Leading with Cultural Intelligence 3rd Edition: The Real Secret to Success

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© 2024 David Livermore

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For Linda . . . my soulmate,

fellow sojourner, and love.

CONTENTS

Cover

Title Page

Copyright

Foreword by Soon Ang, PhD, and Linn Van Dyne, PhD

Prologue

Part I

Cultural Intelligence for Global Leaders

1.   Culture Matters: Why You Need Cultural Intelligence

2.   What Is Cultural Intelligence?

Part II

Developing Cultural Intelligence

3.   CQ Drive: Discover the Power of Difference

4.   CQ Knowledge (Part 1): Understand the Culture Effect

5.   CQ Knowledge (Part 2): Learn Ten Cultural Dimensions

6.   CQ Strategy: Create an Inclusive, Agile Plan

7.   CQ Action: Adapt, but Not Too Much

Part III

Cultural Intelligence for Organizations and Teams

8.   Leading a Culturally Intelligent Team

9.   Building a Culturally Intelligent Organization

Epilogue

Reflection and Discussion Questions

Acknowledgments

Appendix: Ten Cultural Clusters

Notes

Index

About the Author

FOREWORD

As pioneers of the concept of cultural intelligence, it is our pleasure to write the foreword to this third edition of David Livermore’s book Leading with Cultural Intelligence.

The research on cultural intelligence is based on a scientific-practitioner model that emphasizes the integration of research and practical application. Few people can translate technical writing into clear and lucid material as well as David Livermore. He summarizes the research and shares engaging examples to make cultural intelligence practical and accessible to leaders around the world.

Since the first two editions of Leading with Cultural Intelligence were published, the research on cultural intelligence has continued to grow and has been conducted across more than 150 countries throughout the world. More than a thousand papers have been published in more than six hundred scholarly journals, spanning many different disciplines. To date, more than three hundred thousand individuals have completed the CQ assessment. This third edition reflects the latest research while providing examples of how you can enhance your cultural intelligence and apply it in many different settings. There is also new content on how to apply cultural intelligence in domestic contexts as well as new chapters on building culturally intelligent teams and organizations. In addition, David discusses the importance of balancing divergent thinking (information sharing) with convergent thinking (decision-making) in diverse teams and complex leadership situations.

This third edition will continue to be an invaluable resource for leaders in a wide range of organizations (business, nonprofit, government, education, etc.). It should be especially relevant to global leaders; members of diverse teams; HR managers; training and development professionals; organizational researchers; and students in management, psychology, education, and other disciplines. It will be valuable to anyone who wants to understand the factors that are critical to effective leadership in our multicultural, global world.

It is indeed a rare privilege to write the foreword to the third edition of what has become the quintessential guidebook for culturally intelligent leadership in the twenty-first century and beyond.

—Soon Ang, PhD

Goh Tjoei Kok Chair and Professor in Management

Center for Leadership and Cultural Intelligence

Nanyang Business School

Nanyang Technological University, Singapore

—Linn Van Dyne, PhD

Professor in Management

Michigan State University

East Lansing, Michigan

PROLOGUE

Leadership advice comes at us all day long.

Lead by example.

Communicate effectively and transparently.

Empower and trust your team.

Adapt and embrace change.

Inspire and motivate others.

I did a decent job applying these kinds of leadership principles when I was leading our start-up team at the Cultural Intelligence Center. We were a small, close-knit group who worked hard and enjoyed one another’s company. Our conversations moved seamlessly between work and personal life. But as we added more team members, some of whom lived and worked in different places and time zones, it was harder to retain our camaraderie and efficiency. I quickly discovered that what one person considered clear, another found confusing. What built trust with team members in person was different from what built it with those I rarely saw. And while some found my hands-off management style empowering, it had the direct opposite effect on others. I was traveling around the world teaching executives how to navigate cultural differences. But I was struggling to figure out how to change the way to lead my own increasingly diverse, remote, and global team.

