Written by Tamerlaine Beasley, Managing Director of Beasley Intercultural
The ‘Australia in the Asian Century’ whitepaper, released in October by the Australian Government, is a big step forward in defining the realities of the Asian Century. While the paper clearly outlined what needs to be done, the challenge for businesses will be how to implement these recommendations.
With over 40 per cent of the world’s economic activity now in Asia, there is no denying the region presents significant opportunities for Australian businesses. Separate to the resources sector, Australia has the potential to lift economic performance in, and due to, Asia by up to $275 billion over the next 10 years with improved Asia Capabilities.
It is therefore critical that businesses develop or access intercultural awareness, perspective, knowledge and capability. These Asia-skills will enable the strategic approach, development of nuanced relationships and adaptability it takes to succeed in the diverse markets of the region.
Research shows a significant lack of board members and senior executives with Asian experience or language ability in Australia’s leading companies. Many businesses do not yet recognise or understand the cultural differences and the impact these have on business relationships, processes and outcomes.
Many Australian businesses are sticking to ‘business as usual’ and learning the hard way through trial and error when engaging in the region. This is costing time, money and wasting resources and effort. CEOs need to understand the cost of developing Asia capability in their teams will be a sound investment in future success of their business.
What is Asia Capability?
Asia capability is about being effective and able to achieve results when working in Asian markets, or with people from Asian cultures. It is also about recognising the distinct nature of the cultures within the Asian region and the huge variances between and among individual countries.
Research has shown the higher the proportion of senior leaders who have cultural training, speak an Asian language or have lived and worked in Asia for more than three months, the more likely business performance will exceed expectations.
Many misconceptions regarding what Asia capability is exist because, in many instances, businesses are at the stage of ‘unconscious incompetence’ – they don’t know what they don’t know. Without local language capability or trusting relationships with locals, it’s hard to access the significant differences in world-view which occur in diverse cultures.
Achieving Asia capability is a four step process:
Understanding what is cultural and what isn’t. For example, when negotiating in China the Chinese will sometimes say something is not possible for cultural reasons, implying the other party is being racist. Without a depth of understanding of what’s cultural and what’s not, this claim can be a real challenge for Australian negotiators who may not be able to discern whether this is merely a negotiation strategy or a reality.
This involves learning how your (Australian) culture influences your perspective, behaviourand approach to business process, and how this may be different to the people you are working with. In the highly complex and culturally diverse context of the Asian region, it’s hard to know all cultures in detail. What is far easier to do, is understand the key elements of Australian culture which are most foreign in the region. For example, the Australian preference for ignoring hierarchy and being highly informal and using ‘banter’ to develop rapport, is something often misunderstood in almost all Asian contexts.
You need to develop your knowledge of Asian cultures so you can understand the local context, how and why it is the way it is, as well as the unique characteristics in relation to the capability you need. For instance, business and meeting processes, negotiation styles and governance. Understanding these differences leads to less confusion, greater accuracy in predicting timelines for achieving outcomes and greater focus on the areas of activity which will have the most impact.
This involves developing the skills to adjust, adapt and perform with and in other cultures. When we are capable we get results. With greater capability in the region, we can better contribute to the regional community, ensure our organisations are more successful and secure a brighter future for our children.
There are many challenges associated with doing business with Asian cultures. However, there are no shortcuts and no way to skip the first three steps outlined above. Developing Asia capability requires long term investment in developing understanding and expertise which results in greater capability.
About Tamerlaine Beasley
Tamerlaine is the founder and Managing Director of Beasley Intercultural and an expert in cultural intelligence, global collaboration and leveraging diversity within workplaces. She is also National President of the Australian Thailand Business Council.
About Beasley Intercultural
Beasley Intercultural is Australia’s leading intercultural consultancy and training company. The business works with clients to navigate the complexities of an increasingly culturally diverse workforce and helps them to maximise the opportunities of the Asian century. The team supports global workforce capability development in leading companies and government agencies across the Asia-Pacific region.