The second in an eight-part series of challenges facing Canada's foreign trade: Dealing with cultural differences
It is the world's unspoken language, and businesses that fail to listen for it will struggle, without understanding why. Cultural difference adds an extra layer of complexity to doing business internationally. Three key areas involve attitudes to time, relationships and directness in communication. One of the challenges Canadian business faces as it competes on the world stage is to make sense of these hidden or unspoken attitudes and to weave their new understanding into their business practices.
Georges Brotman, who was born in France, created and runs TTI Transculture Training International Consulting, which coaches businesses on how to deal with cultural differences they may encounter abroad. Carla Kearns, a dual citizen of Canada and the United States, is the owner and founder of TLI - The Mandarin School in Toronto, which provides language and intercultural training for business.
Are Canadians as worldly, as comfortable in the world, as we like to think?
Ms. Kearns: A lot of executives fear what they don't know. They're already disoriented when they go to another country. We're very comfortable doing business with the United States. When we go to a country that is so different, like China, India or Russia, where the values are so different, it's shocking.
Companies tend to look at the hard things. They invest time in legal, in financial, in governance. These are all truly important. Often the cultural differences initially get dismissed. "Oh, it's the soft skills, how difficult can it be? We're Canadian, we have a great deal of intercultural experience, we're multicultural."
What are these shocking differences that business should be most aware of?
Ms. Kearns: In my experience working with China, time is the biggest gap. We have a very short perspective on time. Our concept is "time is precious, time is money, don't waste my time." We have an unspoken agreement to do things as quickly as possible so we can get out and do something else. China is different. Even though China has been advancing at a rapid pace, individually people have a very different concept of time. It's much longer. It stems from it being a very old culture. People are used to things taking time and resolving themselves in time.
How exactly does not making enough time hurt business?
Ms. Kearns: Where it becomes tricky is where a Canadian company goes to negotiate. We want to rush things. They don't want to do that in China.
Is being in a rush so wrong?
Ms. Kearns: Chinese companies know this about Canadian and American companies; they know this short-term perspective is going to drive the board or executive team at these companies to say "if you don't come back with a contract signed your trip is a failure." They know there is corporate pressure that can be used as a negotiating tool. The Chinese counterpart can draw out negotiations.
Mr. Brotman: There's a saying that time needs time. Here in North America we're much more fact-, figures-, conclusion-based, versus relationship-based. In countries like China and Brazil, you need to establish a relationship first before they even want to do business with you. That's why doing business in China takes a long time. I call it the rule of two. If you're doing business outside of the U.S. it's going to take you twice as long, twice as much in terms of budget; you're going to have to put in twice the effort that you would in North America.
So time is necessary to develop the relationship.
Ms. Kearns: It takes face time. Those personal relationships are integral. If you go to China and schedule your trip so you've got back-to-back meetings all day and go back to your hotel and you're e-mailing your corporate office and you go for five days and head back so you can get the weekend, you will never be successful.
Mr. Brotman: In China, businesses are built on networks, or guanxi. Knowing the right intermediary is key.
I imagine you discovered the hard way about the need to focus on relationships.
Mr. Brotman: Japan was the one that really opened up my eyes. I landed after a long trip. The Japanese came to meet me at the airport, graciously took me to the hotel, gave me a half hour and said we're going for dinner. I thought, wait a second, I just flew across so many time zones. To myself I said, "that's totally inconsiderate." But that's the way they start establishing a relationship. They want to know who you are. Do you have integrity, do you have credibility? Can I trust you? If they don't relate to these elements, you'll never be able to do business wherever you go.
I made my presentation in the North American style which is to provide some slides, some facts and figures and conclusions. I saw that their eyes were glazing. Two or three appeared to be sleeping. They work very long hours; very often it takes them two or three hours travelling by bullet train. It didn't matter that one or two were not fully attentive because the next day they review the presentation.
Then I realized the presentation is just one thing. They want to understand that I am really committed to working with them in the long term. They have a long-term horizon when they do business. In the U.S. and often in Canada, we're very quarterly focused. What are the revenue and profit figures? You must declare those by law and it affects the share price. Over there they're really not concerned about that. Let's have a long-term relationship and see how we develop jointly as organizations.
What other big differences should business people be aware of when they go abroad?
Mr. Brotman: In India you can ask a direct question and they will never say no to you because it's totally disrespectful to say no. You have to be able to interpret the type of questions they pose so you know if it's a yes or a no.
Ms. Kearns: We have an unspoken rule: if there's a problem, give me a head's up. In China, people don't feel comfortable with that. People don't volunteer bad news in China. But you can get it. There has to be that personal relationship. No one is going to fire off an e-mail saying there's a problem here. It comes out of time spent, sitting around having dinner or having a tea. But it doesn't come with the precision we're used to working with in North America.
[Also]It really depends on the country, but women would be smart to research specifically about the country they're going to. In China a lot of women perceive that women in general are not highly regarded or not involved in business, but the reality is that it's quite similar to North America - it's not 50-50 here either but there are a lot of women in senior positions of power in government and politics and corporations. Women going to China to do business will be highly regarded. Women need to take the extra step in all countries of understanding what is acceptable dress. How do I need to dress to demonstrate my stature as a leader in this organization? Often that tends to be more conservative.
In companies where hierarchy is very important, make sure the woman is listed first. Make sure her title clearly designates her role within the group. If she is going over to a country with a delegation make sure she understands the cues that show she is the leader. For instance allowing her to enter the room first and to take the seat of priority at the table.