As simply stated by Solomon et al.(2010) “you will not succeed in global business today if you don’t understand, appreciate and know how to manage across cultures. No matter how smart you are, how innately talented, or how technically competent, without intercultural skills you will not achieve your potential.” (Solomon et al. 2010, pg.24)
The reason is “because in the twenty-first century, the whole world is your marketplace and the people you work with come from every part of the globe” (Solomon et al. 2010, pg.24) Small business organizations may have customers, suppliers or even employees anywhere in the world. For example, my son used to order products on EBay which were shipped from China and I had a real estate business training course which taught us how to hire employees from the Philippines to do our clerical work.
Large business organizations are now going global to increase their market share. Since the current business environment is dynamic and global, a leader must be able to manage across cultures. “Each country is unique for reasons rooted in history, culture, language, geography, social conditions, race and religion”(Bates et al. 2017 pg. 199)
Leaders who cannot understand cultural differences in people cannot lead or manage them.
There are 4 main cultural differences in business that can be found between countries. (Bates et al. 2017)
(1)Power distance: in some cultures, the difference in authority between the boss and employee is small and the employee is expected to contribute to decision-making. However, in other cultures, the employee expects most decisions to be made by the boss.
(2)Individualism/collectivism: some cultures tend to work on their own while some others prefer to work as teams.
(3) Uncertainty avoidance: In some cultures people are comfortable taking risks while other cultures feel threatened by uncertainty.
(4)Masculinity/femininity: Some cultures value quantity of life over quality of life. (Bates et al. 2017 pg. 200)
Any leader who wants to lead people of different cultures must first try to understand the cultural differences in order to prevent unintentional miscommunication.
What skill set does a manager need to effectively manage globally?
According to Bates et al., the following are skills needed to effectively manage globally. The manager should be sensitive to cultural differences, must have a solid knowledge of the business, must be willing to take a stand on issues and also be able to bring out the best in people.
A global manager must act with integrity, be insightful, be committed to the organization’s success and be prepared to take personal and business risks. A global manager seeks and uses feedback, is culturally adventurous, is open to criticism, is flexible and seeks opportunities to learn. (Bates et al. 2017 pg. 199, Exhibit 6.10)
Bateman, T. S., Snell, S., & Konopaske, R. (2017). Management: leading and collaborating in a competitive world (12th ed.). New York: McGraw-Hill Irwin.
Managing across cultures. (2010). Manager: British Journal of Administrative Management, (69), 24-25.