Global companies establish offshore operations in many configurations.This post relates to Sales and Service Organizations, which are set up to sell and service the products to the local consumers in various geographies.

My experience is that typically,inexperienced companies may chose local management who are “user friendly” for Corporate Headquarters: good English; possibly US educated, risk takers willing to promote the companies’ emerging products and “manage the customers’ expectations” until the product stabilizes.

Very often, due to these very characteristics for which they were chosen, this type of local management may have a less than adequate interface with the local clientele, especially with government and public sector utilities. The clients may see this type of management as having gone native with their HQ, reckless and out of touch. In some cases, the high level of English of the local will even alienate the local client.

I was witness to many cases when a product expert came from HQ and local management served as translators. The client (highly ranked) was highly embarrassed by his poor English, and lost face when someone from the  local vendor spoke such good English. (I had recommended use of a translator for this very reason, yet my advice was ignored for budget reasons.)

My suggestion is always to chose local management who can handle the customer, and then align HQ to deal effectively with this managerial diversity.

I found 4 major fish on the plate each time in all post merger integrations that I led.

1) The impact of corporate cultural diversity on the merger.

2) The differences in national and ethnic cultures involved in the merger

3) The “change of power” political dynamic on the part of the acquired,  and the need to stabilize and align an effective power structure.

4) The competence of managers handling the complex labour of integration of units, processes and people.

While it is very lucrative to do many cross culture seminars in the early PMI phase, this not the way to start. It is even more lucrative to pretend to “blend” or even “change” corporate cultures to create a “new culture”. Lucrative, but not too effective.

I see that the most effective interventions were those that focused on the following  key drivers of post-merger success.

1-Lowering the level of post merger negative politics.

Realigning the “power dynamic” is a major PMI consulting task, which is beynd the scope of this particular post. I will relate to it in a later post.

2-Ensuring the appropriate staffing of skilled managers driving the integration on the ground.

Managerial competence is critical. This includes cross cultural competence, yet this cross cultural competence is only part of a huge bag of tricks that the integrating managers and teams need

3-Creating quality team work at the top.

Mergers can only to be good if they are good at the top. Cross cultural training must happen, and it will be  meaningful  to the degree that it is factored into the teamwork of the top team and other teams. So the focus must be on team effectiveness, not cultural training per se.

As far as the “creation of a new corporate culture” is concerned, I see this endeavour  as “snake oil”. No one knows how to do it well, and it happens on its own. We are midwives in this process.

Strategy factors in competitive analysis, swot analysis, financials, capabilities and what have you.

Strategic planning rarely takes into account the way that culture impacts the strategizers themselves, and thus the very  act of strategizing.

So, as they say in Chatuchuk Market in my favourite city, “lookie lookie” at the following examples.

• People who come from an “empire” assume that strategy is a tool by which they can control and shape the environment.
• People who come from cultures with a “survivor mentality” may believe that strategy is  dangerous or futile, because is mitigates immediate threats.
• Folks who come from merchant cultures may believe that strategies defocus opportunities.
• Folks who come from cultures where discretion is preferred to openness may believe that an espoused and transparent strategy increases  vulnerability. “Muddy the water, and catch the fish”.
• People who come from very conservative cultures may view any strategic exercise as “threatening”.

Next time you sit down to strategize with folks in a very global organizational configuration, you would be best to flush out some of these assumptions.

1Those who work globally are aware that the cultural freedom to express even minor disagreement with people in authority is not universally accepted and disagreements between with superiors are thus manifested very differently.

Here are a few examples.

Explicit hardball challenging: Gilad (m, Israel) argues with his Israeli boss all the time. Gilad challenges the boss’s assumptions and directives in challenging emails as well as  by speaking out against the boss’ policy  in meetings. US based colleagues who have observed Gilad believe that Gilad shows no respect for his boss. However, once a directive is given, Gilad will carry it out to a T, never trying to stand by passively as things go bad.Gilad and his boss play on the same soccer team and socialize together at the beach.

