Three Step Approach. Our new unified meta-theory theory of Competence. Cultural Differences affect business in many different ways. A model of culture

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1 Three Step Approach Managing Diversity in Global Business Dimensions & Process Awareness Increase awareness of one s own cultural perspective. Respect Appreciate cultural differences. Reconciliation Resolve cultural differences. Fons Trompenaars Managing Director THT Dimensions & Time Our new unified meta-theory theory of Competence Cultural Differences affect business in many different ways Whereas Middle Managers make decisions on issues High performing leaders and international managers continually reconcile dilemmas Transcultural Competence = the propensity to reconcile seemingly opposing values How would you define Culture? A model of culture A model of culture Explicit Culture Language Explicit Culture Products and Artifacts Physical contact Food Work ethic Architecture emotion Pace of life Music Noise Dress Climate Literature

2 A model of culture Culture as a Normal Distribution Explicit Culture Artifacts and Products 12 and Norms Values Values 1 8 Stereotype Stereotype 6 U.S. Culture French Culture 2 Norms and Values A model of culture Culture Explicit Culture Artifacts and Products is a dynamic process of solving human problems/dilemmas in the areas of: Implicit Culture Norms and Values Basic Assumptions Basic Assumptions Human relationships Time Nature Your friend hits a pedestrian What right has your friend? My friend has a definite right as a friend to expect me to testify to the lower figure. He has some right as a friend to expect me to testify to the lower figure. He has no right as a friend to expect me to testify to the lower figure.

3 Human relationships versus Particularism friend has no/some right and would not help versus Particularism 12 Individualism versus Communitarianism Neutral versus Affective Relationships Specific versus Diffuse Relationships Achievement versus Ascription SWI USA CAN SWE DEN UK NL GER CZE POL FRA SIN JPN MEX INA IND CHI RUS KOR NEP VEN versus Particularism friend has no/some right and would not help Dilemma Reconciliation Case Study: Copyright or Right to Copy? FEM-US MALE-US FEM-EU MALE-EU USA HR95 CAU NAM BAA ASIA HISP Culture Clash Seoul, April 12, 1996 ATTN: Dr. Fons Trompenaars RE: The Letter of Appreciation Dear Dr. Trompenaars; I am very sorry for sending this letter of appreciation to you late. We are very pleased to let you know that your book Riding the Waves of Culture has been successfully translated in Korean and it gives us big help for developing, our Group's Globalization. It is our great honor and thank you for letting us have an opportunity to use your masterpiece. Sincerely yours. Mr. Jae Ho Park Executive Director GLOBAL MANAGENT INSTITUTE British Publisher = Universal Copyright

4 U P Universal Copyright British Publisher: Universal Copyright Korean Organization: Particular Relationship Particular Relationship With Organization Dilemma 1: Globalism and Localism Universal Copyright Finding Joint Publisher (1,1) Global Standards (Critical Mass) Transnational Centers Of Excellence X (1,1) Small Nations MULTINATIONALISM Particular Relationship With Organization Cultural Diversity (Differing Solutions) Leadership of the 21st Century Main challenges: Human Relationships versus Particularism Individualism versus Communitarianism Neutral versus Affective Relationships Specific versus Diffuse Relationships Achievement versus Ascription

5 Individualism versus Communitarianism One Said: It is obvious that if one has as much freedom as possible and the maximum opportunity to develop oneself, the quality of one s life would improve as a result. Another said: If the individual is continuously taking care of his or her fellows then the quality of life for us all will improve, even if it obstructs individual freedom and individual development Individualism versus Communitarianism % OPTING FOR INDIVIDUAL FREEDOM MEX EGY ISR ROM CAN USA DEN NL FIN AUS UK RUS BUL HUN GER ITA INA SIN FRA CHI BRA JAP IND Individualism versus Communitariamism opting for individual freedom Dilemma Reconciliation 12 1 Case Study: From Invention to Innovation 2 FEM-US MALE-US FEM-EU MALE-EU USA HR95 HISP CAU BAA ASIA NAM Culture Clash Dutch Research Site: Individual motivation Japanese Colleagues: Communitarian motivation Options Adopt his own values only Abandon his values Compromise his values Reconcile opposing values

