How Authority and Decision-Making Differ Across Cultures

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Welcome to the HBR IdeaCast from Harvard Business Review. I'm Sarah Greene Carmichael. Managing across cultures is about as tricky as it gets for a leader. Different assumptions and blind spots can cause all kinds of confusion. So for example, how much should a leader pay attention to someone's rank or status? And who makes the tough calls? Does the boss decide or does the team hash it out together? This all depends on the culture you're working in. And it turns out that even the managers who are savviest at working cross-culturally make a common mistake. They confuse these two things: authority and decision-making styles. That's because even in cultures where status is hierarchical, people can decide things by consensus. Here to break down these factors and explain why they're so important and often misunderstood is Erin Meyer. She's a professor at INSEAD and researches doing business across cultures. And she's the author of the article "Being the Boss in Brussels, Boston, and Beijing" in the July-August 2017 issue of Harvard Business Review. Erin, thanks for coming back on the IdeaCast.

Pleased to be here with you, Sarah.

So let's start by talking about authority. How do different cultures deal with hierarchy?

Different cultures defer to authority at different levels. So we have cultures, for example, in Scandinavia or Australia or Israel or the Netherlands, where children are really taught from a young age that the boss or the teacher or the parent is just a facilitator among equals. And in those cultures, we're taught that it's very appropriate to disagree with the boss or challenge the boss. And the boss, you know, is just there to kind of facilitate the interaction. And then in other parts of the world, like in India or China or Japan or even more so a country like Nigeria or Korea, children really learn from a very young age to defer to the person in charge. And in these countries, it would be considered inappropriate or to be a bad follower if you were also to contradict the person who was senior to you. So this has a big impact, of course, on what we expect from our leader in different countries.

Based on the examples you just threw out there, it sounds like maybe one of these ways is more Western-oriented and the other is more Eastern-oriented?

Yes, we could say overall that Western cultures tend to be a little bit let's say, less deferring to the boss, and Eastern cultures a little more. But of course, we have a lot of difference from one Western culture to another, as we would also in the East. So France, where I live— I'm American, but I've lived in France for 17 years. And France is a much more hierarchical culture than the United States is, but much less than China. I interviewed a Chinese woman who was working for the French company Hermès, and she said to me, wow, you know, working with the French, it's just amazing because they really see everyone as being egalitarian in the company. And the CEO is treated exactly the same as the janitor, which I thought was a really funny or just interesting relative comment because if you ask an American working for a French company like Hermès, they will not see it that way.

How do you measure this kind of thing?

Right. So I have this system that I've developed from a bunch of research that positions 55 countries up and down 8 behavioral scales. And you can look at the fact that, you know, trust is built differently in different parts of the world, or decisions are made differently in different countries by comparing the gaps between 2 countries. Of course, every individual is different. And when we do the research, we are looking for a range of what would be considered an acceptable or appropriate behavior in each country.

With that in mind, let's talk a little bit about decision-making styles. I was surprised to learn from your article that these don't always map onto notions of hierarchy. Sometimes hierarchical cultures have a very consensus-driven decision-making style.

Yeah. So I think that one of the things that's very complicated is that When we talk about decision-making, we look at how many people are involved in the decision-making process and then how fixed the decision is once it's made. So in a country like Sweden or Japan, which are two strongly consensual cultures, in those cultures a lot of people are involved in the decision-making process. The decision takes a long time to be made by consensus, and then after the decision is made, it's fixed. It doesn't change. In comparison, in countries like, well, like the U.S., or more so like Russia or India, decisions may be made very quickly, often by the boss, and then later on they may be changed. As more information arises. So what we find then is that not all egalitarian cultures are also consensual, as the American culture is quite egalitarian, but also values quick and flexible decision-making.

Can you give me an example?

