This incredibly varied response, even at the risk of personal health, may indicate just how important deeply embedded national cultures affect people’s behavior, especially their reaction to “rules and regulations.” It’s also a reminder for those engaged in global business of why cultural awareness is an essential competency today for business leaders. One size does not fit all, and yet we still see today large multi-national companies trying to create a uniform global corporate culture – pushing out identical human resources policies, for instance, from Seattle to La Paz to Tokyo. When those at corporate headquarters are not internationally experienced or culturally aware, they often fail to realize that people from different countries have different reference points. They bring their own cultures with them into the workplace; they do not park them at the front entrance.

It is impossible, of course, for executives to be experts on every culture they encounter or operate in; however, it’s useful for leaders to be culturally sensitive, to have a mental framework to help them detect and respond to rapidly evolving situations through different cultural lenses.

Here are five important cultural factors that business leaders need to be aware of:

High-Context vs. Low-Context

Anthropologist Edward Hall, widely credited for being the founder of “intercultural communication” as a field of study, first identified the difference between what he called “high-context” and “low-context” cultures. In a low-context culture, the content of what is being said is the most important thing; in general, people say what they mean, and an outsider will likely be able to understand the meaning of a conversation based on the words that are being used. German, German Swiss, and Scandinavian cultures are classic examples of low-context cultures. By contrast, much communication in a high-context culture depends on subtle nonverbal cues and other contextual information, such as the relationship between two speakers. In Japan, for example, people often take great care not to use the word “no” in conversations, and it is up to listeners to use contextual clues to understand when their request has been declined.

Individualist vs. Collectivist

Again, we’re seeing this difference played out in the varied responses to the coronavirus crisis. Individualism, along with the next three factors on this list, are four of the six “cultural dimensions” identified by Dutch social psychologist Geert Hofstede, a pioneer in the field of cross-cultural communication. It’s easy to see why this dimension may result in vastly different organizational cultures across different countries, even for companies that largely have the same goals. In a country that emphasizes individualism, employees may be given a wide degree of latitude to “think outside the box” and pursue their own strategies to solve problems. In a more collectivist country, such behavior may be seen as detrimental to the group dynamic, and organizations are likely to emphasize teamwork and adherence to agreed-upon practices.

Uncertainty Avoidance

A high level of uncertainty avoidance is associated with a low tolerance for uncertainty, ambiguity, and risk taking, while a lower level of uncertainty avoidance indicates the opposite. As a culture, the United States has a moderate level of uncertainty avoidance, whereas this avoidance tends to be much higher in European and Latin American countries. Employees in such countries may expect their employers to minimize risk through very defined rules and policies. The response to the Covid 19 pandemic in high uncertainty avoidance countries has been compliance, by and large, to national directives.

Power Distance

In a country with a high level of power distance, there is a great deal of acceptance of hierarchies – even among those nearer the bottom rungs of the proverbial ladder. Organizations operating in countries with a low power distance index may see that their employees expect a more egalitarian (or “flatter”) organizational structure, but they would need to be careful in exporting this perspective to high power distance countries.

Masculinity vs. Femininity

The terminology here is, admittedly, somewhat archaic. But according to Hofstede’s definitions, participants in more “masculine” cultures are driven by competition, achievement, and success. By contrast, less “masculine” cultures, such as Scandinavian countries, are characterized by an emphasis on quality-of-life and collaboration, as opposed to standing out above the crowd. Understanding these differences can be critical in multinational corporations when determining local policies related, for instance, to family leave and vacation.

As much as cultural experts and trainers around the world over are well aware of the cultural dimensions mentioned here, when I teach business leaders about cultural awareness, most are unaware of these concepts and their practical significance in improving effectiveness and business results in today’s highly globalized work environment. We often see that mergers and acquisitions, for example, are more successful when partners are consciously aware of cultural differences between them and take proactive actions to deal with those, prior to merging operations. There are countless examples of business marriages falling apart because cultural factors were not considered seriously and dealt with at the outset.

How nations are dealing with the COVID-19 pandemic is laying bare national cultural differences and priorities. One would hope that learning from them will serve as opportunities for leaders to think about and tackle issues in their own world that may have been lurking under the surface for years. Often, citizens will most vividly remember a leader’s first response to a crisis, and so it is true for businesses as well. It is important for executives to demonstrate empathy and sensitivity in the context of the culture they are operating in. In an increasingly globalized business world, effectiveness in communication and action requires a solid foundation in cultural awareness and cultural competence.

Source: The European Business Review