Many leadership books give us the idea that leadership is a universal skill set that works the same with anyone anywhere. It sounds promising, but it just doesn’t jibe with the realities of leading in today’s increasingly complex, globalized world. Yet busy leaders don’t have the time to master the ins and outs of every cultural situation they encounter. Furthermore, many of the traditional approaches to cultural differences are outdated. Can we really categorize millennials, Indians, or African Americans as monolithic groups that can be described with bullet points of traits and tips? I’m not sure we could ever do that kind of thing but especially not in today’s digital, diverse world. This is a book about leading with cultural intelligence. Cultural intelligence, or CQ®, is your capability to effectively lead people with different cultural backgrounds, including different national, ethnic, organizational, generational, and many other backgrounds; more simply, it’s the ability to lead anyone, anywhere. CQ is rooted in academic research conducted all over the world, and it’s a form of intelligence that can be learned by anyone. This book will help you develop your cultural intelligence and apply it as a leader. It’s less about mastering all the dos and don’ts of every culture you encounter—something that’s close to impossible if you encounter as much diversity as most of us do. It’s more about developing the overall adaptability as a leader to motivate, negotiate, and accomplish results in whatever situation and cultural context you find yourself. I’ll share how cultural intelligence has influenced the way I lead and, more importantly, provide research findings and case studies that offer direction on how we can all lead everyone better.

Why This Book?

There’s an abundance of books and models on global management and inclusive leadership. Many of these have informed my own thinking and practice. But even with the growing number of resources available, marginalized groups continue to experience discrimination and inequity, even in organizations that are lauded for their efforts in diversity, equity, and inclusion (DEI). Seventy percent of international ventures fail because of cultural differences.¹ And workers are revolting against leaders they perceive as out of touch and overpaid. There are myriad strategies that need to be used to build inclusive, agile organizations that are well suited to working effectively in today’s diverse, digital world. But it all rises and falls on leadership.

Rooted in rigorous, academic research, the book reveals the capabilities most consistently found in effective global leaders—CQ Drive, Knowledge, Strategy, and Action; and it gives you a four-part model that can be used in any culturally complex situation. By developing these four capabilities, you can improve the way you lead everyone—the supplier on the other side of the world, the trans employee who just joined your team, the remote team member who misses out on the happy hour gatherings. And for those who have already learned how to do this through the school of hard knocks, cultural intelligence provides a way to share what you’ve learned with others you lead.

This is the third edition of this book, the core of which is the same as the previous two editions: presenting the cultural intelligence model and applying it to leadership. But each chapter and, for that matter, every page has updates and revisions. Part of this stems from the growing body of research as well as another decade of talking about CQ with leaders in many diverse settings across the globe. In addition, the explosive growth of generative AI, a global pandemic, the expansion of DEI initiatives around the world, the increased blur between local and global, increased polarization surrounding most any sensitive topic, and myriad other realities mean that there are many new and expanded ways to apply cultural intelligence as a leader. The essence of culturally intelligent leadership hasn’t changed. But the way we apply CQ continues to evolve.

How to Read This Book

Whether you’re traveling all over the world, managing a team who all live in the same metropolitan area, or spending most of your day on Zoom, cultural intelligence will give you the tools you need to lead inclusively and effectively. While there’s no substitute for hands-on experience, Leading with Cultural Intelligence provides a road map to navigate the increasingly complex, diverse situations facing us as leaders.

Part I demonstrates how cultural intelligence addresses many of the challenges and opportunities of leading in today’s digital, diverse world. You’ll get a fuller understanding of what cultural intelligence is, how it can help you lead more effectively, and the proven outcomes for those who lead with cultural intelligence. If you’re already familiar with the cultural intelligence model and why it matters, you may want to skim part I and go straight to part II for guidance on how to develop and apply CQ.

Part II takes a deep dive into the cultural intelligence model. It’s organized around the four capabilities that are consistently found in effective global leaders. Each chapter provides evidence-based ways to develop and apply these four capabilities. You’ll see how to use these capabilities in real leadership scenarios.

