16 Trust: open or closed

People readily ask for help and extend it to those whom they know and trust ... Workers find it difficult to adopt practices and suggestions from co-workers with whom they do not have any personal contact.

Transferring Knowledge Across Cultures, Debby Swallow

There is an unspoken assumption in many global organizations that all those who work for the same company see and react to the world in the same manner, and that therefore trust follows easily. But this isn’t necessarily so. There are vast cultural differences that are often not acknowledged or not addressed, and these can create misunderstandings in multicultural teams even before the members have had a chance to meet.

Cultural differences play a key role in the creation of trust, since trust is built in different ways, and means different things around the world.

Research indicates that there are high and low trust cultures; people who are initially open to trust and those who are closed. This instrument compares and contrasts the two approaches.

Guanxi. It’s the first word any businessperson learns upon arriving in China. Loosely translated, guanxi means ‘connections’ and, as any China veteran will tell you, it is the key to everything: securing a business license, landing a distribution deal, even finding that coveted colonial villa in Shanghai. Fortunes have been made and lost based on whether the seeker has good or bad guanxi, and in most cases a positive outcome has meant knowing the right government official, a trusting relationship nurtured over epic banquets and gallons of XO brandy.

Frederick Balfour

Culture crash

It wasn’t a match made in heaven; the Spanish project coordinator and the Russian treasurer seemed to fall out further with each incoming email. One email from the direct speaking, process-driven Russian pronounced: ‘The CORRECT version of the sentence from my previous email...’ Two emails later and the Russian was asserting: ‘I will not write anymore emails to you on this topic. Your tendency to evade answers and misinterpret what I write is unacceptable.’

Finally, the indirect, relationship-oriented Spaniard replied: ‘I honestly do not arrive to understand the source of your discomfort, but you can have the assurance that the tone of your last emails is deemed seriously offensive in Spain. I personally do, and I do not accept any more communications in such terms. I resign.’

Culture tip

Written communication is a very real source of misunderstanding, and trust degenerates the more the misunderstanding continues. You can never know what was in someone else’s mind when the email was written. Is your counterpart deliberately trying to undermine or insult you?

Pick up the phone and find out. In the story above, the Russian was being pedantic; the detail had to be right; routine and process had to be followed. She didn’t intend to offend. However, the Spanish manager found her tone unacceptable: ‘She was treating me like a dog and I am a man. I am a man of my word; I can be trusted,’ was his explanation.

Generally, Western cultures are more open to trust. However, the US and UK trust more easily than many other European nations, along with Scandinavians, Finns and the Dutch. They generally assume that other people can be trusted until they are let down. Individuals who do not know one another generally assume that they both have positive intentions. Trust is implicitly expected and given at the beginning of a relationship and is reinforced by ‘delivering on time’ on one’s commitments and demonstrating reliability.

Culture crash

An American colleague has lived and worked in fifteen countries, from Europe to the Middle East. Due to constant moving, he is inclined to talk to complete strangers, network and build friendships, all based on a sense of trust. As a result of these short-lived relationships he assumes that the trust he has with each person remains there, and will still be present at their next encounter.

One day he came across an old college friend on his university’s website. Happy to be reminded about his Mexican buddy, he linked to him through Linkedln. After an exchange of emails and a Skype call, our colleague asked his friend to consider becoming partners in a potential business.

However, things did not progress until they eventually met up. ‘What I assumed was that we’d just pick up where we left off all those years ago – after all, that’s what you do with good friends, isn’t it? But with José it wasn’t like that. I got the feeling that we were starting over again,’ the American remarked.

Culture tip

Creating trusting relationships is by no means a simple process. Unfortunately, as new cross-cultural teams are organized, the issue of trust is rarely considered or addressed explicitly. Taking time to build trust is critical to improving the effectiveness of individual relationships and project teams. Also, as that story shows, never assume that trust remains in place. Trust is ‘sustainable’ in US, UK and Nordic cultures. As one Finnish manager stated, ‘If anything changes, I’ll tell you.’

In Germany, trust takes a long while to develop and needs to be nurtured as it will decay overtime, as in Mexico in the case above. The French and Italians are somewhat cynical when it comes to trust. French people who meet by accident in the street are usually on the defensive: each assumes that the intentions of the other are negative until proven otherwise.

All group-orientated cultures are slower to trust; building relationships is a prerequisite for professional interactions. Building trust involves lengthy discussions on non-business topics and shared meals in restaurants. In these countries, getting down to business can only start when your foreign counterpart has become comfortable with who you are. This may take a lot longer than you would consider ‘normal’; in the case of Arab and South American countries, it can take months of repeated interactions to establish trust. In the Far East, it can take years.

‘People in our part of the world really don’t understand networking. They do it but don’t understand it. In the Far East ... people want something more professional and strategic from their relationships in the more group-oriented societies. Business is all done on trust.’

Cultural insight

In the Far East you have to be part of a collective entity. In China, guanxi (pronounced gwanshee), the cultural concept of connections and relationships, goes back thousands of years and is based on traditional values of loyalty, accountability and obligation – the notion that if somebody does you a favour, you will be expected to repay it one day. If one person has guanxi with another, one will be quick to do a favour, act on another’s behalf and, depending on the depth of the relationship, be required to do anything necessary for the other party. In such a way guanxi can be considered as a type of currency that can be banked or spent between the two parties. Like money, it is a resource that can also be exhausted, so you must be careful not to become overdrawn. The Chinese are cautious about trusting strangers because they do not know whether you are worthy or not; they fear you may compromise or tarnish their reputation or position. Therefore, they are unlikely to trust you enough to do business with you unless you already have a connection to them through a third party whom they trust. Guanxi is often about strategic intent; wanting to know up front what you/they hope to gain from the relationship, to ensure they are not contributing effort or services without gaining something in return.

Culture crash

Gavin Scott, an experienced international negotiator in a UK-based petroleum company, shared his opinion: ‘Chinese companies argue, over-promise and bribe. From our perspective, Chinese businesses can be seen amongst the most corrupt in the world. They are more likely to pay a bribe than anyone but their Russian counterparts!’

‘Arabs tend to utilize their networks in different aspects of life through what is called wasta, the literal translation of which is mediation. Wasta is considered as a force in every significant decision. The importance of family connections is so great that when people are admitted to university or hired for a job, wasta is more important than their performance in class or on the job!’

Culture tip

Chinese companies are prone to use subcontractors who lack relevant experience since Chinese officials can see this as an opportunity to issue favours. It is not uncommon for officials to renegotiate the original terms of agreements as well, so it is all the more important that cultural training becomes embedded corporate knowledge.

‘In China you’ve got this thing called guanxi. Guanxi is ... a form of you only do business in a circle – in a sort of trust circle – of people you know and have established business or friendly relationships with.’

Cultural insight

Wasta plays a major role in the business negotiation process. Western business people should understand the importance of the networking concept in the Arab world because it has influence in many business activities. For example, negotiating with one company at a time after receiving quotes might be common in the Western world. However, in the Arab world, businessmen can negotiate with several companies and choose the company that they will work with, not based on the contract contents but on the company that had the strongest wasta connection.