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Identifying Cross-Cultural Agility in Senior Executives

Cross-Cultural Agility, Part 1

Editor’s note: Data from our extensive work with organizations expanding globally points to the chief causes for the successes (and failures) of executives deployed across borders. Exploring these findings with more than 25 global line executives who have successfully transitioned to cross-border roles revealed significant similarities. This series explores how 1) organizations can identify leaders with cross-cultural agility and 2) how both organizations and the executives themselves can ensure long-term success in their cross-border roles and beyond. 

Despite the preference of many multinational corporations (MNCs) to groom or hire local executives for key leadership roles, they will still need to deploy senior executives from other countries for a variety of reasons: when highly specific expertise is needed, when there is a shortage of local talent with the requisite management experience, or when the CEO and board want to develop senior executives by appointing them to foreign leadership roles.

Although an executive may be a top performer in his/her native country, not every executive is cut out for a leadership role in another country. Sending the wrong executive on an international assignment can be a million-dollar mistake, not to mention a significant setback for the executive’s career and family. In dedicated discussions with human resources leaders and our studies of multinational talent, we learned that problems with expats rarely bubble up to human resources (HR) or senior leaders in headquarters until the situation is a “train wreck” and it is too late. Typically the executive has to be reassigned or released. Many times the executive leaves the company of his or her own volition.

Given the high stakes, what can companies do to make these international assignments more successful?

As part of our work evaluating executives for a variety of domestic and foreign assignments, we have observed a clear pattern regarding those who adapted very well to international posts versus those who struggled. The executives who succeeded in cross-border assignments possessed high cross-cultural agility, which we define as the ability to work effectively with people from another cultural background in another cultural context. Our interviews with some of these senior leaders indicate that multinational assignments are most successful when organizations take certain steps, including:

  • understanding the key capabilities that are commonly shared by individuals with cross-cultural agility,
  • selecting executives based on their degree of cross-cultural agility relative to their peers, and
  • clearly defining expectations and creating a plan for the executive’s transition and continued development.

The five signs of cross-cultural agility

Many leaders of MNCs are acutely aware that some of their executives are not suited for an international assignment due to cultural, personal or career challenges. While firsthand knowledge of executives’ strengths and weaknesses is certainly valuable, there is often no consistent methodology for identifying a strong candidate or selecting among equally qualified candidates. Some CEOs and senior international executives involve their HR department and others do not. Most conduct formal interviews, but the interview process typically lacks consistent criteria to identify cross-cultural agility. Others simply ask the individual to visit the location and report on their comfort with the experience.

Amid such varying approaches, one valuable revelation of our study is the identification of five capabilities found to be consistent among leaders with a successful cross-cultural track record.

1. Curiosity and openness to new experiences

Executives with high levels of curiosity and openness tend to focus on learning, adapting and growing. For example, they may ask, “Why do all Scandinavian countries have the same pattern with different colors on their flags?” or “What does the Deepavali holiday represent?” Those low in this characteristic might simply compare their current location to their previous living situation and, rather than ask questions, make statements such as “I don’t like the honking horns” or “The weather is too cold here.”

Many executives who demonstrate curiosity remembered having a desire to travel at very young ages and meeting people throughout their lives who fueled their interest in expanding their horizons. They also tend to celebrate the differences between cultures and possess the intellectual ability to operate within different cultural paradigms at the same time.

Those with high curiosity also tend to celebrate the differences between cultures. As Geoff Haydon, CEO of Absolute Software, states from his international experience with EMC, “you don’t have to be an expert at the nuances of a foreign culture, you simply need to show that you appreciate the differences, and demonstrate that you are genuinely interested in learning.”

While counterintuitive, companies may be better off giving greater weight to this mindset over other capabilities — including actual experience — when selecting a new leader for an assignment. Jean Luc Butel, corporate vice president and president of international operations for Baxter, decided to pass over an experienced, but over-confident candidate for a critical executive position in China in favor of another who had no experience in China, but who came to the interview with humility, self-awareness, an intense curiosity about the country. In fact, in the initial meeting, books on China were literally falling out of his briefcase. “In that first year, I thought it was the worst decision of my career,” Butel said of his hiring choice. “He was struggling and needed a lot of coaching. But he never stopped learning and improving. It was clear after 18 months that he was one of the best general management hires of my career. He became a star.”

2. Adventurousness and responsible risk-taking

Leaders with cross-cultural agility take curiosity to the next level and enjoy the excitement of stepping outside structured and predictable habits. In fact, many international executives with these traits do not want to return to the corporate HQ in roles that they view as too narrow and bureaucratic.

Tsun-Yan Hsieh, a renowned CEO counselor and board adviser and chairman of Linhart Group, shared that as a child growing up in Singapore, he found himself stepping outside the comfort zone of his Chinese peers and befriending individuals from other countries in his neighborhood. As managing director of McKinsey in Canada, Hsieh learned to spot risk-taking individuals as he was advising younger consultants to take on international assignments, an important developmental step on the road to becoming a globally effective partner. About half of the younger consultants were eager to explore challenging assignments in remote locations on other continents. The other half preferred short-term assignments in U.S. cities just south of the Canadian border, or put off their response or commitment altogether. Ultimately, the consultants who ventured abroad into different cultures and contexts were far more likely to emerge strong global consultants than their more risk-averse counterparts.

3. Self-awareness and cultural adaptability

Self-aware executives are sensitive to the impact of their behavior on others and are able to adapt it accordingly, even in unique situations where they are unsure of social norms. They may ask others for advice, or simply put more energy into observing and learning acceptable social practices. Superior self-awareness and adaptability provide executives with the advantage of being able to engage and lead more effectively than those who lack these skills.

