Cultural Differences in Business: How to Effectively Manage People and Build Relationships with Clients?

In the world of business, just like in everyday life, there are no two identical people with the same experience, and expectations. Cultural differences impact the way of thinking, managing, and communicating, creating a unique landscape where every step can lead to either success or misunderstanding. And here, it’s not just the discrepancy in management styles or communication between countries and continents that matters. This also happens within the same country, among people from the same cities, speaking the same language.

What is Erin Mayer’s book “The Culture Map: Decoding How People Think, Lead, and Get Things Done Across Cultures” about?

Erin Meyer, in her book “The Culture Map”, presented the results of her research on cultural differences in international companies.

• Why does a proven leader in one country experience disappointment in another?
• Why is respect for the superior a matter of geography?
• Should a manager be serious, or does professionalism exclude a touch of madness and nonchalance in our superior?

Meyer identified eight dimensions on which cultures differ, creating the potential for misunderstandings:

1. Communication
2. Evaluating employees, negative feedback
3. Persuasion
4. Managing people, hierarchy, and power
5. Decision making
6. Trust in business
7. Critiquing, discussing
8. Planning meetings and the sense of time

Being aware of these differences, we can not only avoid misunderstandings but also use this knowledge to build stronger, more understandable, and effective business relationships.

Recognizing the illness and accepting it is already half the healing process. However, it’s not about being at odds with each other in the workplace or acting unnaturally. To be effective leaders, we need to be aware of the environment and context in which we work, and how processes, communication, and actions, affect others. Our effectiveness is measured by impact and the domino effect. It’s not always about doing something against oneself — we won’t get rid of all our habits, but thanks to the knowledge gained about cultural differences, we can set common rules of the game at a meeting or in a team and achieve better results, but also in a shorter time. And that is a huge part of a leader’s work.

Let’s take a closer look at the most important dimensions where misunderstandings occur.

Different Communication Styles and Required Context

“You have two eyes, two ears, but only one mouth. You should use them accordingly” — this quote appears in the context of cultural differences between the Chinese and the French, which Meyer refers to. For example, a person from China will not interrupt during a business meeting (which someone from the USA or France might do) — they will wait a few seconds after someone else’s statement for their turn. If we do not ask them a question or prompt them ourselves, we may not allow them to speak and miss the moment when they are still waiting for someone to definitely finish their thought.

Another example concerns the story of two young fish meeting an older fish swimming in the opposite direction. When the older fish asks: “Good morning, guys, how’s the water?”, one of the young fish says to the other: “Hey, what the heck is water?”. This story shows how difficult it is to gain self-awareness in one’s natural environment. We act according to routine, pattern, and what is natural for us, because we have always done something this way. If we come from an environment where there was little independence, and every task was assigned and controlled by a manager, we expect the same in another workplace. Again, mapping how we work in a team and in a company, and self-reflection are very important.

Meyer’s method allows us to define communication on a continuum between low and high context:

• Low-context — communication is direct, concrete, simple, clear.
• High-context— communication is sophisticated, nuanced, multi-layered, suggesting more than it says directly.

In low-context countries, the United States, Australia, Canada, the Netherlands, and Germany dominate, while high context is characteristic of Japan, Indonesia, Korea, China, Kenya, and Saudi Arabia.

Meyer argues that the more countries are immigrant and culturally diverse, the more direct communication is needed. In more traditional, homogeneous countries, more ambiguity and subtlety can be afforded.

Understanding these communication differences is of great importance not only in business but also in family and friendly relationships. It’s important not to assume anything based on one’s own experiences, which can lead to misunderstandings. Therefore, clear and frequent communication is crucial, which can defuse many disputes before they have a chance to intensify.

