THE RAPID INCREASE of globalization over the past few years
means that record numbers of business school graduates now
interact with significantly different cultures on a daily basis as
they take international assignments or join globally distributed
teams. This has created an acute need for employees, managers,
and organizations to become more cross-culturally competent.
This need is exacerbated by the fact that 42 percent of overseas
assignments are judged to be failures, according to a June
4, 2013, article on QZ.com. Previous research from INSEAD’s
Manfred Kets de Vries yielded the worrying statistic that failure
rates range anywhere from 10 percent to 50 percent, with
destination playing an important role in success or failure.
Furthermore, expatriate assignments are known to be expensive,
sometimes costing more than three times an employee’s
annual salary. The cost can be even higher if the assignment
is deemed a failure.
Nonetheless, companies will continue
sending employees on international
assignments and assembling international
teams. This means that most
executives will find it not only desirable,
but essential, to acquire cross-cultural
competence. In fact, several studies—
including one from Paul Earley
and Randall Peterson in 2004 and one
from You-Jin Kim and Linn Van Dyne
in 2012—have shown just that. The
research demonstrates that, when employees
are posted overseas or teamed
up with diverse colleagues, cross-cultural
experiences and skills are direct
predictors of managerial performance.
But there are even stronger reasons
for executives to develop cultural
awareness. Leaders who operate in a
global environment need to feel confident
and optimistic as they build strong
relationships, encourage cooperation,
and develop common goals with their
counterparts across borders. They must
connect people and transfer knowledge
on both a local and a global level.
Very often, people think they understand
a foreign culture when all they
know are the basic do’s and don’ts, such
as how to bow or when to hand over a
business card. Much more important is
the ability to recognize how the culture
views right and wrong, what basic
values people have, and how other
people might interpret events in
fundamentally different ways.
For business leaders to develop deep
bonds and build consensus with people
from different cultures, they first must
understand what drives the beliefs and
behaviors of their diverse colleagues.
CQ: THE NEW INTELLIGENCE
In the management education field,
we had been au fait with the idea of
IQ (intellectual quotient) for years
when Daniel Goleman introduced
a new kind of intelligence in 1995.
Emotional intelligence, or EQ, examines
how we recognize, understand, and
manage emotions—our own, as well
as other people’s. The concept of EQ often comes to mind when we think
of “great” leaders.
Leaders must understand what drives the beliefs of their diverse colleagues.
Yet, in a volatile world where workers
move constantly across the globe, we
need still another kind of competence:
cultural intelligence. CQ combines
aspects of IQ and EQ and operates in
Cognitive CQ is knowledge about
context-specific facts, such as social,
economic, and legal systems in various
cultures. High cognitive CQ helps people
form more accurate expectations and
makes them less likely to misinterpret
Behavioral CQ is the ability to behave
according to different cultural practices
and to use the appropriate verbal and
nonverbal behavior. The classic example
is greeting: Do you shake hands, bow,
or do something completely different?
But, of course, human interactions
are much more complex. For instance,
verbal behavior will vary according to
culture. Who speaks? How loudly? Other
implicit codes of communication also
come into play: silences, hesitations,
instances of uncomfortable behavior,
or indirect references.
Motivational CQ is the energy that
allows people to deal with unfamiliar
situations or to handle the stress associated
with problematic interactions. This
skill allows people to “become comfortable
with being uncomfortable.” People
with motivational CQ show that they are
interested in the language, the culture,
and the history of their counterparts—
that they enjoy being there and they are
eager to learn.
Metacognitive CQ is the ability to
comprehend cultural knowledge and select appropriate responses. Leaders
with good metacognitive CQ constantly
check that their actions are appropriate
for a specific cultural context and develop
strategies for future encounters.
While the four CQ dimensions are
considered conceptually independent
of each other, they tend to work together.
A GROWING AWARENESS
As the workforce grows more diverse
and mobile, a range of stakeholders with
an interest in business are paying more
attention to cultural intelligence. For
instance, multinational corporations
and other organizations have begun offering
special training programs to their
expatriate or sojourner personnel.
Young people who are about to
enter the workforce are demonstrating
a growing cultural sensitivity. Many
already have a social conscience and are
concerned about issues such as racism
and sustainability. When they enroll at
a business school, they expect to learn
how to have a positive impact on the
world through courses on cross-cultural
management, ethics, corporate social
responsibility, diversity, and global leadership.
Indeed, business graduates cited
“the ability to make an impact” as one of
their chief motivations for changing jobs,
according to research from CEMS–the
Global Alliance in Management Education.
