Culture is Key: Cultural Intelligence and its Importance for Global Business

Culture is uniquely human. Whether we are conscious of it or not, we are all affected by our culture-- our learned ways of being in the world. The cultural lenses are always there, shaping our perspectives. Culture affects our norms and values, even things as fundamental as our perception of the world, sense of community, relationships, and conception of time.

Culture is inevitably shaped by human behavior, which, in turn, is shaped by the forces of geography and history. Whether it's the mountains of Iran, the riverine mazes influencing Nigeria's varied ethnic groups or the open savannas of northern Uganda fostering a culture of decentralized community governance structures, these forces have persistent effects on people and their cultures.

Cultural factors may influence key aspects in the planning and execution of projects ranging from market entry to investments to risk advisory work. Whether seeking to enter a new market, take on a potential partner, or invest in a new venture, a thorough understanding and integration of local cultural intelligence is a critical aspect of evaluating the risks. Below we will explore just some of the key questions to ask about culture and its relevant impacts and examine how adding historical and geographical context can bolster our cultural analysis.

Culture and its impacts on your potential venture

If you are seeking to enter or operate in a new market, take on a potential partner, invest in a new venture, or generally operate across borders/cultures, then you should be aware of some key areas impacted by culture as outlined below (this list is, of course, not exclusive).

Culture Impacts:	Who the key players in the community are and how they are viewed
Sample Key Questions to ask:	Are you talking to the respected community leader, or one who is viewed less favorably because, for example, he violated cultural norms? How do local religious, traditional, and political leaders interact and what are their respective spheres of influence?
Takeaways:	Understanding how community leaders interact with and relate to key local stakeholders as well as who the real leaders and stakeholders are is a key element of success in project execution. This implies a need for further contextualization through stakeholder risk mapping. The right community leaders connect stakeholders across spheres as diverse as business, politics, and local governance. They can be a source of critical insight into community and local dynamics, a means of connecting to the right decision makers and vital engines for mobilizing support and sidestepping bottlenecks. Stakeholder risk mapping is essential for visualizing and assessing potential risks and influences of stakeholders on projects. This strategic tool helps leaders anticipate challenges, mitigate risks, and leverage collaboration opportunities. But it can be a complex exercise and, as such, is best left for another blog post.
Culture Impacts:	How people communicate
Sample Key Questions to ask:	Are you truly understanding what local sources and collaborators are telling you about the situation on the ground? Are you communicating in the most effective and culturally-aware way with locals?
Takeaways:	Communication is inherently shaped by culture. Insights may only really be available to those who know how to read "between the lines" with an understanding of the the local culture and language. When someone refers to a mordida in Mexico they may, in fact, not be referring to a literal "bite" of something. When someone in Africa tells you that certain government officials are sometimes, "unwilling to provide help in the best way that they can," you may need to read the subtext to really understand. Sometimes what goes unsaid is as important as what is said or even how something is said. Whether a culture is high-context or low-context as well as cultural ideals about collectivism/individualism and power distance have significant implications for communication styles. Awareness of cultural influences in communication styles is vital to both understanding the situation on the ground as well as communicating effectively.
Culture Impacts:	How legal systems operate
Sample Key Questions to ask:	Do you understand all the intricacies of the (perhaps) overlapping legal regimes that touch upon your project? How can you best resolve (or even prevent) any legal disputes that might arise?
Takeaways:	Culture influences the development and operation of legal systems. In some regions, culture determines how land ownership is managed, how resources are allocated, and how disputes are adjudicated. Traditional practices and customary law may take precedence over national law. Tribal elders may have greater influence in disputes and decision making than "regular" government officials.
Culture Impacts:	How community relations can best be managed
Sample Key Questions to ask:	How are your local representatives and collaborators perceived by the relevant communities and stakeholders? Are you working with representatives from the ideal regional and/or ethnic background?
Takeaways:	Culture and history inevitably influence views of out-group members and thus carry implications for managing community relations. For example, a majority of Ugandans see traditional leaders as more trustworthy, less corrupt, and more responsive than elected leaders. As such, they have significant influence in governing local communities, resolving local disputes, and, in many cases, allocating land. At the same time, deeply-rooted cultural concepts about community (e.g. ubuntu) and its importance can influence how trust is built across cultural contexts. The community benefits of a given project may be more important than any single influential figure. Furthermore, in some regions, and among some ethnic groups, the history of relations with outsiders may influence perceptions of them. It may not make sense to rely on someone well-connected in Region A to act as your representative in Region B, particularly if there are regional or ethnic tensions to consider.

Beyond the surface: the importance of history and geography

Culture does not develop or live in a vacuum, it's an evolving set of ways of being in and seeing the world. As such, it's crucial that we understand some of the broader historical and geographic influences and impacts on culture in our target regions or countries. These include, among others:

• The effects of geographic features on the development of culture and governance structures (See for instance the differences in the open savannas of northern Uganda versus the littoral regions of Lake Victoria)

• The structural challenges created by the legacy of colonialism and the persistent power dynamics they engender (For example, distrust between ethnic groups fostered by the legacy of colonial policies in African countries. See Uganda and the case of the Acholi).

• The economic dynamics created by historical disputes over resources.

• Clashes of modernity and tradition (for example, clashes between long-standing customary land tenure and state-led land management policies).

• The persistent yet evolving role of religious and social traditions and taboos.

• The legacy of generational traumas of conflict and war.

The takeaway: Cultural Intelligence is key to getting the whole picture

Culture gives us a much deeper perception of what the key points to understand are in an operating environment, how to go about mapping stakeholder risk, how to ask the right questions, how to manage community relations. As such, well-sourced cultural intelligence can make the difference between a successful project and a disaster, or a well-informed risk analysis versus a superficial scan. Cultural intelligence is a critical element of proper risk advisory where cross-border business is concerned, without it, at best, you are only getting a partial picture.