How Do Cultural Differences Affect Leadership?
Culture- the values, ideals, beliefs, and norms of a target market- affects literally everything in the world of business and leadership. What works in the U.S.A, for example, may not work for businesses that are based in other parts of the world. That explains why if you are interested in moving your operations to a different country- say to China, you may need to hire a professional employer organization to help you meet the cultural demands of the region.
Culture is one of the most vital external variations that you as a business leader ought to involve yourself enthusiastically with, particularly for the purposes of pleasing your local employees, customers, and stakeholders. It is an administrative part of the business that requires personal, close reflection of the way the cultural heritage of the people influences your business decisions. In that case, you must know how to balance between your own culture and that of your business associates so that one is not lost in the other.
Here are 3 ways that cultural differences affect business leadership for international corporations.
1. Working hours
As a business leader, it is imperative that you understand the differences in time zones for different customers and employees. What you consider to be reasonable time schedules back in your zone could be very unreasonable for your international employees and what they consider to be reasonable time may be too late or early for you.
In that case, therefore, you will have to compromise on literally everything from staff meetings to customer care hours. Sometimes you will have to keep standby teams at the head office who can respond to customer questions and address operational challenges that might occur in your overseas offices.
In some cultures, it is okay to call employees even on their off days or after work, some others strictly don’t allow such. In some cultures, coming late can lead to sacking, others do not necessarily consider time as a key factor of production. You will need to understand how to react to different time cultures within your company’s workforce.
2. Business negotiations and transactions
Clients and investors alike can have varying approaches to business negotiations and transactions depending on where they are from. For example, investors in the west expect you to be direct and get straight to the point in regards to your financing needs, whereas those in the east, particularly China and Japan, expect you to approach business deals more delicately.
If you are too direct with your potential business partners in China, you could come across as rude, unprofessional, and confrontational, which could ruin your chances of convincing the investors to buy stakes in your company. On the other hand, being too delicate in the USA or Europe could seem overly cautious and evasive, and that can make potential investors a bit skeptical towards your business proposition.
In a nutshell, understanding the cultures of people is very important before setting up any business meeting. Whenever possible, it is wise to start by agreeing on what you’ll talk about, both you and the other party, so that no important topics will be missed or uncomfortable topics included in the discussions. As the leader, you must ensure that every stakeholder knows what to expect beforehand.
3. Office culture
Business cultures vary from one part of the world to the other, with contradicting views on important things such as dress codes and hierarchy. In some cultures, it is perfectly okay for colleagues to refer to each other informally and even wear informal clothes to work, such as t-shirts and jeans. In other cultures, it is okay for employees to take lots of breaks provided they are “reasonable”.
In some other cultures, colleagues will use titles to address one another, strictly wear suits and other official dress codes, and put a lot of emphasis on punctuality.
As a leader, you must understand that, as much as they are different, no approach is inherently better than the other. The most important thing is to research typical company cultures in all the regions that you operate in and then streamline your administrative approach to meet those cultures. Also, try and understand the values that inform different cultures before taking your business to other countries so that you can pick all the important information from the tons of nuance that the other culture emphasizes on. Learn to handle such nuances first before moving ahead with your globalization plans.