Cultural intelligence: Management in an interconnected world

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In a multicultural world, how can business leaders manage effectively?

‘Don’t point your foot at someone in Thailand.'

‘Give and receive business cards in China with two hands, and read what’s written on them immediately and attentively.’

‘Don’t order a cappuccino after 10am in Italy.’

The internet is awash with lists of cultural faux-pas and how to avoid them. And while it is important for business professionals to recognise the value of cultural diversity, what is considered 'appropriate' conduct varies widely across cultures.

The reality of managing complex global organisations in a hyper-connected interdependent world requires awareness far beyond the basics of etiquette. While management styles and practices are diverse, successful global leaders must respond to a multiplicity of management styles simultaneously, At the same time they must balance global integration and local responsiveness and be both centralised and decentralised.

Although there is no one best way of managing in this global environment, there is a skill set professionals can develop to make success more likely. In an interview Carlos Ghosn, chairman and CEO of Renault-Nissan Alliance, recommended three global leadership facets that summarise ‘CQ’ or ‘cultural intelligence’:

  • listen, learn and love – be curious, open to differences, mindful, and humble;
  • be willing to learn, reflective, flexible and resilient;
  • be a person of integrity who is happy to be there.

Put simply, cultural Intelligence (CQ) is the capability to function effectively in culturally diverse situations. It includes four elements:

Cognitive intelligence is knowledge about context-specific facts, such as social, economic, and legal systems in various cultures. High cognitive CQ helps the leader to form more accurate expectations and be less likely to misinterpret cultural behaviour.

Behavioural CQ is the ability to behave according to different cultural practices; being able to use the appropriate verbal and nonverbal behaviour in a specific cultural context.

Motivational CQ is the ability to generate energy for dealing with unfamiliar situations or stress associated with problematic interactions. This is an important ingredient for a global mindset and sustains the ability to ‘become comfortable being uncomfortable’.

Metacognitive CQ is the ability to comprehend cultural knowledge and how to select responses. A leader with good metacognitive CQ constantly checks if her or his actions are appropriate for a specific cultural context.

The good news is that an individual’s CQ can be enhanced via training and experience. It should be a key element in any education programme aimed at future global leaders.

I teach on the CEMS Master in International Management (MIM), which brings together students at 30 leading business schools in 30 countries, along with more than 60 corporate partners. We aim to make these future leaders fully aware of their personal responsibility and of the ethical and cultural frameworks in which leadership is exerted.

Exposure to other languages and cultures is crucial as part of this process. So called ‘third culture kids’ of mixed marriages, who have lived and gone to school in different countries and speak more than one language, have a huge advantage. Learning another language means becoming aware of your own culture and world view. It opens the doors to the world, to different global perspectives, creates flexibility and enhances CQ capabilities.

Student exchanges and internships create this exposure, but will only be successful if managed well and if future leaders are carefully selected, prepared, and coached.

It has been said that cosmopolitans – those who live and work in multiple countries and speak multiple languages – lose or question their identity. But what identity are we talking about? In different contexts different aspects of identity will play: I am a child to my parents, a boss to my employees, a tennis player, a concert goer… We all have multiple identities that we can choose from in specific situations, and this includes different cultural contexts.

All our identities are connected, and our individual identity is the spider at the centre of the web. Reducing a person to one ‘identity’ is denying them the liberty to decide which group they belong to in a certain context.

A global leader needs to be the spider in this web – connecting people, transferring knowledge, developing locally and globally simultaneously, and always increasing her or his capability to function effectively and responsibly in culturally diverse situations.

Marie-Therese Claes is leader of CEMS Global Leadership and Cross-Cultural group and director, International EMBA, Louvain School of Management, Belgium

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