Written by Alessandra Sbarra
Edited by Kayla Karmawan
Reading time: 5 minutes
The power of cultural intelligence in global leadership
Have you ever walked into a meeting and realised that a nod doesn't always mean agreement? Or that silence in one culture speaks louder than words in another? At JET - as much as at ESCP - where cultural diversity is at the heart of our values, these moments are not just learning experiences, but opportunities.
As aspiring young leaders addressing challenges in an increasingly globalised world, we want to put innovation into action. People from different nationalities often bring diverse verbal and non-verbal communication styles, which, if not properly understood, can lead to conflicts and misinterpretations that hinder progress. This situation should be avoided to the greatest extent possible, as it can be costly for the company. Therefore, developing cultural quotient (CQ) is no longer an optional skill, but a game-changer.
Why culture matters in teams
An international manager needs to communicate more transparently when working internationally, as in a domestic context we do not display our expectations of performance because we feel people understand them. Domestic, mono-cultural teams often perform better than international, geographically dispersed or virtual teams, relying on this unspoken and shared understanding. But well-managed international teams have the potential to outdo domestic teams. Both experience and research indicate that international teams are more creative, generating more ideas compared to their mono-cultural counterparts and using a broader range of criteria to judge the quality of those ideas. Moreover, other studies suggest that members of international teams achieve a higher degree of satisfaction with their team work (Comfort & Franklin, 2011).
Case study: Suntory and Beam’s cross-cultural success
As demonstrated by CNBC (2019), the merger of Suntory and Beam, which took place in 2014 strategically aimed at creating a global powerhouse in the spirits industry, provides a concrete example of how effective cross-cultural management can lead to success.
Who are the two companies:
Suntory Holdings Limited: A Japanese multinational beverage and food company, known for producing alcoholic beverages, but expanded into other areas such as soft drinks and health products.
Beam Inc.: An American company, considered as one of the largest spirits brands in the world, with a strong products portfolio.
Despite the significant cultural differences between the companies, they emphasised the importance of mutual respect and clear communication in overcoming challenges. In particular, they highlighted the need for transparent communication about expectations. The case study shows how recognising and respecting cultural differences - such as the varying meanings of "yes" in Japanese culture - is key to fostering collaboration and thriving by leveraging on their different perspectives.
The Virtuous Circle Model for Effective Team Management
In such situations, a great model to follow is the Virtuous circle of team management competencies (Comfort, 2014), which allows diverse teams to work well together. It involves starting the cycle with an understanding of yourself and others, further analysing one's direction, organisation, and role, supporting people and providing feedback, understanding how you are perceived, identifying the sources of conflict, with the ultimate goal of finding the key to effective cooperation, creating an environment where diverse perspectives can harmonise toward shared objectives.
Culture in team dynamics
Why does culture have such an impact on team dynamics? Taking one of its earliest definitions, “the complex whole which includes knowledge, belief, art, morals, custom and any other capabilities and habit acquired by man as a member of society” (McCort & Malhotra, 1993), it is understandable how culture must significantly impact a team by shaping how its members communicate, make decisions, and collaborate. We might consider how deadlines are interpreted differently in countries where relationships are more relevant than rigid timelines. Hofstede's dimensions of culture (Individualism–collectivism, Uncertainty avoidance, Power distance, Masculinity–femininity, Long-term orientation) highlight the differences in values globally. Recognising these differences is needed to gain insights on the people we are interacting with, taking them not as stereotypes but as instructions to better navigate conflicts, foster inclusivity, and enhance creativity, ultimately leading to effective teamwork and an overall better performance.
More in depth (Hofstede, 2011):
Individualism–collectivism describes the relationships individuals have in a culture; where individualistic societies look after their immediate family only, while collectivistic cultures look after a group in exchange for loyalty.
Uncertainty avoidance refers to the extent to which people are afraid of uncertainty and ambiguity.
Power distance shows the consequences of authority inequality, influencing hierarchy and dependence relationships.
Masculinity–femininity prove how a society could be more drawn to values such as achievement and success, whereas in feminine countries caring for others and quality of life are the dominant ones.
Long-term orientation stands for societies that value perseverance and thrift.
Celebrating cultural differences
But cultural differences shouldn’t be something only to acknowledge, they should be celebrated as an asset. They teach the art of perspective-taking, pushing us beyond our limits and out of our comfort zones. If we effectively incorporate those insights, a creative and more enriched environment can surely be met. It is about embracing curiosity. Do not rely solely on what meets the eye: instead of assuming, ask. An additional question goes a long way in uncovering hidden meanings and building a relationship.
Sticking to your natural approach surely is easier, but flexibility is key. Understand how to behave based on who is standing in front of you. Should you make your communication style higher or lower in context? At the end of the day, what truly brings us together are our goals - focusing on what connects us can transcend barriers. At JET ESCP, we’re uniquely positioned to thrive in this environment, giving us a competitive edge.
Conclusion: Take action to build your cultural intelligence
If you are thinking of pursuing a consulting role, keep in mind that the best consultants aren’t just problem-solvers, they’re bridge-builders. If well-equipped with cultural intelligence, being able to let cultural differences enrich the conversation, you will always be one step ahead, closer to the best solution.
References
Comfort, J., & Franklin, P. (2011). The Mindful International Manager: How to work effectively across cultures. http://ci.nii.ac.jp/ncid/BB0629446X
Comfort, J. (2014). The virtuous circle of team management competencies: developing teams to enhance firm performance. Journal of Management Development, 33(10), 935-947. doi:10.1108/JMD-02-2014-0016
Hofstede, G. (2011). Dimensionalizing Cultures: The Hofstede Model in Context. Online Readings in Psychology and Culture, 2(1). https://doi.org/10.9707/2307-0919.1014
McCort, D. J., & Malhotra, N. K. (1993). Culture and Consumer Behavior: Toward an Understanding of Cross-Cultural Consumer Behavior in International Marketing. Journal of International Consumer Marketing, 6(2), 91–127. https://doi.org/10.1300/J046v06n02_07
Suntory CEO on overcoming challenges with Beam integration. (2019, December 27). [Video]. CNBC. https://www.cnbc.com/video/2019/12/27/suntory-ceo-on-overcoming-challenges-with-beam-integration.html
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