This post is an excerpt from “Flex: The New Playbook for Managing Across Differences,” (March 2014, HarperBusiness), by Jane Hyun and Audrey S. Lee. The book is available at Amazon, Apple, Barnes & Noble and Indiebound.
As individuals we can accomplish only so much. We’re limited in our abilities. … Collectively, we face no such constraint. We possess incredible capacity to think differently. These differences can provide the seeds of innovation, progress, and understanding. — Scott Page, “The Difference”
Two senior-level managers read through the performance evaluations for their team members, preparing for upcoming annual reviews and a rankings meeting. As they comb through the evaluations, they keep in mind a mid-level managerial spot that has recently opened up, scanning for top performers they might tap to fill the position. “What about Ursula?” asks one. “Her numbers are fantastic.”
“Yeah …” The other man pauses. “Maybe. She’s a rock star — don’t get me wrong. She’s got tons of expertise. But I don’t really get her. She doesn’t really respond to my questions and feedback, so I’m never sure if I’m reaching her. Does that sound like leadership material?”
It’s the reality of the new global workforce: many managers are struggling, faced with a playing field that looks dramatically different from the one into which they were hired. Even those who work for organizations offering access to cutting-edge management training programs find little guidance about the critical skills for doing business and leading on the global stage. Most programs focus on teaching employees to improve communication, manage conflict, manage their teams, promote their accomplishments, and hone their presentations. Yet workplaces feeling the effects of their employees not being understood, have missed opportunities to expand their markets: dissatisfied and disengaged workers perform poorly or leave. High-performing employees and fast-track candidates are getting derailed or pigeonholed because the organizations have not used their abilities to the fullest. Managers don’t get what they want or what they think they asked for. Others simply don’t understand their new employees.
The truth is that the landscape of the American workforce is changing. It’s growing more multicultural, younger, and more female, and we are feeling the effects of the growing distance between frontline managers and workers from different backgrounds. As of June 2012, people of multicultural backgrounds (of Asian, African American, and Latino/Hispanic descent) made up 36 percent of the labor force, according to the US Department of Labor. Census data predicts that by the year 2050 there will be no racial or ethnic majority in the United States, and that between 2000 and 2050, immigrants and their first-generation children will be responsible for 83 percent of the increase in our country’s working-age population. According to a McKinsey study, women held 37 percent of all jobs in the United States in 1970, and nearly half of all jobs in 2009. Right now there are about 40 million millennials in the workforce, with millions added every year. By 2025, three out of every four workers around the globe will belong to Gen Y. As of last count, medical school enrollment stands at just under 50 percent women.
Even managers who in the past were consistently effective at leading their teams in the United States now face more communication problems, as well as more complex and multilayered challenges in developing their teams, than they did even as long as fifteen years ago. This phenomenon is echoed around the world, including in the UK, France, Japan, Brazil, and Germany. The same management techniques are not working, and the rules for engagement cannot be applied universally in this new playing field. Without a more nuanced understanding of the interpersonal gaps between people, managers will be at a loss as to how to bridge the distance between themselves and employees who possess different cultural values and drivers of success.
Large multinational corporations learned their lessons rather abruptly a few years ago, when hundreds of companies outsourced their back- office IT operations to Asia in an effort to cut costs. These same companies later had to invest enormous amounts of time and money figuring out how to work better across borders. They had failed to consider the human implications of this transaction— what their new partners expected, how they communicated, what were their decision- making processes, how they defined values such as trust and respect, and what were their measures of success.
The high stakes of losing our best talent
Perhaps you might be wondering at this juncture, Does this apply to me? Don’t some management skills apply universally? Isn’t this a problem only for large Fortune 500 companies with a global presence? But multiculturals, women, and the millennial generation are now, or will soon constitute, an increasingly large percentage of your workforce. Even if you are a small company and may not have as diverse an employee base, your suppliers, external partners, and customers will represent, in the near future, a broader cross section of your business. What are the costs of bringing employees onboard and leaving their development to chance? According to HR executives we consulted, costs to replace an employee who has left to go elsewhere can range from 150 percent to more than double an employee’s salary. That can amount to approximately $250,000 (including salary, recruiting, training, and onboarding costs) to replace a management consultant within the first year of hire after graduate school. Multiply that by the number of new hires, and we’re talking about a serious, make-or-break investment.
When highly competitive industries examine the turnover rates of their most recent recruits and find inordinately high attrition, they begin to question the effectiveness of their existing processes.