Part III takes cultural intelligence beyond the individual level and applies it to the teams and organizations we lead. This reflects some of the newest and most important research that has emerged on cultural intelligence and addresses essential ways for cultural intelligence to truly shape our effectiveness as leaders.

In a perfect world, I’d love for you to take time after each chapter to write down a couple reflections and discuss them with others. The discussion guide at the end of the book provides some prompts to guide you. Think about how the research and case studies shed light on the things you’re experiencing in your organization with real colleagues and teammates. I expect you’ll encounter ideas that give you pause and some that you may disagree with. Great! My hope is that this book will be a catalyst for you to take your leadership to the next level.

With cultural intelligence, we can engage in our increasingly diverse, divided world with an underlying sense of mutual respect and dignity for people everywhere and better accomplish our personal and organizational objectives. This book provides a pathway for gracefully and successfully continuing your leadership journey across our digital, diverse world. I look forward to sharing that with you.

—David Livermore, PhD

San Diego, California

PART I

Cultural Intelligence for Global Leaders

CHAPTER ONE

Culture Matters: Why You Need Cultural Intelligence

Scroll through many articles in Forbes, Fast Company, and even Harvard Business Review and you get the sense that leadership is a universal skill set that includes 5:00 a.m. workouts, letting people work autonomously, communicating transparently, and eliminating anything that resembles hierarchy. Yet this is not how the majority of people want to be led.

When I reviewed leadership content published over a five-year period including books, articles, seminars, and even business school curriculum, I found that roughly 90 percent of the content was designed for leading in individualist, egalitarian cultures.¹ But 70 percent of the world is collectivist and hierarchical, values that not only characterize people in Shanghai and Dubai but increasingly people in Copenhagen and Omaha. And while in the past it would have been hard to find a more hierarchical context than India, many younger Indians grew up in families where they were empowered to voice their opinions and challenge authority. If you expect every thirty-two-year-old Indian engineer to address you formally, you may be surprised.

Today, most leadership contexts include people with a diversity of values and backgrounds on the same team. Organizations need culturally intelligent leaders—leaders who can influence diverse groups to work toward common goals within a global context. Leading with cultural intelligence is not about geography. It’s about having the dynamic agility to lead anyone, anywhere.

All my life I’ve been fascinated by cultures. From as far back as when I was a Canadian American kid growing up in New York, I was intrigued by the differences my family would encounter on our trips across the border to visit our relatives in Canada. The multicolored money, the different ways of saying things, and the varied cuisine we found after passing through customs drew me in. I’ve learned far more about leadership, global issues, and my faith from my cultural experiences and work than from any graduate course I’ve ever taken or taught. I’ve made people laugh when I’ve stumbled through a different language or inadvertently eaten something the wrong way. I’ve winced upon later discovering I offended a group of colleagues because I spent too much time complimenting them publicly. I’m a better leader, teacher, father, friend, and citizen because of the diverse relationships I’ve forged. And through the fascinating domain of cultural intelligence, I’ve discovered an enriched way to understand and prepare for my work across borders, at home and abroad.

Cultural intelligence (CQ) is the capability to relate and work effectively in culturally diverse situations.² This includes traditional differences like nationality and race, but it applies equally to any number of figured worlds we encounter. Figured worlds are the social contexts where we figure out who we are and what we value. For most of us, this begins within our family context and expands to include other figured worlds including our interests, professional identity, religious background, gender, socioeconomic group, and myriad other social contexts that shape us. Cultural intelligence gives us the adaptability to effectively communicate across many figured worlds. You see this exemplified by leaders like Indra Nooyi, PepsiCo’s former CEO. One second, she’s giving her board a no-nonsense update about the company’s share price, and the next minute, she’s lightheartedly telling a group of consumers about how her grandmother scolded her for wasting water while growing up in India.

