Organizational Culture vs. Macro Culture: How to Lead in Multi-Cultural or Even “Foreign” Environments

Many of my posts and articles address the critical nature of culture within organizations, and for good reason. Many of the biggest leadership challenges today are actually more about culture (beliefs, values and behavior) than about operations or strategy.

But what role does macro culture (the culture outside the organization) have on the micro-culture inside the organization and on related leadership challenges? It turns out it’s a really big deal.

In my case, I have been very fortunate to have travelled to 39 different nations and lived in six different countries around the world. Although I carry an American passport, my world-view is the product of life and work in dozens of different macro cultures, with particularly extensive experience in those of Latin America, Europe, and the Middle East. As part of my experience, I have served as a Chief Executive Officer of large, complex organizations outside the United States and have learned powerful lessons as a result.

So, back to the original question: What role does macro culture play on the internal cultures of organizations within those macro cultures and, importantly, what are the implications for leadership in those contexts?

It would be impossible to fully answer such questions in a single article, but there are some high level takeaways I can address here.

Let me start with what was nearly the biggest mistake of my professional life. I was the new CEO of a parent company in Latin America that had four subsidiaries within the overall structure, three in Latin America and one in Florida, on the U.S. mainland. I had the advantage of speaking Spanish and of extensive experience living in other Hispanic countries, but I had never run an organization outside the U.S. at that point.

The holding company had American ownership and I was hired in the U.S., with the implicit assumption that I would impart American business practices in the Latin American operations. In fact, early on in my tenure, I determined that my objective was to make my new company the “best American operation possible.” Huge mistake.

Macro cultures have evolved over centuries (or millennia) and many generations. They dramatically impact values around things like time, incentives, respect, relationships, gender roles, hierarchies, and even religion among others. These values are reflected in behavior and language, among other manifestations, and while people may learn to say what they think a boss wants to hear, if they are being asked to do things that conflict with theircultural values, there will be no sustained commitment at all and lots of down stream dissonance and confusion.

Not surprisingly, I initially found myself frustrated with some things that didn’t match my expectations. One example was what I felt was a lack of urgency around time commitments. Another example (funny now) was what I thought to be “inappropriate” use of organizational email systems for personal, all-staff emails. However, I also discovered deep value for human relationships, for loyalty, for family, for enthusiastic social life, and an almost limitless patience in the face of frustrating bureaucratic challenges. And as for time, yes, it really was perceived differently, but it turns out that the relationship with time was, at its core, far more healthy than what I had been socialized to believe in typical American organizations.

Thankfully, before I had a chance to seriously damage my professional relationships or to create unsustainable stress in the organization, I came to the realization that my objective had to be to create the “best Puerto Rican operation possible,” which still provided opportunities to inculcate best practices in the organization (which we did with things like shared services, customer service, planning, financial controls, and accountability among others), but those efforts had to exist in concert with the overriding external cultural values that so thoroughly permeated the organization—and I absolutely had to choose my battles. There were a few cases in which I challenged organizational norms because I just didn’t believe they were justifiable, culturally or otherwise. But I only did so if I was really confident (and had confirmed with others from the local culture) that I was probably right. One example was the notion that we just couldn’t provide great customer service because that didn’t exist in the external culture. I didn’t buy it and launched a comprehensive effort to change the reality, which we did. That became a competitive advantage.

Another example comes from the Arabian Gulf area of the Middle East. Compared to American norms, professional interactions are incredibly formal in the Arab world and there is a long, historical tradition of being deferential to those at the top of hierarchies. Even long time lateral colleagues often address each other as “Mr.” or “Dr.” so and so, particularly in the presence of others. Being from the West, but also being someone who believes that formal hierarchy can get in the way of open communications, dissemination of ideas, teamwork, etc., this was a challenge for me. At first I created occasional dissonance by simply being too informal. While still more informal than most of my colleagues, I have learned to be more protocol driven, particularly in the presence of others. My motivation for that, in addition to simply being respectful of the local norms, is to avoid the appearance that I do not honor the professional status of my colleagues. I’ve also had to accept that managers simply will not “challenge” each other, and certainly not their superiors, in front of others in Arabic culture. As a result, I have learned to solicit more transparent assessment of ideas or potential courses of action in one on one settings, which is possible. It is a work in progress, but a critical key to success when navigating new cultural environments is to earn the benefit of the doubt by listening, learning, and being as gracious as possible.