Larry Scott, commissioner of the Pac-12, has lived and worked on four continents and has displayed these attributes throughout his career. In his previous role as leader of the Women’s Tennis Association (WTA) Tour, he experienced a particularly challenging cross-cultural issue when the government of Dubai would not allow a female Israeli tennis player entry into the Dubai Open. Some Israeli officials encouraged boycotting. But Scott didn’t think that approach would result in anything positive: “Based on my years doing work in that part of the world, there’s a fine line between mounting pressure and boxing people into a corner to the point you can’t get the result you want. Living abroad made me a better listener and able to see different perspectives with far more insight.”

His strategy was to allow the tournament to continue, and the player decided to withdraw to avoid putting too much attention on herself versus the tournament. But through Scott’s encouragement, the players used it as a platform to verbally protest the discrimination. In fact, Venus Williams, who accepted the winner’s trophy that year, condemned Dubai’s action on television. Through Scott’s intervention, the Dubai Open also received the largest penalty in the history of the WTA and had to post a $2 million bond in order to repeat the tournament. The government in Dubai changed its policy the next year and allowed Israeli athletes to compete. For this and other accomplishments, Scott was awarded the Anti-Defamation League’s Americanism Award in 2013. 

4. Cultural knowledge

Knowledge of a country’s specific culture is another element of cross-cultural agility and can be accumulated over time and accelerated by curiosity. However, it’s important to note that cultural knowledge alone cannot fully compensate for the lack of other aspects of cross-cultural agility, a fact that has been borne out in many of our discussions with top executives.

Cultural knowledge is typically low for first-time international transfers. Yet, some leaders have unique circumstances that have provided them with a strong foundation, such as living abroad as children, being raised in a household with first-generation family members from another country or growing up in foreign diplomatic or military posts. Formal education can undoubtedly supplement cultural knowledge, but it is more effective (albeit more stressful) to learn through true immersion in a culture.

Executives with a high level of cultural knowledge will be aware of differing social customs, cultural dress, various religions and holidays, and may be adept in a foreign language. Interestingly, the majority of those interviewed felt that while foreign language fluency is correlated with cross-cultural agility, it is not a practical expectation for a new transfer. Since English is the common language of business, for a successful business integration in most countries, it is often enough to speak it properly, clearly and simply. Also, much of communication is non-verbal, including understanding social hierarchy and proper introductions.

5. Situational factors

The lines between work life and home life can become even more blurred in an international assignment and often, if one area suffers, so does the other. Thus, the role of the family, especially the life partner, cannot be underestimated in the decision. Driven by operational imperatives, MNCs can sometimes pressure executives into accepting international transfers even when the family is not supportive. This is a mistake. Fulfillment of personal needs and the establishment of a support system are critical to the leader’s professional success.

Potential issues that should be considered include the partner’s own cross-cultural agility; children’s needs; preferences and educational requirements; elder care requirements; relocation issues; healthcare considerations; and longer-term career and personal goals. We advise that leaders obtain direct input from their partners before finalizing a transfer. Some of the leaders we spoke with recommend including the executive’s partner in a discussion over dinner during the selection process to more thoroughly explore the broader implications of a relocation.

On occasion, the cross-cultural strength of the partner may compensate for weakness in the executive. Terry Clontz, former president of BellSouth’s Asia Pacific region and chairman of Singapore-based StarHub, recalled a situation when he was skeptical about a subordinate’s ability to transfer to a new role in Shanghai. The Southern U.S.-based executive was adamant about the opportunity, so Clontz finally agreed to let him and his wife be tested in a cultural assessment program. The executive’s scores were average, but his wife’s were among the highest they had ever recorded. Therefore, Clontz made the decision to relocate the couple to Shanghai, where they remained for 15 years and assimilated well personally and professionally. Clontz attributes much of the executive’s success to the high cross-cultural agility of his wife.

Sometimes, organizations can be tempted to send executives who have personal challenges abroad, believing the distance will give them a chance to both mend individually and renew their focus professionally. One CEO of a major consumer brand and former head of Asia, has seen this strategy fail many times. “You have to respect the foreign culture, which takes a lot of work and not all executives have the energy for it,” he said. “Some executives are sent overseas for the wrong reasons — executives with personal issues can have a tendency to further disconnect from the company as part of their healing.”

The importance of realistic expectations

The candidate and the organization must be clear at the outset about the expectations of both the role and its longer-term career implications. Some executives assume a promotion is waiting for them back at headquarters at the end of an international assignment. But the right opening may not exist upon the executive’s return. Seeing a lack of career progression among other executives who return from foreign assignments may cause executives to feel international postings are risky. They can even be perceived as career derailers rather than as important steps in their career development.

“It’s best to avoid considering an international posting as just a step on a ladder,” said Keith Barr, chief commercial officer of International Hotels Group and previously CEO of Greater China for the company. “It is better to set the expectation that embarking on a cross-cultural journey will forever make the individual a more broad-minded person and a more interesting and adaptable executive.” Yet, success in a foreign assignment can accelerate one’s career and create a role model for others. Tim Love, former vice chairman of Omnicom Group, lived in Brussels, Tokyo and Singapore. He stated, “I remember in 1990 when my client Procter & Gamble promoted someone from a foreign assignment into the CEO role for the first time in the company’s 163-year history. After that promotional decision, everyone lined up for a foreign assignment.”

A strong foundation

Finding the right leader is an inherently complex process, and the challenge is amplified when the assignment is in another geography. With such high stakes, organizations cannot afford to deploy an executive who is not well-suited for such a major transition. Understanding and assessing for the characteristics of cross-cultural agility can help greatly in setting the foundation for a successful assignment.

Read Part 2 of the series, which explores how organizations and the executives themselves can help ensure long-term cross-cultural success.

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