Behavioural loyalty despite deep hinted differences : Hermann (m Germany) is very critical of his German boss, with whom he has been working for 5 years. In meetings, Hermann asks challenging yet legitimate technical questions and provides in depth risk analysis for his bosses’ proposed suggestions. Hermann will refrain from any other expression of disagreement. In private, Hermann will state that to anyone who will listen that the boss is an idiot. Hermann will loyally carry out the directives of his boss even if they are causing failure. Hermann and his boss move in two different social circles.

Pragmatic Controlled  Disagreement: Karen (f USA) believes that her American boss has made several critical errors over the last month. Karen is very pragmatic; she asks some mildly  “challenging” questions after adding “well, let me play the devil’s advocate”. Privately, Karen assures her boss that, I am with you”, yet Karen adds her “concerns”. When one of her boss’s directives goes bad, Karen will be remain composed, and not go out of her way to help, allowing things “to take their course”.  Karen needs her boss’s recommendations after she leaves to “further her career”. Karen and her boss socialize only at the Christmas party.

Indirect Backdoor-ism: Tree (m Thai) thinks that his Singaporean boss overplays relationships with sales people in the selling process and underplays schmoozing up to the clients’ technical staff,  resulting in problems during initial deployment. Tree is very polite to his boss. He never expresses any disagreement, either in meetings or emails. Tree gossips all the time to his boss’s other subordinates about the boss’s errors. Both Tree and his boss know about the disagreement, yet  never talk about them, in order to maintain harmony. When a bad decision causes failure, Tree will be very passive and smile. Tree and his boss socialize in the Chinese New Year Party and have lunch twice a week to  chat.

So-do not assume that agreement with what you say is real; do not assume that those who challenge you are against you; and don’t ignore gossip but factor it in in societies where harmony is more valued than “truth”.

It is fascinating to observe the gap between the “wow-we-can-do-it” crowd and those from other more realistic cultures who observe this attitude.

I do not propose that can-doers change, yet I would like to share  observations about the way that  can-doism is perceived in the acutely diverse global workplace.

1) Arrogant. Many folks see can do-ism as snake-oil mind over matter, and as such, they see can doism as mitigation of difficulty via over reliance on self.

2) Superficial. When obstacles are very complex and appear insurmountable, can doism is seen as high on action and low on thoughtfulness and caution.

3) Lip Service. Since can-doism is often associated with cultures whose optimism is seen as “phoney”, can doism is seen as lip service to a normative way of expressing oneself.

Information technology, the predominance of Western culture in many global organizations, the necessity of “time to market”, and other factors accelerate the speed of organizational life. Commitments are aggressive, competition is cut throat; speed is strategy. Were Darwin alive, he would have written a book about Organizational Darwinism.

Global organizing means exposure to “acute diversity”, not the diversity of skin colour and other relatively “minor” differences often referred to  by folks who deal in diversity within the US and Canada. By acute diversity, I mean a lack of a shared language, opposing and clashing cultural values as well as very different and opposite  views of organizational life.

• Amala keeps her cell phone constantly because she believes she needs to be available to her clients all the time. She comes late to meetings because time is not a valuable resource. She texts  her family members during meetings because work and family are a simultaneous mix; she works 7 days a week. Amala is very opinionated but rarely expresses her opinions because she does not believe she can input his boss’ faulty direction. Amala ignores process because it “does not reflect the way the world works”. Amala will stay with her company for decades. Amala comes from an area in India where her “accent” is hard to understand in a phone call.
• Fred works 5 days a week. Fred shuts down his phone in meetings and Fred is punctual. On the basis of personal expediency, he will express himself when he disagrees with his boss  “up to a point”. Fred follows process to a T. Fred will stay with his company until he gets a better offer with a shorter commute. Fred speaks one language, English, and he has never left the States, except for a trip to the Canadian side of Niagara Falls.

So, if business moves so quickly and people are so different, what does that mean for dealing simultaneously with the need for speed and coping with acute diversity?

It means that the speed will accelerate the differences between people. Speed accentuates conflict, forces direct communication and pushes for rapid resolution. Speed forces people to accommodate one another, but destroys trust needed for long term sustainable relationships.

