Understanding cultures is always a challenge. In today’s global economy, we have to work across different departmental, regional, national and corporate cultures.

Here’s a tool that should make it easier to meet this challenge.

Simplified cultural framework.

1. Communication styles – Direct or indirect? (adapted from Hofstede)

2. Personal drivers – emotional/functional?

3. Bureaucracy/Hierarchy check – the pencil test.

1. Communication styles.

1.1 Direct communication styles are favored by Western cultures. Direct communication gets to the point very quickly, sharing approval or disapproval very clearly.

E.g. One employee to his manager “It is now 1030 – time for tea break. The meeting will end now.”

For those from an indirect culture, they may view this method of communication as rude or confrontational. It is important to remember that this is not meant to be rude or confrontational but a method of expressing oneself. The benefits are that this method of communication make it easy for feedback and flow of information in a corporate setting.

1.2 Indirect communication styles are favored by Asian cultures. This style gives more subtle cues and hints at the desired outcome. This is in line with “saving face” of the recipient. When dealing with this style, one must be more alert to the subtle nuances and clues of the language. In a corporate setting, you will need to spend more time in meetings/negotiations. It would be better to have another person with you studying the tone and body language of the parties concerned while you listen to the words. Getting feedback would require extensive questioning. Some indirect cultures prefer one to one communication as a face saving method.

E.g. An employee mentions to his manager that the team hasn’t eaten breakfast and that is very hungry.

Another example is where the team member are silent when the manager implements a new directive. To elicit opinions, the manager should have one on one sessions with the team members. Here the questions need to be focused – allowing the other person to give suggestions to meet the end result.

2. Personal drivers.

2.1 Functional driven cultures tend to look at issues rationally in black and white. This is often common within the manufacturing industry (probably due to the heavy influence of by six sigma and kaizen).

2.2 Emotional driven cultures tend to look at  experiential and emotive things.

E.g. Purchase decision making – Shower gel. A functionally driven culture will look at price and whether the product cleans. A functionally driven culture will also tend to take shorter time in the shower.

An emotionally driven culture will look at smell and sensory perceptions in deciding to purchase the shower gel.

Within the culture, there may be items which are emotional and some which are functional. In some cultures, religion can inflame passions, while discussions on the work week and working hours are merely functional.

Questions to ask:-

a.Is the issue emotional or functional?

b. If emotional then is there an alternative around it? If functional, how can we address this?

E.g. A Muslim manager on an oil rig in Myanmar issued a directive that no pork would be served. That same afternoon, a call came from the minister’s department telling him that pork will be served on the oil rig. The manager had touched on an emotional issue. Pork was tied in with national dishes and national pride. His reports had not voiced their concerns directly (indirect culture) but as it was an emotional issue, they channeled their frustrations to the ministry. A better way to handle this would’ve been to have a short chat with the reports on a one on one basis, explaining why he wasn’t comfortable with pork in the galley. He should have sought their advice on the best solution. A compromise could have been a separate area designated as pork free.

3. Bureaucracy/Hierarchy check – the pencil test.High or low?

This looks at organizations and the levels of bureaucracy.

3.1 High level e.g. In one organization, we needed the signatures of 4 people to obtain office stationary. This organization had a lot of controls on its people. Common features include slow decision making as well as possible disconnect between the levels of management. When dealing with this culture, we need to accept the slower pace of decision making.

3.2 Low level e.g. In another company, not only did we have free access to the office stationary, we also had access to the very expensive corporate gifts for the CEO, which included Mont Blanc pens. Common features include an empowered workforce as well as faster decision making. When working with this culture, be prepared for swift decisions from lower levels of the organization.

I hope this framework proves useful to dealing with different cultures. Feel free to share your own experiences in the comment box.

I had made an error on a particular file that could have been disastrous. My partner in charge, after sorting out the mess made, called the client. I was in front of him when he said these words “An error has been made on the file. Please don’t blame my young colleague. It was my fault and I take full responsibility.”

I worked with him for four years. He was a demanding boss who pushed me really hard. But knowing that he had my back made it easier for me to focus on my work. He took full responsibility for any errors. most managers can learn from this. If you screw up, own up. Take responsibility. You will gain the respect and trust of your team.

As an entrepreneur and father of 2, I now try to make sure that I not only live this value, but also try to instill it in the people around me.

If you have a relatively small market share in a fragmented market, this is your opportunity to grow market share. Why?
1) Some of your competition may go out of business. This will mean that you have a new potential market which needs your service/product (albeit in reduced quantities)
2) Your consumer may now have a reduced budget. Overall your market will shrink – perhaps from RM100million to RM70million. Is that a large contraction? Yes. However, in your fragmented market, your business may have 1% or less market share. That still gives your organization large room for growth while some competitors shut down.
3) Your product pricing may have to be amended. We are currently offering a product where we tie in our fee with the customers performance. If their organization increases its profits, our fees increase with it.

Do post your thoughts on this.

Key Issues 

This article will take a holistic view of management. Subsequent articles will focus on the specific areas in greater detail. In Malaysia, in particular the financial sector, among others has been going through various stages of consolidation, with fewer and larger banks in the marketplace. The consultants or investment bankers who propose the mergers or acquisitions paint rosy pictures and their analysis often includes the terms “economies of scale” and “cross selling”. In theory this sounds good but it doesn’t always happen in practice. Studies estimate that between 50 to 80% of all mergers fail to add value. For this article we will be focusing on the financial sector. However, most of the lessons are applicable across industries and functional areas.

There are 3 key initiatives that companies can use to achieve “economies of scale” via “cross selling”, :-

 Breaking down walls

·       Customer focus

·       Single point of contact

1)    Break down walls between departments.

