In today's global work environment, it's a given that companies need culturally diverse teams to succeed. Both scientific studies and common sense tell us that having people with different viewpoints onboard increases the creativity that teams will employ in solving problems. Of course, that's assuming all members of the team are pulling in the same direction.
But what if they aren't? Can being exposed to intercultural conflicts and tensions have an impact even on observers who are not directly involved in these disharmonies?
Harvard Business School Assistant Professor Roy Y. J. Chua started asking those questions a few years ago, when writing a case about a Chinese luxury apparel company. The firm had members from China, Hong Kong, Germany, and France, who were all working together to meld Chinese elements with Western fashion. As he observed them, however, Chua saw tension and miscommunication based on cultural differences. "Even though, when you asked them, they didn't think it was a problem, I wondered if it could have an indirect impact on people observing these tensions," he says.
Chua compares it to the kind of "hostile work environment" that occurs in cases of sexual harassment or racial discrimination—in which coworkers' morale or performance suffers even when they are not the direct targets of abuse. He coined a term for the phenomenon, "ambient cultural disharmony," which he discusses in depth in The Costs of Ambient Cultural Disharmony: Indirect Intercultural Conflicts in Social Environment Undermine Creativity, a paper published this month in the Academy of Management Journal.
"A lot of times when we study cultural conflict, it's about people directly involved in conflict," says Chua. "The key word here is 'ambient,' looking at the effect that cultural conflicts can have on an observer. That flows more through the perceptions we have about other cultures."
The effect of indirect conflict happens all the time. Children who witness conflict between parents may develop negative ideas about marriage, just as citizens of the United States and China may develop bad feelings about each other from watching their leaders squabble. So why wouldn't the same thing happen in the workplace?
Testing For Like
Chua tested the concept in a series of studies. In the first study, he asked a group of online participants to list the important people in their social networks, noting their cultural backgrounds and whether they liked each other. Then he asked them to do a word association exercise that compared their ability to connect disparate ideas across cultures—a precursor to creativity in a global context. For example, when given the words "Great," "Street," and "Berlin," they should correctly answer "Wall," connecting the Chinese "Great Wall," American "Wall Street," and German "Berlin Wall."
After tallying the length of time it took for participants to come up with the right answers, he found those who had more people in their social network from different cultures who disliked each other did about 23 percent worse on the test. This makes sense, says Chua. "Just as a child observing parents not getting along may develop the notion that marriage is very difficult, those seeing conflict around them by involving people of different cultures may develop the idea that ideas from those cultures are incompatible and cannot be easily combined."
For his second study, Chua asked participants to call to mind two friends or acquaintances from the same or a different cultural background who did or didn't get along with other people. Participants were then asked to read Chua's business case on the Chinese fashion house, and afterward told to come up with ideas for next year's collection that would blend Asian and Western styles.
When expert fashion designers judged the creativity of the ideas, they determined that the least creative ones came from participants who had called to mind acquaintances from different cultural backgrounds with disharmonious relationships. [On average, those who recalled that cross-cultural disharmony generated ideas receiving creativity scores 23 percent lower than the average of the other conditions. In the other three conditions, creativity was about the same.]
"As human beings, we pay more attention to negative information because it is a signal of danger”
Interestingly, while ambient cultural disharmony decreased creativity, ambient cultural harmony (that is, observers experiencing people from other cultures having a good relationship) did not promote creativity. That reflects human nature, Chua says. "As human beings, we pay more attention to negative information because it is a signal of danger. Positive information tends to be given less weight."
In his final experiment, Chua took the concept of ambient cultural disharmony a step further by exposing participants to video clips of two people interacting in a business situation. In six scenarios, the people/individuals were from the same or a different culture and were engaged in positive (harmonious), neutral, or negative neutral interactions—six scenarios in all.
After viewing the videos, participants were given details about two cultures—a Mongolian tribe called the Ewenki and a South American population called Jivaro—and were asked to come up with innovative business ideas that could help both groups/cultures. A team of experienced entrepreneurs judged the business ideas on creativity—for example, broadband Internet, while useful, scored low on the creativity scale, while a long-lasting fuel scored high since the Ewenki had trouble gathering fuel, and the Jivaro believed fire to be sacred and should never go out.
Even after a brief exposure to situations involving people they didn't know, the participants who experienced cultural disharmony received creativity scores about 24 percent lower than those viewing the harmonious or neutral interactions. Surprisingly, Chua also found a slight drop in creativity among those who viewed the same-culture harmonious videos. He speculates that perhaps observing ingroup harmony inadvertently sends the signal that people are unwilling to step outside their comfort zone to engage with other cultures.
"When you see a lot of people of the same type clicking together, you might come to the belief that they are not receptive of people different from them—it's almost like an old boys' club situation," says Chua, though he cautions that those findings were slight compared to the much stronger effect of ambient cultural disharmony.