For instance, 80 percent of these
students believe their generation will be
responsible for finding the solution to
Accrediting bodies also are reflecting
this new imperative for cultural
awareness. For instance, the accreditation
standards of AACSB International
explicitly state that business programs
should foster sensitivity to global perspectives,
expose students to cultures
different from their own, and prepare
graduates to pursue careers in a diverse
THE B-SCHOOL RESPONSE
To meet this burgeoning demand for a
culturally sensitive workforce, business schools are offering a wide range of
academic and experiential opportunities.
Many have added cross-cultural
management (CCM) courses at both
undergraduate and postgraduate levels.
Students take such courses to learn to
be more effective in the cross-cultural
encounters they will experience in their
international management careers.
While the content of CCM courses
varies according to the school and the
teacher, programs might include topics
such as leadership, identity, gender, diversity,
global teams, and the role of language
and language policy in determining
culture. Many instructors use short
cases that allow students to analyze how
managers rely on different aspects of CQ
in specific situations.
Some schools also promote CQ by
creating class situations with mixed
groups learning alongside one another.
These settings make students aware of
their own and others’ cultures.
Another way schools can help
students develop CQ is by making
language learning a priority. We know
that bilinguals see the world through
two different conceptual systems, which
enhances their cognitive flexibility,
divergent thinking, and creativity. In
fact, it doesn’t seem sensible to expect
a manager with only one language to be
open-minded and sensitive to nuance.
Therefore, CCM programs often require
fluency in more than one language.
THE EFFECT OF BUSINESS EDUCATION
The question remains: Are programs and courses like these enough to enable business schools to teach cultural intelligence effectively? A few years ago, I worked with CEMS colleagues from the Cross-Cultural Management Faculty Group on a study that investigated the impact of CCM courses on the cultural intelligence of global students studying for the master’s in management degree. (Read more in the Academy of Management article.)
We found that CQ indeed can be
enhanced via training and experience.
For instance, our study showed that
CCM courses act as “experience
equalizers,” allowing students with
less international experience to catch
up with their more well-traveled peers,
thus minimizing the cultural competence
gap between the two groups.
Bilinguals see the world through two different conceptual systems.
More important, we found that after
students took CCM courses, their overall
CQ was higher, particularly in the areas
of cognitive and metacognitive CQ. On
the other hand, CCM classes had little
effect on students’ motivational and behavioral
CQ. These dimensions showed
greater improvement when students had
the opportunity to live for a significant
amount of time in another culture.
From these results, we concluded
that any education program aimed at future
global leaders should include both
academic and experiential cross-cultural
opportunities. School leaders should
realize that short-term experiential
multicultural exposure, even if it is
rich, does not suffice as a cross-cultural
learning intervention unless specific
cross-cultural training runs alongside
it—and the reverse is also true.
Our conclusions are supported by
several other studies. For instance, Kerri
Anne Crowne’s 2008 piece on “What
leads to cultural intelligence?” finds that
certain types of experiences—such as
study or employment abroad—increase
CQ. And in research published in 2007
by Steve Sizoo, Hendrick Serrie, and
Morris Shapero, the authors determine
that people do not increase their cultural
expertise merely by living abroad unless
they also have cross-cultural training.
We aim to provide both academic
and experiential opportunities through
the CEMS alliance, which includes 32
international business schools, 70 multinational
companies, and seven social
partners. CEMS schools run international
business projects with multinational
business partners, and they also give
students a chance to spend a semester
immersed in life at a second school located
in a different country and culture.
THE RESPONSIBILITY IS OURS
Once business schools realize that
graduates with high CQ will be better
employees, they should make sure corporate
recruiters also understand how
CCM courses prepare students to cope
with culturally diverse situations and
build culturally competent workplaces.
Furthermore, they should encourage
international companies to get involved
with university programs that offer
CCM training and long-term international
When students—or executives—get
to know and understand different
cultures, they realize that there is more
than one way of thinking and that no
one way is better than another.
Cross-cultural learning helps them
become better employees, negotiators,
leaders, and international citizens.
As we in the business school community
educate the next generation of business
leaders, we have a responsibility
to nurture our students’ cultural intelligence.
When carried out in the right
way, CCM training creates managers
who are more tolerant, accepting, and
appreciative of difference—and more
likely to be successful in their international
Marie-Therese Claes is a professor
of cross-cultural management at the
Louvain School of Management at the
University of Louvain in Belgium.
She teaches on the CEMS Masters in
International Management team and is
part of the alliance’s Global Leadership
This article originally appeared in BizEd's March/April 2020 issue. Please send questions, comments, or letters to the editor to [email protected].
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