Barriers Cross-Cultural Communication - Case Study Example

In attempting to understand the barriers to effective cross-cultural communication and how they can be dealt with, the context of the Chinese multinational company operating in America is examined. The two cultures are in many ways very unlike each other just as their languages are very different. Using Schwartzs model of cultural values in the main, the fundamental cultural differences are identified. The need for cultural understanding is emphasised, possible issues that could arise are mentioned with real examples and solutions are explored for dealing with them. Barriers to effective cross-cultural communication and how they can be overcome In the business world, increasing globalisation has been resulting in the formation of many multinational companies (MNCs). Initially, these were mostly dominated by the West, whereas Asian Multinational Companies (AMCs) have mostly been of Japanese or Korean origin. Lately, a new breed of AMCs are emerging that are mostly of Chinese and Indian origin. Their expansion however, as with the earlier MNCs before them, is posing challenges related to cross-cultural communication. This paper seeks to identify the typical barriers to effective cross-cultural communication in this new context and how they can be overcome. The greater focus is on examining Chinese culture and the experience of Chinese managers of AMCs working within the American socio-cultural environment. Such Chinese high-profile AMCs include Haier, Lenovo and Huawei, and Indian AMCs include Tata and Bharti Airtel. Both countries have some domestic economies. Apart from issues such as the need to improve governance, have greater transparency, and so on (Moller, 2008), they also recognise the need to adapt to different cultures. This entails stressing responsibility and accountability, and to be more responsive to local needs (Rajan et al., 2009). The Chinese realise that it is knowledge and skills for operating internationally that are needed more than owning shares due to the previously limited exposure and general seclusion. The Indians on the other hand have had a longer exposure to the market economy. Both acknowledge that knowledge acquisition is paramount for innovation (Teagarden et al., 2008), but new knowledge has to be communicated using language in order to be acquired (Welch & Welch, 2008). Tata’s acquisition of South Korea’s Daewoo vehicle company in 2004 was seen as a success but that is because their cultures shared many similarities to begin with (Rodrigues, 2006). The language barriers were overcome easily, which speeded the integration, and confidence developed naturally. The Koreans were found to be very enthusiastic and strongly disciplined but needed to learn to be more assertive and willing to contribute ideas. Greater challenges exist when two cultures are more unlike each other rather than situations as the aforementioned in which there are already many similarities. Cultural dissimilarities are thus the most important barriers in cross-cultural communication (Hui, 2007). Whereas structural differences can be easily overcome, cultural differences are harder to deal with (Drinnan, 2010). Understanding the culture therefore is an imperative because the company has to handle such tasks as public relations as well. Feng & Mu (2010) for example, highlighted the cultural challenges faced by Chinese oil companies in Africa. These challenges were not only in the area of communication, but also working habit, religion, orientation and coexistence. Chinese IT professionals have revealed language complexity, culture and communications styles, work behaviours and cultural understanding to be the main cross-cultural challenges (Huang & Trauth, 2007). A good example of a new AMC facing cross-cultural challenges is Haier’s experience in the U.S. Haier is a Chinese appliance maker that owns a factory in South Carolina in the United States. Chinese MNCs typically face a number of challenges in the U.S. ranging from political, marketing and technological aspects besides cultural aspects (He & Lyles, 2008). All these challenges owe to their ‘foreignness’. The cultural differences between China and the West came to the fore again recently with Haier buying a 20% stake in a New Zealand company (Drinnan, 2010). The cultural challenges for Lenovo were even more difficult because its presence in other countries including the United States was sudden following its acquisition of IBM’s computer division (Kristensen, 2009). The two cultures, i.e. Chinese and American, are completely different. As Lenovo’s then CEO discovered, education, family values, and the role of society were altogether different in the West (Kristensen, 2009). The company as a whole had to deal with difficulties related to work habits and employee cooperation. With hindsight, it is evident that Lenovo attempted to become a global player when it was not ready to deal with the cross-cultural challenges (Meredith, 2009). Culture itself is intricately tied with communication (Avison & Banks, 2008), but it includes both verbal and non-verbal communication so the differences are not always apparent without cultural understanding. Several frameworks exist to distinguish between different cultures, among which are Hofstede’s