, Mark Hehl, all rights reserved

77. Vague Direction from Europe My Client My Client Questions not answered directly Questions not answered directly Read between the lines Read between the lines (c) 2010 Mark Hehl, all rights reserved

78. Communication tips Use clear elegant language Use clear elegant language Verify understanding Verify understanding Follow up callFollow up call Avoid Avoid JargonJargon ColloquialismsColloquialisms (c) 2012, Mark Hehl, all rights reserved

79. MY Plan How I will avoid being the Ugly American How I will avoid being the Ugly American1)2)3)4)5) (c) 2012, Mark Hehl, all rights reserved

80. Other Items Stop, Look and Listen Stop, Look and Listen Ask questions Ask questions HistoryHistory Local AreaLocal Area Avoid pointing one’s finger Avoid pointing one’s finger Use an open handUse an open hand

81. (c) 2012, Mark Hehl, all rights reserved Applying Cultural Savvy Avoid Stereotyping Avoid Stereotyping Be Genuinely Interested Be Genuinely Interested CultureCulture HistoryHistory Enjoy the ExperienceEnjoy the Experience Stop, Look & Listen Stop, Look & Listen

82. (c) 2012, Mark Hehl, all rights reserved Applying Cultural Savvy Research & Learn Research & Learn CultureCulture HistoryHistory Language BasicsLanguage Basics Ask Questions Ask Questions Communicate their way Communicate their way Show Respect Show Respect

83. (c) 2012, Mark Hehl, all rights reserved Best Investment Cross Cultural Training All Team Members All Team Members Both Directions Both Directions A Critical Investment!

84. (c) 2012, Mark Hehl, all rights reserved Questions Thank you for allowing me to be of service! Mark Hehl Hehl & Associates Southbury, CT USA 203 982 6231 ww.hehlassociates.com