The imbalance in the supply and demand for culturally intelligent leaders necessitates the development of these skills within an organisation. However, despite the importance of intercultural competency for the success and longer-term growth and prosperity of today’s businesses, few companies understand how to cultivate this capability in their workforce.
Cultural intelligence (CQ) develops either on-the-job or through 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 intelligence develops socially as individuals engage in authentic exchanges with individuals from diverse cultural backgrounds.
Exchanges with diverse others offer opportunities for practising and refining the four competencies of cultural intelligence. Although, at first confronted with the disorientating effects of culture shock, employees gradually develop:
- an understanding of their own value set and an awareness of cultural similarities and differences (CQ Knowledge);
- the 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).
Organisations that embrace a global mindset and engage in practices that promote authentic intercultural exchanges at work—global talent mobility, diversity and inclusion, cultural knowledge management, incentive systems that reward collaboration, international internships and formal training—support the development of a culturally intelligent workforce.
GLOBAL MINDSET
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. Rather, organisations with a global mindset pursue opportunities, recruit talent and scan competitors globally. Such organisations select the optimal location for each specific business activity and view the global market as a source of new ideas and technology as well as profits. This openness encourages greater interaction among leaders, employees, customers and other external stakeholders across diverse locations and supports CQ development.
GLOBAL TALENT MOBILITY
Organisations with a global mindset are more likely to have a formal global talent mobility strategy. 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, plus global talent management develops cultural intelligence by providing employees with increased opportunities for authentic intercultural exchange.
A series of studies by Adam Galinsky, William Maddux and colleagues have also linked international experience to higher creativity. Individuals who immerse themselves in a foreign culture are more willing and able to consider problems from multiple perspectives. The link between creativity and multicultural experiences has been demonstrated in the laboratory as well as in corporate settings. Individuals who have spent time interacting in novel cultural settings score higher on creativity tests and enjoy higher promotion rates and more positive perceptions of creative competence among their colleagues.
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, whether in the form of traditional expatriate assignments or contemporary approaches including short-term assignments, international business travel, multicultural grouping, job rotations or virtual grouping.
Not every multicultural experience, however, develops cultural intelligence. Short-term business trips may not provide the employee sufficient time or opportunity to master new behaviours. High-contact assignments provide more opportunities for authentic intercultural exchanges and practising and refining cultural intelligence competencies. High-contact assignments are those on which workers spend more time interacting with diverse others, such as in multicultural groups, at international meetings and through intercultural mentoring.
Cultural learning requires meaningful engagement with culturally diverse others, both inside and outside the workplace. Deeper engagement is encouraged by structuring interdependent tasks and by ensuring travel schedules and deadlines allow time for engaging either socially or time for business issues unrelated to the assignment. Cultivating social ties, in addition to business relationships, promotes greater cultural sharing.
Assignees should also be given opportunities to explore the ideas and perspectives of minority cultures and subcultures that exist alongside dominant societal cultures. This exposure broadens an individual’s appreciation for different worldviews and helps offset national cultural stereotyping.
Also, assignees must be allowed to test and refine their cultural learnings. Employees should not be penalised for well-intentioned intercultural failures. A learning orientation, as opposed to a performance orientation, recognises that trial and error are important elements of intercultural development.
Expatriate research has highlighted a particularly high exit rate for returning assignees. Reasons cited include a perception that their new cultural skills and knowledge acquired while on assignment are not appreciated or utilised upon repatriation. The process of repatriation has been reported to be more stressful than expatriation as the individual mourns for a lifestyle, job and relationships left behind and encounters unanticipated changes back home in their work, social and everyday life. Unfortunately, however, only 14 per cent of companies have a formal repatriation strategy linked to career management. International and multicultural assignments should be incorporated into career development plans to ensure that valuable cultural knowledge acquired from those participating directly in the initiatives is retained and leveraged by the organisation.
