Culture: A Brief Introduction
Leadership can be taught. Confucius knew this,1 Machiavelli believed this, and most management educators subscribe to this idea as well.2 But what if you are being taught the wrong thing? What if the information on leadership you’ve heard is coming from scholars of the same Western, educated, industrial, rich, and democratic – or WEIRD3 – perspective. Furthermore, many of the behavioral tests themselves are being conducted on this limited cross-section, bringing the contended universality of the resulting behavioral findings into question. This is problematic but may help our readers understand why proposed leadership theories and behavioral research outcomes often fail to comport with the reality of cross-cultural environments and behaviors.
Leadership refers to the process by which an individual is able to “influence, motivate, and enable others to contribute toward the effectiveness and success of the organizations of which they are members.”4 But the ways in which people are influenced, motivated, and enabled is understood differently in different countries. Emerson, a Fortune 500 company with operations throughout the world and with more than 75,000 employees,5 provides a good example of a multinational company that must pay close attention to such things. Jean Paul Montupet is eminently qualified to speak to these challenges. He has served as the business leader for Emerson Industrial Automation, the executive vice president for Emerson, the chairman of Emerson Asia-Pacific while in Hong Kong, and as president of Emerson Europe. Montupet worked closely first with longtime CEO Charles “Chuck” Knight and later with current CEO David Farr. He relates the following story, seemingly grounded in corporate governance but which ultimately has much broader implications:
Corporations around the world have to deal with three main constituencies: customers, employees and shareholders. For American companies, the number-one priority is to achieve the financial results expected by the shareholders. In order to do that, you, of course, need to fully satisfy your customers and treat your employees well. But if it comes to the point where trade-offs have to be made, it is usually the financial objectives that prevail.
In Europe and Asia, the priority is more often the protection of the employees, as illustrated by the Japanese practice of “employment for life,” or the fact that during an economic downturn, German companies do not lay off as many people as a US company would. Instead, they put many redundant employees into training programs while waiting for better times to return.
Another example of those trade-offs has to do with the offshoring of manufacturing jobs to low-cost countries: many American companies, Emerson being one, have taken advantage of NAFTA to move some manufacturing jobs to Mexico. While no American worker is happy to lose his or her job under such circumstances, the American workforce is usually abler to understand the economic motivation of such a move and can be receptive to the argument that, by improving its overall competitiveness, the company will ultimately be able to grow and create more jobs in the United States. In Europe, the employees and the unions that represent them are strictly focused on the protection of their jobs regardless of the consequences for the rest of the company.
Emerson was confronted by that situation in the early 1990s when eastern Europe opened up and offered low-cost opportunities similar to those in Mexico. Emerson CEO Chuck Knight was keen to quickly take advantage of these opportunities. My view was that we could do it, but it would take more time as we would first need to get our European management to accept the idea, and then we would have to work with them to develop appropriate communication plans to which our European employees would be receptive. We would also have to be patient, as due to European laws the process takes longer and is also more expensive. Chuck Knight, who had worked in Europe in the early part of his career, was fully capable of understanding the differences with the United States, and in the end Emerson was successful in adding a best-cost eastern European manufacturing base to its already powerful western European setup.
Other American companies did not take the same prudent and disciplined approach and have run into serious problems, such as suffering from long and violent strikes with employees occupying the plants, who burned old tires out front. That never happened at Emerson because of the good communication programs and the proper adaptation to the local culture. The fact that CEOs Chuck Knight, and his successor, David Farr, had extensive international experience was also essential.6
The point is that what works “here” – wherever “here” is – may not, and often will not, work “there.” Indeed, it is with a certain degree of arrogance that scholars assume the American standard for leadership, profoundly influenced by American culture, works well as a model for vastly different cultures.
Geert Hofstede is considered by most to be the first to make the case – through a dogged empiricism – that leadership principles touted in the United States were hopelessly blended with US-centric cultural beliefs that had more limited application for other cultures. Hofstede wrote: “If one thing has become clear, it is that the export of Western – mostly American – management practices and theories to poor countries has contributed little to nothing to their development.”7 Hofstede went on to note that some of the most famous management minds of all time, such as management theorists Frederick Taylor, Henri Fayol, and Peter Drucker, all sought universally applicable management styles. However, as Trompenaars, a leading scholar who followed Hofstede, later wrote: “the fallacy of the ‘one best way’ is a management fallacy which is dying a slow death.”8
Between 1967 and 1971, Hofstede carried out cultural studies on tens of thousands of IBM employees across fifty countries,9 and he updated this work in subsequent decades. The results of these studies provide a working foundation upon which to understand cultural dimensions across virtually the entire world. Although national cultures are in part perception, Hofstede writes: “National and regional differences are felt by people to be a reality – and therefore they are a reality.”
Hofstede’s work is a guide in our own investigation of cross-cultural leadership, and it is supplemented by the work of Fons Trompenaars and Charles Hamden-Turner, authors of the cross-cultural management classic, Riding the Waves of Culture, a work that includes survey responses from more than thirty thousand participants. Finally, our work is based on the GLOBE Study of 62 Societies by Robert House and colleagues. All these researchers categorize their findings through the use of their own cultural dimensions that overlap to varying degrees. Additionally, a fundamental grounding for our work here is to take a hard look at how to effectively lead internationally to apply many of the lessons from psychology and behavioral economics across territories.
When we discuss national culture, it is important to establish that a national culture simply represents the values held by a majority of members. This means we can say there is such a thing as an American culture or a Peruvian culture, but it is virtually assured that no single American perfectly encapsulates the American culture. This is partly because culture often varies between different categories of people – rich and poor, secular and sectarian, educated and uneducated, rural and urban, as well as by type of profession – within a country, thereby creating subcultures to the broader culture. Professionals, for instance, may be said to have their own subcultures that cross country lines: lawyers around the world may have a certain concept of justice, musicians may tend to be independent-minded nonconformists, and executives are more charismatic than your average person. Even sports teams may have cultures that elicit passionate advocacy, as the New York Yankees-Boston Red Sox or Leeds United-Manchester United rivalries illustrate.
If all this variation exists, why study national culture? The reason is that even if no single American perfectly encapsulates the American culture, we can say most Americans will encapsulate most of the American cultural values. We can add that the average American will more closely resemble the American culture type than that of Peru or any other country. Consequently, national cultures are not perfect representations of all national citizens, but as the Voltair...
