Cross-Border Supervision

We recently spoke with someone who works in marketing for a popular international chain of gyms, and he has run into a problem that Southeast Asia is going to need to deal with: cross-border supervision.

A growing number of firms in Southeast Asia are expanding their operations into other countries, a trend that will continue as the upcoming ASEAN Economic Community opens more doors. While many western multinationals have been operating across borders for years, more and more Asian MNCs are growing, and many of them have operations extending beyond Asia and into many other markets.

What we are seeing in Southeast Asia, as companies expand into new countries, is that the home office is keeping pretty tight control over operations elsewhere. This might not be much of a surprise if you think about it in terms of distance; flying time from Singapore to Kuala Lumpur, for instance, is about the same as flying from New York to Washington DC, and it takes less time to fly between Singapore and Bangkok than it does to go from Chicago to San Francisco.

But while the distances between these places might be pretty small, the cultural differences between them can be pretty big. We do not think much about cultural differences between Chicago and New York, but there can be some pretty significant differences in business styles and customer behavior between countries. The fellow with whom we spoke pointed out that his boss was in Singapore, and “she didn’t understand how we do things here.” Gym clients in Singapore have different goals and expectations than do many gym clients in Bangkok, when you consider a typical client. The employees also have different styles of work and expectations about their own objectives. And then there is the language issue: “she expects all of us to speak English as well as she thinks she does, which isn’t all that good anyway,” despite the fact that, while English is the norm in Singapore (which after all was a British colony in the last century), it is less common in Thailand (whose residents will proudly tell you has never been anyone’s colony).

This might not have much of an impact if we are talking about something like manufacturing, where techniques can be simply repeated over and over and once the employees know them they can pretty much function on autopilot. It has more of an impact, though, in knowledge-based work, and Creatives will certainly suffer if their bosses don’t understand them. Cultural differences and lack of understanding affect your boss’ ability to guide you and to understand the content or concept you produce. A product or outcome appropriate for one setting may not be right in another environment.

The solution really boils down to one of two options: greater cultural understanding, or decentralized control. Neither of these will be easy. Understanding the intricacies of another culture is tough enough, and trying to really understand five or six or more is a real challenge. Asian executives have for years been telling their Western counterparts “you don’t really understand our culture,” but now many of those Asian leaders are facing the same challenge.

The other option, loosening the reins of control, will also be hard to do. One common element across many Asian cultures is the expectation of strong centralized authority, and many businesses — especially the family-owned ones — have traditionally had a strict hierarchy with lots of oversight. It gets harder, though, to look over your employees’ shoulders when those shoulders are a couple thousand kilometers away, so as the nature of their working environment changes, leaders need to consider how their leadership styles might also need to change.

Tough though it may be to overcome some of the problems of being supervised from another country, the truth is that as firms grow beyond borders and as knowledge-based firms increase their economic power, something needs to change for distant employees to achieve their full potential. Being limited in your abilities because the person setting your goals does not understand your culture is sure to be frustrating, and frustrated Creatives do not create very well.