Yep. We call the boss by the first name. We are comfortable, you know, expressing opinions that are different than the boss's opinion. We're comfortable putting the boss just like in the middle of the room when we set up the desks, right? But on the other hand, we do want our boss to make a decision. We want him to ask some questions, to solicit a little opinion, and then we want him to decide fast so that we can all move in the same direction. German culture, on the other hand, there's, in comparison to the US, there's much more emphasis on the hierarchy, on using a formality when you speak to the boss, on showing a level of respect to the boss, maybe putting the boss in a specific seat or in a specific office. But they also are much more focused on including the group in the decision-making, and there would be much more of a feeling that It's your responsibility to tell the boss when you disagree with him and to not give in if you don't believe in what he's suggesting that you do. And Japan follows that pattern to an extreme, very hierarchical culture that also follows an extreme consensual decision-making pattern.

So let's zoom in on these egalitarian, top-down decision-making cultures like the US. What are some other countries and cultures that tend to have those characteristics?

So there aren't too many egalitarian top-down countries. The U.S. is the one that we see that pattern the most clearly with, but many other Anglo-Saxon cultures also tend towards that pattern. So for example, the British are slightly more hierarchical than the American culture, and about the same same on the top-down scale, but overall I would consider both of those rather egalitarian top-down. We could also see if we were looking at Australia, for example, Australians are even more egalitarian than Americans are, and also a top-down culture.

Why is it that these Anglo-Saxon cultures seem to be the ones that operate this way?

So I think, I mean, if we look at the United States, I think that what's happened is there are two value systems systems that have come together. The first is that, you know, many Americans, when, you know, the pioneers kind of fled the hierarchies or the persecutions of their own cultures, so when they came to the U.S., they felt that they really wanted to try as much as they could to start to remove the deference to authority from the system. And then every year we've seen that that that, you know, moving away from deferring to authority has become stronger. Yet on the other hand, in American culture, there's a strong emphasis on speed. And I think, I mean, you know, getting it done fast. And I think that also comes from the fact that Americans were pioneers and they came to this new land. There was so much opportunity and it didn't matter really if you got it right, you know, if you went a little bit north or you went a little bit south, it wasn't exactly that you were running in the right direction that counted. What counted was that you got there first and that you were the first one, you know, to start digging and find the gold. So we really learned that on the one hand we wanted to move away from these hierarchical patterns, but on the other hand we wanted the the fastest decision-making system possible, and consensus is a lengthy decision-making process. I think that's why we've brought those two things together.

You know, if you are an American and coming from this egalitarian, top-down decision-making style of culture, do you end up looking kind of hypocritical to people from other cultures who maybe don't understand? Well, they say everyone's equal, but then when it's actually time to make the decision, you know, it's always the boss who decides.

Right, so that is a very common comment from Germans working with Americans. This German client, he said to me, you know, I'm in the U.S. and before the meeting, the Americans are saying to me, my American colleagues are saying to me, well, I think we should, you know, make decision A. And then we go into the meeting and the American CEO says, oh, well, we're going to B. We're gonna take decision B. And then the American managers, instead of saying, "No, no, no, we disagree," like they should, they say, "Oh yes, boss, you know, whatever you think," and they just follow along. And we can see here then that the German feels that this is real hypocrisy, whereas to the American, those two things are not incompatible because in American culture It's fine to express your opinion, but once the decision has been made, it would also be expected that you would quickly align in order for speed of application. So, a little complicated.

So, the Germans are kind of the opposite side of the two— the imagined two-by-two matrix, right? If Americans are egalitarian and top-down, Germans are hierarchical but consensual. In the article, you also talk about Japan being in that sort of same quadrant. Is that something that actually allows them to be such great manufacturing bases? Maybe because everyone's so well aligned, they're just able to execute better.

Yeah, well, it's interesting because, of course, Germans and Japanese are very different when it comes to all of my communication dimensions. So, like, the Germans are super direct, the Japanese super indirect. The Germans believe in open and strong debate and, like, are very comfortable with strong disagreement in meetings. The Japanese would deal with disagreement in a much more subtle way and try not to disagree openly with an individual in front of the group. So, in all the communication, communication dimensions, the Japanese and Germans are, you know, totally apart. But when it comes to the dimensions that are focused around work style, there tend to be a lot more similarities between the Germans and the Japanese, such as the one that you've just described, that they are two cultures that are both more consensual in their decision-making and more hierarchical. Now, that being said, the Japanese much more much more hierarchical than the Germans, and the Japanese much more consensual than the Germans, but still they both follow that type of pattern. And in addition, both the Japanese and Germans are very focused on structure over flexibility. So those are two of the cultures in the world that are the most focused on being punctual, organized, structured, on time. I think it's because of those dimensions, yes, that we can see that, for example, the Japanese and the Germans are some of the best automotive makers in the world.

