All of these situations are fundamentally different from anything we have talked about so far because they may involve the simultaneous meeting of national, occupational, and organizational cultures. Each culture is, from the point of view of its members, the correct way to perceive, feel about, and act on daily events. Each culture may have opinions and biases about “the other,” but by definition our own culture is always the one that is “right.” Getting cross-cultural organizations, projects, joint ventures, and teams to work together therefore poses a much larger cultural challenge than the change problems we have discussed in the last chapters, where mostly organizational cultures and subcultures were involved.

An extreme version of this problem is well illustrated in the medical organizations that deal with immigrants from cultures that have different norms and values about how to deal with medical problems. Not only is there a language problem in giving instructions about prescriptions, but the patient may believe that the medicines will be harmful and secretly not take them.¹ The business version of this dilemma occurred in a Canadian-Italian joint venture in which various memos with important instructions from the Canadian parent were systematically ignored by the Italians in the venture because they believed that anything of importance should and would be personally communicated. The memos were viewed as insulting and rationalized as being unimportant.

Variations in occupational cultures can breed the same kinds of problems, as was the case in Ciba-Geigy when headquarters attempted to create a management development program to improve marketing skills. The program was offered to the chemical, agricultural, and pharmaceutical managers, but when it was discovered that they would be taking the program together, they balked on the grounds that marketing was “far too different in each of these sectors.” How could people who sold drugs to doctors have anything in common with salesmen who slogged around in muddy fields selling new kinds of fertilizer to farmers? Clearly the designers felt that there were general marketing principles that everyone could and should learn, but it was very difficult to convince the different occupational groups that such was the case.

A further problem in these multicultural enterprises is that culture is typically not considered in their initial formation. Whether we are talking about mergers, acquisitions, joint ventures, or temporary partnerships and task forces, economic, strategic, and political considerations dominate the decision whether to go ahead or not. It is assumed that the cultural issues can be solved later once the new unit has been created. Even when culture is considered as part of the due diligence process prior to consummation of the deal, it is rarely given a central role, in spite of the fact that the failure of such enterprises is often attributed after the fact to cultural mismatches.

In the case of mergers, the problem of separation, domination, blending, or conflict is compounded by the fact that the new unit does not have any shared history, so one or the other subunit probably feels inferior, threatened, angry, and defensive.² In most of these situations, we are dealing with the interaction of two or possibly three cultures that have to accommodate to each other over a period of time.

A whole new set of intercultural issues arises in the various kinds of temporary or ad hoc organizations that are increasingly being created in today’s global environment. This point is best illustrated by what is being called “collaborations,” such as a United Nations health team consisting of members from several countries operating together in yet another country, or an engineering team from a global service company such as Schlumberger being sent to another country to help with oil production.

The cultural issue is fundamentally different in most of these situations because the work group itself is already multicultural, both in terms of nationality and occupational background. In the previous analysis we have dealt with members of subcultures launching change processes that impacted members of other subcultures and, thereby, changed elements of the total corporate culture. In these situations, any given department, project, task force, or standing committee may already consist of members from two or more different national and corporate cultures, leading from the outset to potential difficulties in communication, decision making, and performance.

A further complexity is provided by the growing number of teams, task forces, and other kinds of collaborations that are not co-located. For example, a number of consulting companies are abandoning the McKinsey model of hiring a broad range of experts to put into project teams. Instead, they are hiring a large pool of individual experts on virtually everything that a client might need help with and then putting together teams that might or might not work in physical proximity. The question of how cultural issues will manifest themselves in these kinds of collaborations remains to be seen.

To deal with these broader multicultural issues, we will first review what I have already said about merger, acquisition, and joint venture issues where organizational as well or national cultures are involved and then examine the issues of multicultural units such as “collaborations” later in the chapter.

