A Vital Skill For International Lawyers
2014 Looks Set to Become Another Bumper Year for International Mergers and Overseas Acquisitions.
This Is Where Cultural Intelligence Comes Into Play, as Peter Alfandary (Pictured Right) tells Grania Langdon-Down of The Partner (March 2014).
While entry into new markets and cementing existing client relationships may be the right strategy, creating a cohesive new practice and winning new clients can be a minefield without cross-cultural skills. Still, there is one word which comes up without fail when solicitor and management coach Peter Alfandary asks non-British lawyers and executives to characterise their British colleagues - 'hypocritical'...
It is an uncomfortable thought. Alfandary puts it down to the indecipherability of our language code rather than actual hypocrisy. But, he says, it should be a wake-up call to firms to recognise that we all bring our own unique cultural baggage to the table.
So, while English may be the lingua franca of business and we can communicate globally at the touch of a button, he argues that, far from disappearing, the need to understand cultural differences is greater than ever.
'If I say to you, "Grania, I am slightly disappointed with the way this interview is going", you would know I am livid and regret talking to you” he says. 'Say that to an Italian and she would think, "Fine, but why is he even mentioning it?" and only later wonder where it all went wrong”.
So how can cultural intelligence help breach that gap in understanding and why is it so important to the business of being a lawyer?
Defined as an individual's capacity to relate and work effectively across cultures, the concept has one big advantage over its close cousin IQ - it can be taught.
“We are living in an era where we, as lawyers, are being judged as much on the "how" as on the "what” we do”
The concept grew out of academic studies going back to the 1970s though it is only in the last decade that it has really gained traction as an important management tool. Business has grasped the idea - the 2012 Economist Intelligence Unit's survey of several hundred CEOs concluded that misunderstandings due to cultural miscommunication were one of the biggest obstacles to international collaboration. Cultural intelligence is taught in business schools, while many corporates include it in their induction courses for staff at all levels.
'I haven't seen this happen to the same extent in law firms,' says Alfandary. 'But we are living in an era where we, as lawyers, are being judged as much on the "how" as on the "what" we do and we ignore this at our peril. Our expertise as a lawyer is no longer a differentiator - in an increasingly homogeneous legal market, the true differentiator is in the way we do the work.'
Appreciating the impact culture has on people's behaviour started early for Alfandary, whose parents sent him to the French Lycée in London so he would grow up bilingual. 'Having a French education in England had a profound affect - not only in learning the language but in learning to think in a different way,' he recalls. Its legacy is that he now thinks of himself as 'a European rather than a Brit'.
He went on to become a lawyer in the City, where he developed an international practice before co-founding a small firm which merged in 2001 with a larger practice with a global reach.
Against that background, he has channelled his fascination with culture into a parallel career providing cross cultural training to law firms and corporates.
How do you shake hands?
Starts from the idea that there is a 'cultural iceberg’. Learning whether you should shake hands or bow, how you should hand over your business card, is the easy stuff, he says. 'You can learn that on the flight to Tokyo or Rio. What you need to do is dig deeper so you know how to service your client well and ensure that, post-merger for instance, your international offices integrate well. How often do you hear someone complain that the Moscow office "doesn't get it" or there are "always problems" with the Milan office?'
The law of cultural averages
While stereotypes and generalisations can be dangerous because they oversimplify behaviour, Alfandary says research has made it possible to talk about 'cultural averages' - certain types of behaviour you are more likely to see in a French lawyer than in a US lawyer, for example. Recognising those patterns can be a useful management tool for lawyers who need to be able to predict the behaviour of their clients and colleagues in other jurisdictions.
"I don't want a colleague in another jurisdiction to be any less Italian or any less Chinese"
Those 'cultural averages' also help us hold up a mirror to ourselves. 'Cultural intelligence is not just one-way,' he stresses. 'It is also about understanding your own culture so you know why you react in a particular way.'
Alfandary does meet with scepticism. Some people have a cultural blind spot - 'Everyone speaks English so why do I need this?' Others fear it means subsuming their own cultural identity.
But he says: 'I don't want a colleague in another jurisdiction to be any less Italian or any less Chinese. This is about enriching our minds, not diluting our identity and when you open people's eyes to the concept, it is almost like a revelation - "now I understand why that negotiation went pear shaped".
