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2017-06-22 07:27:57
Erin Meyer
From the July August 2017 Issue
Cultural differences in leadership styles often create unexpected
misunderstandings. Americans, for example, are used to thinking of the Japanese
as hierarchical while considering themselves egalitarian. Yet the Japanese find
Americans confusing to deal with. Although American bosses are outwardly
egalitarian encouraging subordinates to use first names and to speak up in
meetings they seem to the Japanese to be extremely autocratic in the way they
make decisions. As a Japanese manager living in the United States and working
for Mitsubishi put it: I couldn t figure out how to adapt my approach from one
day to the next, because the culture was so contradictory and puzzling.
Problems like this manager s are widespread. In many years of researching,
consulting, and teaching executives and managers in hundreds of global
companies, I ve found that it s common for people from different countries to
grapple with mutual incomprehension. Often that s because managers fail to
distinguish between two important dimensions of leadership culture.
The first of these is the one we re most familiar with: authority. How much
attention do we pay to the rank or status of a person, and how much respect and
deference do we pay to that status? On this dimension, the Japanese are clearly
more hierarchical than Americans. The positions are reversed, however, when we
look at the second dimension: decision making. Who calls the shots, and how?
Does the boss decide, or does the team decide collectively? On this dimension,
which is often overlooked, the Japanese are more consensual than Americans.
The management approach that works in Lagos won t be as effective in Stockholm.
Approaches to authority and decision making are not the only ways in which
cultures differ, but they are arguably the most important in the leadership
context. And if international managers confound the two, they will make
mistakes in adapting their leadership styles to the cultures and situations at
hand. (For a more general treatment of cultural differences, take a look at my
May 2014 HBR article, Navigating the Cultural Minefield. )
In this article, I explore the two dimensions and how they affect global
leadership effectiveness, focusing particularly on how attitudes toward
decision making impact global teamwork. I conclude by mapping selected cultures
along both dimensions and comparing the resulting expectations about the role
of the leader.
Attitudes Toward Authority
Over the past century, the biggest leadership trend in the U.S. and parts of
Western Europe has been the abandoning of hierarchical management processes for
a more facilitative, egalitarian approach. Command-and-control has been
replaced with empowerment. Managers have been trained to stop telling their
employees what to do and instead move to management by objective, open-door
policies, and 360-degree feedback. Early on, addressing the boss by first name
rather than title became the norm. Company hierarchy further dissolved when the
CEO began management by walking around, having impromptu discussions with
people at all levels without even letting their supervisors know. Then the
corner office yielded to open-plan spaces. Since most management literature and
research still come out of the U.S., business school education has largely
reinforced this trend.
But attitude toward authority is one of the most striking points of difference
across cultures. In Nigeria a child learns to kneel or even lie down as a sign
of respect when an elder enters the room. In Sweden a student calls her
teachers by their first names and, without implying any disrespect, feels free
to contradict them in front of her classmates. Unsurprisingly, the management
approach that works in Lagos will not get the best results in Stockholm.
Understanding this disconnect is important. In general, the greatest business
opportunities lie in the big emerging economies, which include Bangladesh,
China, India, Indonesia, Russia, and Turkey. In nearly every case, these are
cultures where hierarchy and deference to authority are deeply woven into the
national psyche. The management orthodoxy of pushing authority down in the
organization does not fit easily into the emerging-market context and often
trips up Western companies on their first ventures abroad.
Take the case of an American firm I worked with two years ago. I ll call it
Chill Factor, as it delivers innovative cooling solutions to consumers and
small businesses. For the previous 15 years, Chill Factor had been training its
employees in the latest egalitarian leadership methods, encouraging low-level
workers to show initiative, while teaching the bosses to leave their doors
open, accept 360-degree feedback, and set objectives rather than issue edicts.
Additionally, the business had set up the flattest organizational structure
possible. This progressive culture helped the company attract talent and keep
employees inspired and engaged. The entire workforce was humming with
creativity and innovation.
After decades of success in the U.S., Chill Factor took a big jump and
negotiated a joint venture with a company in Hangzhou, China. But within weeks
the Chill Factor managers were complaining about the lack of initiative shown
by their Chinese staff. As one manager related to me:
My Chinese employees don t see it as their job to have ideas or make
suggestions to their leaders. They just follow instructions. Subordinates do
not volunteer solutions but simply present problems. Their measure of success
is to do what they are told, when they are told, and to do it well. But I
expect them to produce new ideas and to give the bosses information so that we
can make the best decisions for the benefit of the business.
