Copyright Eddy A. Sumar 2009

Intercultural Trade Communication

March 16, 2010

Arrowhead Credit unionSan Bernardino, California

Copyright Eddy A. Sumar 2009

A Cultural Journey

ByEddy A. Sumar, MBA, CCE, CICE

ERS Consulting ServicesIn Collaboration with

The County of San Bernardino Economic Development Agency

& CITDPresents

A Global Village

The World is Global

Trade agreements

International trade

Multinational corporations

The privatization of state enterprises

The ability to locate business, particularly manufacturing, wherever the cost is lowest

The ability to execute financial transactions instantaneously on a global basis

The ability of information and communication technology to transcend time and distance

Business is Global

Have a global mindset!

Understand the world

Understand Self

Think Global and Act LocalThink Local and Act Global

Understand Culture

Understand People

Globalization cries out:

Cross-cultural competence is

no longer an option

It is survival

• Roots [Content & Context]

• Risks

• Rewards

Understanding Culture = Survival Survival = Harnessing R3

R3

• Definition• Awareness• Competence• Choice of Behavior

Understanding Culture is the road toCultural Intelligence & Business Success

Cultural intelligence

Cultural intelligence is the capability to deal effectively with people from different cultural backgrounds

Cultural intelligence is not difficult to understand but it is difficult to put into practice on an ongoing basis

Three Components of Cultural intelligence

Knowledge of culture: [Definition]• what culture is• how culture affects human behavior• how cultures vary

Awareness:• being aware of our own assumptions, ideas, words, and behavior• being aware of other person’s assumptions, ideas, words, and behavior• using all the senses in perceiving situations• viewing situations from several perspectives

Behavioral skills: [Competence & Choice]• choosing and displaying the appropriate

behavior for each particular intercultural situation

Define Culture

Culture is……

The collective programming of the mind which distinguishesthe members of one group or category of people from another.Geert Hofstede

The customs, beliefs, art and all other products of human thought, made by a particular group of people

at a particular time.Richard D. Lewis

Beliefs, norms, and attitudes that are used to guide our behaviors and to solve human problems.

Guo-Ming Chen, William Starosta

Culture is:

The way we dress

The way we communicate (verbal and non-verbal)

The way we relate to others and authority

Our outlook and attitude toward life

Our perception of self and role in society

Our perception of time

Our space perception

The way we learn and study

A way of life

Culture is below the surface……

Culture hides more than what it reveals, and strangely enough, what it hides, it hides most effectively from its own participants.

Edward Hall

Culture is like an iceberg: only a part of it is seen;

all the rest is hidden under the water

Behaviors

ValuesCustoms

Beliefs

AssumptionsMyths & Legends

Roots

Perceptions

Folklore & History

Layers of cultures

A national level

A regional level

A generation level

A gender level

A social class level

Organizational or corporate level

A personal level

• History• Religion• Tradition• Customs• Values• Beliefs• Art• Literature (Sayings, & Proverbs)

Understanding CultureSearching the Roots

Understanding CultureAvoiding the Risks

• Alienation• Culture shock• Conflict• Confrontation• Loss of face • Loss of business• Loss of credibility

Understanding CultureEnjoying the Rewards

• Increased market share• Higher sales and profitability• Enhanced cash flow• Diversified portfolio• Truly global presence• Ability to compete• Improved relationships• Enhanced loyalty

• Understand the Values of your own Culture • Consider your assumptions

Understanding CultureStart from the Home Front

Understand the Values of American Culture What Japanese say [Elashmawi & Harris]

• Personal life• Wealth• Fairness• One answer• Family• Liberty

• Materials• Education• Time• Success• Dreams• Freedom

• Directness• Money• Reasons• Religion• Power

Understanding CultureStart from the Home Front

Understanding CultureStart from the Home Front

Understand the Values of American Culture What Malaysians say [Elashmawi & Harris]

