Developing cultural competence must be given the focus of a key competency by Indian Corporations aspiring to be Global. This competency is a must for Global Leaders/Managers.

1. `30
Subscriber copy
RNI No.35850/80; Reg. No. MH/MR/South-82/2012-14 TN/CH(C)250/2012-14; Published on: Every alternate Monday; Posted at Patrika Channel Sorting office, Mumbai-400001 on every alternate Monday-Tuesday
October 14 to 27, 2013
HDFC
Bank
Aditya Puri
MD
Hinterland
Express
With tried and tested products in place, HDFC Bank
is spreading into rural India. Its challenge is execution

2. Column
B u s i n e s s I n d i a u t h e m ag a z i n e o f t h e c o r p o r at e wo r l d
Towards cross-cultural competency
Developing cultural competence must be given the focus of a key competency
T
he current crises in the Indian economy
and the huge impact of the rupee devaluation bring home the critical importance
of globalising Indian business corporations. A
globalised company can weather the storm with
a more balanced top and bottom line, providing significant revenue and profit from overseas
operations. In the context of consistent devaluation of the rupee, it and pharma companies in
India that have successfully globalised are likely
to report better relative performance. Of the six
competencies required for successful globalisation of an organisation. ‘Cross-cultural competence’ is the second of the six competencies,
following ‘Global mindset’ covered in our previous column. It is critical in initiating and establishing successful global business as acquisitions,
joint ventures or greenfield subsidiaries.
Culture is values in action. Cross-cultural
competence for an individual is the capability to
function effectively across national, ethnic and
organisational culture. For an organisation, in a
globalisation context, it is the capability to successfully navigate and conduct business in cultural environs that are different than the home
country. A set of historical behaviour patterns,
mindsets, beliefs, lifestyles and value systems
often define the culture in a country. An American executive normally comes directly to the
point and looks for a ‘yes’ or ‘no’, which may
not be the best way in dealing with business
issues in Asian cultures. On the other hand, the
Indian trait of a ‘know-it-all’ attitude in interactions can upset businessmen from other cultures. Then, there is the Japanese businessman,
who is low-key and likely to take a long time to
respond to a business proposal and remain noncommittal sending wrong signals. Japanese culture is consensus-based and requires internal
deliberations involving various levels in the
organisation before a commitment is made.
India is a microcosm of cultures that can facilitate conceptualising of cross-cultural issues.
Consider the languages, food, festivals, religious
beliefs, customs, behavioral traits and lifestyles in
North, South, West and East India. Consider the
differences that exist between Maharashtra, Gujarat and Goa, though in the same region. The good
news is that over time, and post 1947, India has
come a long way in adjusting and evolving crosscultural competence. Indian business is, therefore, more adept at cross-cultural competence in
Di n e sh Ch a n dr a
V i bh ay
Sinha
a global context than some other nations.
Consider some of the positive contributors to
the development of cross-cultural competence
in India. Mobility from opportunities arising
through transfers and recruitment in government and business organisations; inter-caste and
interstate marriages; national institutes like iits
and iims; central services like ias, csir, drdo and
armed forces; media including tv and Bollywood
movies. Also, consider the continuing hindrances
of regional politics and narrow parochial vested
interests including caste, religion, corruption and
fear of loss of heritage. India has been on a learning curve to appreciate different cultures through
understanding, compromise and integration,
progressively leading to more unity in diversity.
Surely, the attitude of openness and assimilation
of new ideas that has existed throughout Indian
history can be the right way to leverage the large
population and demography to higher levels of
national prosperity.
C
Av i s h D a h i y a
Dinesh Chandra,
Avish Dahiya are
co-founders and
Vibhay Sinha
is the Senior
Consulting Partner
of DNA Global
Network (www.
dnaglobalnetwork.
com), a
Management
Consulting Firm
specialising in
globalisation
based in San Jose,
Ca, USA
u 92 u
O c t o b e r 14 -27, 2 013
ross-cultural competence of some successful economies have ‘globalised’. Consider
the top four economies of the world the US,
China, Japan and Germany. The US, despite
being a melting pot of cultures, is not the leader
of cultural competency. Education, vast natural resources and a relatively low population,
enlightened immigration policies attracting the
cream of the world and an enlightened system
of government that has built in ‘checks and balances’ are primarily responsible for their polar
position. Now that large contributions from
overseas business exist, Americans are focussing on a fast learning curve of cross-cultural
competence. Stints in countries like India and
China are a significant plus for ceo aspirants of
large US multinational corporations because of
exposure to cultural and business diversities.
The trait of not attempting to understand the
underlying issues that may require compromise
seems to persist possibly due to the American
ethos to ‘get the job done’. The American dna
had an arrogant component, in line with their
preeminent economy, but it is now in transgression, given the interdependence of the US economy following increasing globalisation. Chinese
culture, in a business context, derived from their
ancient past and more recent communist present is akin to the Japanese in terms of building
trust over time, conservative and bureaucratic