Employee Evaluation and How to Give and Receive Feedback

Feedback, especially negative (or constructive, whatever works), is conveyed in different ways. For example, in the USA, it may be given more delicately, as a suggestion or area for development, while in other countries it may be expressed directly. Erin Meyer cites the example of a Frenchwoman in the USA who thought she was being praised by her boss, while he complained that she ignored his critical remarks and did not make changes in her behavior.

We should ask ourselves:

• What kind of feedback do people I work with expect?
• Do I clearly communicate what I expect from others and how often?
• Do I make sure my message has been understood?

It turns out that low-context cultures do not always provide direct feedback, while high-context cultures may prefer a more veiled form of communication.

Direct feedback is typical for countries such as Russia, Israel, the Netherlands, Germany, France, Denmark, while more veiled feedback can be expected in Japan, Thailand, Indonesia, Saudi Arabia, Korea, Ghana.

What lesson does this also teach us? Even in a culturally homogeneous company, it is worth mapping your team, exploring what kind of feedback people expect, and whether our needs are clear to them.

Persuasion and Convincing Others of Our Point of View

The way of persuading also varies depending on the culture. Meyer distinguishes two main approaches:

• Applications-first — we start by presenting the way of implementation, facts, assumptions, opinions, and then ideas to support our line of thought; we start with an executive summary, points; practice counts.
• Principles-first — we first present the theory, a complex problem, before moving on to facts, assumptions, and opinions; we build theoretical foundations, and discussions are based on the realm of ideas.

The way we prepare presentations, and for whom, matters. Do we, like in the USA, first sell the idea, concept, examples, and then the context of our solution? Or do the theory and data count first? This is largely influenced by the education system and the way we were taught.

• Applications will dominate in: USA, Canada, Australia, UK, and Netherlands.
• Theory and data will dominate in: Italy, France, Spain, Russia. American and Germanic cultures are based on the philosophical, theoretical systems of ancient Greece and Rome, so these countries will also use this approach.

If we look not only at these differences between practice and theory, we can also think about the characteristics of people we want to convince of our strategy, and idea. Are they people who are more influenced by graphics, design, and examples, or rather focused on data and Excel, or do they need a story? This will also help us prepare the right line of thought and how to present it.

Managing People, Hierarchy, and Approach to Power in Different Cultures

In managing people, hierarchy, and power, the approach to what makes a good manager differs. Meyer distinguishes two main approaches:

• Egalitarian approach: small difference in hierarchy between boss and employee; primus inter pares, manager is a facilitator among equals; flat structure, levels are skipped in the discussion. What is welcome: a) Disagreeing with the boss in front of others, b) Acting without the boss’s consent, c) Writing several levels higher, bypassing the supervisor.
• Hierarchical approach: high difference between boss and subordinates; strong leader, important status, multi-layered hierarchy. Discussion takes place between people of the same level: a) No disagreement with the boss, b) Communication according to hierarchy, c) Seating at the meeting according to position.

What does this tell us? It’s worth considering what approach people expect from me? If they come from a more hierarchical culture or company, it’s worth setting the rules of the game and expectations among ourselves.

Meyer mentions a study where employees from different countries answered the question: Is it important for a manager to have immediate concrete answers to most of the subordinates’ questions about their work? In Sweden and the Netherlands, the answer was 8–11%, while in Spain and Italy it was 56–58%.

Geographically, the egalitarian approach is seen in Denmark, the Netherlands, Sweden, Israel, Australia, while the hierarchical approach is in Japan, Korea, Nigeria, Saudi Arabia, India, China.

Decision-Making in Different Cultures

When it comes to decision-making, Meyer distinguishes two approaches described as “Big D” and “small d”:

• Big D: after a long time of discussion, a Decision is made, after which there is no room for further discussion.
• Small d: after a short time of discussion, a decision is made, which may be modified during its implementation.

Additionally, depending on who and to what extent is involved in the decision-making process, we distinguish:

• Consensual: decisions are made collectively, through unanimity.
• Top-down: decisions are made by individuals, usually by the boss.