In a session with a group of American executives and a dozen of their Chinese
colleagues, I asked the Chinese managers to work as a small group and give
advice to the Americans about how to handle their Chinese staff more
effectively. They huddled and then presented their recommendations:
Because Chill Factor now wants to succeed in China, we hope our American
colleagues could kindly make some changes:
Before attending a meeting with your staff, prepare more ideas for yourself.
Be more specific with directions to your employees.
Have your own plan before allocating work to your subordinates.
The American managers were dumbfounded and asked for elaboration. The most
surprising comment from our Chinese colleagues, one Chill Factor executive
later explained, was that we were perceived not just as incompetent but as
arrogant, because we didn t take the time to explain to our staff carefully and
in detail what we wanted them to do and how. It was a valuable learning moment
for this firm, which began to pull back on some of the egalitarian practices
that it had so long taken for granted as the best approach.
Of course, those who already have some international experience might not be
surprised that Chinese managers defer to their bosses and that American
attitudes toward status don t travel well. But understanding differences in
attitudes toward hierarchy and status, as we ve noted, isn t the whole story.
Attitudes Toward Decision Making
Many executives and managers assume that in more-hierarchical societies,
decisions will be made at the top by the boss, and in more-egalitarian
cultures, decisions will be reached by group consensus. Yet on a worldwide
scale, we find that hierarchies and decision-making methods are not always
correlated.
The U.S. is a striking example. American business culture has become more and
more egalitarian over recent decades, but consensual decision making is clearly
not the norm. American companies favor quick and flexible decisions, so
decision-making power is vested in the individual (usually the boss). With a
disdain for analysis paralysis and a belief that any decision is better than
no decision, the American manager may solicit input from his or her team but
ultimately is the one to make the final determination. And in most cases, the
team members not only are fine with this but expect it. The U.S. can thus be
described as an egalitarian culture where decisions are made top-down.
In top-down decision-making cultures (India, Italy, Mexico, Morocco, and Russia
are other examples), decisions are made quickly, but they are subject to change
as new input or arguments arise. When people in these cultures say they ve
reached a decision, the decision is not a firm commitment but a placeholder
that can later be adjusted.
Contrast that with what happens in Germany, Japan, the Netherlands, and Sweden.
If you ve collaborated with companies in those countries, you might have
noticed that a lot of people seem to be involved in the decision-making
process, and it takes a long time to negotiate group agreement. However, once a
decision gets made, implementation is surprisingly quick, because details and
stakeholders were aligned while consensus was being reached. In these
consensual cultures, it s as if the word Decision has a capital D,
representing a commitment that can t (and shouldn t) be easily changed.
If groups reach decisions in different ways, be explicit about the process.
Either system can work well, and both have their advantages. Small d top-down
decision making is particularly suited to industries where the pace of change
is fast and speed to market trumps product perfection. Big D consensual
cultures are great for industries where development timelines are long and
perfection of the product is essential. It s perhaps no surprise that two big
D cultures Germany and Japan are among the world s greatest car-manufacturing
nations.
Problems arise, however, when members of a single team have different norms of
behavior. What happens, say, when a consensual big D Japanese company
acquires a top-down small d American business? This was exactly the situation
when Suntory became the majority shareholder in Beam (maker of Jim Beam
whiskey). The success of this acquisition reveals some useful strategies for
navigating safely through big D /small d collaboration.
As is the tradition in Japan, Suntory managers used a consensual big D system
of decision making. One of them explained:
In Suntory the management structure is hierarchical, but decisions are most
often made by group consensus. Mid-level managers discuss a proposal among
themselves and come to a consensus before presenting it to managers one level
higher. The next-higher-ranking managers then discuss the proposal themselves
and come also to an agreement. If they collectively believe in the initiative,
they pass it on for approval at the next level, until it gets to the top.
Two words define this consensual process, so common in Japanese companies. The
first is nemawashi the practice of speaking with each individual stakeholder
before a meeting in order to shape the group decision and develop agreement in
advance. The second is ringi, which involves passing a proposal around level by
level, starting at the bottom and then working through the layers of middle and
senior management before arriving at the top.
This system works beautifully, provided everyone understands and follows it.
