It's Evident

By Wayne A. Conaway and Terri Morrison
© Copyright 2004, All Rights Reserved

Using different criteria for decision-making is not limited to law enforcement. Executives from different cultures also are prone to have different priorities. Of course, each person is an individual; no two people are the same. But our respective cultures teach us what is important. Consequently, it is possible to make predictions on how the average executive from a specific culture may act.

The late Dr. George A. Borden, a Fulbright Scholar who specialized in intercultural communication, identified three areas of cross-cultural decision-making. For non-academicians, he termed these three factors Faith, Feelings, and Facts.

The third of these, Facts, is the easiest for English-speaking North Americans to understand. In the US and the English-speaking parts of Canada, we are expected to base our decisions on facts. Whenever our decisions are questioned, we are required to prove that we made the right choice. After all, the United States is one of the most litigious nations in the world, and the US legal system demands proof. And, in the US, documentation – whether in the form of letters, notarized documents, email, audio recording or videotape – is considered the most authoritative form of proof.

Consequently, US executives are often surprised when they go abroad that other executives do not necessarily consider facts above all else. To their surprise, many cultures empower their executives to make decisions primarily upon their Feelings.

In many cultures, executives are not expected to do business with someone they do not personally know and like. In some South American countries, an executive can cancel a deal on the basis of his or her "gut instinct." This is why the establishment of personal connections is so important. In such cultures, businesspeople will not sign a deal until after they have gotten to know you socially as well as professionally. Building these relationships takes time. Furthermore, once trust has been established between a South American client and a US executive, that trust is not necessarily extended to the US executive's employer. Many US firms have been dismayed to find that their business relations in South America cease when their local representative retires or is transferred. In such countries, the feeling of trust is given to an individual, not his or her company.

The last aspect of the evidentiary triad is Faith. The most obvious example of this is a personal or religious belief that impacts on business. At present, McDonald's is embroiled in a lawsuit brought by US vegetarians and Hindus. In 1990, the fast-food chain announced that its US restaurants would switch from beef fat to vegetable oil to cook its French fries. Many vegetarians and observant Hindus (who do not eat beef) took this to mean that McDonald's French fries were now acceptable to eat. However, to appease American palates, McDonald's adds a small amount of what it calls "beef flavoring" to its fries in the manufacturing process. This revelation made headlines in Indian newspapers. Outraged Hindus vandalized McDonald's restaurants in India, despite the fact that McDonald's uses no beef flavoring in countries with large Hindu populations. As for the French fries in the US, McDonald's lawyers maintain that they never claimed their fries were 100% free of animal products, just that they were cooked in vegetable oil. To people whose faith prohibits the consumption of beef, even a miniscule taint of animal product is forbidden.

Faith can also be manifested in other ways. The Japanese have a strong sense of their group identity. (This is similar, but not identical, to patriotism in the West.) When doing business with foreigners, a typical Japanese executive feels responsibility not only to his company, but to the well-being of the Japanese people. Somewhere in the executive's mental checklist is the question, "Is this deal good for Japan?" This question won't be at the top of the list, but it exists – although it may be on a subconscious level.

Contrast that attitude to the average US executive. The wholesale rush to export US jobs to cheaper markets overseas shows how few executives care if a transaction is "good for America." Indeed, any US CEO who resisted exporting jobs would probably be ousted by stockholders. In the US, it is left up to the government to question whether or not a deal is good for the country. Currently, the US communications firm Lucent is being courted by the French corporation Alcatel. Lucent's holdings include Bell Labs, the source of many innovations critical to the US military. As a result, members of the US government are considering if it is good for America to allow Lucent to be bought by a French firm. But the US business community is only concerned if the deal will be successful. (Frequent Flyer magazine: As we went to press, it was announced that the Lucent/Alcatel talks had broken down and had been terminated).

To observers in a country where faith (expressed as patriotism) is the primary consideration, it is madness for the US government to allow US high-technology firms to be bought by foreigners. Observers who make their decisions based on their feelings would want to know if the Lucent executives are comfortable being acquired by the French. And the average US executive is only concerned about the bottom line: the facts of the deal. Which opinion is correct? Perhaps the only answer is that all three opinions are…to the people who make them. It all depends upon your point of view – and how you interpret the evidence.

Excerpted from OAG Frequent Flyer, June 29, 2001