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      Readers are aware of the importance of recognising and respecting cultural differences for facilitating international relations of any kind. They are able to explain and compare different frameworks for distinguishing organisational or national cultures. The awareness about their own cultural perspectives and resulting judgements is heightened and the ability to reconcile cultural dilemmas enhanced.

      Knowledge about intercultural differences and their manifold effects on the building blocks of the management system is a key prerequisite for a successful internationalisation. This section explains typical pitfalls of mono-cultural thinking in a global business environment and provides different business-related frameworks for distinguishing cultures. The use of these frameworks in designing and implementing international management systems can foster an organisational climate embracing the opportunities of multicultural approaches for doing business. Figure 2-1 delivers the concept map for treatment of the key issue Cross-Cultural Competence.

      Figure 2-1: Concept Map “Cross-Cultural Competence”

      Culture is still one of the most iridescent concepts in science. When people first think about culture, it is usually about the obvious aspects like behaviour, traditions and customs. French people carrying baguettes, African people in colourful caftans and the formal bows in Japanese greetings – all these observations shape our perception of culture. But these observations form only the tip of the (cultural) iceberg. The famous cultural iceberg metaphor (usually attributed to Edward T. Hall from his book published 1976, although he does not use the term)¹ illustrates that the essential cultural differences lie underneath the visible spectrum, as depicted in Figure 2-2. Dissimilarities in beliefs, values and thought patterns are far more relevant for intercultural misunderstandings than different traditions that are more prominently displayed and therefore create awareness more easily.

      Figure 2-2: The Cultural Iceberg

      Understanding cultural-induced behaviour is a prerequisite for successful business operations in any international context. A lack of cross-cultural competence gives rise to manifold faults in information retrieval, decision making, negotiating and leading that might become disastrous for the organisation’s long-term achievements. Throughout the EFQM Excellence Model, the correct assessment of cultural beliefs and values is presumed for finding effective responses. For example, leaders can only act as role models if their ideas of how to act with integrity and how to follow high standards of ethical behaviour are in line with the respective expectations of all of their team members. As these expectations vary from culture to culture, acceptance can only be ensured by a thorough research of possible misunderstandings. In dealing with customers and stakeholders, cultural misunderstandings can be of even more dramatic consequences. A misinterpretation of customer requirements might lead to the development of non-marketable products. A violation of unspoken negotiation rules might ruin a bid for a long-term contract.

      The development of intercultural sensitivity is the most effective countermeasure for this kind of intercultural conflicts. Intercultural sensitive people are able to apply skills of empathy and adaptation of behaviour to any cultural context with varying degrees of sophistication. Unfortunately, this ability does not come naturally. It is something that has to be learned and grows whenever a person is exposed to foreign cultures with an open mind. Milton Bennett describes typical stages in this very individual development process from first denial to final integration in his Developmental Model of Intercultural Sensitivity as illustrated in Figure 2-3.² People growing up in a monocultural environment accept the culture they grew up with as the only one existing. Exposure to other cultures leads first to denial of differences. When denial is no longer possible, people start experiencing their own culture as more advanced and “better” than the other, known as the defense phase. This phase is usually accompanied by the use of stereotypes in order to confirm prejudices. Both early phases of cultural development could take exaggerated forms of aggressively eliminating foreign cultures and their representatives or – on the contrary – romanticising them. After realising existing similarities between their own and the foreign culture (usually in superficial aspects like customs or food), people tend to minimise the fundamental differences, believing that there are generally recognised patterns of human behaviour that enable effortless and successful communication. With the next step, the ethnocentric stages are overcome and people enter the ethnorelative stages of intercultural development. These start with a genuine acceptance of differences in cultures and of the right to use different solutions to typical human problems. This does not include an agreement with the solutions a certain culture exhibits, which are continually scrutinised in order to accumulate more knowledge. Expanding the view of the word leads to the ability to understand other cultures and to behave appropriately in their cultural frameworks. In this adaption phase, people are able to shift their frame of reference and use empathy for the benefit of good communication. The final stage “integration” allows a person to move in and out of different worldviews at will. For these people, a specific culture is no longer a constitutive part of their definition of self.

      Figure 2-3: Developmental Model of Intercultural Sensitivity³

      Some people will never be able to overcome inner fears and will keep their prejudices, being stuck in the defense phase. However, for a prosperous career in the globalised economy it is imperative to reach at least the first ethnorelative stage of acceptance.

      The best way to reach the higher ethnorelative stages in the personal development are intensive encounters with people from foreign cultures in agreeable and positive circumstances. This could be ensured by a high grade of open-mindedness as well as careful preparation. Knowledge about foreign cultures can be obtained through many sources like travel and culture guides, internet research and enquiries of people from the respective country or of travellers with experience in the region required. It is important to notice that these sources have to be used with a critical view on their cultural background and potential prejudices. Sometimes, a book written from an American about the French culture can be quite misleading. Therefore, the most important source of comparative intercultural information is provided by scientific research. In the next chapters, the main frameworks for distinguishing cultures in a business context will be introduced.

      One of the pioneers in intercultural studies is Geert Hofstede. With the first issue of his original book “Culture’s Consequences” he revolutionized the way differences in cultures were assessed. His ground-breaking survey covered a significant number of countries

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