• Success• Power• Adherence• Material Possessions• Openness• Profit• Individualism

• Time• Commitments• Money• Aggression• Innovation• Progress

Understanding CultureStart from the Home Front

Understand the Values of American Culture Cultural contrasts in value [Elashmawi & Harris]

• Freedom/Independence• Self-reliance• Equality• Individualism/privacy• Competition• Efficiency• Time• Directness• Openness

• Aggressiveness• Informality• Future-orientation• Risk-taking• Creativity• Winning• Money

• How do we conduct business?• How do we establish business relationships?• What are our expectations of the other person?• What does it take to establish trust and

respect?• How do we make decisions?• How do we view time, power & space?• How do we persuade others?• How do we communicate?

Understanding CultureConsider Your Assumptions

• Understand the Values of the new Culture • Consider their assumptions

Understanding CultureConsider the other person & Culture

Understand the Values of Arab Culture What Japanese say [Elashmawi & Harris]

• Religion• Allah• Koran• Status• History• Family

• Nationality• Islam• Moustache• Gold

Understanding CultureConsider the other person & Culture

Understand the Values of Arab Culture What Malaysians say [Elashmawi & Harris]

• Family• Community• Wealth• Brotherhood• Respect• Power• Friendships

• Social grouping• Religion• Status • Leisure• Traditions• Self-image

Understanding CultureConsider the other person & Culture

Understanding CultureConsider the other person & Culture

Understand the Values of Arab Culture Cultural contrasts in value [Elashmawi & Harris]

• Family security• Family harmony• Parental guidance• Age• Authority• Compromise• Devotion• Very patient• Indirectness

o Hospitality/ friendshipo Formal o Past and presento Religious beliefso Traditiono Social recognitiono Reputationo Family network

• How do they conduct business?• How do they establish business relationships?• What are their expectations of you?• How do they establish trust and respect?• How do they make decisions?• How do they view time, power, & space?• How do they persuade others?• How do they communicate?

Understanding CultureConsider the other person & Culture

Dimensions of Culture

1.Power Distance2.Individualism vs. Collectivism3.Masculinity vs. Femininity4.Uncertainty Avoidance5.Long-term Orientation

Hofstede’s Culture Dimensions

Individual ……………GroupDirect…………………IndirectVerbal………………..Non-verbalInformal……………..FormalEgalitarian…………..HierarchicalTask………………….RelationshipUniversal…………….Situational

Dimensions of National Culture

Cultural Orientation Framework

• Environment: constraint orientation -- It’s fate, Insh’allah

• Time: Multi-focus, high commitment to relationship-building rather than just task completion; insulting to hurry

• Action: ‘Being’ culture -- stress is on affiliations, character and personal qualities

• Communication: High-context, usually indirect

• Space: Closer physical proximity (12” - 18”)

• Power: More tolerance for hierarchy, group and family connections important

• Individualism: Collectivist; loyalty is paramount

• Competitiveness: Midway between being competitive and cooperative

• Structure: Order -- seek to reduce ambiguity and make events predictable

• Thinking: Deductive and based upon ‘gut-feel’ / intuition

Cultural Orientation Framework

• Establish personal rapport• Establish personal status/family context• Express admiration; use flattery; be

indirect• Close distance and informal• Long range• Generosity and and hospitality• Emotional support and harmony

Relationships Across CulturesA Middle-eastern Example

Communicating Across Cultures

Communication is the interchange of messages [verbal & non-verbal] between people.

It is the fundamental building block of social experience.

We always communicate whether we are selling, buying, negotiating, leading or working with each other

MESSAGE

FEEDBACK

SpeakerSender

WithKnowledgeExperience

ValuesFeelings

Communication

skillsEtc.

ListenerReceiver

WithKnowledgeExperience

ValuesFeelings

Communication skillsEtc.

