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THE concept of cultural intelligence is a relatively new one. In October, when the Nanyang Business School at NTU announced the establishment of what is reportedly the world's first Cultural Intelligence Centre, not everyone understood what it was about.

Unlike intelligence as in IQ tests, and like emotional intelligence as in EQ tests, cultural intelligence is about the ability of individuals to handle certain kinds of problems and situations.

To IQ, and EQ scores, we can now add 'CQ' scores. EQ and CQ have some similarities, but are different concepts. A person of high EQ within his own cultural setting may become a fumbler in an unfamiliar cross-cultural situation, using the wrong gestures, saying the wrong things, tripping over himself and not even knowing it.

Let me give a couple of examples of situations where a bit more cultural intelligence would have helped.

Words have different meanings in different cultures. Take the word 'suck': Normally we say that a vacuum sucks air and dust. However, in colloquial American language, when you say that something 'sucks', it is a derogatory remark. When the Swedish white goods giant Electrolux introduced its famous brand of vacuum cleaners to America, their advertising experts came up with what they thought was a clever turn of phrase: 'Nothing sucks like Electrolux.'

Needless to say, it became the butt of many a joke.

Closer to home, cultural intelligence, or a lack of it, seems to have played a role in the early problems encountered by the highly visible Singapore investment in China called the Suzhou Industrial Park. This project set out to be a model of Singapore-China cooperation, with Singapore investing a majority 60 per cent stake in the park. The project was personally negotiated and approved at the national level by top leaders from both countries.

In Singapore, approval by the top leaders of the country guarantees that civil servants down the line would break their backs to ensure its success. It is not the case in China, where part of the underground culture is shang you zhengce, xia you duice, or 'for every edict from above, there is a counter-measure from below to circumvent it'.

When the Suzhou Industrial Park was being built, another industrial park in the New District of Suzhou was already in operation. The head of the other park was a senior official in the Suzhou municipal government, and naturally he proved to be a serious competitor as the rewards for his team were tied to the revenues of the other park.

Singapore complained about unfair competition but the Chinese felt it was just free competition, something which they thought was a core value of the Singapore economic gospel. Relationships between officials of the two countries deteriorated, but the turning point came when Singapore retreated to a minority shareholder position and the official from the other park also ran the Suzhou Industrial Park. That turned out to be a culturally intelligent move, and the park now enjoys considerable success.

It has been estimated that 83 per cent of cross-cultural mergers and acquisitions in the world fail because the players involved lacked CQ, amongst other factors. I would hazard a guess that an even greater percentage of international political deals or negotiations fail for the same reason.

Political commentators have reasoned that the woes of the Bush administration in dealing with uncooperative Europeans and the unexpected tenacity of Iraqi insurgents have to do with cultural intelligence, or the lack of it.

The good news is that while IQ is largely inborn and cannot be improved significantly by education at the secondary or tertiary level, and while EQ is largely in your hormonal secretions and family upbringing, CQ can be changed with training and experience. In other words, education can play a critical role in developing CQ.

Before dealing with education in cultural intelligence, it is useful to briefly review the various aspects of cultural intelligence.

Globalisation

IN A recent US study, 19 of the 20 most globalised companies had foreign sales in excess of 50 per cent of total sales and operated in 50 countries or more. Half or more of all staff were foreigners. Rapid globalisation has made international experience and cross-cultural competence increasingly valuable to businesses and managers.

For many individuals, career decisions are no longer based on nationalism. Young people the world over increasingly want to work for the GEs, Citigroups, Sonys or Nestles of the world. For these companies, cultural diversity exists right in their midst, among staff and clients.

For global operations, cultural intelligence is a key element of the overall business intelligence. The traditional model for business intelligence involves hard information on competitive customers, suppliers and dis- tributors, economic trends, and local rules and regulations.

Equally important are cultural intelligence factors such as knowledge of social customs and traditions, methods of communication, the ability to build trust and credibility, the dynamics of group decision making, and an understanding of what motivates the other party. Many businesses resist addressing this aspect of cultural intelligence because they believe, incorrectly, that such knowledge cannot be easily taught.

Business blunders

'THE trouble with this world is not that people know too little, but that they know too much that ain't so,' said Mark Twain.