Some concrete examples will make this point clear. Some years ago, General Foods (GF) purchased Burger Chef, a successful chain of hamburger restaurants. But despite ten years of concerted effort, the parent could not make the acquisition profitable. First, GF did not anticipate that many of the best Burger Chef managers would leave because they did not like GF’s management philosophy. Then, instead of hiring new managers with experience in the fast-food business, GF assigned some of its own managers to run the new business. This was its second mistake, since these managers did not understand the technology and operations of the fast-food business. Their efforts to use many of the marketing techniques that had proved to be effective in the manufactured food business proved to be useless. Third, GF imposed on Burger Chef many of the control systems and procedures that had historically proved useful for GF, not realizing that this would drive the operating costs of the chain too high. GF’s managers never completely understood franchise operations and hence could not get a feel for what it would take to run that kind of business profitably. Eventually GF sold Burger Chef, having lost many millions of dollars over a decade. With hindsight, it was clear that GF never understood that a fast-food business creates a very different kind of culture than a manufacturing package-food business does.

Lack of understanding of the cultural risks of buying a franchised business was brought out even more clearly in another case. United Fruit, at the time a stuffy, traditional, moralistic company whose management prided itself on high ethical standards, bought a chain of fast-food restaurants that were locally franchised all around the country. The company’s managers discovered, much to their chagrin, that one of the biggest of these restaurants and its associated motel was the local brothel. The activities of the town were so well integrated around this restaurant /motel that the alternative of closing it down posed the risk of drawing precisely the kind of attention United Fruit wanted at all costs to avoid. The managers asked themselves, after the fact, “Should we have known what our acquisition involved on this not-very-obvious level? Should we have understood our own value system better, to ensure compatibility?” So a great deal of effort had to be expended to keep this acquisition functioning while hiding potentially embarrassing information.

A third example highlighting the clash of two sets of assumptions about authority is the case of the two first-generation high-tech companies. Company A, run by a founder who injected strong beliefs that one succeeds by stimulating initiative and egalitarianism, was bought by Company B, this one run by a strongly autocratic entrepreneur who trained his employees to be highly disciplined and formal. The purchasing company (B) wanted and needed the acquiree’s managerial talent, but within one year of the deal most of the best managers from Company A had left because they could not adapt to the formal autocratic style of Company B. The autocratic entrepreneur could not understand why this happened and had no sensitivity to the cultural differences between the two companies.

What is striking in these cases is the lack of insight on the part of the acquiring company into its own organizational culture, its unconscious assumptions about how a business should be run. Contemplating some recent major mergers (such as Citicorp and Travelers, AMOCO and British Petroleum, Chrysler and Daimler Benz), one can only wonder how these corporate giants will mesh not only their businesses but also their cultures. The histories of these companies suggest that substantial cultural differences almost certainly exist between them.

So would it not have been helpful to do mutual cultural assessments before the deals were consummated? Paradoxically, there are several reasons why this would not be useful or even possible. One reason is that prior to the merger the negotiations leading up to it often have to be kept secret. Each organization could do a self-assessment but would not have the license or ability to get into the other organization to find out how it really works. A more important second reason why culture assessment before a merger would not be useful is the general point I have been making that you would not know what to assess. Until organizations are actually meshed, they usually don’t discover where the cultures conflict. Until Ciba-Geigy acquired Airwick, it had no way of knowing that its own culture was so strongly built around scientific breakthroughs and solving the world’s important food and health problems.

However, once a merger is publicly announced, it would make complete sense to engage in such formal assessment. The two organizations could form a series of task forces with equal numbers of participants from each cultural unit. These task forces could then assess the artifacts, espoused values, and shared tacit assumptions in the main areas of mission, goals, means, measurement, corrective mechanisms, language, group boundaries, and status and reward systems. The work of such “integration units” is typically done in one of two ways: (1) examine each business process to determine how to take the best elements of each merging or joint venture organization, leading to some blend of the different cultures or (2) examine each business process, decide immediately which organization’s process is best suited to the future enterprise, and impose that process on the new joint unit.

For example, I was told by an ex-DEC manager who was part of the integration team that planned the merger of HP with Compaq that they decided from the outset it would take too long and be too anxiety-provoking to try to blend the old DEC, the old Compaq, and the old HP ways. Instead, they opted to examine each process, make a decision immediately as to which one was best suited for the future, and simply imposed it on the new merged organization.