five dimensions of culture, Tromprnaars’ dimensions, and Schwartz’s model of cultural values. In the latter, it is posited that “cultural value dimensions represent the key issues that all societies face” (Beuckelaer et al., 2007), and seven values are identified based on three polar dimensions. These dimensions are (1) Relationship between the individual and the group, (2) How cultures ensure socially responsible behaviour, and (3) How societies relate to their natural and social environment. With respect to the first dimension, the Chinese would be considered as upholders of the status quo whereas Americans tend to have greater autonomy in pursuing their ideas and feelings. In terms of Hofstede’s descriptions, this is to say that Americans are highly individualistic whereas the Chinese and many others are collectivistic. The second dimension distinguishes between hierarchy and egalitarianism. Under egalitarianism, there is voluntary cooperation with others whereas hierarchical cultures organise people so as to make them abide to certain rules. The power distribution is therefore unequal. Again, the Chinese fit the description of having a hierarchical culture and the Americans would like to see themselves as being egalitarian. With respect to the third dimension, people who have ‘mastery’ over their environments take charge and implement changes within it whereas those who value ‘harmony’ tend more to accept things the way they are and learn to adapt. In this regard, it can be said that the Chinese prefer to live in harmony whereas Americans look upon themselves as ‘masters’ of their environments. Clearly, the Chinese and American cultures are at opposing ends of the three dimensions. Another aspect of the cultural difference between the two societies is in the way risk is perceived, or how the societies tend to deal with uncertainties. In this regard, like Japan, China has a strong uncertainty circumvention society whereas in the U.S, people are more open to tackling challenges and facing risks (Jing & Bing, 2010). The Chinese also try to save their ‘face’, which is why they tend to be less open during meetings, but this is not uncommon in other nationalities under certain circumstances (Harzing & Feely, 2008). In fact, Goodall et al. (2007) point out that this uncertainty avoidance dimension failed to be validated in a 1987 study in China. Thus, Hofstede later replaced it with ‘Confucian dynamism’, which is the tendency to observe certain Confucian traits as the Chinese traditionally adhere to. Examples of such traits are hard work ethics and a longer-term view of time. There is evidence of a move away from traditional Confucian based cultural values to some extent in relation to communication to an emergent communication style which holds the traditional values less strongly (Fang & Faure, 2010). However, this is an area that is still under study and Confucian values do remain in vogue albeit to a lesser extent than before among the younger generations. The change is being brought about due to an increasing materialistic orientation, greater mobility, exposure to Western influence, and so on (Goodall, 2007). Furthermore, there is scope for some individualism even within the existing Confucian set of values. This means that Chinese managers can continue to work within their own value structure. A specific and important Chinese concept is that of ‘ren’, which could be translated as altruism or humaneness. This revolves around close relatives who are given priority over others (Ma, 2009). In contrast, Westerners tend to treat each person individually so there is usually little practice of nepotism. Therefore, Chinese managers working in the U.S. would need to get rid of any such tendencies, and also learn to establish and take advantage of group or teams within their organisation tasked with particular objectives. Furthermore, in Chinese culture, leaders are equally highly respected and therefore identified with the brand. The absence of this phenomenon in the West means that Chinese MNCs in the West need to master the art of brand management and global marketing dissociated from the characteristics of the corporate management and leadership. Traditionally, marketing is not given much attention by Chinese companies, whereas this is also necessary given that there exist negative perceptions regarding the quality of Chinese brands (Interbrand, 2007). As with emotional intelligence then, ‘cultural intelligence’ is also an essential quality for today’s global leaders, which requires good “conceptual understanding of differences among cultures” (Wang, 2006). This includes physical aspects such as greeting rituals, and emotional aspects such as appreciating the relationship dynamics in a diversified workforce. This requires a global mindset based on this wider awareness and understanding. Leininger & Javidan (2010) conducted a global survey involving over 6,500 global leaders. Based on the results of the survey, they devised a four-step process for developing a global mindset. The first step is to understand your needs, the second is to measure your baseline, the third is to identify development priorities and the fourth is to adjust and monitor. Understanding needs entails considering the organisational vision and future plans, baseline measurement