EQ vs IQ: The challenge of global succession planning

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By Louise Chaplin. Published on 19 October 2017

Globalisation has certainly changed the dynamic of board-level recruitment and succession planning. Yes, internal and external candidates still need to be able to point to a track record of successful performance; of building and shaping businesses, teams, and functions across borders; and of inspiring an increasingly diverse knowledge base that brings with it new and exciting ways of solving complex business issues.

But demonstrating such competencies, which have traditionally defined an individual’s core skill set and capabilities, can only tell half the story when assessing business leaders for today’s international assignments. The other half, and the real differentiator of a person’s proficiencies, relates to the softer skills surrounding ‘cultural competency’.

This does of course challenge traditional approaches to executive recruitment. Established practice is to typically focus on finding the most intelligent candidates available, people confident with the day-to-day P&L sheet and the ability to extend this capability over a wider theatre of operations. Now don’t get me wrong these are still important boxes to tick, but as we continue to exist inside a globalised business economy I would suggest cultural sensitivity is increasingly the trump card to play – alongside the emotional intelligence needed to be able to work with other leaders and other nations.

Take for example the demands of leadership engagement when merging with or acquiring a family-run business in India versus a similar company in say Bulgaria. Both would generate unique challenges based on underlying cultural dynamics, and both would require distinct approaches to developing working relationships. The key to success for both however is cultural awareness, as well as the empathy needed to observe and detect what’s working, what’s not, and what’s expected.

The result of all of this is that the archetype of a successful global leader is rapidly changing.

A global mindset

What does this mean? Well to me it’s about an aptitude and commitment to embrace the demands of working inside multinational and cross-cultural teams. It’s about an ability to show adaptability, and a willingness to engage with the many nuances and subtle complexities that emerge when working with differing worldviews and social norms. Skills that will only grow in importance as businesses continue to seek growth from increasingly distant shores.

In fact, there seems an inevitability to these trends, which is best summed up by PwC’s recent forecast that, for example, India’s real annual GDP growth will be 8.9% leading up to 2050, in comparison to the modest 2.4% predicted for the US and most Western economies. All of which points to a continuation of business strategies being extended across international footprints, and organisations aspiring to new markets and new opportunities. Investments that bring with them many risks, including the inability of a leadership team to connect with and invigorate local talent and resources.

This last point is especially interesting, because it relates to a leader’s ability to unify and co-ordinate the focus of regional management in line with the wider business’ strategic goals and ambitions. It’s about ensuring everybody is singing from the same hymn sheet, without having to enforce compliance. This is important because forcing an agenda inevitably leads to one ideology being seen as dominant. The more balanced approach brings us back to the word empathy, and understanding why regional leaders are acting as they do, the cultural levers behind such behaviour, and the need to identify the support needed by these people to help them transition to a global outlook.

But is this supportable in today’s business environment? What I’m finding is organisations appreciate that leaders can arrive from many unexpected directions. Acquisitions, mergers, organic growth: all can help build a powerful leadership pool. To return to the previous example, the executive of the Indian business could well prove to be a superstar in the making and a candidate for managing the entire region – if given the right guidance. That said this same person could be tricky to manage, as he or she moves from a position of relative autonomy to a global hierarchy. Overcoming such an obstacle again places the spotlight on emotional intelligence, and ensuring this quality exists within the individual as well as the wider management team to deliver a successful outcome.

But what can we expect of these people? Fluency in every language and cultural mores is the ideal, but highly unrealistic in practice. Instead, industry opinion advocates a mix of personal attributes based around a fascination with the international community, an intellect for observing and questioning new experiences, and an open mind for engaging with divergent opinions and perspectives. Most important of all however is empathy, and a keen interest in learning about other cultural characteristics and traits as the basis for forging new relationships. This is where emotional intelligence can prove a more valid trait that academic intelligence, because even the greatest leaders and business strategists can be rendered ineffective if they are unable to communicate with local and regional teams – or brought to a standstill through their inability to network with different cultures.

Understanding what success looks like

My final point relates to implementation. How can businesses develop and execute succession plans for global leaders? How can they use this process to find the next wave of global enthusiasts capable of extracting the maximum value from an international operation? And how can they align these people, many of whom suddenly find themselves working inside an international operation for the first time, with a fixed global strategy?

The obvious place to start is the criteria you set for potential candidates, and recognising what a business needs in terms of people, process, and technology. People first of course, because it’s the human resource that’s going to drive processes and technology enablement. Yet as we know, people do not exist inside a vacuum, and the introduction of processes and technology has to be sympathetic to cultural differences – and blend together local operational requirements with those of ‘top-down’ regional and global expectations.

That said there are shortcuts in this process, which is where workforce diversity at home plays an important role. The cultural complexities involved in moving to a new market can be considerable, yet the more your existing workforce is exposed to such cultural differences, and working with others of distinct backgrounds and worldviews, the easier it is to identify suitable candidates – and to prepare them for the challenges ahead.

Finally, there’s the support and training that can be made available prior to deployment. Support that should include language and cultural training, introductions to localised services, and technology enablement. The value here being to accelerate the ‘cultural indoctrination’ procedure to a stage that any individual can act autonomously from the moment they arrive in-country, and to solve problems independently while building up a trusted and multi-dimensional support network.

Such an approach, and the elevation of cultural considerations above technical skills sets and functional expertise, could mean that more ‘obvious’ candidates might end up being judged unsuitable for surviving and thriving in a high profile international posting. But this is the reality of today’s global business environment, and the race is on for organisations to enhance and refine the way they develop talent to avoid damaging failures in the future.

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