6 Individual Motivation Reward Teams for Individual Creativity And (1,1) Leadership of the 21st Century Co-Opetition Main challenges: Reward Individuals for Team Work Team Motivation Human relationships Neutral Versus Effective versus Particularism Individualism versus Communitarianism In cases where I am upset at work I am inclined to express it openly. Neutral versus Affective Relationships Specific versus Diffuse Relationships Achievement versus Ascription Please select your position on the statement above: a) Strongly agree b) Agree c) Be undecided d) Disagree e) Strongly disagree Neutral versus Affective % OF RESPONDENTS NOT OPENLY EXPRESSING UPSET AT WORK Neutral versus Affective % OF RESPONDENTS NOT OPENLY EXPRESSING UPSET AT WORK ETH JPN HK CHI INA IND CAN SIN DEN POR SWE HUN UK USA MEX BRA ITA FRA ARG RUS SAU SPA EGY KUW FEM-US MALE-US FEM-EU MALE-EU USA HR95 HISP BAA CAU ASIA NAM

7 Clashing Values Clashing Values Head in Control Head in Control Analysis, Paralysis (1,1) Loving Neurotics (1,1) Heart in Passion Heart in Passion Clashing Values Leadership of the 21st Century Head in Control (1,1) Continually Checking What Your Heart Communicates Co-Opetition Main Challenges: It Is Cool to Be Emotional Heart in Passion Human Relationships Specific-type of Personality versus Particularism Individualism versus Communitarianism Neutral versus Affective Relationships Specific versus Diffuse Relationships Achievement versus Ascription

8 Specific-type of Personality Diffuse-type of Personality Specific Relationship Diffuse-type of Personality Diffuse-type of Personality No Relationship Diffuse Encounter Diffuse-Specific Specific versus Diffuse Hi-Touch versus Hi-Tech Danger Zone

9 Hi-Touch versus Hi-Tech Leadership of 21st Century Demanding Facts And Performance On Line High Tech, No Brokers More Clicks That Stick Main Challenges: Co-Opetition It Is Cool to Be Emotional Moments of Truth High Touch, No Clients Rapport, Trust And Confidence With Brokers Human relationships Achievement versus Ascription versus Particularism Individualism versus Communitarianism Neutral versus Affective Relationships Specific versus Diffuse Relationships Achievement versus Ascription What You Do Who You Are STATUS? Ascribed Status Achievement versus Ascription % disagreeing with acting as suits you Family Age Sex Education NOR USA AUS CAN NZL UK SWE DEN GER THA SWI FRA HK MEX RUS CHI JPN INA POL KOR CZE ARG EGY

10 Achievement versus Ascription % disagreeing with acting as suits you Leadership of 21st Century 8 7 Main Challenges: Co-Opetition It is Cool to be Emotional Moments of Truth 2 It is Being What You Do 1 FEM-US MALE-US FEM-EU MALE-EU USA HR95 CAU BAA ASIA NAM HISP We said earlier that culture: is a dynamic process of solving human problems / dilemmas in the areas of: Human Relationships Time Nature Nature Time Think of the past, present and future as being in the shape of circles. Please draw three circles representing past, present and future. Arrange these circles in any way you want that best shows how you feel about the relationship of the past, present and the future. You may use different size circles. Past, Present and Future (1) Past, Present and Future (2) USA FRA Male CAU JPN SPA Female ASIA UK DEN HISP BAA

11 Leadership of 21st Century Main Challenges: Co-Opetition It Is Cool to Be Emotional Moments of Truth It is Being What you Do We said earlier that culture: is a dynamic process of solving human problems / dilemmas in the areas of: Human Relationships Time Nature Just In Time Synchronizing Sequences Internal versus External Control Internal versus External Control Internal Control Nature as a mechanism Dominance over nature External Control Nature as an organism Subjugation to nature ISR NOR USA DEN UK FRA ARG NL KOR ITA INA GER IND JPN CZE SIN KUW RUS CHI VEN Internal versus External Control Leadership of 21st Century Main Challenges: Co-Opetition It Is Cool to Be Emotional Moments of Truth It is Being What you Do Just In Time Synchronizing Sequences MALE FEM FEM-EU MALE-EU USA HR95 HISP CAU NAM BAA ASIA Pushing through the Pull

12 Leadership Be aware of cultural differences Respect those differences Reconcile cultural differences Role of Diversity in global companies Possible levers to pull: 1. Link Diversity activities to strategy 2. Internationalize Task Forces 3. Attract diverse staff 4. Assess transcultural competence 5. Train transcultural competence 6. Transfer diversity experience