Banter Without Borders

Cultural Upheaval: Will Canada be the New China?

 Twitter |  Facebook |  digg it |   delicious |   StumbleUpon |   LinkedIn |  reddit 

“Oh, how things have changed.”  Thus began a recent Bloomberg Business Week podcast on China. The vexing question of whether to tackle the ins and outs of doing business in The Middle Kingdom started long before the recent and wrenching Google saga, but China's increase in power and, now, boldness on the world stage are more apparent than ever. Ongoing talk of Beijing’s ‘decoupling’ China and the U.S. is clear evidence of such a dramatic and unsettling development. For Western companies, red carpet treatment has now been replaced by red tape. The heady days of rushing to China and its untapped resources are over. Businesses are thinking far more carefully now, wary of the new and increasing risks of entering a market whose great wall of restrictions, regulations and requirements is steadily rising. As those of us who work with clients on improving their ‘intellectual capital’ vis-à-vis overseas business know, cultures and their values allegedly don’t change, yet even this holy grail of global coaching and consulting is thrown in doubt, with China’s apparent personality shift providing one huge exception to the cultural rulebook.  When it comes to China, myths and realities are on murky ground.

With China and even Asia no longer automatic destinations for companies in expansion modes, and with recession tightening everyone’s belts and changing thoughts of how to proceed with globalization, where are companies to go when seeking to expand beyond domestic markets?

One answer may well be Canada, which is looking like a really viable choice at the moment.  Many in retail would seem to agree, as a WSJ article* indicates. U.S. companies in the clothing industry, from J. Crew to the Limited to the Gap, are all taking the plunge into Canadian waters ever so carefully, and so far, so good [Interesting that Gap, which didn’t fare very well in its earlier overseas attempts in China and European markets and is now trying to set up an online presence there, is an enthusiastic participant in Canada].  There is no question that the Canadian market will present some very different challenges in terms of its market and culture – its higher end focus, emphasis on the outdoors, historically more discriminating and slower-moving consumer, not to mention the sizable number of cultural nuances overall. The time, though, seems just right, and the notion of expanding a business to Canada certainly carries much less psychological weight than is now the case with so many other destinations. I’m sure at least Google and GoDaddy would agree.

Technology, Globalization and China: Too Much, Too Soon?

 Twitter |  Facebook |  digg it |   delicious |   StumbleUpon |   LinkedIn |  reddit 

There is no denying it: technology has made globalization possible. It has, in large measure, flattened the world and leveled the playing field, bringing cultures and countries together in ways we wouldn’t have thought possible, even twenty years ago. For tech geeks new and seasoned, this has been a blessing and a joy, with each new development bringing welcome challenges and opportunities. But, alas, new technological advances have always had their downsides as well, affecting not only basic skills and strengths but cultural constructs such as family structure and the social fabric as well. Way back in the 20th century, the invention of the TV caused worries about the loss of imagination and creativity, as people would, going forward, be fed visual images. The advent of the electronic calculator similarly caused concern that mathematical prowess would suffer, as simple operations would no longer need to be done in one’s head. More recently, as computers burst on the scene, and the rate of technological progress suddenly seemed to take off at unprecedented speed, the price has been paid, many would argue, in the communication sphere, as huge swaths of etiquette and social decency seem to have fallen by the wayside with each new upgrade, particularly where social media is concerned (And talk about infectious – even the players at Copenhagen have been dubbed “Facebook Bureaucrats”*).

What happens, though, when after years of government imposed deprivation, a country, never mind one of the world’s fastest growing superpowers, suddenly leapfrogs over the computer age’s early by-products  -- “instant messaging, video streaming, online gaming and interactive media,” to name a few -- and drops full throttle into the present, missing the decade where such developments transitioned naturally? According to a recent article in the Financial Times**, the consequences for China’s youth are dire for many, as internet addiction has recently surfaced as a serious social problem there (and in China, eroding values are already posing a cultural challenge to the centuries' old nation steeped in tradition). The notion of Chinese teenagers addicted to their computers isn’t exactly shocking, especially given the aura of forbidden territory resulting from so much policing of internet activity. Besides, as it’s the rare individual anywhere these days who is not helplessly hooked on one tech device or another, it’s a refrain we’re certainly used to hearing. In China’s case, though, it’s the degree and seriousness of this addiction which is troubling. The FT article cites a recent film which chronicles dozens of sobering cases of China’s wayward youth involving even murder, and “pinpoints the internet as the scourge leading kids astray and tearing families apart.”

In response, many of these teenagers are now being sent by their parents to bootcamps throughout China, of which there are currently over 300***; and with the country’s dubious track record where human rights are concerned, it is all the more worrisome to hear of the questionable conditions and “inhumane methods” under which these youth are weaned of their internet addictions. Since we’re dealing here with the future workforce of a country which perhaps holds more promise and potential than any other nation at the moment, this is not something to be taken lightly.  With China facing so many unique challenges as it moves up the global success ladder, and with technology sure to keep racing ahead, let’s hope that its youth’s internet addiction crisis recedes before too long. 

Globalization's Tribulations: Old (Cultural) Habits Die Hard

 Twitter |  Facebook |  digg it |   delicious |   StumbleUpon |   LinkedIn |  reddit 

One of the consequences of the recent economic downturn is that more and more companies realize they can no longer continue to grow their businesses successfully on domestic turf alone. In writing of the Japanese pharmaceutical industry, a recent Financial Times* article states: “With diminishing prospects at home…companies have little option but to scour the globe for richer pickings.”  While I do find the notion of Japan manufacturing ‘fat-busting’ products for its rotund Western customers a bit tongue-in-(plump) cheek, it is nevertheless a compelling sign of this trend in action. Whether through shrinking populations, as in Japan’s case, or shrinking earnings figures and GDPs, companies from Bentonville to Bangalore are, more than ever, “[taking] the fight abroad.” For those of us in the global coaching and consulting industry, it signals cultural challenges and tough times ahead.

As businesses expand their operations through various means (M & A activity, joint ventures and the like), they must resist the temptation to fixate solely on the financial picture.  Although this seems obvious, the spate of recent articles on the lack of global mindset and proper attention to cultural context and human capital factors would have us believe otherwise.  In the Harvard Business Review*, Rosabeth Moss Kanter discusses successful mergers, and outlines the importance of attending to the cultural and emotional facets of a transaction in order to “create real value.” In her eyes, “a deal is never a bargain” when these all-important factors are shortchanged.

Similarly, the title of an editorial in last week’s Nikkei Weekly*, “What Good is Globalization without Global Perspectives?”, effectively describes the many frustrations of UK companies who have been operating in Japan, stymied in their attempts to reach across the cultural divide. It is a striking example of how, even when the aforementioned factors are taken into account, and even with thorough due diligence  – and who better for assiduous information gathering than the Japanese – putting globalization into practice is far easier said than done. Old cultural habits die hard.

From the unfolding Kraft and Cadbury drama, where the merging of two major US and UK business cultures is at stake, to the countless discussions as to whether the cultural differences of East and West Germany have been reconciled successfully since the fall of the Berlin Wall, signs of the difficulty in managing cultural interactions are nearly impossible to ignore. With the world’s economic future still uncertain, and companies ramping up their overseas efforts, we can at least be sure of plenty of intercultural activity on the horizon.

* http://www.ft.com/cms/s/0/72688fb8-c9ab-11de-a071-00144feabdc0.html  

* http://hbr.harvardbusiness.org/2009/10/mergers-that-stick/ar/1