Dr Margaret Byrne is an award winning management consultant, executive coach and researcher on leadership and change management. She was recently interviewed at the AICD’s Company Directors Conference in Kuala Lumpur about the need for Australian business leaders to build “cultural competency”.
Additionally, as part of the Conference, Dr Byrne gave a speech titled “Learning about Asia to succeed in Asia: Culture as a risk factor”. She outlined how Australian businesses can improve their cultural awareness in order to better navigate cultural risks and take advantage of opportunities in Asia. The first video excerpt from this speech is contained below.
Understanding cultural risk
“The correct place for culture is actually on your risk register”, says Dr Byrne. “Cultural risk is an area where you do have a responsibility to your shareholders [and] to your stakeholders to minimise risk”.
Dr Byrne suggests there are three domains where Australian directors can develop cultural awareness in order to succeed in Asia. These are the affective, cognitive and behavioural domains. In her view, cultural awareness begins firstly with a self-assessment against each of these domains:
- What are the attitudes and attributes that underpin a successful career as an operator in Asia?
- Do you know what you need to know? Do you understand the things that are going to make a difference to your business and success?
- Do you know what you need to do differently? Do you know what skills you need to allow you to achieve the outcomes you want?
Lacking an awareness of cultural and cognitive differences creates cultural risk. “Cognitive differences across cultures pervade all aspects of thinking and behaviour, and for many organisations these things tend to go unnoticed and because they go unnoticed, you’re exposed to risk”, says Dr Byrne.
With “low levels of insight and skill”, argues Dr Byrne, there is large scope for misinterpretation where “trust quickly gets eroded”. This can damage relationships, reputation and jeopardise business as well.
Cultural assumptions, biases and expectations
Dr Byrne suggests that becoming more aware of one’s own cultural biases, assumptions and expectations is the first step to understanding cultural risk. “Essentially, a key point is, that you have to bring to your conscious attention what are the cultural frames and assumptions and expectations that you carry with you to Asia”, she says.
These may include “assumptions about roles and relationships” and “how things should be done” from an Australian preference and approach. She says being clear on what are these assumptions allow these to be mapped against the expectations and assumptions from the Asian counterparts.
Over the next few months, the Governance Leadership Centre will explore Dr Byrne’s key insights in greater depth. Please visit the Centre next month for Dr Byrne’s commentary on how Australian businesses can bridge the cultural gap with Asia.