3. Column
B u s i n e s s I n d i a u t h e m ag a z i n e o f t h e c o r p o r at e wo r l d
and is also strategic. The Chinese consider that
China was number one in the world and want
to get there again. Their cross-cultural competence is also cultivated by this national interest.
They are dealing with other countries taking
a long-term view and making compromises as
necessary. The state directed policy is designed
to attract foreigners, students and businessmen,
while concurrently maintaining Chinese cultural and strategic requirements. Their push for
the English language and on education to build
cross-cultural competency is exemplary.
relationships, but does not get the job done on
time. Not enough homework is done by Indian
business leaders resulting in a lack of knowledge of the culture of the other country. There
is a need first to understand Indian cultural
traits and then to integrate with cultures of the
countries where business is sought to be done.
A
ny amount of cultural competence will not
lead to a lasting globalisation success unless
there is mutual trust and a learning process
that encourages adoption of principles and policies from each other that are good for all the
stakeholders. It follows that respect, inquisitiveness, tolerance and adjustments for another culture is a prerequisite of success in cross-cultural
competence. Our recommendations for Indian
business corporations wanting to globalise
successfully are:
u Facilitate understanding of the Indian cultural
traits within your own company by organising
in-house meetings of groups of employees from
different regions and encourage an open dialogue. This will bring about better communication and listening capabilities. Outside experts
can be a catalyst to guide development of
cultural competence within the company.
u There must be an organised effort to understand the prevailing business and cultural practices of the countries where you want to set up
business or partnerships. Courses and webinars
are available about a particular country’s culture
from educational and consulting organisations.
u Consider the personalities of managers charged
with initiating dialogue, conducting negotiations and continuing involvement in the overseas business. Are they capable of transcending
their cultural beliefs and can they empathise
with other cultures? When working in Saudi
Arabia, how would they regard the sharia law of
cutting off hands of a thief, or for instance in the
US, calling elders by their first names? Personal
transformation may be required to have an open
mind and willingness to tolerate, understand
and respect characteristics and ambiguities of
another culture. Give your employees an opportunity to spend some time to visit the country
you want to do business in and experience their
cultural mix.
u If you have decided to start a business activity in a country, recruit executives of appropriate seniority from that country and bring
them to your organisation in India first. This
will facilitate mutual cultural understanding by
interaction and proximity.
In conclusion, developing cultural competence must not be underrated and must be given
the focus of a key competency by companies
that are globalising.
u
J
apanese are fierce patriots. Respect for seniority and elders and patience is a protocol they
practice similar to Indian culture. The quality
movement though originating in the US found
its home in Japan. The extraordinary cultural
trait of teamwork and consensus building is all
Japanese. The implementation of Customer is
king enunciated by Mahatma Gandhi was in fact
implemented in letter and spirit by Japan. The
transformation of Toyota was in part made possible by deep inquiry into the requirements of
their US customers by opening design and market survey offices in the US. Their success particularly in the 1970s was exemplified by Japanese
businessmen living abroad for extended periods at personal sacrifice. However, traditionally,
Japan has been wary of foreigners and apprehensive that their culture will get polluted. It seems
their policy of limiting interaction with foreigners and strict immigration laws are hurting their
capability to innovate and negatively impacting
their economy.
The German cross-cultural competence is
exemplified by discipline, well-planned rules of
engagement, a conservative attitude, fact orientation, hard work, desire for quality, world dominating excellence in products and a no-nonsense
attitude in business dealings. Relationships are
honest and long lasting, once tested over time.
Indian adaptability helped maintain its heritage and identity despite many invasions
throughout history. Indian businessmen have
shown cultural understanding and Indian organisations have many success stories to share. However, Indian businesses must recognise that there
is a lot to learn to elevate cross-cultural competency to a higher level when establishing an overseas business. Of the four levels of training, most
Indian companies train for levels one and two.
India continues to be a country of ‘disempowered’ people as demonstrated by its history.
Not taking responsibility and blaming others
for the ill of the country is widely practiced in
India. ‘What can I do’ is uttered with a sense
of helplessness; more often than ‘I can make a
difference’. The circular concept of time builds
u 93 u
O c t o b e r 14 -27, 2 013