As cultural and business complexity increases, so does the demand for developing global leadership skills. Today's global business executives need more than just good management skills, they must be able to understand and adapt to the cultural and regulatory requirements of different countries—and to economic ecosystems that work differently than they do in the domestic marketplace.
The ability to think global is a key attribute for successful leadership in today's global marketplace. “A global mindset has an appreciation for the inter-connectedness of the world's economies, and for the nuances of navigating the various ethnic cultures that linger today," observes James G. Clawson, professor of Leadership and Organizational Behavior at the University of Virginia's Darden School of Business, and author of Level Three Leadership.
Cultivating a global point of view requires an understanding of the common denominators between people everywhere. Culture, Clawson says, ultimately reflects a shared set of values, assumptions, beliefs and expectations about the way the world is or should be. “A good domestic executive must be a good manager of culture," he says. “The global executive must be even more sensitive and more aware of cultural nuances."
Global business leaders need to understand how everything from religion and ethnicity to socio-economic status and language impact the workplace. Clawson, who has consulted with business leaders around the world, says that a fundamental leadership test is how well someone understands and embraces the culture they are working in. Ultimately, he adds, one of the keys to success is the ability to adapt to cultural expectations in order to get deals.
Bob Johnson, international business consultant and co-author of the book Developing Global Leaders: A Guide to Managing Effectively in Unfamiliar Places, agrees that Americans doing business overseas need to think outside of both real borders and mental ones. “The world isn't all the USA," says Johnson.
“As a domestic company, you should start with your customers, and what they need—before you design a solution," he says. “The same is true when you're going to do business overseas. The fact of the matter is you shouldn't assume that all the countries in the world think and act like we do, because that's probably not true."
Go Beyond Culture
Of course, global leaders must have more than just cultural sensitivity in order to successfully manage international enterprises. Common strengths include an understanding of local laws and business customs, as well as the ability to manage foreign exchange and international payments.
Successful leaders do their homework. They know how well their company's products and services sell in a particular country, and they do the market research to identify new channels and opportunities for growth.
Global leaders also have to be in sync with international trends. “The obvious ones have to do with which countries are moving from scooters to automobiles, getting washing machines, or getting air conditioning," says Clawson. “Getting in on the end of those trends is too late. Over-estimating the speed and volume of those trends can be financially deadly. Timing is critical."
Other keys to leadership success in the global marketplace include personal energy and the ability to listen well. It's also essential for global leaders to develop a sixth sense for interacting with diverse groups of employees, vendors and customers. “Forcing people to do things breeds resentment and anger," Clawson adds. “That's not a deal."
Fundamentals for Success
Understanding the marketplace, a willingness to think outside their own cultural biases, and boundless energy to persevere are fundamentals for leadership success. “Every market has its own cultural realities […] that may not be obvious or even partially understood by the novice," Clawson says. “Expats should rely heavily on their local advisors, and listen to them."
Another key to success is a leader's ability to create a synergy between his or her own perspective and the cultural and business norms of the host country. Clawson, for example, was successful using a non-traditional teaching approach in Japan because, he says, his starting point was: “your experience and point of view is important for all our learning."
Honesty is another important factor. “One of the biggest problems is management corruption," says Clawson. "Corruption is a global problem—it sucks the life out of otherwise healthy businesses. Finding ways to navigate that world—among globally greedy business people of every stripe and background—is a tough one."
Trust Means Everything
Building trust in business means much more than simply avoiding corrupt practices. Establishing trust and finding a common ground with international partners is essential for success.
“When people do business with other people, it's about trust," says Johnson. “So you have to establish relationships first. If people see you as someone who wants to understand them, then they'll follow you better and they'll trust you."
The fact of the matter is you shouldn't assume that all the countries in the world think and act like we do, because that's probably not true.
—Bob Johnson, co-author, Developing Global Leaders: A Guide to Managing Effectively in Unfamiliar Places
Johnson says building trust requires avoiding assumptions and working collaboratively with partners and employees to establish goals and objectives. Successful global business leaders, for example, are as transparent as possible when trying to formulate contractual terms with non-U.S. partners. “You have to have a greater willingness to make sure both parties are on the same page regarding how to do business together," Johnson says. “It takes a deeper willingness to make it work."
Emotional intelligence, an awareness of how emotions drive behavior, is a common denominator among successful global leaders. But Johnson and Clawson agree that it also takes cultural intelligence to succeed in overseas markets. “You have to speak softly and listen hard," says Johnson. “It's not a battle. It's not right or wrong or good or bad. It's about helping people who have a common cause, even with their differences, work together."
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