In the case of outright acquisitions the parent company will, of course, impose some of its core processes immediately, even when this is dysfunctional. Recall that the Ciba-Geigy chief financial officer told Airwick Europe they would not be allowed to develop their own streamlined accounting system because the parent company’s system was “adequate.” In that case it made life difficult for Airwick to function optimally. In another case of GE acquiring the Italian company Nuovo Pignone, not only did GE impose its financial and accounting system on the Italian organization but they combined it with intensive skill training to get across the knowledge and values that lay behind it, thus launching a much more intense process of imposing the GE culture around leadership, accountability, and performance measurement.⁴ This and similar cases have been used to make the argument that the imposition of the accounting and performance measurement system is, in fact, the best initial step in forcing more general cultural blending. By starting with the business process that is most fundamental to the health of the organization, its financial system, the acquiring organization can claim legitimacy for its imposition. It was observed in Nuovo Pignone that the initial resistance to the broader elements of the GE culture was gradually overcome as the Italians noted that the GE financial process was successful. This eventually led to the adoption of other GE values and a real set of evolutionary changes in the old Nuovo Pignone culture.

The joint ventures that are springing up all over the globe involve not only different corporate cultures but even different national cultures. When two sets of cultures meet, the basic problem is that more than one culture must be aligned, reconciled, merged, or absorbed. Would it not be advisable for each parent company to educate the members of the future joint venture in the cultural essentials of the other culture or cultures involved? Paradoxically the answer is not clear. On the one hand, it would seem to be essential to learn the language and customs of the other culture in order to communicate and avoid being offensive by breaking basic rules. On the other hand, it builds stereotypes of the other culture that can get in the way of joint learning.

For example, in a U.S.-German joint venture, each parent decided to provide cross-cultural training on what the other culture was like, and the venture budgeted for a one-week outward-bound-type experience to help the two teams to come together. The initial company training created strong stereotypes, and unfortunately the joint training was canceled for reasons of time and money. The early work interactions were therefore heavily dominated by the learned stereotypes.⁵ This showed up, for example, in trying to set production targets; the Germans assumed that the U.S. numbers were always inflated since “Americans always expect budgets and targets to be cut by higher management.” On the other hand, the Americans were warned that “Germans are always too conservative in their projections.” Each side tried to give fairly accurate numbers but totally mistrusted the numbers from the other group, making it difficult to reach a realistic budget figure. Neither group was able to bring this out into the open lest they offend each other. So each group would complain to the researcher but argue that things could not be brought up in meetings.

Some cultural blending eventually resulted from a business crisis. Production was well below what either group had predicted, there were unanticipated labor problems, and the U.S. parent changed key managers after these problems arose. To fix the problems, the two nationalities finally got together as a single group and chose procedures on the basis of which cultural assumptions were best suited to solving the new external problem. In the labor relations area, the Germans ended up leaning more on the Americans, but in the technical area the reverse happened; gradually, a new way of working was forged by taking some assumptions from each parent.

We can speculate in cases like these whether or not an outward-bound type of program that forces joint interaction in a non-work setting would have been helpful. Such programs would surely improve informal communication, but it is not clear whether or not the stereotypes would have been overcome once back at work.

In summary, self-assessment and assessment of the other culture is not an automatic solution to cross-cultural effectiveness. Learning each other’s languages or adopting a common language is certainly essential, but beyond that it may well be that the essential cross-cultural learning is accomplished best in the work setting, where common work problems can guide the learning process. Once again, the point is that cultural analysis works best in the context of a shared problem. Or, as the Russian manager of HR in the joint venture of British Petroleum and its Russian counterpart responded when asked how she could help these two very different organizations come together: “Forced interaction.”