The problems at Suntory and Beam arose because managers on one side didn t
understand how managers on the other side made decisions. The experience of one
American manager from Beam provides a nice illustration:
There was a problem and a decision had to be made, which required a trip to
Japan. The Japanese director in charge would be present, so I thought this
would be the perfect moment to impact his direction. I prepared some slides for
a meeting, along with my proposal. During the meeting, it became apparent that
the decision had already been made by the group beforehand and was different
from my proposal. Trying to discuss and convince during the meeting had no
effect at all.
Learning the approach of the other culture and adapting accordingly is
obviously important. Through trial and error and by asking questions, the Beam
manager came to see that his assumptions about how and when decisions would get
made was entirely a result of his experience working in the U.S. Over time, he
learned to give his input much earlier at Suntory. But if you re managing the
collaboration of two groups with different systems for reaching decisions,
being flexible and adapting your individual style are not enough. You must also
be explicit about the process of decision making. Define whether decisions will
be made by consensus or by the boss. Establish whether 100% agreement is
needed. Clarify whether a deadline for the decision is necessary and, if one is
set, how much flexibility there will be for changes afterward.
Consider the case of a German-American collaboration I worked on. Early in the
project, team members from both countries discussed a major decision ahead of a
meeting with the company s big boss in the U.S. The team formed a point of
view, and everyone seemed united on it. But during the actual meeting, after a
very short discussion, the boss announced her decision, which ran counter to
the team s recommendation. The Americans all agreed with the boss without a
word of pushback. The German team members, however, were deeply unhappy about
this turn of events, concluding not only that the American boss was arrogant
but also that their American colleagues were two-faced.
Of course, these perceptions weren t exactly helping the relationships among
the team members. But the situation became particularly fraught when it came to
the meaning of the word decision. One German team member explained:
At the end of a short meeting the boss would announce, Great! We have a
decision. For a German, when you say We will do this, it is a promise. You
can t just change your mind casually tomorrow. So we Germans would spend days
working on the implementation. And then one of the Americans would call us up
and casually mention that we were taking another direction, or the boss would
show us more data suggesting a different path.
For the first several months of collaboration, the Germans could not shake the
feeling that their American teammates were disingenuous. One manager spoke to
his American boss about the situation, and the conversation was illuminating
for both of them. The German commented, I then understood that for an
American, a decision is simply an agreement to continue discussions. And if you
are American, you understand that. But for a German, who considers a decision a
final commitment to march forward on a plan, this can cause a lot of confusion.
In a consensual, egalitarian culture, the boss won t jump in and decide.
To get the collaboration on track, the two leaders organized an off-site
retreat. The team members discussed their assumptions about how decisions
should get made and what the word decision means in each of their cultures.
They developed a system for collectively arriving at decisions and determining
how flexible those would be, using the big D /small d distinction. In
subsequent meetings, an American might be heard to say, Great! Decision made!
only to pause and clarify, Decision with a small d, that is. We still need
to run this by our colleagues at home, so don t start working on it yet. With
the cultural difference brought to the surface and acknowledged, the
collaboration took off.
The Four Cultures of Leadership
Making a clear distinction between attitudes toward authority (from
hierarchical to egalitarian) and attitudes toward decision making (from
top-down to consensual) goes a long way in helping leaders become more
effective in a global context. It turns out that countries are quite broadly
scattered across the two dimensions, as you can see from the exhibit Mapping
Leadership Cultures, which plots the positions of 19 countries within four
quadrants. Let s look at the main expectations people have of leaders in each
quadrant.
[R1704D_MEY]
Consensual and egalitarian: Denmark, Netherlands, Norway, Sweden
Early in my career, I worked as the only non-Dane on an eight-person team. As
an egalitarian American, I thought it was great when my boss told me that
decisions would be made by consensus. But then the e-mails started. First from
him: Hey, team, for the annual face-to-face in December, I thought we would
focus on being more client-centric. What do you think? Then from a team
member: Hi, Per. Great idea. But wouldn t it be better to focus the meeting on
how to market our services more successfully? And from someone else: I think
it would be most effective to have presentations from all team members about
their individual client strategies. And then everyone began sending responses
to one another, ending with: Erin, we haven t heard from you. What do you
think? Consensual decision making sounds like a great idea in principle, but
people from fundamentally nonconsensual cultures can find the reality
frustratingly time-consuming.
If you are to thrive in this quadrant, therefore, you need to go in with the
following approach to leadership:
Expect the decision making to take longer and to involve more meetings and
correspondence.
Do your best to demonstrate patience and commitment throughout the process,
even when diverging opinions lead to lengthy ongoing discussions.