So, 4 tips for coping with speed and acute diversity.

1) Don’t assume a shallow “can do” attitude. Acknowledge the problems and difficulties. “Can do” is a deadly enemy of acute diversity.

2) Build and foster relationships instead of just expediting tasks.

4) When you visit other locations, stay for a weekend or two. Make friends with the people you work with. Establish a context where you can “exchange favours”.

4) Be very patient when things are very different. Slowing down often makes things speed up. Not saying anything may be more useful than speaking up. Showing humility in face of great challenge may be more useful than being arrogant by trying the same tactic again and again.

Suddenly, after you slow down, things will pick up on their own. Sounds weird, but it happens. It is just counter-intuitive.

As we saw in the last post, Canadian Doug and Israeli Yael created a company known for  aggressive commitments, and despite slips in delivery dates, clients were compensated by “over delivery in quality and features” which delighted their clients.

They paid very very well, and drove their staff hard. People worked 14 hours a day; no one even paid lip service to work life balance. Cell phones were expected to be on all the time.

The company had  a semi official motto which said “we make a religion out of our problems.” Company meetings were brutal; all the issues were always at the center of the table, and communication was brusque and aggressive. Very often, there were tears and outbursts of anger in the daily meetings.

But why did Yael and Doug design the company as they did? In over a hundred hours with them, I managed to understand that their belief system as  detailed below. This belief system explains their company culture.

a-Building and running business in a highly competitive environment is like boxing. “THAT is no country for old men”, wrote Yeats. In other words, the tough win and the weak get the cr-p knocked out of them. The company and its people  need to be a winners: innovative, flexible, fast, fast, fast and faster. And they also need to be resilient and absorb a punch.

b-Speed and flexibility cause intense conflicts to surface; dealing with these conflicts politely or cordially makes no sense. There is a need for timely resolution, i.e., the task becomes more important than peoples’ feelings at that particular moment. Members of the organization need to “fight for” what they believe in. The system should be not optimized, but there should a constant struggle between competing dichotomies, like `first to market`and feature rich“.

c-Meetings where priorities are worked out are like boxing matches. Each side advocates its own interest and hits hard.  If you chose the right people, this creates great decisions because committments are very aggressive, yet do-able. Compromise happens because people respect one another…..the psychology of a tough neighborhood.

d-Putting up a fight for what you believe in means you care. It is easy to trust people who care. It is harder to trust people who are expedient and do not advocate for what they believe and are viewed as “phoney`or wimps”`, or both.

e-Trust between worthy opponents needs to be leveraged to create very strong relationships out of the ring, which are leveraged and tested in the ring.

Doug McNeal (Canada) and Yael Bar-Yoav (F, Israel)  studied together at McGill; many years later they reconnected and established a successful software company  which develops and deploys cost effective software security solutions for small businesses (between 2-50 users). (Readers of this blog already know I as well  studied at McGill).

Their business grew in North America and Europe. Doug drove the Sales and Marketing and Yael drove a strong core product with sector-related applications with phenomenal time-to-market speed.

Their company is known for aggressive commitments, slips in delivery delivery dates compensated by “over delivery in quality and features” which delights its users.

The company has paid huge bucks yet they drive their staff hard. They have  a semi official motto which said “we make a religion out of our problems.” Company meetings are brutal; all the issues are on the table, communication is brusque and aggressive yet excellent relationships made this all doable; the relationships “smooth over” the immense pain caused in these meetings. (Very often there are tears and outbursts of anger in the daily meetings).

I knew Doug and Yael from McGill. Doug and I skied together while Yael and I knew each other from an Israeli association group. Ten years ago they hired me, following 5 unsuccessful attempts to break into the market in Taiwan, Thailand and Indonesia.

I flew to Asia and I spoke to people with whom they had worked and I quickly learned that the company culture did not fly in APAC.

