Take relational drivers into account when you travel across the globe
How do you keep an internationally distributed company on track? What is the best plan of attack for ensuring you meet objectives and stay ethical?
Expatriate leaders typically start in new countries by implementing the policies for compliance and governance (C&G) that they use at home. This is logical, as what works at home in places like the UK or Germany is assumed to be best practice, and so will “definitely improve local standards”. Unfortunately, this approach frequently leads to significant cultural problems in the context of new markets, drivers and perspectives.
Employees’ Self-Interest and Cultural Values
When implementing a western governance apparatus cross-culturally, a key question is: How can you assure successful C&G where employees’ self-interest and decision-making are shaped by different cultures?
In the west we tend to have a “rules first” approach to organizational C&G. However, most of the world puts relationships first, with rules secondary and existing to serve key relationships. Loyalty to family, tribe and country and a need to stay aligned with those in power are aspects of core relational values and drivers.
Relationally-driven cultural values are not objectively better or worse than a policy-driven mindset – just different. The unexpected outcome is that they tend to clash when they arise within the same organization.
Employees already face complex ethical decisions about compliance in juggling office politics, personal ethics, career advancement and organizational goals. Decisions are further complicated when an organization’s compliance and governance policies are out of tune with the broader culture in which employees must operate.
It is tempting for leaders coming from a western mindset to diagnose unethical or corrupt practices as flowing mainly from negative forces like peer pressure, bullying and coercion. But successful C&G requires a deeper understanding of cultural drivers.
The Three Colors of Worldview©
KnowledgeWorkx’ Three Colors of Worldview© summarize the foundational drivers behind how people behave in community. The three motivational pairs are Power/Fear, Honor/Shame, and Innocence/Guilt. Understanding the Three Colors of Worldview© is key.
The good news for understanding these is that you are already influenced in some way by each one, even if some are stronger than others in your personal culture. To help leaders get a feel for the dynamics in Innocence/Guilt, Honor/Shame and Power/Fear cultures we can explain from the childhood experience of sharing toys in a sandbox.
Compliance in a Sandbox
As I grew up in the UK, it was simple at first to obey a command and receive praise from my parents. But these decisions quickly became wrapped up in complexities. One of the early challenges to obeying “the rules” occurred while playing with other children in a sandbox.
I was told to share my toys. But I remember thinking and feeling something along the lines of, “Why should I give Tommy the spade? I feel good and powerful when I have all the tools, and it gives me status, and I don’t want to give that up.” I felt pressure to do “the right thing;” but part of me also felt sharing was the wrong thing to do.
From an Innocence/Guilt perspective I had a desire to feel like a “good boy” and worried about the consequences if I was found guilty of not complying. This is a rulebook mentality, where maintaining innocence under the rules is a significant driver.
From an Honor/Shame perspective I might have shared my spade with Tommy because he is my brother or a member of my tribe, and it would give him and our group honor if we both have tools. Or I could be motivated by the shame my parents might heap on me for representing our family poorly if I was selfish and unwelcoming. This is a relational mentality that seeks to maintain and increase honor for my group or tribe.
From a Power/Fear perspective I might create a sort of hierarchy and instill fear by making Tommy promise he’ll give me something later if I share with him now. Or if I was socially mature enough, I might realize that empowering Tommy with a shovel could increase his loyalty to me. This relational mentality is sensitive to power and control dynamics, and who has the ability to get things done.
People’s foundational motivations for social and organizational behavior are a blend of Innocence/Guilt, Honor/Shame and Power/Fear. In every society a cultural fabric has grown up around these and is deeply entrenched in people’s mindsets. The mix varies in different parts of the world as to which of the Three Colors of Worldview© are the predominant drivers in the local society.
Ethical dilemmas and tensions
As westerners grow up, most are taught that relational considerations of Honor/Shame or Power/Fear must sometimes be suppressed, especially where fairness or compliance with rules is a stronger priority. Some examples are in giving fair grades to students in a class or choosing who gets promoted through an unbiased process.
But even in a strong Innocence/Guilt society personal loyalty to my group and what others may think could lead me to disobey the rules. Or in a bullying or confrontational office setting, I may align with powerful people and corporate tribes to escape fear and insecurity, despite having to do things that are unethical. These are ethical tensions from an Innocence/Guilt cultural perspective.