Let’s think about how we make decisions, depending on the type of task. Is it clear to everyone in the organization? Can we plan the decision-making process before starting a project to avoid disappointments? Maybe you have a project in mind that was run in the Big D and small d way?

Or maybe you want to test the delegation poker exercise with your team?

Countries that prefer the consensual approach are Japan, Sweden, the Netherlands, Germany. The top-down approach is presented by countries such as Nigeria, China, India, Russia, Italy.

The Basis of Trust in Business Partners

The issue of trust is crucial in every organization. However, it is built in different ways, and our expectations and standards may be different. Meyer distinguishes two basic approaches:

• Task-based: trust is gained through joint activities; relationships at work are built quickly, through a practical approach to situations; if you work well, you can be relied upon, I like working with you, I trust you.
• Relationship-based: trust is built through shared meals, outings, and meetings; relationships at work are built slowly, often after personal acquaintance, after getting to know the person also outside of work, after meeting others who trust her.

Now think about whether we have yet to hire someone similar to us, who reads the same books, and has the same hobby. To what extent can we unconsciously reject people during recruitment when they do not fit our image, but could bring a lot of expertise and experience? In the case of business partners, is it always the best offer that counts, or is it also that it is nice and we have a thread of understanding?

The task-based approach is preferred in such countries as the USA, Denmark, the Netherlands, Australia, Germany, Finland. Trust based on relationships dominates in countries such as Saudi Arabia, Nigeria, India, China, Thailand, Brazil.

Critiquing, Discussing, Disagreeing at Work

In the matter of discussing, disagreeing, and debating, we can also distinguish two approaches:

• Confrontational: disagreeing and debate are positive for the team; open disputes are accepted, do not negatively affect relationships.
• Avoiding confrontation: disagreeing is negative for the team, breaks harmony, negatively affects relationships.

We don’t have to work in different cultures to know that some people prefer to express their opinions directly, while others avoid confrontation — this is influenced by many factors, such as upbringing, education, previous professional experiences, and the consequences we face when we express criticism directly.

The confrontational approach is presented by countries such as Israel, France, Germany, Russia, the Netherlands, Denmark, Spain. Avoiding confrontation is characteristic of Indonesia, Japan, Thailand, Ghana, China.

Meeting Planning and Time Management in the Project

The issue of time and meeting planning also varies depending on the culture:

• Linear-time: projects are carried out sequentially, after completing one task, you move on to the next; concentration on the task, adherence to deadlines and plans, organization is more important than flexibility.
• Flexible-time: the project is carried out fluently, tasks change depending on the situation, many things happen at the same time, adaptation is appreciated, flexibility over organization.

But again, does this only apply to other cultures and geographies? Don’t we know people who are extremely precise and punctual, and perpetually late, flexibly approaching time? Everything again comes down to clearly presented expectations.

The linear approach is dominant in countries such as Germany, Switzerland, Japan, Sweden, the Netherlands, Denmark, the USA. The flexible approach is characteristic of Saudi Arabia, India, Nigeria, Kenya, China.

Cultural Differences in Business — Summary

Just as in communication with any other person, key are sensitivity, empathy, and emotional intelligence. Effective and healthy communication is particularly demanding in the context of different cultures.

The business context introduces additional dimensions on which we can experience difficulties, get tired at work. These are:

• Communication
• Evaluating employees, negative feedback
• Persuasion
• Managing people, hierarchy, and power
• Decision-making
• Trust in business
• Critiquing, discussing
• Planning meetings and sense of time

If you have any interesting examples from your backyard, or thanks to this knowledge you have learned something useful — let me know. I am very open to feedback.

By the way, it turned out that I have a very Danish approach to management, which was a surprise to me because I have only been to the country of Legos once, and that was when I was in elementary school. As you can see, it still works.

Thanks for reading the article! If you have any questions, comments, or suggestions, don’t hesitate to contact me. ;-)