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High levels of trust in business correlates positively with innovation, competitive advantage, support for change and increased productivity according to research (1). It is therefore wise for international and multicultural organisations to invest in building and maintaining high levels of trust. However, while research may prove that trust is key to success, why do we so often see in practice when business units, virtual teams or multicultural teams are created, the matter of trust is rarely taken into account?
A dictionary might say that trust is ‘having belief or confidence in the honesty, goodness, skill or safety of a person, organisation or thing’. Trust is a prediction of reliance on an action, based on what one party knows about another party. So why is building trust so much more complex across cultures? Cultural differences play a key role in the foundation of trust and trust means different things around the world. People tend to attribute more trust in the early stages of multicultural or virtual teams to people they consider to be similar to them. More importantly, different cultures have different expectations about how relationships and trust should be established.
Example From One Of Our Global Clients
An Australian based American HR Executive for an USA-based Global MNC had successfully implemented a 360-degree feedback system (based on their USA model) and a plan to roll out training and development in Australia. When asked by Head Office to implement the same system in Asia while being stationed in Sydney, the American HR Executive ran into serious difficulties. Two years into the project – as the Chinese pilot system was ready to be tested – the project was suddenly cancelled by the Chinese HR manager. Needless to say, the American HR Executive was furious about the time, effort and money that went into the project, only to see it fail.
In cultures such as Australia, the USA and some Northern European countries, a higher level of tendency to trust, and higher external trust seems to exist in business relations: people are expected to be able to demonstrate performance over time; one develops and gains the trust of one’s colleagues by keeping their commitments and delivering on time. In the 360 project cited above, the Australian implementation went smoothly because the Australian organisation was well aware of the American HR Executives’ high-level professionalism and proven track record in the USA.
In other cultures, including some Asia, Arab and Latin American countries, there is often a bias against ‘outsiders’, resulting in low levels of trust in cross-cultural business: building relationships and trust takes time and is a pre-requisite for professional interactions; it may take many meetings or months of repeated interactions to establish trust.
So what were some of the Chinese HR team’s issues with trust? First they indicated that they felt that they had not had a chance to get to know the American HR Executive prior to the start of the project. How could they really know or trust him when he had only flown in a couple of times each year from Australia? Another point the Chinese HR team made was that they felt that the Executive did not understand that for them to pass on negative feedback to their superiors like expected in a 360-degree feedback system did not go down very well with their staff nor superiors: subordinates do not usually trust that this type of information would be kept confidential. Also they mentioned that people do not really trust that 360-degree feedback systems are there to help advance their careers; they expressed fear that staff would see it as a tool that could identify under performers and risk losing their jobs.
The American HR Executive however dismissed their concerns and insisted that the system would work perfectly well just as it had done in the USA and Australia. The day before the system was finally ready for testing, the local Chinese HR manager emailed the American HR Executive that she and her Chinese team preferred their own local system and that they would cancel the project. To make matters worse, she handed in her resignation claiming that she felt responsible for the miscommunication. The local Chinese HR team however blamed the American HR Executive and Head Office.
It is imperative to remember that when dealing across cultures you need to take time to build relationships, trust and to discuss expectations. When cultural expectations differ, trust is undermined and the cost to business can be significant.
Organizational trust: ‘A Cultural Perspective’ 2010 edited by Mark N. K. Saunders, Denise Skinner, Graham Dietz, Nicole Gillespie, Roy J. Lewicki.
Joost Thissen, Partner & Interculturalist
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