Misunderstanding the rules and norms surrounding the issue of authority is probably the most common problem in newly formed multicultural groups. The high degree of formality that is associated with diplomacy can be understood as a defense against making mistakes in this cultural arena. But formality itself can lead to problems if there is insufficient understanding. For example, in a formal classroom setting, I observed the following variations in response to the same lecture material if I asked “Are there any questions or comments?” In the United States, American managers were quick to raise their hands and invariably asked questions about how the content that had been discusses would be useful. The same material taught in the United Kingdom elicited from British managers a spirited theoretical discussion of the material with the wonderfully masked disagreement that would always be preceded by “but one would have thought. . . .” The French and Italians always zeroed in on the details and got especially involved if they perceived some logical inconsistency in what had been presented. The Asian students, even managers, typically did not raise their hands at all for one of two reasons. In China there was a norm of deference to the professor that inhibited individuals from raising questions, but I learned that if I gave them a chance to discuss the material among themselves for a few minutes they could then raise questions through one of their representatives. With Japanese managers I discovered that they were very conscious of their status hierarchy and it was not appropriate to speak before one of the higher-status persons had spoken.

In the work situation, if the leader is from a culture in which it is expected that subordinates will speak up if they have a relevant piece of information, but he or she is dealing with group members whose norms dictate that one does not speak up until the boss specifically asks, and even then one suppresses information that would embarrass the boss, one can foresee that this group will have difficulty being effective. Misunderstandings around authority then have a direct impact on the quality of communication that is possible.

Lest we think that this is only a problem across national boundaries, consider the problems caused by different norms around these issues in occupational communities. The engineering culture had clearly defined the problem of the unsafe O-rings under cold weather conditions in the flight of the Challenger and had made an effort to communicate their concern but were overridden by the norms of the managerial culture in which cost, schedule, and political commitments overrode the data.⁶

The multicultural problem, then, is how to create a group situation that enables sufficient task-relevant communication to occur so that the group can perform its essential function. Is the solution better initial selection, cultural training prior to creating the group, a leadership style that encourages openness, joint training once the group has been formed, training in Dialogue, or all of the above?

A more subtle but possibly more relevant way to locate culturally “intelligent” people is to observe how they behave in situations that involve different occupational cultures. For example, in product development teams that include members from marketing, manufacturing, and engineering, how ready are members to try to understand each other’s points of view?⁸ You might discover that the engineer who is interested in and willing to listen to the marketer would also be interested in and willing to listen to someone from another national culture.

Occupational cultures produce inter-cultural problems of the same sort that national cultures do, so sensitivity to others with different assumptions and values can be observed meaningfully within organizations. Sensitivity to interpersonal and group processes is probably the most important dimension to observe. The German manager in the Brazilian company clearly had very little sensitivity to how groups work, poor observation skills, and possibly very little desire to work with other cultures.

An even bigger problem is that prior training on other cultures can lead to inappropriate stereotyping and perceptual biases. Knowing what the Japanese in general are like and value does not guarantee that the particular Japanese who is in your newly constituted task force will behave in that way. Furthermore, if he or she does behave that way and validates the stereotype, this insight does little to facilitate better communication. It only avoids offending the other. Certainly it is important to know what kinds of things will be offensive in other cultures, but that will not be enough to build good working relationships.

Because the leader is in a position of authority, it is the leader who is most likely to cut off communication unwittingly, especially with cultural groups where upward communication is difficult in the first place. Just as it is difficult for a Japanese manager to talk back to a U.S. professor, so it is hard for a nurse or a technician to talk back to a senior surgeon. It is up to the person in the leadership position to create the climate and conditions for such communication to occur, and to coach the members of the team by encouraging and rewarding feedback and analysis.

Creating a climate of open communications sometimes requires special events in which status boundaries are deliberately blurred. For example, in the very formal Ciba-Geigy, at each annual three-day meeting of senior executives one afternoon was always devoted to everyone playing at some sport that would reduce everyone to the same level of incompetence, for example, shooting crossbows or hitting a ball with a club head that was attached to a two-foot leather thong at the end of a three-foot rigid club. Following this common humiliation, we all went to an informal dinner at which everyone was randomly seated to mix up the various ranks represented. Conversation flowed freely and one could see that subordinates found ways in this setting to get messages across to their superiors. The Japanese ritual of going out drinking with the boss so that things can be said under the influence that could never be said at the workplace has a similar function.

In spite of all the mechanisms I have described so far, the danger remains that members of such groups will develop too rapidly the illusion that they now understand each other. To deal with that danger, a more powerful approach is needed to enable mutual understanding across cultural boundaries.