I told Yael and Doug that they need to do to adapt their corporate culture to the Asian market. Communication must be less aggressive; there must be more room for discretion in dealing with limitations and failures. “Face-management” must be factored in to the way meetings are run. They pushed back on me for more than an hour when I gave them this feedback. Then I lost my cool, and used a metaphor which was uncalled for since we were eating  at the time.

“Every home has a toilet, a living room and a kitchen. You cook in the kitchen, you watch TV and socialize in the living room, and you rid your body wastes in the toilet. The folks that I have spoken to in Asia believes that in your company, there is confusion between what goes on in the toilet and the living room. In other words, things go on in the living room that should go on in the toilet, and to make it worse, when someone goes to the toilet, the door is left open for all to hear and see. Your company has too  much public aggression, too many perceived insults and no where to hide because no one’s face is ever saved. So great local talent does not want to work with you. Thus you brought in expats who do not understand the market, and fail.”

Yael choked and said, “I got it”. Doug told me that “as usual, Allon, you are clear”.

Most cultures try to separate between facts and opinions as well as between discussion and negotiation. However, there are many cultures where facts and emotions mix all the time, where discussion and negotiation are intertwined and where very strong opinions are expressed as a matter of course, in all stages of social intercourse.

And, there are other  cultures where there are different rules for insiders and outsiders; the insider group leverages on relationships whilst trading favours and the outsider group needs to play hardball when dealing with insiders.

In both situations, the question arises on how to deal with strong opinions and an atmosphere of constant hardball negotation.

5 tips on how  be more effective in dealing with situations like these:

1) When someone says “No”, choose to hear is “not now”, “not yet” or “test me to see if I mean what I have said.”.

2) If someone raises their voice, listen to the content and try to block out the style-related noise, which can be distracting.

3) Negotiate as well, all the time.  Make ridiculous demands, and then back off. Look at this like a game, or like training a dog to yield.

4) When encountering a very strong opinion that you may want to challenge, try saying “You are wrong”….then explain. This will get the other side’s respect and admiration!

5) Do not follow “process” or protocol, because you will be seen as weak. Process and protocol  do not provide protection  in cultures like these.

Play hardball; people will trust you and respect you more for it.

Charles is a product expert /evangelist in a North America based company. Charles owns adapting the specs for each specific market where his product (to be released in 6 months) is to be sold.

Charles lives in a culture where his utmost loyalty is to his career, and Charles could easily walk away from his company for a 20% raise, especially if the commuting time is less. Charles does not believe the company is loyal to him; Charles believes that in another recession “I would be thrown to the dogs without an afterthought.”

Jaya (male, Indonesian) is an account manager in Jakarta. Since Jaya’s mom is British, Jaya speak perfect English. Jaya has always worked for “foreign firms” and managed relationships with the Indonesia based clients. Jaya sees utmost value in the local  relationships he has with his customers. Into his relationships, Jaya “plugs in” the product of the company for which he is working.“Today I will sell them something; when I change companies, I will sell them something else”.  Jaya must always be seen as highly credible in the view of his customers, who have a very low tolerance for half-cooked, just released products, since customer service is done out of a regional hub in Taipei, which is too culturally and geographically removed.

Charles wants to visit a huge Indonesian client to push his product. Charles does not want Jaya to be in this meeting because “Jaya throws too many blocks”.

Jaya has emailed corporate that if Charles visits this Indonesian customer without his presence, Jaya will leave the company the same day. Jaya does not trust Charles, who “flies in, makes promises, flies out, and  leaves me to manage the mess.” Jaya believes Charles can quit “tomorrow”, so Jaya does not trust the product or Charles, which are one in Jaya’s view.

A solution was found! Charles took part in a webinar on “how to behave at a client visit in Indonesia”. Charles learnt that Indonesians generally do not show enthusiasm. He also made a note that he was expected to remain calm. This was his major takeaway.

Charles’ visit was a disaster and Jaya quit. And this is what happens when our training addresses the wrong issues, the wrong way.

Cultural and diversity training needs to address matters of process design, business assumptions,  as well as  provide employees with mutual dependencies in specific situations a protocol for interaction. The training needs to be tailored made, and  driven by business needs.