So the hierarchical top-down people, this is the one that is kind of least surprising. I would expect a hierarchical culture to have top-down decision-making, and yet the group of countries that you name-check in that section are very, very different from each other in so many ways. So countries like China, Saudi Arabia, Russia, France. Tell me a little bit about why we see such a diverse group of countries in that quadrant of our imaginary 2x2.

Every emerging market country in the world falls under that quadrant.

Huh. Why?

And I don't know if I can give a clear reason for why, but I do think it's very useful it's useful in a country where the processes are— the institutions and the legal systems are still developing to have a very strong leader. That's one of the reasons that we might see that pattern.

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You mentioned earlier that Sweden is one of the egalitarian consensual cultures. The other examples that you give in that group are also Nordic countries. Is that kind of a, a style that's unique to that region? What is it about Northern Europe that really pushes that style?

Yeah, so the countries that fell under the influence of the Vikings are some of the most consensual and egalitarian countries in the world. The Vikings themselves managed in tribe by consensus. So there are all of these stories historically about Southern Europeans coming to Scandinavia to negotiate and having to come home early because they weren't able to figure out who was in charge. So that pattern started early. In addition, we see when it comes to egalitarianism that Protestant cultures tend to be more egalitarian than Catholic cultures. Especially in Europe, we can see a clear Catholic-Protestant divide, and Protestant religion removed the hierarchy from the church. So we see some different things that came together in both Scandinavia, in Finland, the Netherlands, which would be the cluster of the world that we most strongly see the consensual and egalitarian pattern. I worked for a Danish company many years ago, and my boss explained to me, you know, I use this consensual way of managing. It's very popular in Denmark. I thought consensual decision-making sounded great, but then when I was in it, I I saw my Americanism coming out, which was he wanted to organize the upcoming management meeting. So he sent out an email to all of the managers. I think there were 12 of us, saying, well, this is what I was thinking of for the meeting. What do you think? And then Lasse responded saying, well, no, I think actually it would be better to talk about this. And then Enya responded. Responded saying, "Well, I was hoping we would talk about this." And then via email they were all responding to one another's emails and putting in their own input. I just was like, "Oh, please, please just make a decision." And I saw that decision-making requires a lot of patience in a consensual culture. But I also saw that once the decision was made, it was very fast to implement each time because because everyone was on board and after the decision had been finalized, it was never changed, which was really different than, you know, the style I was used to, which was like every day the decision might be different.

The idea that Vikings and the way they operated 1,000 years ago might be affecting the number of emails that you're getting today about, you know, some decision is super interesting and it makes me wonder in a very large country like the US or like Russia where you had very different influences in different parts, Do you see regional differences within large countries too when you look into this stuff?

On the one hand, there are some dimensions, like if we look across the US, of course there are regional differences in the US. How direct we are with negative feedback has a big difference regionally. So New Yorkers are by far the most direct in the United States. In the Northeast, and then the least direct you would find if you went to Southern states. And I think you can have very strong culture shock if you have someone from Georgia who is now managing someone in New York City. Uh, so those regional differences can be strong, um, because usually we'll find that people from a culture experience the regional differences in their country much stronger than someone coming from another country would feel those differences. So, for example, like in India, there are really strong regional differences. And the Indians feel those differences so strongly. But for an American company working with India, they won't feel the regional differences in the same dramatic way that an Indian would.

And there might be differences company to company too, it seems.