Communication

Body language

Up to 90 % of our communication is non-verbal

Supportive body language Non-supportive body language

We Produce Our First Impression Only Once

Introductions

Forms of address (names)

Exchange of business cards

Handshake

Eye contact

Personal space

The American bubble Extends about 12-15 inches(combined 24-30 inches)

Asian, especially the Japanese, stand even further apart

Latin Americans, Mexicans, Mediterranean people stand much closer

Touch

Touch• Spain and Portugal

• Some Asian cultures• Middle Eastern

countries• Latin Americans

(only the same gender)

Don’t touch• United States and Canada

• England• Northern European

countries• Japan

• Australia

Gestures

Communication styles

In direct convention of communication most of the message is placed in the content of the communication – the actual

words that are used

In indirect convention the context is more important, such elements as the previous history of relations between the

participants, power distance, the physical setting, nonverbal clues and others

CulturesHigh context cultures Japanese

Chinese Arab Greek Spanish Italian English French American Scandinavian German German-Swiss

Low context cultures

Indirect

Direct

Perception of Time

Monochronic people• Do one thing at a time• Concentrate on the job• Take time commitments

(deadlines, schedules) seriously

• Are committed to the job• Adhere religiously to plans• Are accustomed to short-

term relationships

Polychronic people• Do many things at once• Are highly distractible and

subject to interruptions• Consider time

commitments an objective to be achieved if possible

• Are committed to people and human relationship

• Change plans often and easily

• Have strong tendency to build lifetime relationships

Past, Present and Future Oriented Cultures

Past• Talk about history,

origin of family, business and nation

• Show respect for ancestors and older people

• Everything viewed in the context of tradition and history

Present• Activities and

enjoyments of the moment are most important

• Show intense interest in present relationship,

“here and now”• Everything viewed

in terms of its contemporary impact and style

Future• Much talk of

prospects, potentials,aspirations

• Show great interest in the youthful and in the future potentials

• Present and past used, even exploited, for future advantage

Tips for doing business

Past- and present-oriented cultures

• Emphasize the history, tradition and cultural heritage of those you deal with as evidence of their great potential

• Agree future meetings in principle but do not fix deadlines for completion

• Do your homework on the history, traditions and past glories of the company; consider what re-enactment you might propose

Future-oriented cultures

• Emphasize the freedom, opportunity and limitless scope for that company and its people in the future

• Agree specific future meetings and deadlines

• Do your homework on the future, the prospects and the technological potentials of the company; consider mounting a sizable challenge

IndividualismIndividualism stands for a society in which the ties between individuals are loose:everyone is expected to look after himself or herself and his or her immediate family only

• Individual is treated as the most important element in any societal setting

• Self-esteem, self-identity, self-image and self-expression are emphasized

• Personal goals supersede group goals

• Individuals are task-oriented and seek individual reward and appraisal

• Competition is encouraged

CollectivismCollectivism stands for a society in which people from birth onwards are integrated into strong , cohesive ingroups, which throughout people’s lifetime continue to protect them in exchange for unquestioning loyalty

• Individual is interdependent and shows conformity to the group’s norms

• Self-concept plays a less significant role in social interaction, people are emotionally dependent on the success of the group

• Only ingroup views and needs are emphasized

• Cooperation is encouraged

Second language strategies• Be patient• Speak distinctly, annunciate the words• Use short, simple sentences• Use action words – verbs etc.• Pause frequently, allow time for the person to formulate

responses• Provide feedback and encouragement• Avoid idioms, slang, acronyms and sports terminology• Paraphrase if not understood instead of repeating the whole

statement louder and slower• Be careful with numbers, write them down or repeat if necessary• Never assume that people around you do not understand your

language• Use gestures, actions, visual aids to help understanding

Cross-cultural negotiation

Phases of negotiation

Building a relationship

Exchanging information

Trying to persuade each other

Making concessions and reaching agreements

Western culture mainly take a “transactional” approach: they focus mainly on the last two stages