A recent example illustrates the issue. I received an e-mail telling me that one of my books was being translated into Chinese and would I be willing to provide a short preface for this translation. I agreed, wrote the preface, and sent it off. The Chinese publisher sent back a further request for a photograph to put in the book and for an autograph. I sent the photo but was reluctant to send an autograph, both for security reasons and because I did not see how this could be accomplished with e-mail. I did, however, suggest that if they had a fax number, maybe I could get the autograph to them that way. They sent me a fax number, I faxed the signature, but got a further e-mail saying that they had not received it. At this point, out of patience, I sent an e-mail saying that they should just list my name and affiliation, that they did not need a signature. They wrote back thanking me for providing exactly what they needed. Evidently what they meant by “autograph” was just how I wanted my name and affiliation to be printed at the end of the preface. My literal translation caused a lot of unnecessary work and irritation.

Research on product development teams showed how a similar kind of issue can arise around occupational cultures.¹¹ The teams agreed that their effectiveness would be a function of maximizing the amount of “information about customers” that they had. They felt satisfied that they had enough information to proceed with product development, but it turned out that the engineers defined information as “knowledge of what customers needed in the way of technical solutions,” the manufacturing members of the team defined information as “knowing how customers used equipment,” marketing members defined information as “how many customers are out there,” and planning members defined information as “what would they pay for the equipment.” Until the group sorted this out and realized how differently they were defining the simple word “information,” they could not really develop products that would meet customer demands.

When mergers, acquisitions, joint ventures, and collaborations are designed it is often on the basis of how well the externals such as products and markets fit, and the assumption is made that people of goodwill will figure each other out and make the necessary accommodations to work together. To show goodwill, we also tend to exaggerate the degree to which we actually do understand each other.

In the cross-cultural setting, one reason we exaggerate the degree of mutual understanding is to avoid the pain of being “unknown.” If I am asked to work with someone from another organization and he or she has never worked with me, it is painful to realize that I have to establish my identity from scratch. It is less painful to assume that we are probably basically alike and proceed from there. Only later might we suddenly discover great differences in how we operate or that words we were using meant different things to each other.

At that point, a second trap is usually sprung: the need to cling to and justify my own way of doing things. Suddenly my way seems to make complete sense and I cannot for the life of me figure out why the “other” wants to do things differently. I am likely at this point to go into a persuasion mode and to stereotype others as not making sense if they don’t agree with me.

This springs the third trap in cross-cultural communication: our disagreement and our stereotype are themselves undiscussable. We have no way of backing off and examining our assumptions without risking offending the other person or demeaning ourselves. Instead, we maintain a pretence of understanding each other and make compromises on effectiveness. To get past these traps we need to create settings in which new communication norms can be developed so that discussing misunderstanding does not become a threat to each other’s “face.” Such new norms can only be built with efforts at dialogue.¹²

Dialogue is more a low-key “talking around the campfire,” allowing enough time for and encouraging reflective conversation, rather than confrontational conversation, discussion, or debate. But its purpose is not just to have a quiet, reflective conversation; rather, it is to allow participants to begin to see where their deeper levels of thought and tacit assumptions differ. Paradoxically, such reflection leads to better listening in that, if I identify my own assumptions and filters first, I am less likely to mishear or misunderstand the subtle meanings in the words of others. I cannot understand another culture if I have no insight into my own.

For this to work, all of the parties to the dialogue have to be willing to suspend impulses to disagree, challenge, clarify, and elaborate. By slowing down the conversation, we learn to hear the deeper layers of our own discourse and realize how much our perceptions, thoughts, and feelings are based on learned assumptions. We begin to experience our own culture, that is, the degree to which our own group identifications and backgrounds color our thought processes. As we discover this in ourselves, we are more ready to hear it and accept it in others.

Using Dialogue as the conversational process requires the imposition of certain rules such as not interrupting, talking to the symbolic campfire instead of to each other, limiting eye contact, and, most important of all, starting with a “check-in.” Checking in at the beginning of the meeting means that each member in turn will say something to the group as a whole, the campfire, about his or her present mental state, motivation, or feelings. Only when all of the members have checked in is the group ready for a more free-flowing conversation. The check-in ensures that everyone has made an initial contribution to the group and stimulates some reflection rather than assertion.