Cultural intelligence is an asset that can help organisations avoid embarrassing mistakes. The culturally uninitiated business consultant has been the source of many hilarious blunders in product-naming history.

The American Sunbeam Corporation once launched a new product for the German market, a beautiful curling iron which it called 'Mist Stick' from the Clairol product line. Clairol's culturally unintelligent advisers apparently did not know that 'mist' is German slang for dung. The German market did not appreciate a 'dung' or 'manure' stick in its hair, with or without the curls, and the new product was appropriately, and hygienically, buried in dust.

Then there are car makers which discover too late that certain models are spurned by rich Chinese towkays and executives, no matter how plush the interiors or how wonderful in other ways. These are cars with model numbers or names that contain a certain phonetic sound - one that translates into the Cantonese dialect for 'die'.

Conflict situations often arise unnecessarily owing to misunderstandings caused by lack of cultural appreciation of the other party. Some of the typical stumbling blocks to understanding cultural differences are as follows:

Stereotyping

Stereotyping occurs when an exaggerated belief is associated with a category. The assumption that our beliefs and values are similar can lead to unnecessary misunderstandings. Stereotypes can create expectations which, if untrue, may lead to inaccurate 　eval　uations of situations.

For example, an American worker with a more direct communication style may be viewed as abrupt and uncaring by his Asian co-worker who values harmony in relationships over freedom in individual expression.

Silence in communication has different implications in various parts of the world, as was evident in the case of the three US executives who flew to Japan to sell tractors. The Americans thought that their presentation had gone well, but the Japanese expressed no reaction when they quoted the price of their products. Their silence became disquieting, so to speak, and the hapless American team leader proceeded to lower their price. The Japanese continued to keep a stony silence and an inscrutable expression on their faces.

Ultimately, the Americans lowered their prices far more than they had ever planned. They did not know that the Japanese executives had fallen silent not to signal rejection of the proposal but that it was their style.

Ethnocentrism

Ethnocentrism is the emotional attitude that one's own ethnic group, nation or culture is superior to all others. It leads to the tendency to view differences in a negative light and, in so doing, reinforce one's own values and beliefs.

For example, some years ago, McDonald's, determined to expand its business in France, identified a French partner. Its cross-cultural research read the market right, but it overlooked the ethnocentricity trap. Its restaurant in Paris was a resounding success in sales but the company subsequently wasted years in litigation trying to revoke the licence it had granted to the French partner.

The Americans had overlooked cross-cultural differences in attitude towards hygiene. They had assumed that their high standard of hygiene was reflected in other nations as well. The French were generally more relaxed about this subject, but that did not please the nit-picking imperialistic Americans. McDonald's inspectors turned up numerous violations of their cleanliness codes. Their global image - not just French people in Paris - was involved in a fundamental way. They eventually took the licence back but it took years in court to correct this cultural mistake.

Two cultures

CULTURAL gaps exist within the same society within the same ethnic group. In the 1960s, a British thinker and writer spoke of the divide between the 'two cultures' in Britain - the scientists and the humanists or artists.

Misunderstanding often arises from not knowing what drives the other party.

In Singapore, apart from cultural differences among the major racial groups, there is a perceived difference between HDB dwellers and those who live in private estates. Some years back, there was an attempt to classify them as 'heartlanders' and 'cosmopolitans' respectively. This classification had its detractors among those who objected to being labelled, particularly when being cosmopolitan implied being more sophisticated and having an international outlook. In fact, HDB estate dwellers are quite cosmopolitan - witness their travel frenzy every December, and French wine sold in NTUC FairPrice. And I can think of any number of private estate dwellers who are xenophobic and parochial in their social attitudes.

Most organisations today face the challenge of recruiting and retaining a culturally diverse staff and making them work together as an effective team.

Even organisations celebrated for their enlightened strategies for globalisation, such as Honda or Philips, have difficulty implementing their global strategies because of the lack of management talent with cross-cultural skills.

The first priority is to motivate individuals to educate themselves about other cultures. Before travelling to another country on business or working with professionals from other countries, it is imperative to take the time to learn about that culture, especially with regard to business and social protocols.

An American oil executive thought he had covered all bases and was about to sign a contract with a Middle Eastern nation. An hour before the signing ceremony was about to take place, he met the responsible government official for tea. Relaxing, the American propped his feet on a table, with his soles facing his Arab host (considered a rude gesture), who stood up and left the room, to the surprise and chagrin of the American. It took another year of painful negotiations before he finally got the contract signed.

