A Korn/Ferry study explores globalization's effect on Asian businesses and offers suggestions for hiring managers of expatriate executives
According to a study Korn/Ferry International (KFY) conducted in concert with the Economist Intelligence Unit in late 2006, the cultural variety of Asia and the need to manage the continent's breakneck pace of growth are making it increasingly difficult to define one leadership style or a set of best practices that will be the most effective there.
Globalization warrants a new set of business standards combining best practices from Western and Eastern cultures, and a "fused" leadership profile will evolve over time. In the meantime, companies must find creative solutions to nurture expatriates in this challenging environment while also being more systematic in how they select foreign talent to run their Asian operations. In addition, they should better prepare the executive for his or her assignment and be clear and realistic about performance expectations, which may need to be adjusted.
By considering the leadership profile and broader personal situation of each candidate as well as the true nature of the assignment, companies can greatly improve the odds of success for the individual and the company. Specifically, hiring organizations can facilitate the success of expatriate executives by addressing two key questions:
1. Do they have the intercultural competencies and leadership capabilities they will need to thrive?
2. What is the inherent "degree of difficulty" of the assignment's location and does the executive's family have what it needs to adjust to life in Asia?
Step 1: Identify Leadership Styles for Asia
Most firms approach expatriate selection backward: They choose an internal manager based on his track record in his home country, or someone with specific technical or functional skills, and offer a position in Asia. However managers with the highest potential for success in Asia's emerging markets may be hidden deeper in the pool, exhibiting a rare combination of leadership attributes, including a high tolerance for ambiguity, personal flexibility, patience, the ability to look at situations through the eyes of an Asian colleague or employee (i.e., intercultural competence), as well as stamina, confidence, and a strong drive for results.
Only after the person accepts does the company evaluate his/her suitability for the role. In addition, often the people making this decision have never lived abroad themselves and therefore lack the context for understanding what the critical skills actually are.
Although the largest and most global companies are able to select from a wide pool of internal candidates, most firms need to hire externally as their own staff might have limited experience living and working in Asia. Another pitfall is that many multinationals falsely assume leadership styles are universal, yet Korn/Ferry's data show Chinese leadership profiles, for example, differ markedly from their Western counterparts.
Where "best in class" leaders from the U.S. and Europe typically exhibit strong social and participative styles, Chinese executives are decidedly task-focused and hierarchical. Companies should consider not what style is better or worse, but what type of leadership roles and styles are the most appropriate for Asia or the specific local market.
Specifically, Western managers running businesses in Asia should focus on establishing strong local networks to reflect the current Asian business leadership norms that rely heavily on familial and friendship links. For instance, most Western managers are accustomed to working in countries that have a strong rule of law. But in many parts of Asia, using the legal system to solve business problems is a route of last resort; learning to solve problems by leveraging personal relationships to create good will with tax and licensing bureaus, customs functions, and IP enforcement agencies can be much more effective and ultimately faster and less damaging. In other words, effective leaders in Asia put the emphasis on nurturing and preserving relationships to get things done rather than using logic and legal arguments.
Step 2: Consider Location, and its Impact on the Whole Family
As companies analyze who should go to Asia, they must also understand the assignment location's true "degree of difficulty" from the perspective of the whole family. Being located close to a community of expatriates means easier access to international schools, international cuisine, and social networks that often define the difference between failure and success.
Checklist for Success Once companies have selected the best candidate for an Asia-based assignment, they will need to ensure their success by providing:
Pre-departure training: Pre-departure training should involve the entire family and include not just surface-level cultural issues (e.g., how to use chopsticks) but more importantly the psychological aspects of cultural adjustment. Briefings on the cross-cultural business environment are also critically important for the executive and should involve a realistic overview of how to best protect the organization's interests in Asia, how an Asian workforce behaves, and what typical workers expect from their leaders.
Coaching: During the first year of the assignment, having an executive coach with deep Asia or country-specific experience can add incalculable benefits to the new expatriate. A competent coach is able to provide feedback to executives on how others perceive them, and to provide a local perspective on problem solving that might otherwise not occur to someone who is new to the region. Such a coach is often able to help the executive in question see potential issues before they arise.
Family support: No expatriate manager will succeed unless the family is able to cope, so providing ongoing support to the non-working spouse and children is at least as important as supporting the executive on the job. Cultural transitions are most difficult for the non-working spouse; having an experienced and empathetic counselor who can work with all family members in a constructive manner on confusing or negative experiences can greatly improve the chance for success. Many expatriate families in China, for example, isolate themselves from Chinese society because it is intimidating to cope with a steep language barrier as well as unfamiliar cuisine and even unfamiliar transportation or health systems. A guide can give family members the confidence they need to function on their own wherever they are.
Successful expatriate managers develop leadership skills and experience that can provide enormous competitive benefits to the company not only during their time in Asia but beyond. A realistic approach to identifying and developing them is a smart investment.