An example of discovering our own culture typically arises around the instruction to talk to the campfire and avoid eye contact. For some people this is very easy, but for others, for example, American human resource professionals, this is very difficult because in U.S. culture looking at each other is considered “good communication,” and this is reinforced by the professional norms in the human resource field that eye contact is necessary to make the other feel that you are really listening. We also discover that culturally Americans are made uncomfortable by periods of silence, leading them to speak up to try to move the group, while members of some other cultures find the silence comforting and an opportunity to think and observe. In both of these examples, the important discovery is not how the other feels but that our own assumptions about eye contact and need to fill silence by activity is itself culturally determined, not some absolute principle. Once I realize how many of my biases are cultural, I can hear more clearly the biases of others.

In another kind of example, the need for dialogue in a cross-occupational context arose when members of the Exploration and Production Division of a large oil company were asked by senior management to review how they were measured now and should be measured in the future. After many hours of making lists and debating, the group discovered that they really were two very different subcultures—an exploration culture that was built around a trial-and-error process that produced mostly failures but occasional big wins, while the production culture was built around the need for absolute reliability so that every well that was discovered could be reliably and safely exploited.

I suggested a Dialogue session in which we would take three or so hours just to explore the semantics of the word “measurement,” with emphasis on all of the emotional connotations that this word had in the two subcultures. We started with an elaborated check-in by asking each member, without interruption and in turn, to talk out what the word measurement meant to him or her. Not only did this reveal the depth of the difference between the occupational subcultures of exploration and production, but it clarified to senior management that they would have to use different measurement criteria for the two groups. For exploration they needed big rewards for occasional rare events, and for production they needed immediate rewards for reliable performance and the avoidance of rare events (explosions, etc.).

Most of the mechanisms for stimulating cross-cultural understanding such as joint training, process reviews, after-action reviews, and Dialogue are not usually part of the daily routines of organizational life. They have to be designed as “cultural islands” and added to the normal flow of work.

The kinds of assessment process referred to in relation to organizational cultures and subcultures—that is, just comparing artifacts and espoused values around various business processes—does not reveal enough about the shared, tacit, underlying assumptions, although such comparison of artifacts can be a good start for a cross-cultural dialogue.

Once the new organization is about to be formed, if cultural understanding is to arise it is essential to create Dialogue groups to explore each other’s shared assumptions. Only by creating reflective dialogues is there a chance to overcome inevitable defensiveness and the illusion of similarity. After joint operations begin, a new culture is gradually built as the resulting organization together faces new tasks and learns how to deal with them. To speed up cultural learning, you should create such joint tasks early in the life of the new group.

The leaders of such groups must, at the outset, be aware of the cultural traps and minimize their operation through selection of culturally sensitive members, joint training that includes periods of Dialogue, opportunities for review and analysis of work accomplished leading to further periods of Dialogue, and perpetual display through their own behavior of commitment to open, task-relevant communication. Such norms of openness do not require members to get into personal or interpersonal issues, but leaders must emphasize that information relevant to task performance must travel freely across hierarchical and cultural boundaries if multicultural groups are to be effective.

If a joint venture, partnership, merger, or acquisition is at the stage at which the participants can be revealed to each other and to the public, the planners should then create focused Dialogues around the major elements of the strategy, goals, and means to be used in the new organization. Operationally, this means:

If the new organization is a multicultural group or a collaboration, the same process would be used, but the initial question for the check-in might be something specific that would highlight cultural differences such as: “In your country (organization) what do you do when the boss asks you to do something that you strongly disagree with?”

Again, the goal is to avoid one-on-one conversations, questions, or arguments, stimulating instead a listening climate such that members will be less self-conscious and less worried about self-presentation. Talking to the campfire is crucial because the campfire does not talk back.

We have now reviewed most of the cultural issues that leaders, managers, consultants, and group members are likely to face. How the insights gained can be used will depend very much on the local situation you are in, but there are some realities that cut across all of the situations, and the last chapter of this book attempts to describe what those realities are.