Cultural intelligence can be learned by most anyone. It offers leaders an overall repertoire and perspective that can be applied to myriad cultural situations. It’s an approach that includes four different capabilities, enabling us to meet the fast-paced demands of leadership in our increasingly digital, diverse world. Think about a project you’re involved in right now that includes a diversity of people and perspectives and consider these questions:

What’s your motivation for addressing the cultural dynamics of this project? (CQ Drive)

How well do you understand the impact of culture on this project? (CQ Knowledge)

How will you strategize in light of the culture effect? (CQ Strategy)

How do you need to adapt your leadership to see this project succeed? (CQ Action)

If you’re not sure how to answer some of those questions, we’ll get to that. But before more fully describing cultural intelligence and how to develop it, we need to spend a few minutes understanding its relevance to us as leaders, whether you work for a local start-up, a midsize university, or a multinational company.

From the Midwest to West Africa in Twenty-Four Hours

It’s the day before I fly to Monrovia, the capital of Liberia. Liberia, a small country on the coast of West Africa, isn’t a place I ever planned to visit. But given that the university where I was working was forming a partnership there, it became a regular destination for me. The twenty-first-century world of globalization makes even the most foreign places seem oddly familiar in some strange way. Wi-Fi in the hotel, Diet Coke, and the use of US dollars removes some of the faraway feeling of a place like Monrovia. Even so, I still have to make a lot of adaptations to do my job as a leader in a place like Liberia.

In some ways, faraway places can seem strangely familiar. In other ways, not so much.³

The day before I leave for West Africa is spent tying up loose ends prior to my weeklong absence. I respond to emails from colleagues in Dubai, Shanghai, Frankfurt, and Johannesburg and I talk on the phone with clients in Kuala Lumpur and Hong Kong. My wife and I grab a quick lunch at our favorite Indian restaurant, and we talk with the Sudanese refugee who bags the groceries we pick up on the way home. Before my kids return from their Cinco de Mayo celebration at school, I call my credit card company and reach a customer service representative in Delhi. Even in the small city of Grand Rapids, Michigan, where I lived at the time, intercultural encounters abound.

One would think travel across our globally connected world would be easier than it is. Getting from Grand Rapids to Monrovia takes deliberate planning, and it wreaks havoc on the body. The travel had to be planned around the three days a week when Brussels Air, the only Western airline that flies to Monrovia, goes there. But still, the fact that I can have breakfast with my family one morning and go for a run along the Atlantic Coast in West Africa less than twenty-four hours later is pretty amazing.

On the flight from Brussels to Monrovia, I sit next to Tim, a twenty-two-year-old Liberian guy currently living in Atlanta. We chat briefly. He describes his enthusiasm about going home for his first visit since his parents helped plan his escape to the States during the civil war ten years earlier.

As we land, I see the UN planes parked across the tarmac. Eight hours earlier I was walking the streets of Brussels and grabbing an early morning waffle. Now I am making my way toward passport control in Monrovia.

Eventually I end up at baggage claim next to my new acquaintance Tim. A porter who looks so old he could pass for a hundred is there to help Tim with his luggage. The porter asks Tim, How long are you staying here, man? Tim responds, Only two weeks. I wish it was longer. The porter bursts out with a piercing laugh. Why, my man? You’re from America! Tim responds, I know, but life is hard there. I wish I could stay here longer. Life is better here. The porter laughs even harder, slaps Tim on the back, and says, You’re talking crazy, man. Look at you. You have an American passport! You don’t know what a hard life is. I’ve been working the last thirty-seven hours straight, and they haven’t paid me for six weeks. But I can’t give up this job. Most people don’t have jobs. But look at you. You’ve been eating well. You look so fat and healthy. And you live in the USA! Tim just shakes his head and says, You don’t know. You have no idea, no idea. It’s hard. Never mind. Just get my bag. I see the fatigue penetrating Tim’s broad shoulders.

I can understand why the porter finds it absolutely laughable that a twenty-two-year-old bloke who can afford a two-week vacation across the ocean can consider life hard. Yet I imagine there are some significant hardships for Tim as a young