As economies become increasingly integrated with each other - and companies more comfortable with remote working and distributed teams - knowing how to lead effectively across borders is an essential skill for managers. At the organizational level, multinational companies often cherish the benefits of international diversity. They bring people from different cultures together, and attract top talents from local markets to compete effectively on a global scale.
On top of that, many companies are no longer content with just dominating their domestic markets. In particular, many are looking to Asia to fuel their international expansion goals. According to a study by Mckinsey, Asia could account for more than half of global GDP and about 40% of global consumption by 2040. This is a clear indication that the fastest-growing economies in Asia will be of great importance for both regional and global players. With the increase in global competition, leaders are placing more focus on attracting the right talent and building a diverse and inclusive workforce. However, it is often difficult to successfully navigate through the challenges that come with leading teams from different countries and cultures.
Here are some practical tips that can help cross-border leaders achieve their business goals:
- Understand the local culture and how it impacts the work environment
Generally speaking, there are several common themes that permeate the Southeast Asian culture. Businesses are typically more hierarchical in their structure, with decisions made from the top down. Being able to forge and maintain good working relationships is also key to developing trust and gaining respect in the business environment.
The major challenge that cross-border leaders face is understanding the local culture and integrating it into their daily business operations. For instance, when a company expands its operations to a largely religious country like Indonesia, the leader will be required to go the extra mile to appreciate religious holidays and prayers during the day.
In highly collective cultures like Southeast Asia - where team roles tend to be more shared and cooperative in nature - leaders need to understand that the focus in such cultures are more about maintaining harmony and balance within the organisation. Hence, practices such as disagreeing with a more senior person in a public forum, or putting individual needs before those of the team should be avoided.
2. Utilise organizational design to improve communication
Communication is among the most important components that needs to have a strong foundation in cross-border teams.
The leader needs to thoughtfully design an organization that allows for efficient communication channels to develop. As the company expands to more regions, cross-border leaders are compelled to revamp their organization’s reporting lines, meeting cadence, and process of escalating issues. Communication should be as smooth as possible and effective across hierarchies.
The leader’s approach to utilizing organizational design should also be culture-specific. For instance, organizational culture in South-east Asia organizations might be more top-down and hierarchical. To be an effective leader in this culture, a director-level role in each market is likely to be more suitable than allowing a lower-level facilitator-type manager oversee country operations in the organization.
3. Align Business Across Borders
To ensure alignment in business across borders, there is a need to consider issues surrounding management of the business and administrative tasks.
One of the challenges that cross-border leaders face is dealing with HR processes. Companies like Deel and Multiplier use innovative and adaptive approaches to handle international payroll and compliance with regulations of the countries they operate in. Payments is also a significant challenge for companies doing regional business, and many turn to cross-border remittance providers like Wise, or local payment gateways like Xendit which is present in both Indonesia and The Philippines.
4. Be able to build strong relationships
Expanding to different geographies often means that leaders will need to work closely with local stakeholders and authorities. Having the ability to establish trust and build relations and partnerships provide cross-border leaders with a competitive advantage. At the same time, the ability to nurture strong relationships with local stakeholders open up new opportunities for leaders and their teams. Oftentimes, cross-border leaders will be surrounded by senior local counterparts on their team who can help them build relationships with external parties like partners and regulators.
Building emotional connection with team members from different geographic locations is also a common challenge for cross-border leaders. In addition to coming from different backgrounds and cultures, teams from different geographies also face the issue of social distance as they may have never met each other in person. Such teams might find it more difficult to communicate informally or build trust and commanderie outside of their work. For this reason, it is important for leaders to proactively create an environment that allows for team members to bring their personality to work and to feel comfortable sharing their interests and passions.
5. Always be adaptive
An effective cross-border leader should always be adaptive. They need to empower their teams to continuously learn for quick and immediate adjustments of any plans, business models or partnerships. Displaying an anticipation of changing needs and trends in different geographic locations will allow the team, leader and organization to adapt and thrive in challenging environments.
The challenge is that shifting one's teams’ values, beliefs and perceptions can be extremely difficult. Most people might be reluctant to let go of the plans and strategies that you and your company have set at the beginning of the year. This calls for the leader to understand why the team is hesitant and be willing to listen to the teams’ point of view. In some cases, the team may understand nuances of the local market in ways that justify re-evaluating the new plan.
6. Remain authentic to your roots
Leading teams across cultures might bring out different management styles and personality traits, however, it is important to always remain authentic and stay true to one's own cultural roots. Completely assimilating to another culture runs the risk of appearing inauthentic and can result in the loss of your own set of unique differentiators as a leader. These unique management styles, values and culture are what continues to retain and draw new talents to your organization.
According to Forbes, authentic leadership is crucial in cultivating a great culture and recruiting a diverse workforce. When leaders are self-aware, genuine and able to display their personality, they can build a culture of openness and belonging. Employees across geographic locations will feel that they’re in a more inclusive culture, and find greater enjoyment in the workplace.
For cross-border leaders, solving new problems and challenges seem to be at the heart of their role. These four points are critical for cross-border leaders: aligning the organization structure and processes to fit the local environment, building strong relationships with local stakeholders and partners, always being adaptive to one’s plan, business model or strategy, and remaining authentic to your leadership style and cultural roots. When these happen, teams can become a true representation of the “global village”, not just because of their international composition, but also in terms of making their members feel mutual trust and a sense of kinship.
Learn how Asavi can help you be a more effective cross-border leader to increase your team's communication, trust and collaboration.
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