Many other cultures pay more attention to creating a background relationship: they emphasize the social side of the situation over the task side

Principles of cross-cultural negotiation

Gain cultural knowledge to anticipate differences

Practice mindfulness: pay attention to the context and the conventions of communication

Develop adaptive skills

The Cross-cultural Joy Model

• Listening• Watching• Feeling

• Reacting• Participating• Growing

• Adapting• Sharing• Experiencin

g

Enjoying

Core Intercultural Values• Humility• Respect• Listening• Observation• Empathy• Flexibility• Informed judgment• Persistence

Multicultural teams

Culturally diverse groups have the potential both for higher achievement

and greater failure than single culture groups.

In order to avoid failures team members need cultural knowledgeand the knowledge of group types, group tasks, group structure

and processes

Development of culturally diverse groups

Forming – becoming familiar with each other

Storming – going through inevitable conflicts ( who is doing what and how to go about things)

Norming – starting to develop common expectations

Performing – finally working effectively together

Strategies• Understand your own culture as the point of

reference [Self]• Develop an international cultural perspective and

global mind-set [Self]• Gather culture-specific information about the

countries you are doing business with [Others]• Appreciate the complexities of cultures and

individuals – avoid mindless stereotyping [Others]• Be aware of on-going cultural changes [Self &

others]

Final Thoughts• Think beyond local perceptions• Prepare for new mindset• Adapt to new realities and ways• Be open and flexible• Welcome new experiences• Show appreciation for other cultures• Observe behavior; suspend judgment, seek

rationale• Never ignore local sayings and proverbs• Negotiate differences: I adjust, you adjust, we

look for a third way

American Proverbs

• Good fences make good neighbors. • In God we trust; all others pay cash. • Scratch my back and I'll scratch yours.

American Sayings

• One today is worth two tomorrows; what I am to be, I am now becoming.

• Time is Money.

• Where sense is wanting, everything is wanting.

• There’s danger in delay.

Middle East in Perspective

Sayings to be guided by

• “One step at a time” (literally, "Grapes are eaten one by one")

• A foolish man may be known by six things: Anger without cause, speech without profit, change without progress, inquiry without object, putting trust in a stranger, and mistaking foes for friends.

• Arrogance diminishes wisdom.

Middle East in Perspective

An Arab Proverb

• Eat whatever you like, but dress as others do.

• No cure, no pay. • What is learnt in the cradle lasts to

the grave.

Middle East in Perspective

Quotes to be guided by

• Your tongue is like a horse--if you take care of it, it takes care of you; if you treat it badly, it treats you badly.

• The fool has his answer on the tip of his tongue.

China in PerspectiveSayings to be guided by

• No friends, no business• A drop of water in time of need will be

reciprocated forever• A man without a smile should not open a

shop• A sweet temper and friendliness produce

money• If you pull out one hair, you must rebalance

the whole body• The divine dragon exhibits its head but

never its tail

The Elephant-Tiger—India Inc.

• Understanding India

‘What is play to one is death to another.’

Hindi proverb

‘Knowledge is wealth.’Vedic Adage

India in PerspectiveProverbs to be guided by

1.Unity is strength. 2.One Who could not dance said that the

ground was uneven.3.One's mother and homeland are greater

than even heaven. 4.A scalded cat dreads cold water.5.To lose is to learn.6.Don’t bargain for fish which are still in the

water.

Become a Global Citizen. A global citizen is able to work effectively together with other people of

any culture, personality, or profession.

Become a cultural commuter, one who can cross from culture to culture with ease and

naturalness.

Dealing with the World of Culture

The Serpent & The Eagle The Fox & the Hedgehog

Chameleon

Wisdom In ExecutionW

ER$ Consulting ServicesEddy Sumar, MBA, CCE, CICE, CEW7841 Leucite AvenueRancho Cucamonga, CA. 91730

909-481-9869ealberto@aol.com

Thank You!