A manager of college recruiting at a health-care company reports, “We hired the same number of people this year as we have in years past, but we’ve already lost thirty percent of that class of trainees in the first nine months. It’s hard to retain our new talent due to our top-down organizational culture, where power only flows in one direction, and where there’s a lack of early engagement that the managers are providing the young hires. Our newest hires are eager to contribute, to communicate their opinions, and to look for a way to add value, but there are no mechanisms for them to have a voice. Why doesn’t senior leadership pay more attention to them? After all, they have, just a few months ago, been on the outside, still have strong linkages to the outside and can therefore provide real- life perspective into how we can be more relevant to our consumers.”
Although companies might agree that they have done a decent job of recruiting a fair representation of women and multicultural employees, they are far from being certain about how to get the best ones to stay and realize their full potential. Moreover, they are not always adept at identifying the diamonds in the rough through traditional recruiting mechanisms. It is clear that we need to do things differently!
There is a solution to all this misunderstanding, miscommunication, and missed opportunity. The answer lies in valuing differences in the leadership development of your employees and developing the qualities of a fluent leader. She investigates, without bias, the differences between herself and those of her team members. He does not require all his team members to adapt to his style, but instead is able to adapt his leadership approach and management style in order to meet his team members partway and help bridge the distance between them. This ability to flex affects how we deal with power and status differences, and how we communicate and relate to each other. And while the concept of flexing appears simple enough at the outset, it takes an intentional commitment to refine that skill over time in order to maximize its impact and have the impact felt by colleagues from a variety of backgrounds.
The challenge of building trust
It takes courage to be a leader who inspires others to contribute their very best. Creating an environment of trust with employees (particularly with those with whom you are not as familiar) is not an easy task, even for the leader who manages a homogeneous team! It may mean setting aside personal judgments and assumptions about others while truth- testing the validity of those assumptions. And it involves a heartfelt belief and consistent follow-through on your commitments.
To give us all a reality check, a recent MBA we met posed an earnest question after a coaching meeting: “There are senior leaders in my firm who get away with a lot of garbage because they make a lot of money for the company. But no one touches them. Why should I aspire to be better than that when even bad leaders who mistreat their people get rewarded? Is it worth the effort?”
We can understand his perspective; it’s easy to get cynical about leadership practices when you don’t see positive examples to emulate. Organizations need to be vigilant about instilling strong corporate values since employees look to leaders to demonstrate what those values look like in practice. It may mean holding people accountable for their most prized principles in the workplace. And it will be up to the individual leader to decide how he or she will demonstrate effective day-to-day management practices. No doubt, in that process, you may encounter some naysayers in your quest to develop principled leaders. If you want the managers in your organization to value fluent leadership, you may consider a firmwide strategy to instill inclusive leadership and cultural fluency as core values into your corporate DNA. If you are looking to build a profitable and sustainable business in this new global landscape, you will not be able to exclude the talent, resources, and perspectives that differ from the dominant environment. It is our sincere hope that you will see how flexing will make you a powerful, more respected leader in today’s global business environment.
Flexing is good for business
Becoming a fluent leader requires personal integrity and a commitment to do the right thing as a manager. It just makes good business sense. It’s worth repeating that the American — and perhaps global — business environment and workplace will never be the same again. In developed countries around the world, the workforce is aging and will be retiring in the next decade or so. Chances are good that your company will be composed of workers from around the world as well as multicultural employees in North America; more women will be in the workforce than ever before and more young people will replace retiring baby boomers. No matter where your company headquarters are, you are also likely to be doing business with at least one overseas partner, vendor, or supplier.
The way you handle the social distance between yourself and employees (or clients) of different cultures, genders, and ages can make or break your company. This distance, or the power gap, is the “amount of emotional distance that separates subordinates from their bosses,” as defined by Dutch social psychologist Mauk Mulder.
Renowned intercultural expert Geert Hofstede added his research to the definition by showing that the power distance that is socially acceptable by the boss and employee depends largely on their national culture. For the purpose of this book, we will apply the power gap to discuss the chasm that separates managers and employees, men and women, as well as employees of different generations and different cultures. In each of these relationships, we will refer to this distance as the power gap. In some countries, for example, contradicting another senior executive in public can be enough to derail sensitive negotiations or to dismantle an existing working relationship. Similarly, in some workplaces around the world, a manager who is a woman will be viewed with less respect than her male peer.
A variety of academic studies and reports link diversity and diverse thinking processes to a higher return on investment, better communication, and more effective teams. More recent studies reveal that embracing different ways of thinking contributes substantially to creativity and teamwork. Fluent leaders who think innovatively are able to capture the unique perspectives that your people bring to the table (mining the gold, as it were). In “The Innovator’s DNA,” authors Jeff Dyer, Hal Gregersen, and Clayton M. Christensen highlight that “discovery-driven” executives network with people who are not like them, seeing the importance of finding wisdom in unexpected places. As a manager, you can apply this in your own organization by actively and consistently reaching out to bridge the distance and difference that exists between you and your team members, not discounting those who may have fallen under your radar.