When It Comes to Incenting a Global Sales Force, Culture Matters

When It Comes to Incenting a Global Sales Force, Culture Matters

In a global business environment, cultural differences make a big difference in what successful management looks like in various parts of the world. These differences are particularly important when it comes to sales: What to sell, how to sell it, and to whom can depend to a great degree on the cultural habits and social mores of one’s target market. At Strategy+Business, Matt Palmquist goes over a new study he calls “one of the largest analyses of international sales to date,” which surveyed over 400 sales representatives in 38 different countries to investigate how their geographical and cultural context influenced the way they sold innovative products and what methods were most effective at motivating them:

The authors also analyzed four different societal factors in the surveyed countries that have been shown to influence how employees interact with supervisors and consumers. These cultural dimensions include power distance (the degree to which people in a given country accept that authority is unequally distributed in an organization or society), individualism (the importance placed on people acting on behalf of themselves, rather than the group), uncertainty avoidance (whether a society embraces or shuns ambiguity), and long-term outlook (the value placed by a society on future goals).

After controlling for individual reps’ selling experience and job satisfaction, as indicated in the surveys, and the societies’ differences in economic wealth and education levels, the authors arrived at several findings.

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For Global Leaders, Global Skills Are Necessary but Not Sufficient

For Global Leaders, Global Skills Are Necessary but Not Sufficient

At the LSE Business Review, Ken Fireman stresses the increasing importance of global skills for leaders at multinational organizations:

As the world becomes ever smaller and more interconnected, the ability to train and manage an international workforce has become a key requirement for corporate success. But finding sufficient talent to handle this challenge can be a daunting task, one that requires careful planning and a significant commitment of resources. And it is not clear that business schools at U.S. universities are doing enough to meet the challenge by preparing the next generation of managers for life in this globalised environment.

The changing landscape is reflected in the sheer numbers of multinational corporations. There are now more than 100,000, up from 40,000 two decades ago, and they employ tens of millions around the globe. Some of the world’s best-known brands, such as Nestle and Honda, now have most of their operations and workforce outside their home country, which means more employees than ever are being sent on international assignments. Many multinationals are finding their greatest growth opportunities in countries outside the developed world, such as India, China and Brazil. …

But finding talent that meets this standard can be difficult, and the stakes are substantial. A survey of more than 800 U.S. companies in 2014 found that 86 percent said their overall business would grow if they had more staff with international experience, and 43 percent said it would increase a great deal.

A few years ago, CEB did some in-depth research into the qualities of effective global leadership. One of the most important findings of that study (which CEB Corporate Leadership Council members can read here) was that although not having intercultural skills can derail the success of global leaders, the competencies that make a global leader great are actually many of the same skills that make all leaders great. Influence skills were found to be the most important for great global leaders, followed by skills such as vision, decision making, and resource allocation.

In other words, while “global” competencies definitely matter, if organizations are overly focused on finding and developing talent with international backgrounds, language skills, interest in travel, etc., they run the risk of not getting the talent who will really succeed in global leadership positions in the long term.

Best Practices Aren’t Always Best

Best Practices Aren’t Always Best

At the Harvard Business Review, Stanford professor Pamela Hinds explains why “best practices” are often more effective in some cultures than in others:

Leaders … often assume that if a practice worked in one place, it will in another—and they want to reap the benefits of sharing common practices across locations. But they aren’t always successful. Many of us know this intuitively: best practices are optimized for a particular place and time and don’t necessarily transfer well between cultures. They’re like a shoe that doesn’t always fit. You can put the shoe on, and it may even look nice, but it will likely create blisters if the fit isn’t exactly right. That’s how it is with practices that don’t quite fit another cultural context. It isn’t that workers in other countries … are doing anything wrong—they’re not the cause of the blisters.

In one study she conducted with several of her colleagues, Hinds observed what happened when a US company tried to introduce the same innovation practices in its offices in the US, China, and India:

What we saw, and what I’ve seen happen elsewhere, is that despite the fact that these employees were all part of the same company and even doing the same type of work, the practices weren’t interpreted or implemented the same ways across cultural contexts.

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