Another point to note is that geographical proximity does not imply better understanding and less need for education about your neighbour. Nor can a plentiful supply of common sense and goodwill take the place of education aimed specifically at raising cultural intelligence levels. Without mentioning specifics, we only need to look at Singapore's rocky relations with our two closest neighbours for evidence of this.

We also see immigrants who have lived in another country for dozens of years and still do not understand the country's culture. Similarly, expatriates living in other cultures often spend most of their time with their own countrymen. When this happens, little can be learnt about the country's culture beyond superficial observance.

Both nature and nurture influence cultural intelligence, but nurture is the more important factor. A person's CQ may be quite stable in the short run but it can be raised in the long run through training. Education in cultural intelligence should preferably start from a young age, in primary and secondary school, continuing into tertiary and executive education. Education should aim at developing competencies in two basic areas: awareness of oneself, and knowledge of others.

The writers are with the Nanyang Business School at Nanyang Technological University. This article is based on a speech delivered to the Educational Research Association Conference on Nov 24 last year at which Dr Hong Hai was a keynote speaker.

Important Concepts

IQ (intelligence quotient): Tests that measure intelligence. Controversy exists today about the fairness and accuracy of the tests

EQ (emotional quotient): Tests that measure emotional intelligence, especially in the ability to monitor one's own or others' emotions and to interact effectively with others

Suzhou Industrial Park: Located in a suburb of Suzhou, China, this is the biggest cooperative project between the governments of China and Singapore. It is composed of an IT park, an international technology park, a life science park and a software park.

Globalisation: State of making global or worldwide in scope or application

Mark Twain: American author, humorist, narrator, and social observer. His novel The Adventures Of Huckleberry Finn is widely considered a masterpiece

Stereotyping: Conventional and oversimplified conception

Ethnocentrism: Belief in the superiority of one's own ethnic group

The Worksheet
FILL IN THE BLANKS

1. A knowledge of the culture in a market is a/an __________ for a global company.
2. Companies with a/an __________ workforce probably have an advantage in the global marketplace over companies with a __________ workforce.
3. Some companies provide their employees who are __________ with a course to familiarise them with the culture of the country they live in.
4. Its __________ say that the course to familiarise employees with foreign culture is not an efficient use of resources since culture is such a broad topic.
5. Edward Hall's The Silent Language, published in 1973, was one of the first books to point out the importance of knowledge of the __________ of different cultures.
6. The great __________ of cultures makes it impossible for one person to be familiar with the intricacies of all of them.
7. The student showed __________ in his study of the foreign language's __________ expressions.
8. The __________ businessman inadvertently made a remark that was interpreted as __________ by his client, a member of another __________ group.

TRUE OR FALSE?

Based on what they say in this piece, say which of the following statements the authors would be likely to agree with and which statements they would be likely to disagree with. Put T (True) if you think the authors would agree, Put F (False) if you think they would disagree.
1. The school curriculum should pay more attention to teaching students about different cultures. __
2. Misunderstandings based on different cultural outlooks are highly unlikely between Chinese Singaporeans and Chinese from the People's Republic of China because they share a very similar set of cultural assumptions. __
3. While a knowledge of different cultures is undeniably important, it would be inappropriate to include study of them in a university course. __
4. 'CQ', like IQ, is largely genetically determined. __
5. Globalisation has made it increasingly important for businesses to be familiar with the idea of cultural intelligence. __
6. Cultural misunderstandings rarely cause major problems in business. __
7. Cultural misunderstandings frequently occur between members of different societies, but rarely occur between members of different groups within a country. __
8. People who live in HDB flats tend to be xenophobes. __
9. So long as you're friendly and honest in your dealings with foreigners, you probably won't have any difficulty doing business with them. __
10. Even big global companies like McDonald's sometimes have problems dealing with cultural differences. __

ANSWERS

Fill In The Blanks

1. asset 2. cosmopolitan parochial 3. expatriates 4. detractors 5. protocols 6. diversity 7. tenacity colloquial 8. hapless derogatory ethnic

True Or False?

1. T 2. F 3. F 4. F 5. T 6. F 7. F 8. F 9. F 10. T

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