DIVERSITY AND INCLUSION
By increasing the opportunities for intercultural exchange, culturally diverse workforces support an organisation’s efforts to develop cultural intelligence. Best-practice diversity programmes do not limit their cultural diversity internally but also seek cultural diversity in their external stakeholder relationships, including suppliers and community groups.
Diversity per se, however, does not foster cultural intelligence. The successful development of cultural intelligence across an organisation depends on the effective management of tensions and biases inherent in diverse settings. For a diverse workplace to increase cultural learning, organisations must have competencies, practices and structures in place that discourage social categorisation and promote inclusion and the exchange of cultural knowledge.
An inclusive workplace culture recognises, respects, values and embraces cultural differences. An inclusive workplace encourages the expression of unique cultural identities and values the contribution of every individual. Inclusion is achieved when every member of the organisation is enabled to participate fully in and contribute to an organisation’s decision-making processes and operations.
Global organisations should also ensure that senior management support for diversity and inclusion extends to cultural diversity as well as the traditional focuses of race and gender. Support must be visible, active, ongoing and consistent. A culturally diverse senior management group is important. Cultural diversity at senior levels normalises intercultural interactions and can send a powerful message to lower-level staff.
CULTURAL KNOWLEDGE MANAGEMENT
The value of cultural knowledge grows exponentially when it is shared. Cultural knowledge management links individual-level cultural learning to a broader network of colleagues who can then use and integrate this information innovatively to solve problems and improve performance.
Knowledge management is more of a people issue than a technology one. This is particularly true for cultural knowledge. Cultural knowledge is not easily codified into explicit knowledge for capture by technology, such as database systems. The effective management of cultural knowledge is reliant on an organisational culture that supports open communication, continuous learning, the sharing of ideas and collaboration.
Companies that stress the interconnection among diverse employees through networking, grouping, mentoring, social events, open-plan offices and the leveraging of communication technologies support cultural learning. Organisations should also seek to increase communication between employees and diverse external stakeholders.
Although cultural skills are best learned by engaging in face-to-face exchanges with diverse others, virtual learning communities that use chat, threaded discussions, or social media tools can be advantageous for the sharing of cultural knowledge and the development of cultural intelligence. Online communities can be far more diverse and global than would ever be possible in an office setting. They provide access to a richer collection of differing and often conflicting perspectives and are more representative of global cultural complexity.
INCENTIVES AND REWARDS
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 as to 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 or financial performance. Rewards should encourage the sharing and integration of information across borders or culturally diverse groups. 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 programmes. International internships also offer opportunities for screening applicants and increase the likelihood that globally-minded graduates will be attracted to the organisation.
CULTURAL INTELLIGENCE TRAINING
Without the right foundation, employees who are thrust into a culturally diverse environment with a sink-or-swim approach are likely to suffer the negative consequences of culture-shock for job performance, attitudes and physical and mental health. Cultural intelligence training provides an opportunity to acquire and practise new skills in low-risk, simulated culturally diverse environments in the safety of a classroom setting.
Cultural intelligence training transfers the foundation of knowledge, skills and abilities required to manage cultural diversity and improve performance in diverse cultural settings. Cultural intelligence training also equips individuals with the skills they need to self-learn from their intercultural experiences. This avoids overwhelming them with long lists of ‘dos and don’ts’ and reduces the likelihood of disorientation when encountering novel scenarios.
To learn more about how Culture Plus can help you to develop culturally intelligent leadership, email info@cultureplusconsulting.com.
ABOUT THE AUTHOR
Felicity Menzies is an authority on Cultural Intelligence and diversity and inclusion in the corporate environment. Felicity’s interest in the role of culture in business began during her tenure as the Head of Private Bank, Westpac, in Singapore. There she led a culturally diverse team of bankers serving a multinational client base and learned firsthand how Cultural Intelligence is a necessary component of business success.
As Principal at Culture Plus Consulting, Felicity now applies her business acumen and intercultural expertise to help global organisations respond effectively to the opportunities and challenges presented by diverse workforces, unfamiliar markets, and rapid shifts in the global competitive landscape.
Citations
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