A mortgage salesperson at a large bank is not aware of the bank’s recently launched platinum credit card, When asked by his customers, the reply is “I don’t know, we have so many products. I don’t know what that department is doing.” This is a farly typical response from frontline sales people.

The reasons for this barrier to departments include:-

(a) different locations for the various business units

At one Multi National Company, I observed a division between floors. The 3rd floor sales team were fearful and suspicious of the 4th floor corporate offices. Neither party wanted to go to the other floor. Many banks face not just the challenge of different floors but also have the various business units located at different premises up to 30 minutes drive away. This divide can also happen when people are on the same floor but they put up barriers/silos between units.

(b) No real incentive to cross-sell other products.

Most employees today are often pushed for time. As such, without an incentive to cross-sell and learn about other products, it is unlikely to happen. Frequently, employees don’t put other department requests on top of their list of priorities.

To bridge this divide, companies can implement two measures – the “sponsored lunch” and a revised reward structure. 

“Sponsored Lunch” - Companies should ensure that the heads of department and key personnel to have lunch on a regular basis. People then get to know each other better and build a working relationship. Companies should allow employees to expense the lunch as the benefits of departments working together will show a return many times the lunch investment. In implementing this, departments could take turns hosting the lunch for their guests.

Reward Structure - An important determinant of corporate behaviour is the reward structure. The adage “you get what you pay for” will ring true with any sales manager who has increased commission for slow moving products. If a bank wants it’s employees to cross sell products, it should have an appropriate incentive scheme for them to do so. People fail to realize that the reward structure is one of the most important determinants of corporate culture and behaviour. As a sales manager for commercial vehicles, the most effective way to clear stocks of vehicles/accessories was to give double commission to the sales team.

2) Customer Focus. So often, many new products and processes are thought up in the top floor corporate office without taking into account the customer’s needs.

For example, when a local bank took over another company, they removed the drop box where a large number of customers paid their bills. This action was done without thinking of the customer. The ensuing customer uproar and card cancellation caused the drop box to be reinstated.

When banks want to encourage cross-selling, lack of customer focus is a major hindrance. In today’s market, customers are often pressed for time – yet banks require existing customers to fill out countless numbers of forms and submit the same batch of documents over and over again.

When banks come up with new products or processes, we would suggest they examine the key customer insight. 

Customer insights – All new processes and products should be based on a customer insight. New products especially should be there to meet an unmet consumer need. 

It is rare that the front line staff are ever consulted before a new product is introduced. If they are made part of the product development process then they are more likely to buy into the product and sell it.

A key consumer insight is that there are so many credit cards out there – does the consumer really need another card? The recently launched American Express Platinum Credit Card in Malaysia by Maybank offers golf course entry and discounts at the Shangri-La hotels for dining. These privileges are combined with a complimentary Longines watch if customer spending exceeds RM20,000 in the first 6 months. The benefit is designed to entice high net worth individuals to sign up with American Express.

The dining and golf privileges are designed to entice the customer in while the Longines watch is a smartly designed “carrot” to persuade the consumer to use the card as their primary card over a 6 month period. Once consumers get into the habit of using the card, it is likely that they will continue to use it thus giving Amex a high share of wallet by virtue of continued behaviour patterns. People will continue doing what they do.

3) Single point of Contact. Human beings prefer dealing with people they know and with whom they have a pre-existing relationship. 

A banking executive has an existing relationship with a customer who has taken RM10 million of company loans from the bank. He now requires financing for a BMW 5 series in his wife’s name. The banking executive passes his customer’s contact details to his colleague in auto finance. Frequently, the customer doesn’t receive the call from the auto finance colleague when promised. (BAFIA issues)

Due to silos/barriers mentioned in 1) above, there is little co-operation or incentive to work between departments. To truly maximize the economies of scale, the reward structure mentioned earlier should be in place. Also we would suggest that the customer have one key person that he/she talks to throughout the transaction. 

The single point of contact would help given the following :-

1) Pre-existing relationship – the banking executive would or should have some knowledge of the modus operandi and preferences of the customer. The relationship should also be at a certain point that each party can manage expectations clearly.

2) One person to be accountable – This will avoid finger pointing between departments – the buck stops at one person. For this to work, the bank should make sure that its inter department processes are able to run effectively and efficiently, i.e. minimal repeated processes that are so common with many banks.

If these key strategies are in place, the companies/banks should then be able to capitalize on their large size and truly becomes a seamless “one-stop shop” experience to their customer. This action plan would achieve economies of scale and offer a unique selling proposition. These solutions seem simple and obvious. If they are so simple and obvious, are we implementing them and more importantly are we implementing them successfully? juarezlowe helps implement these and other value added solutions to your organizations.

Juarez Salih Lowe, MBA, LLB, CLP is the Chief Executive Officer of juarezlowe. He has worked at Johnson & Johnson, Cycle & Carriage, Sapura and Lee Hishammuddin. His experience includes management positions in marketing, sales and law across a variety of industries in both Malaysia and Singapore. 

juarezlowe offers corporate training, coaching and consulting services in the areas of change management, negotiation and sales/marketing. juarezlowe‘s learning success across organizations and industries through its unique combination of:-

Interactive Learning where participants are able to interact, leading to the cross-fertilization of ideas. This is achieved via case studies and group exercises with a focus on application of theories.

World-class content adapted from the top international scholars made easy to understand and grasp.

Professional trainers with excellent academic qualifications and relevant corporate experience deliver the above.

For further details on how juarezlowe can add value to your organization or general feedback on the article, please contact us:-

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