I often have people say to me, you know, Erin, we deal with cultural differences. In our multinational company by creating a strong corporate culture that we reinforce. And I do think that that can be very useful. So like if you look at Google, Google who hires Googlers. If you go to Google here in France or you go to Google in India, you'll find that the people working at Google act a little bit like they're from California, right? But if you're working for a company that has a lot of local competition, you might find that having a very strong corporate culture can actually be a disadvantage for you. So for example, I worked with one big multinational American company who was huge in Nigeria, and they hired— some Americans are very task-oriented, and this company was very task-oriented, so they they hired the most task-oriented Nigerians that they could find. And that helped them internally, but it also was hard for them later. They found out that actually these Nigerians were not very good at selling to the local population because they were more like the corporate culture than the national culture. So we need to think about, um, not stamping out diversity. Or removing our, our employees from local preferences if we are emphasizing a strong local culture, uh, corporate culture.

As English is often the common language of business around the world, do you think that there is a common international business culture that's emerging around the world, especially in countries that are sort of more globalized and do a lot of business with other countries?

Overall, there's been a big trend in that kind of global elite to move to more and more egalitarian methods of management, which is something that we teach in US business schools. So no matter where you come from, if you go to Harvard, you're going to learn about management by objective and 360-degree feedback and empowerment, open-door policies. But that being said, the countries that are emerging in the world, like China and India, really the countries that the world is looking to for growth and opportunity, those are countries where more hierarchical patterns of management or top-down styles of management are deeply instilled. I believe it's really important that we stop and ask ourselves, you know, just because I learned to be an egalitarian manager at that business school I attended in the US doesn't mean that, you know, that's the future.

So if there is someone who has a degree from either a top American business school or one of the top global business schools like INSEAD, What do you think that person's role is when they are acting locally? Because it seems like in some ways that person might have more in common with other members of the elite than, say, the people they are managing who are locals and maybe only speak one language.

If you were raised in Korea or you were raised in, uh, in Australia, you are not the same because, you know, these differences are, are deep in us. But if you were raised in Korea and then at age 18 you had the opportunity to go live in Germany, and if you were raised in Australia and then at age 18 you had the opportunity to go live in Indonesia, what you have in common is not that you are the same, but that you've already started to recognize what your own culture looks like from a distance. And because of that, you can recognize inside you what is cultural and what is personal. And you can then move to thinking, you know, in this situation I really want to adapt to that culture. And in the next situation I think I'm going to use my own style, the style I learned in my own culture. So it gives us options. Multinational companies more and more need people with a strong level of cultural flexibility to lead their global departments. People who can say, "You know what? The conference call on Monday in Mexico, I'm going to do it this way. Then the next week when I've got Finland on the phone, I'm going to do it this way. When I have Finland, Mexico, and China all together on the phone, I'm going to to manage the team in a way that gives everybody an opportunity to share their viewpoint. And that's really, I believe, the most important thing that multicultural people can bring to our globalizing societies.

It just all sounds very complex and complicated. You know, at the end of the day, work does have to get done. So if you feel like you're maybe having some trouble moving ahead, because of a cultural conflict, what are some suggestions for how to keep the work moving forward?

Well, let me give you a, a really simple and practical example. So one of the things that I hear the most from clients is that on their global teams, some of the cultures end up doing all of the talking and other cultures don't participate very much. The meetings. This could happen with many different cultural combinations, that one of the cultures speaks less because they want to prepare their thoughts or they want to check with others, and the other feels very comfortable speaking up. So the way to deal with that is to then say, you know, in our conference call on Wednesday, I'm going to be asking for your input on these 5 questions. Questions. You know, please prepare to answer each of them. I will be calling on you. And that gives, you know, the Americans, the Japanese, everybody else an opportunity to prepare if they want to, an opportunity to check with others if they want to. And then most importantly, in the global meeting, you need to recognize that you have to clearly call on everybody because we have such different ideas about when the moment to speak comes up. And it's the global leader, above all, responsibility, the team leader, to make sure that everyone gives a clear moment to talk in the meeting. So that's just one of many techniques that we can use no matter which countries we're working with.

Erin, thank you. This has been really fascinating, and I appreciate you taking the time to talk with us today.

It's been a real pleasure. Thank you very much, Sarah.

That's Erin Meyer, a professor at INSEAD. Her article, "Being the Boss in Brussels, Boston, and Beijing," is in the July-August 2017 issue of Harvard Business Review. You can also find it at hbr.org. Thanks for listening to the HBR IdeaCast. I'm Sarah Greene Carmichael.