Culture Clashes
For those working in culturally diverse business environments, these experiments demonstrate the risk of bringing people from different cultural backgrounds together—and the importance of actively creating an environment that minimizes intercultural disharmony, says Chua.
"It is inevitable to have conflict when you bring people from different cultural backgrounds together," he says. "It's about how you manage the conflict. A lot of times managers try to put together a multicultural workplace without trying to integrate people better."
As Chua has shown in previous research, awareness of our own cultural biases and assumptions can go a long way toward improving creativity in multicultural situations. He speculates that managers could decrease the effects of ambient cultural disharmony by encouraging employees to identify their own assumptions of other cultures—for example, by keeping a cultural journal in which they record their thoughts and observations. In the workplace, managers can create cultural "awareness moments," as HBS Associate Professor Tsedal Neely suggests, by setting up site visits between employees working in different environments, or by encouraging them to work side by side to observe how cultural differences can influence work habits.
Managing cultural friction in this way might not only help create a more harmonious workplace overall, but also ensure that you are reaping the creative benefits of multiculturalism at its best.
Leslie argues that 'judgments are developed and transformed by way of the "reflective equilibrium" established between the socially cultivated sensibilities inhabiting our guts and the theoretically formalized principles that emerge from our mouths'.
This shows us that the more you take multiculturalism into account (like mentioned in this study), the better you can make decisions.
It was important but also challenging to understand before to be understood and deal with cultural myopia.
Empathy is a time-tested solution.
Undertaking such inter related initiatives in cross cultural management and human values is expected to contribute in its own way, among others, in minimizing cultural friction, strengthening creativity and innovation, and organizational harmony and productivity.
To start this process an organisation first needs to get an accurate picture of the current level of risk culture maturity in the organisation. Various attempts have been made to do this and generally most revert to some kind of questionnaire or checklist approach linked to a scoring sheet that is eventually tabulated to quantify an overall score which is linked to a perceived level of maturity.
Although most inputs in any kind of maturity assessment are subjective, there is value in using a combination of approaches, but generally the outcome, due to human nature and perception, is always mid-point or average. These processes generally fail to identify specific weaknesses or action plans.
There is no standard definition for the different levels of maturity, but an interesting aspect is that most practitioners working on this use the concept of 5 different levels of maturity, this in itself also contributes to most consolidated assessment results ending up at mid-point.
The five levels of Risk Culture maturity have been defined as follows:
1. In a bad risk culture, people will NOT do the right things regardless of risk policies and controls
2. In a typical risk culture, people will do the right things when risk policies and controls are in place
3. In a good risk culture, people will do the right things even when risk policies and controls are not in place
4. In an effective risk culture every person will do something about the risks associated with his/her job on a daily basis
5. In the ultimate risk culture every person is a risk manager and will evaluate, control and optimise risks to build sustainable competitive advantage for the organisation
Risk Culture Building is the process of growth and continuous improvement in the way each and every person in an organisation will respond to a given situation of risk as to mitigate, control and optimize that risk to the benefit of the organisation. No two people will respond the same way to a situation of risk, the way any person responds to risk is influenced by a number of factors, the main ones are:
? Nationality & culture
? Childhood experiences (and formative environment)
? Work ethics, trust & honesty
? Education (and the way it was obtained)
? Work experience
? Religion and other spiritual thinking
? Attitude towards life (and death)
Once an organisation has established the level of maturity, the Board of Directors and Executive Management can commence the process of Risk Culture Building. It is not possible to implement risk culture in any organisation; it is a process of building, starting at the top. There are no best practices that can be implemented, the risk culture must be built upon the underlying corporate culture, so each risk culture building process is organisational specific and unique.
Risk Culture Building is thus a process of change to instill new behaviours in the workforce, both the behaviours the leadership want to encourage and the behaviors they want to avoid.
Addressing the aspect of people risk is the only way an organisation can improve the results of how their people respond to a situation of risk and the effectiveness of their risk management function. No organisation can ever have a perfect risk management culture, but organisations can achieve a level of maturity where they have an effective risk culture process and every employee is risk-minded and does something on a daily basis to mitigate, control and optimize risk.
The development of Risk Culture Building is focused on awareness and training in business ethics and human behaviour, as mentioned, both the behaviours we want to encourage and the behaviours we want to avoid. Organisations should frequently evaluate the progress (or regress) they are making on the path to maturity and implement action plans.
Just as human beings pay more attention to negative information, they invest energy into analyzing it more- in other words, stress.
To my thinking, these results are relevant beyond issues of cultural adventurousness, bias, or bigotry. It is a reflection of the effects of cultural stress (whatever its origins) on the bottom line.