Cultural Intelligence develops either on the job or from formal training. On-the-job cultural learning is unstructured, spontaneous, and incidental to everyday duties. It occurs as an employee uses trial and error to achieve their goals in diverse settings. Cultural learning also results from watching peers or leaders manage diversity.
On-the-job learning is useful for gaining tacit knowledge. Tacit knowledge is information that resides within a person’s mind. It is not easily articulated or documented. Tacit knowledge includes know-how, judgement, insights, beliefs, and perspectives, as well as memories, attitudes, and emotions. Cultural learning is largely tacit. It is not easily transferred to others in written or verbal form. Instead, tacit cultural knowledge develops socially.
Authentic intercultural exchanges
Cultural Intelligence develops when individuals engage in authentic intercultural exchanges. Exchanges with diverse others offer opportunities for practising and refining the four competencies of Cultural Intelligence, and feedback provided during the exchange is useful for improving performance. Feedback includes the verbal or nonverbal responses of the other party.
Although at first faced with the disorientating effects of culture shock, the employee gradually develops:
- an understanding of their own value set and an awareness of cultural similarities and differences (CQ Knowledge)
- an ability to hold multiple perspectives, make culturally appropriate attributions, and engage in more frequent checking and adjustment of cultural assumptions (CQ Strategy)
- increased confidence, a greater tolerance of uncertainty, and respect for diverse others (CQ Drive)
- a new repertoire of flexible, culturally appropriate responses (CQ Action).
These competencies transfer across different cultural settings.
Creating opportunities for authentic intercultural exchanges
Organisations that embrace global values and engage in practices that promote integration increase the likelihood of authentic intercultural exchanges at work.
A global mindset
Organisations with a global mindset:
- identify and pursue opportunities globally
- recruit talent globally
- scan competitors globally
- select the optimal location for each specific business activity
- view the global market as a source of new ideas and technology as well as profits
- maintain a global identity instead of a single national identity.
A global mindset may be differentiated, on the one hand, from a parochial mindset that promotes uniformity across markets, and on the other hand, from a diffused mindset that favours complete market segmentation. By contrast, a global mindset leverages economies of scale yet is locally responsive. Organisations with a global mindset do not geographically constrain processes, markets, and people. This openness encourages greater interaction among leaders, employees, customers, and other external stakeholders across diverse locations.
Global talent mobility
The advantages of global talent mobility are twofold. Moving the right people at the right time to the right locations improves the efficient use of an organisation’s human capital. In addition, global talent management develops Cultural Intelligence by providing employees with increased opportunities for authentic intercultural exchange. Global talent mobility involves a range of options, including:
- the appointment of individuals who come from neither the head office nor the foreign branch
- expatriation, whereby head-office employees transfer to foreign offices
- inpatriation, whereby foreign employees transfer to the head office
- short- or medium-term foreign assignments
- international commuting
- cross-border teaming
- virtual assignments
International and multicultural assignments
International and multicultural assignments should be the cornerstone of an organisation’s efforts to develop Cultural Intelligence. Organisations seeking to capture the competitive advantages of Cultural Intelligence must commit to offering these opportunities.
But international or multicultural assignments do not guarantee Cultural Intelligence. Whether a person gains Cultural Intelligence from an assignment depends on the quality and nature of their experience and on situational factors. It also depends on their pre-assignment Cultural Intelligence and their natural aptitude for cultural learning.
Cultural knowledge management
Organisations can develop Cultural Intelligence by focusing on practices and structures that improve the acquisition, retention, and sharing of cultural knowledge. They must stress the interconnection among diverse employees—initiatives include networking, teaming, mentoring, social events, open-plan offices, and the leveraging of communication technologies. Organisations should also seek to increase communication between employees and diverse external stakeholders.
Leadership must model cultural sharing and seek to articulate those values that support continuous learning, including:
- personal and professional growth
- trust, cooperation and collaboration
- constructive feedback
- learning as more important than performances
- innovation
- examining issues from multiple perspectives
- reflection, questioning, and continuous improvement.
Incentives and rewards that promote cultural integration
An organisation’s incentive system must encourage and reward intercultural exchange. Expatriate packages must be attractive enough to motivate employees to accept the challenges of international assignments, but not so high they isolate expats from the local hosts in a higher socioeconomic “bubble”.
Assignment packages should balance short-term performance against the longer-term development of Cultural Intelligence. Employees should be rewarded for cultural learning as well as task/financial performance.
Rewards should encourage the sharing and integration of information across borders or groups. For example, bonuses should be based not only on head-office performance, but also on regional or global performance.
Study-abroad and international internships
Organisations can increase the available pool of candidates with high Cultural Intelligence by partnering with universities to sponsor study-abroad programs. International internships also offer opportunities for screening applicants and increase the likelihood that globally-minded graduates will be attracted to the organisation.
Diversity & inclusion management
Diverse worldviews, values, beliefs, attitudes, and norms increase the potential for language and communication barriers, and for conflict and mistrust. In addition, social categorisation can result in stereotyping, prejudice, and discrimination. These processes can cause divisive, hostile, isolating, and stressful working environments, with negative implications for trust, cohesiveness, and information-sharing.
The successful development of Cultural Intelligence across an organisation depends on the effective management of tensions and biases inherent in diverse settings. Organisations must have competencies, practices, and structures that discourage social categorisation and promote inclusion and shared learning. An important component of effective global diversity management is Cultural Intelligence training, which builds the solid foundation of knowledge, skills, and abilities required to work well with diverse others.
Diversity issues vary from one country to the next, and they are often more complex outside the United States. Global diversity programs must reflect specific historical, social, political, cultural, and legal contexts, yet global diversity issues are often overlooked by multinationals. Adaptation may be required with respect to content, rationale, language, and methods.
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