Don t expect the boss to jump in and decide for the group. The boss is a
facilitator, not the decider.
Resist the temptation to push for a quick resolution. Take the time to ensure
that the decision you make is the best one possible, because it will be
difficult to change later.
Consensual and hierarchical: Belgium, Germany, Japan
A French director of Deutsche Bank once told me: When I moved to Germany, I
was aware that both our cultures are rather hierarchical. So I continued to
make decisions as I would have in France, which was basically after some good
debate to tell the group what I d decided, even when I knew many people had
opposing opinions about what should be done. When the director received
feedback from his first 360-degree review, he was upset by complaints from his
German staff that he wasn t inclusive. Eventually he realized that the Germans
expected him to invest considerably more time in winning their support before
coming to a decision more than would have been necessary in a French
organization.
If you likewise are not used to a consensual, hierarchical culture, be aware
that in this quadrant:
If you re the boss, your team will defer to your decision, yet desire and
expect to be part of the decision-making process. Make a point of soliciting
opinions and input from your staff.
Be patient and thorough. Invest the time necessary to get each stakeholder on
board.
Once a group decision begins to form, take special care to listen to those with
dissenting opinions.
Focus on the quality and completeness of information gathered and the soundness
of the reasoning process. Remember that in this quadrant, decisions are
commitments that are not easily altered.
Top-down and hierarchical: Brazil, China, France, India, Indonesia, Mexico,
Russia, Saudi Arabia
We ve already visited this quadrant in the company of those Americans who moved
to China with Chill Factor and perceived their Chinese staff as lacking
initiative, while the Chinese viewed the new U.S. managers as incompetent.
If you re operating in this quadrant:
Remember that the boss is the director, not a facilitator.
If you re the boss, you will be deferred to in public and probably in private
too. Don t be shy about telling your team how best to show you respect.
Be clear about your expectations. If you want your staff to present three ideas
to you before asking your opinion, or to give you input before you make a
decision, tell them. Old habits die hard for all of us, so reinforce with
clarity and specificity the behavior you are looking for.
Be careful what you say. You may find that an off-the-cuff comment is
interpreted as a decision and suddenly everyone is building that factory or
reorganizing that department, when you thought you were just introducing an
idea to explore.
Top-down and egalitarian: Australia, Canada, United Kingdom, United States
An American director for the World Bank, whom I will call Karen, described a
challenge she was having with a Korean employee who had recently joined her
team. When I hired Jae-Sun to work for me in D.C., he had a shining r sum ,
Karen explained. Promoted time and again to run teams across Asia, he appeared
to be an employee who knew how to get things done. Yet Karen noticed right away
that if Jae-Sun was with her or another senior manager in a meeting, he seemed
reluctant to express his views and instead deferred to them. I had hoped to
groom him for a bigger role in the department, but with this lack of
self-confidence, I saw it just wasn t going to happen, Karen told me.
Succeeding in a top-down, egalitarian environment requires behaving as follows:
Before the decision has been made, speak up no matter what your status is. You
might not be asked explicitly to contribute, but demonstrate initiative and
self-confidence by making your voice heard. Politely yet clearly provide your
viewpoint even when it diverges from what the boss seems to be thinking.
Once the matter has been resolved, align quickly with the boss and support the
decision even if it conflicts with the opinion you previously expressed. At
this stage, if you show disagreement especially in front of others you may be
viewed as difficult to work with.
After the decision is made, remain flexible. Decisions in this quadrant are
rarely set in stone; most can later be adjusted or revisited if necessary.
CONCLUSION
Once you ve figured out the nuances and complexities of the different
approaches, you will make smarter choices in all your cross-cultural
interactions as a leader and as a follower. During performance reviews with
your Mexican staff, for instance, you might choose to explain your own approach
and ask the team to adapt to you. The next week, while leading a meeting with
those same employees, you might decide it will be more productive if you adapt
to their cultural norms rather than expect them to adapt to yours.
The bottom line? Although you may have been a very successful leader in your
own culture, if you hope to motivate and engage people around the globe, you
will need a multifaceted approach. Today it s no longer enough to know how to
lead the Dutch way or the Mexican way, the American way or the Chinese way. You
must be informed enough and flexible enough to choose which style will work
best in which cultural context and then deliberately decide how to adapt (or
not) to get the results you need.
A version of this article appeared in the July August 2017 issue (pp.70 77) of
Harvard Business Review.