So, if cultural intelligence can be learnt, what is the best way to instil it into your practice? Alfandary favoured option is an interactive workshop where people from a mix of backgrounds discuss personal examples of misunderstandings. This can help them get to grips with the conundrum encapsulated by psychologist Paul Watzlawick that states 'What is true is not what I say but what the other person understands'.
There are recognised tests which can assess your cultural intelligent quotient (CQ). They have their place in making people aware of their own tendencies, says Alfandary, but they are not the solution.
That, he argues, comes from looking at how culture presents itself in the daily life of lawyers.
There are the soft issues - differences in communication styles, time management, decision-making, respect for hierarchy, respect for rules as opposed to relationships, how you praise staff or treat failure.
But, he says, cultural intelligence should also be approached as a hard skill because it is integral to generating revenue by helping win and keep clients and in making a firm work effectively.
'To me, a good lawyer is one who understands other legal cultures so they can anticipate potential cultural shocks,' Alfandary says, recalling his first experience trying to explain discovery to a client from a civil law system who had never litigated in England.
'It was like Mars and Venus. But the culturally intelligent lawyer will think of the questions the client hasn't thought to ask because they don't know they should. A bad lawyer will say "The client didn't ask me".'
The key is to suspend judgment and stand back, he says. 'Question what is really happening at this meeting, why that deal is going wrong. Is culture coming into play? You need to recognise that both sides will interpret behaviour based on their own cultural preconceptions. The use of anger and emotion shows you care in some cultures while in others it implies lack of control, so is that why he is shouting and you are so quiet?'
A recent article in The Times asked leading law firms to identify trends for 2014. They focused on the growing importance of the MINT countries (Mexico, India, Nigeria and Turkey), alongside the BRIC countries of Brazil, Russia, India and China. To win business, law firms will be expected to have strong local knowledge as well as an international background to support business into and out of these emerging economies.
"Remember you are viewing the world through your own prescription contact lenses"
Get it wrong and the consequences can be enormous. One dangerous area for crossed wires, he says, are emails and conference calls - 'Americans and Brits speak much too fast/ so you need a “play back" rule - play back information and instructions so you know they have been understood'.
East meets West
The biggest merger last year was the tie-up between the City practice SJ Berwin and King & Wood Mallesons, the Sino-Australian firm, the first Asian practice to establish a significant presence in one of the biggest Western legal markets.
Competitors have questioned whether the firm will be able to integrate Chinese lawyers with those from an Anglo-Saxon background, given the cultural differences between the regions.
Handled with care, Alfandary says those issues aren't insurmountable. Mergers are as much about 'people' fit as 'financial' fit, he believes, and it is vital that everyone - from a firm's senior management down to its trainees and its HR, accounts and IT staff - 'gets it'.
An interesting debate for the future, he says, is whether there is such a thing as a truly global law firm. 'Can you take nationality out of a merged law firm or will there always be one dominant national culture?' he asks.
In the meantime, Alfandary's message is: 'Stand back and remember you are viewing the world through your own prescription contact lenses.
The truly culturally intelligent law firm realises there are differences and has the humility to accept that others may also be right.'
What's your Cultural Intelligence?
Questions 1-6 relate to your awareness
Questions 7-11 measure your understanding
Questions 13-17 deal with your behaviors or skills.
What do your answers in each one of the sections reveal about your CQ, and your strengths/weaknesses in your awareness vs understanding vs skills?
When you examine your answers in these three areas, are there any differences or similarities that stand out?
Your overall results
[ ] Number of U responses
[ ] Number of F responses
[ ] Number of O responses
[ ] Number of S responses
[ ] N umber of N responses
If you marked U or F for most or all of the statements, you see yourself as culturally intelligent, at least as far as these indicators are concerned. If you responded O, S, or N to many questions, you do not rate yourself as high on CQ.
What this means varies from individual to individual. For example, individuals may have similar competencies but rate themselves differently because their expectations and self-awareness vary.
Regardless of how we evaluate ourselves on these and other indicators of CQ, we must view building CQ as a never-ending process for continual improvement.