The Best of All Worlds

15 November 2006 Mike De Luca

Coverdale's Mike De Luca considers how to build a shared way of working across businesses with a multi-cultural workforce.

Almost every country plays host to 'foreign' companies and people working far from home. Some of these enterprises have extended their global footprint by opening overseas offices and facilities, exporting their managers as well as recruiting locally. Others have developed from cross-border mergers and acquisitions, taking on board the personnel of their new partners alongside their own.

Whatever their roots, if culture-related issues are unresolved they can threaten a company's ability to operate effectively and, conversely, if cross-cultural opportunities are harnessed, they can be developed for the greater good.

"If culture-related issues are unresolved, they can threaten a company's ability to operate effectively."

Many international companies happily muddle along, ignoring or learning to live with their differences. While it is one thing to be tolerant, it is quite another to ignore those occasions where different approaches cause conflict or jeopardise operational efficiency or business success. This is often when the consultants are called in.

Every company or management issue is different and requires an individual solution. By the same token, a consultant working in a cross-cultural environment must suspend any pre-conceived, often Western-rooted, ideas and remain open to the possibility that there is an alternative, sometimes better way of doing business.


The first step to creating robust management solutions is to establish 'clarity'. This means identifying the company's goals against the backdrop of existing corporate structures and capabilities. This search for a common purpose applies equally to a one-off project as it does to a global change programme.

A good example is CSPC, a large joint venture in China between Shell Petrochemicals and CNOOC, a state-owned oil company. In the short term, CSPC wanted its $4.3bn facility up and running efficiently, on time – a challenge the Coverdal Organisation helped it achieve earlier this year.

The ongoing task, however, is to develop a world-class operation. This means working with the management team to reach consensus on the meaning of 'world class' and how it can be measured.


The second step is 'focus'. By gaining a deeper understanding of the company values and determining the behaviours needed to support them, it is possible to create a business model appropriate to the company.

Two cultural aspects were in play at CSPC. First, the workforce is unusually small for a Chinese venture – most state-owned plants have 10-15,000 staff; CSPC began with 1,300, reducing to 900 after the plant had been commissioned. Secondly, it had a skilled work force recruited from 23 different Chinese provinces and 16 different expatriate countries.

"Addressing issues of cultural diversity can create a richer outcome."

Traditionally, large Chinese companies operate a command and control system, with a structured hierarchy and deference to authority – if your boss says do something, you do it, regardless of the job in hand. It is an appropriate model of corporate behaviour in an economy with a vast workforce and cheap labour.

Conversely, the Western oil industry has a culture of relatively high-paid individuals, in smaller teams, who are encouraged to take the initiative.

Given CSPC's small workforce, the Western management decision-making model would clearly work best; Chinese management would need to learn how to establish priorities with their staff rather than asserting their authority, and staff would need to be given the confidence to take level-appropriate decisions rather than simply waiting to be told what to do.

There were, however, other instances where the Chinese approach made more sense. For example, in the West, our priority is to get the job done, with no regard for how employees get on. In China, it is the opposite: the main priority is that everyone gets on well. To start up a petrochemical plant with 1,300 people and not 13,000, everybody really did need to get on. You don't get anything done unless the relationship is right.


Legislating for a common culture through guidelines and rulebooks is the easy bit; enabling the company to embrace change and put new ways of working into practice is more difficult. This is where a programme of learning and skills development that equips every individual in the organisation for his or her part is required. We call this third stage of the process 'alignment'.

Alignment is not about classroom learning but engaging the participants through a programme of tailored, relevant, hands-on experiential workshops. It allows them to appreciate first hand the benefits of change.

In the workshops participants observe each other and identify appropriate outcomes themselves. The method increases motivation using solutions that address issues not just on a practical level but through hearts and minds. Delegates learn to value the spirit of the law not just the letter.

"Many international companies happily muddle along, ignoring or learning to live with their differences."

When Guinness and Grand Metropolitan merged to form Diageo, it brought together a number of internationally significant brands and operations in a number of world markets. Recognising the need to consolidate their multi-national expertise, they formed a team of key marketers to create a tool-kit for brand building. The resulting learning guides were user-friendly and beautifully produced.

However, the management recognised that, to be truly useful, the learning guides had to be part of company-wide culture change. To embrace the tool kit everyone would have to discover the benefits for themselves rather than be told about them, an objective that was achieved through a programme of experiential workshops.


Clients should be empowered to continue the development process locally and globally after the consultants have left. By training local, in-house coaches, it is possible to disseminate change quickly through an organisation and ensure that solutions are sustainable. It also demonstrates to the workforce that this is not an externally imposed process.

For Diageo, this involved training 500 in-house coaches who could then roll out the programme across Europe, Asia Pacific and the Americas. As a result, change was rapid, effective and globally consistent.


Then there is the thorny problem of language. Lack of a common language can inhibit individuals and the team-building process and can also undermine inter-office cooperation. In a particular location, the resolution might be an agreement on a common language: the local language, the language of the majority or a third widely spoken language. But close inter-office collaboration will require more than translation.

One global client specialising in spirits, wine and quick-service restaurants worked hard to overcome their language, cultural and organisational barriers. As part of this process, they established a European works council with representatives from all their countries of operation.

"Lack of a common language can inhibit individuals and the team-building process."

Unfortunately, the members of the council themselves spoke different languages and no single language well enough to participate in a meeting. While interpreters, translation booths, microphones and headsets had their uses, the leaders found that rather than breaking down barriers, the technology created new ones, undermining collaboration and team building.

The problem was solved by pre-planning, agreement on the goals and the preparation of a series of non-language-based experiences for the meeting. As hoped, the delegates came up with more proposals for new initiatives than ever before and the event was a great success.

The outcomes were then posted on an intranet notice board in seven languages so that the global workforce could see what had been achieved and provide feedback. The result was not only a sense of team-based achievement but worldwide inclusion.


While it might seem easier to avoid the issues of cultural diversity, experience shows that addressing them can yield results. It was found that, despite the polarised attitudes to management, there was a huge willingness on the part of the Chinese to learn from their Western counterparts. Their Western co-workers found their own assumptions challenged and were willing to take new perspectives on board.

It is not insignificant that the most respected manager among the Chinese workers was a Westerner, a Dutchman, who went to enormous lengths to fit in, learning the language and sharing in cultural events. It is this willingness to learn and accept a different approach that will ultimately be the strength of all successful global organisations.