CHICAGO — They tied the knot, and now there’s trouble.
Like a marriage, a business relationship is nurtured by good communication. Yet one of the biggest difficulties global companies face these days is the failure to communicate effectively with overseas workers, partners and contractors.
International miscommunciation can be costly — especially with revenues from foreign markets at several large, U.S.-based corporations, such as Coca Cola, Ford, IBM and Exxon-Mobil, exceeding 50 percent.
Companies that simply try to transfer their culture abroad are seldom fully embraced by the people who are making and selling their products. More often they are greeted with rolled eyes, hurt feelings and crossed arms.
This crisis of understanding became evident during a diversity and inclusion conference in Chicago sponsored by The Conference Board, a non-profit consulting group financed by corporations. Diversity officers are like the counselors of the corporation — trying to get workers who find themselves in a marriage of convenience — to make the most of it. But the situations they described just aren’t happy.
One company based in the Midwest that makes plumbing fixtures, and asked not to be named, called its Chinese manufacturers three times and asked them to change some of the processes they were using. The Chinese agreed, but nothing changed. Then the Americans began to have recriminations. Maybe they had been too blunt and maybe the Chinese were trying to save face.
To help them read the tea leaves, companies are hiring experts to teach international insight to their workers. GlobeSmart is an online solution that enables customers to log into its website and learn how to conduct business in 60 countries.
In a test run, users can sample information from three countries. GlobeSmart recommends a different method of resolving conflict for each culture.
In the Netherlands, GlobeSmart suggests addressing conflict in private, not in front of the group.
To settle disputes in the Philippines, the website advises using a “bridge” person as a conflict mediator. “Filipinos abhor direct confrontation. It’s scary to them. You almost never want to be confrontational in a direct way,” wrote one user of the site.
Resolving conflict in Argentina, however, may take intensive face time and diplomacy. GlobeSmart suggests meeting with the parties or subordinates in private first and then meeting with all of the involved parties “to create a mutually agreeable solution.”
Not even the experts have all of the solutions. Intuit, a computer software producer based in California, hired a company to educate its workers about India, but some employees disagreed with the information the company provided about caste, a traditional social classification system based on clans and heredity. Because caste has been used to discriminate in the past, and caste-based discrimination is outlawed by the Indian Constitution, some employees did not wish to acknowledge caste, even for educational purposes.
Every culture has its hot buttons and it will likely take more than a language interpreter, a phone call or several e-mails to figure out how to stop pushing them.
Cisco Systems is drawing on its own resources to better understand such issues. In corporate quick speak it’s called reverse mentoring; corporate executives are turning to their multicultural subordinates to help inform them. Cisco, which makes internet routers, is based in California, but 38 percent of its employees are outside of the United States. It uses video conferencing to help executives learn about cultural issues from junior employees.
The need for greater international knowledge is only going to increase as corporations try to capture the profit potential of underdeveloped markets. “In 2000, emerging and developing nations were responsible for only one-third of global production and developed nations were responsible for the other two thirds,” said Jonathan Spector, chief executive of The Conference Board. “The situation will be the other way around in 2015; emerging and developing nations will be responsible for more than 60 percent and developed nations will be responsible for less than 40 percent.”
All of this promises a new life for the diversity officers in companies where, in the economic hardship of recent years, some chief executive officers have increasingly scorned diversity as a cost. While CEOs often demand proof that their diversity investments are paying off, the costs of not doing it might show up in “accidental” manufacturing mistakes, employees who “retire” on the job by not doing their share of the work or repeated misunderstandings that result in workers defecting to competitors.
If it’s any reassurance, it’s not just the Americans who find themselves stuck in the post-honeymoon blues.
“Now we are seeing Brazilian companies expand into Mexico and they are bringing their own ethnocentrism to it,” said Andres Tapia, a consultant with Hewitt Associates. “So, what was once seen as an American mistake turns out to be a human mistake.”
Tapia, a Peruvian who is based in the United States and navigates cross-cultural issues for a living, contends that there is no quick technical solution for this learning.
After you get beyond the bow or the handshake, the next step is trying to put oneself into another’s skin, not under it. Perfecting the relationship may take years of concentration and adaptation. It could even end in divorce.