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SUPPLEMENTAL ARTICLE

Cross-Cultural Expertise

Author(s):

Marika Lindstrom
Marika Lindstrom is vice president, indirect procurement for Unilever in Schaffhausen, Switzerland.

October 2010, Inside Supply Management^® Vol. 21, No. 10

Become a global ambassador for your supply management organization by demonstrating cross-cultural competencies in sourcing and supplier settings.

The supply management profession is increasingly more global. Supply markets for goods and services are more cross-regional due to trends such as low-cost-country sourcing and make-to-order delivery models — which are further diversifying supply management teams as expertise evolves in various supply markets and spend areas. This globalization requires stakeholders and end customers to possess greater cultural understanding, more flexible engagement styles and deeper knowledge of business conduct. Because of these developments, supply management professionals need new skills to lead global initiatives effectively.

It's still imperative for supply management professionals to possess skills in contracting, negotiations, financial analysis, sourcing process knowledge and supplier relationship management. Today, new competency requirements are also emerging, such as the soft skills and extended leadership capabilities needed to operate in diverse markets and cultures. Supply management professionals now stand ready to lead virtual teams across cultural boundaries, time zones and various work styles to align with and ensure timely and high-quality results. In essence, supply managers now play the role of ambassador for their organizations' global presence.

Here are several critical skill sets in the areas of hard skills, soft skills and leadership skills that are critical to leading in a global environment.

Hard Skills

To enhance your hard skills, you must become knowledgeable in the following areas:

Business acumen requires that supply management professionals learn their company's overall industry trends and developments, so they will be regarded as business people rather than only procurement representatives.
Project management requires understanding project management principles, tools and techniques to bring a systematic approach and governance to global initiatives.
Global reach of operations requires understanding legislation in different countries regarding tax, import/export restrictions, duties, contractual arrangements and contracting entities.
Logistics costs are a significant part of overall cost of goods sold, so skills to optimize different potential business models and costs are critical.
Supply market intelligence deals with recognizing the trends and developments in a particular spend area and understanding how to apply them in supply strategies. Part of that intelligence is knowing country-specific cost drivers such as labor, utilities, land, taxes and availability of these goods and services locally.

Soft Skills

The area of soft skills cannot be overvalued. You must have these soft skills competencies in place to engage successfully with local cultures and understand their behaviors:

Good communication begins with your listening and presentation skills, building concise messaging, developing context and delivering communications in a clear and effective manner. For example, speak slowly and provide the audience with a chance to ask questions frequently. Also, use slides with few, pointed messages per slide, and summarize the actions, responsibilities and next steps clearly. Finally, seek confirmation of understanding at the conclusion of the presentation for commitment and alignment.
Influencing and persuasion skills help build value propositions, creating positive tension by challenging the norms and providing alternatives, demonstrating awareness in difficult circumstances and driving toward a win-win solution. Always ask yourself: "What is in it for the other party? Why would they engage?" Once supply management professionals understand what is driving others, it is easier to find a solution that works for both parties.
Time zone awareness means adjusting to flexible working hours and taking turns accepting inconvenient meeting times globally.
Emotional intelligence requires the ability to see other people's points of view and reasoning, understanding what drives different people and using that understanding in effective communications and negotiations.
Benchmarking skills are needed to build standard data sets and performance indicators to enable external interactions and comparisons.
Knowing local customs such as business etiquette, facts about the country, gift policies, acceptable dinner conversation topics and organizational hierarchies helps you build initial contacts and relationships with new suppliers in new geographies.
Spending time with sales staff and end users allows supply management professionals to understand consumer needs and how procurement can help to enable sales growth and customer satisfaction.

Leadership Skills

Motivating diverse global teams requires you to account for virtual management and teamwork around the clock, using leadership skills in these areas:

Diversity in leadership requires the ability to inspire, energize, empower and lead different individuals regardless of their personality type or cultural background.
Goal setting needs to have a personal element to motivate both individually and on a team level.
Global ownership of goals involves your ability to bring together different teams around the world to own the goals together as a team, along with owning their individual goals.
Performance indicators allow you to measure critical matters, as teams focus on the issues for which they get rewarded.
Documentation diligence and clear communication are critical in managing and engaging virtual teams. As distance grows, the opportunity for misunderstanding also grows. This can be minimized with proper documentation of decisions and actions, consistent and constant communication, and feedback by using team sites and the latest communication tools (for example, instant messaging, Telepresence, Skype and NetMeetings).
Gaining and using spend leverage as a negotiation and strategic tool requires you to use spend analytics tools and resources, as well as have the ability to analyze the data and draw conclusions from it for strategic purposes. Supply market information helps build leveraged strategies in different spend areas.

Supply management executives and other professionals need to recognize that engagement and emotional intelligence skills are just as important as technical skills in terms of individual development. Time and funds need to be allocated to develop competence in these areas to build well-rounded global leaders for the future. Additional innovative learning solutions beyond traditional classrooms or e-learning environments may also be needed. You should consider exploring areas such as cultural mentoring and coaching, job swapping and short international assignments.

Gain a Global Perspective

It is increasingly important for supply management professionals to gain international experience. Assignments abroad, short-term relocations and extensive travel are all invaluable for gaining experience in working with and driving success in different cultural environments and with diverse virtual teams. Leaders gain perspective on the complexities and opportunities of truly global ways of doing business by living among and being exposed to different cultures. Such experience makes global leaders more well-rounded when it comes to understanding diverse viewpoints, requirements and challenges in driving global strategies and gaining leverage.

For instance, working in an emerging or developing area such as Central Europe is a very different experience compared with working in the United States. Central Europe has different business practices, working habits and cultural influences. Some practical examples of these differences include holiday schedules, approaches to taking off or not taking off work on holidays, work-life balance, and diverse public holidays and weekends (Saturdays and Sundays are not weekend days in every country). Decision-making is also different, as certain cultures are more consensus-driven and hierarchical than others.

Supply management professionals must understand the criticality of constant communication, implementation planning, compliance management and follow-up. Individuals who lack international exposure may tend to take shortcuts, oversimplify issues or neglect communications and implementation. "One size does not fit all" is a key lesson learned in a global environment. Different cultures and countries may also have different priorities in areas such as corporate social responsibility, ethics, sustainability and service versus cost.

Driving Skills Development

There are multiple channels for building cross-cultural awareness and experience. Classroom and e-learning solutions are available for cultural awareness, business etiquette, virtual team leadership, and international business, cultures, legislation and languages. Some solutions are more costly than others, and all training needs to align with individuals' needs for personal competence development, skill gaps and budgets.

For example, Unilever's supply management organization is in the process of implementing a learning framework that addresses different competence development areas. Many learning solutions are designed to address cross-cultural issues and soft skills required in a truly global business environment, such as working together, business partnering, driving change, industry and market analysis, understanding currencies and inflation, codes of business principles, sustainability and CSR. This catalog of classroom training, e-learning and reading materials is available for supply management employees based on skill gaps identified in their personal development plans and through discussions with their line managers.

Globalized supply markets, the drive for operational excellence and the increased focus on emerging and developing markets have created a need for new skills and competencies within supply management. But technical expertise alone is not enough to succeed in a global marketplace. Supply management professionals must become ambassadors for their organizations as they forge relationships in both developing and developed regions. The world may become flatter, but there are still stark differences in conducting business between one hemisphere and another.

For more information, send an e-mail to author@ism.ws.