requires knowing the current position before deciding how far to go further, the third step involves identifying strengths and weaknesses to determine how best to develop, and the final step ensures that progress is monitored. The end result is a greater cultural awareness, which is critical to a strong global business strategy. Cross-cultural communication issues also arise irrespective of the physical distance between the two parties, which is a common occurrence in this information age due to the Internet. Many companies also outsource their workload to people in other countries in the same way. A poll of 200 U.S. business executives found that the two major barriers to outsourcing were miscommunication and lacking in cross-cultural understanding (Paton, 2006). Moreover, they found that productivity could be increased by around 26% through implementing cross-cultural communication training programmes. This also tends to improve employee morale and reduces attrition rates. MultiCultural Solutions mention a number of further tips for understanding and thereby improving global cross-cultural communications (Kaplan & Cunningham, 2010). Some of the information can provide useful insight for the context under focus. For example, under the second tip, it is mentioned that Americans always interpret words literally. Chinese managers should therefore take care in their wording, which are more likely to be taken literally and learn to be more forthright rather than leaving important information in the form of nonverbal communication signals. On the language front, the Chinese MNCs also need to use brand names that are easy to pronounce by non-Chinese and re-branding of websites in other international languages including English (Interbrand, 2007). Aside from the language, there are also other essential qualities that enhance cross-cultural communication. As Lenovo’s former CEO, Yang Yuanqing put it the key ingredients for a cohesive multicultural team are “trust, respect and compromise” (Wharton, 2005). Lenovo has had to learn the hard way. In contrast, Haier followed a carefully planned and gradual internationalisation strategy that began with building employee loyalty and then led to globalisation and diversification and the building of the brand and customer loyalty. This approach follows the Uppsala school of thought and remains valid for gaining cross-cultural knowledge despite the proclivity towards rapid internationalisation (Zou & Ghauri, 2010). Haier is also improving the situation by allowing direct and public feedback from its customers (Mobley, 2009). It already has a good strategy for developing its brand and is making heavy investment in developing innovative products (IBM, 2006). For all Chinese companies, it is still a learning period as global Chinese companies have a relatively short history and their management knowledge is still being developed according to their experience (China Daily, 2010). It is therefore an early period for dealing with cross-cultural challenges so it will take time to gain insight into generic coping strategies. Another area for dealing with cross-cultural communication challenges is through training and education, as advocated by Rosswurm & Bayerlein (2005). This tactic is part of an overall strategy that aims to primarily improve the information flows. Their case study also showed that there are not always cross-cultural and language issues behind the problems. Corporate culture could also be in need of changes. This paper has shown that in situations in which cross-cultural communication needs to be conducted, several barriers can present themselves owing to the cultural differences. An example of two cultures that are in many respects poles apart was given as the Chinese and American cultures. Under focus were the challenges posed to Chinese managers of MNCs operating in Western markets, specifically in America, rather than the other way round. The challenges mainly revolve around language, both verbal and non-verbal, but also other qualities such as work habits, managerial styles and ways to conduct marketing. The gradual approach towards engaging with Western companies and the Western public, as undertaken by Haier, was also highlighted for easing cross-cultural communication and integration. In order to understand the cultural differences between the Chinese and Americans, Schwartz’s model of cultural values was used with some references also to Hofstede’s dimensions. For example, whereas the Chinese are generally collectivistic, seek harmony, and adhere to high Confucian values, the Americans are more individualistic, egalitarian, and prepared to take risks. To assist in dealing with the barriers to cross-cultural communication, a number of ideas were explored that can be examined further. References Avison, David & Banks, Peter. (2008). Cross-cultural (mis)communication in IS offshoring: understanding through conversation analysis. Journal of Information Technology, 23: 249-268. Beuckelaer, Alain De; Lievens, Filip & Swinnen, Gilbert. (2007). Measurement equivalence in the conduct of a global organizational survey across countries in six cultural regions. Journal of Occupational and Organizational Psychology, 80: 575-600. China Daily. (2010). 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