From the perspective of someone from a strong Honor/Shame or Power/Fear culture, these same internal conflicts and the desired outcomes can take on a different interpretation. Do I selfishly follow a workplace rule because of pressure from my boss, or give preference to an old family friend and honor the trust developed over many years? Do I adhere to my company’s stated processes to please someone in an ivory tower, or do I further our larger organizational goals by aligning myself with the real power-brokers?
Policy-setters and managers from the West must realize that in most parts of the world it is impossible for people to set aside the considerations of honor and power in society. It is also important to recognize that these drivers are not inherently negative – even though they can be abused. There are great strengths in them, and great strengths to be found for operating in these markets, even though they sometimes clash with policies developed in Western Innocence/Guilt paradigms.
"To reach your legitimately desired outcomes for C&G in diverse cultural locations, and to hold the line where you need to hold it will require you to adapt both your policies and the way you motivate and message them."
A Real World Example
KnowledgeWorkx recently worked with a financial services advisory company that wanted to expand their services into the Arabian Gulf area. Their policies had been developed in the United States. One of the policies addressed how permissible it was to take a client out for a meal. Of course in this part of the world covering a meal for a potential client is completely normal. People don’t just “do business” – they build relationships in which business can then take place.
But the people in the U.S. said – “No, we’re not going to increase your budget to do that, and we don’t want to see that on your books. We call that a bribe.” So the sales team got stuck. They had to score sales, and that require spending time with clients – including sometimes paying for a meal to build a relationship, create trust and store relational capital.
From an Honor/Shame perspective, showing and building honor in that relationship came first, and once the relationship became one of trust, the possibility to talk about products came too. That was not understood by the people in the West. So some of the sales team ended up paying out of pocket for those meals and meetings, because they knew that was the only way to gain clients in this market.
From an Innocence/Guilt perspective they were “not compliant.” But what that actually meant was that company policies were not developed for the way people legitimately acquire clients in an Honor/Shame or Power/Fear oriented culture. Empowering the sales team to do their job in an ethical and locally appropriate context required a change both to policy plus the way it was applied.
When Rules Cannot Be Bent
There are lots of rules and policies that can be taken more flexibly, where there could be personal discretion given to help navigate the relational structures of honor and power. Adjustments, supported by case studies and illustrative examples, may need to be made to the corporate rulebook.
But it is sometimes not possible to bend or break certain rules from a compliance perspective. There are certain situations where things are still unacceptable, such as hierarchical relationships that are prone to nepotism and self-interest, where we cannot flex and will need to intentionally monitor things. More sweepingly, no matter what cultural drivers are present we must agree we do not operate beyond the letter of the law.
A zero-tolerance approach and impartially applying the consequences for rules being broken is a worthy goal once you are confident of your rulebook being inter-culturally validated. This will require working closely with mid- and low-level managers, as they can be complicit in enabling well-connected people to avoid the consequences.
Culturally Shaped Messaging
But even where rules must stay the same, the way you communicate and motivate compliance to the rules can adapt. In the west managers often explain the rationale for policies, explaining why they are the ”right approach” or at least a good one, and seeking personal buy-in from team members. In Honor/Shame and Power/Fear environments, where people think less in terms of “the right thing,” it can be helpful to also appeal to the ways keeping the rules will bring honor to our team, boss, or tribe and how not following them will bring shame.
You can share powerful examples of how meeting standards has brought honor and respect and credibility in the market, and how that shows we as an organization are at the forefront of our field. When we show we are the best at what we do that empowers us to have influence – it gives our team, the boss and the company a voice in society because we have empowered our people to do the right things.
Corporate storytelling along these lines at venues such as a town hall meeting, and rewarding and celebrating teams that go the extra mile brings business values to life. If supervisors, managers and leaders talk the talk and then also walk the walk, this reinforces moral behavior as desirable and honorable.
However you go about it, the way the rules are laid down and the consequences of following and not following must be designed and activated from a Three Colors of Worldview© point of view. If your managers also use these cultural drivers to shape their messaging around compliance, it will be a powerful aid in meeting your objectives and staying in shape ethically wherever you operate in the world.
Special thanks to Michael Nates, specialist in Governance and Compliance and one of our ICI Associates in Dubai, for instigating and co-authoring this article.
Quickly becoming the global preferred choice for Inter-Cultural Intelligence development, KnowledgeWorkx promotes mutual understanding of other cultures and perspectives in the workplace, and helps teams to develop the intercultural capacity necessary to thrive in a globalized world.