Having said that, sometimes there are cultural “non-negotiables” that must be understood and respected. The Middle East, for example, is broadly Islamic and unlike the West, there is often little or no distinction between Islamic values in the workplace, private life, government, etc. While most Muslim majority countries are very respectful of other religions, there is an expectation that Muslims and non-Muslims alike honor certain Islamic values. A very good workplace example is that some female Muslim employees choose to limit their interactions with male colleagues. For example, some have made the choice not to shake hands with male colleagues or to share an elevator alone with a male colleague, etc. While this may sound extreme from some Western perspectives, in practice, it is very workable. It is also an example of something that should not be questioned or challenged. Sometimes the macro culture imposes norms on organizational culture that are “sacred” and simply to be respected. An example in Western contexts is the recognition that managers absolutely should not use their positional authority to pressure subordinates into compromising relationships. Unfortunately it still happens, but the cultural norm does not support such behavior and, in most cases, such behavior is actually illegal in the West.

The fact is that all organizations exist within the context of some set of macro-cultural values and assumptions, which permeate organizations through the people in them. This is true whether a leader finds him or herself in a “foreign” land or in the community where he or she grew up. A good source of in-depth information on this topic can be found in Leading with Cultural Intelligence by David Livermore . The point is that leaders must be cognizant of those cultural influences and must be prepared to honor them even when they are not held by the leader him or herself. More specifically, as noted by Livermore in his book, it is particularly important that leaders understand what behaviors and values are universal (held by most people across cultures), which are specific to a given culture, and which are unique to individuals. Those distinctions have significant implications for the decisions you make as a leader.

Fortunately, as noted above, there are certain values and behaviors that tend to transcend most macro cultural contexts that leaders can rely on when engaging the people in organizations they are leading.

In my experience the most important aptitude for a leader in such situations is inter and intra-personal intelligence and the most important behaviors are to listen and observe more than talk and act. For better or worse, leaders who are imperceptive and lacking in self-awareness are simply ill-prepared to be effective in culturally complex environments. It’s not that such environments are unforgiving to mistakes in protocol; they’re actually quite tolerant with “beginners.” They are, however, unforgiving to “outsiders” who insist on ignoring or disrespecting norms that are important to people in the organization. As an example, I have a very productive and respectful relationship with a female employee in my HR department, whom I initially embarrassed in front of others when I first arrived by trying to shake her hand. I later apologized to her personally and asked her for a brief cultural lesson, but more importantly, I learned from the experience and changed my behavior so that I do not extend my hand first to any female, Muslim employee or colleague. If they extend their hand to me, then I know it is appropriate to shake their hand. Simple.

A related, very important personal trait for leaders in such situations is to be unpretentious (not ethnocentric) about their own cultural norms. People instinctively know that anyone who is new in a given cultural context will need some time to climb a learning curve. It has been my experience that, regardless of macro culture, there is an appreciation for leaders who are authentic and unpretentious. People don’t expect perfection, but they genuinely appreciate a leader who knows that he or she doesn’t know everything—and understands that some local values and customs may not only be of great social importance, but are highly functional and valuable as well. In such situations it is really important that a leader identify a “culture coach”–someone in the organization who is thoroughly versed in the local norms and values and who can be available for questions, but who will also assert him or herself to the leader before a mistake is made. I have had such coaches in multiple settings and they are worth their weight in gold.

In short, it has been my experience that when navigating new cultural environments, leaders are much better served by “soft skills” than by technical skills, regardless of how valuable those technical skills may be to an organization. MBA programs almost never talk about “kindness” or “patience” or “sensitivity” as leadership traits at all, let alone highly valuable leadership traits. That is unfortunate, because the “on the ground” reality is that those traits have high transactional value in essentially any organizational context, but they are effectively required in culturally complex environments in which the norms are unfamiliar to the leader.

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