Project Issues in Asia (3 of 3)

Negotiation

East Asians are more tolerant of ambiguity; sometimes even prefer to leave an issue unresolved in negotiations. They are also tough bargainers. Frontline negotiations are characterized by:

(1) it is usually a long process;

(2) it takes patience and skills to reconcile two languages into a contract;

(3) the concern about face. As East Asians are concerned about face, the principle-based negotiation strategy trying to achieve win-win for both parties may not always work, as face introduces an emotional factor and irrationality into the negotiation.

Negotiation in East Asia is not just limited to frontline formal settings. Relationship buildup through informal sessions such as karaoke, golf and dinner is of equal importance to the outcome of negotiations. Offline lobbying sometimes can get a negotiation out of an impasse.

Other Potential Issues

Payment Part of business culture in certain East Asian countries is to postpone payment to vendors. In Japan and Korea, there is no problem with payment. When a payment is due, it will be paid. In the Greater China region, however, this is a major headache for project managers. After a project has been completed, it may take a long time to receive all the due payments. A project manager may still need to work with the customer on payment issue even though the project has been officially closed.

Etiquette Although culture has many layers, the outermost layer, etiquette, can create a good or bad first impression. One has to carefully observe all etiquette on her first visit to a new city or country, to avoid creating a poor impression among the local stakeholders. For example, a Hong Kong project manager visiting Japan would try not to speak too loudly in public location such as restaurants or trains, and has to avoid using mobile phone in those places. On the other hand, a Japanese or Korean manager visiting Singapore need to be aware that it is a much less smoker-friendly country than their home country.

To be continued...

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Project Issues in Asia (2 of 3)

Team Motivation

A project manager needs to deal with the issues of language and open communication while managing people in East Asia.

Language

Western and Asian project managers alike face the same problem of communicating in local language. Asia has more than 10 major languages, such as Mandarin Chinese (Putonghua), Cantonese Chinese, Japanese, Korean, Malay, Thai, and Vietnamese. There are also countless local dialects. Difficulty in communication with project team members or the customers in local language can impact the outcome of a project. For most business or IT projects, English can be used for team or customer communication though most Asians only possess limited English skills. When using English in Asia, it should be noted that:

• Most Asians’ reading and writing skills are much better than their listening and speaking skills;
• People from different countries have strong accents of their own, and can be a hindrance;
• Even people speak in English, the usage of words and expressions may carry the culture and patterns of their first languages.

Open Communication

In a project setting, open communication among stakeholders is important to the project’s success. The more candid are communication between all parties, the earlier problems can be identified and resolved, and a higher trust level and morale among all parties. However, this is not easily achievable in East Asia, particularly for projects that involve many parties. Sometimes the biggest challenge is to cultivate an open atmosphere within the project team. East Asians are generally shy and concerned about face, so they usually remain quiet in meetings. When they do speak, they sound humble and hesitant. If they have different opinions to their seniors, they do not speak out directly. Instead they only voice out their concerns in a very mild way, or simply keep to themselves. It’s quite common though they would speak out their concerns and disagreements in the most direct way during informal discussion with their colleagues, and complain about their managers not listening.

The only way to cultivate a candid and open communication environment is to build trust within the team, specifically between team members and the project manager. This requires the project manager to participate in team activities more frequently, adapt to local culture and customs, and encourage different opinions during meetings.

Motivators

To motivate a team in East Asia, the project manager needs to show a lot of respect to the local people, try to become a part of the ingroup, and cultivate an environment of trust and open communication. In general, East Asians are concerned about job security and monetary reward. They are willing to work long hours, and like to take up responsibility. Education and training can be a strong motivating factor for most people especially among younger members of the team.

To be continued...

Copyright © 2008 Knowledge Century Limited.

Project Issues in Asia (1 of 3)

More and more projects are being delivered in Asia, with a wide spectrum of project types including infrastructure, construction, IT, finance, product development and business process. Project managers share common cultural conflicts and issues when delivering projects in Asian countries irrespective of business sectors.

Authority

Most Asians, in particular East and Southeast Asians are still receptive to dominant, dictatorial bosses, and authoritative figures. They expect their project managers to be decisive, firm, and assertive. The power distance is high compared to Western countries. European or US managers, though not considered ingroup by locals, have the advantages of being associated with the image of the successful developed world. However, one should carefully observe the indirect ways people express their discontent, and try to achieve a balance between authoritative and participative management style.

Conflict and Resolution

Conflicts are best resolved through smoothing and compromise. East Asians tend to avoid confrontation and relationship is the key to resolving conflicting situation. As Lao-tsu (600 B.C.) said, “Whatever is fluid, soft, and yielding will overcome whatever is rigid and hard.” It is advisable to adopt a soft approach to handle disagreement. Project managers should also note the following cultural traits in Asia.

Process and Methodology

The concept of shade combined with a strong sense of pragmatism has made East Asians (excluding Japanese and Korean) rather poor followers of process and procedure. They use their own judgment when asked to abide to certain processes and have a tendency to bypass processes or take shortcuts. This behavior pattern also diminishes their willingness to adhere to rules and regulations. Pragmatism is very deep-rooted in Chinese culture. A good example is Mr. Deng Xiao Ping, the chief architect of modern Chinese economic development. He made the famous comment “Regardless of white cat or black cat, the one who can catch mice is a good cat”. The legendary proverb of Ba Xian (Eight immortals) crossing a river using their own individual methods also illustrates the Chinese thinking of expedience.

Project managers in the Greater China region should pay particular attention to their team’s performance especially if following global processes or best practices is critical to the success of a project. For outside parties like vendors or sub-contractors, close monitoring and control needs to be exerted. It’s advisable to organize some training for local team members so that they fully understand the benefits of adhering to company process and methodology.

On the other hand, a project manager needs to be aware of how to get things done outside the organization. Formal process or procedures may not work even though they are official. A project manager has to work closely with the local team to understand leeway and flexibility of local procedures and rules.

Ingroup/Outgroup

As discussed above, East Asians have low trust level with people considered outside of their ingroup. Project manager, even a local, is usually considered an outgroup member because of their seniority level. A foreign project manager will definitely be considered an outgroup member by both the project team and the customer due to her nationality and ethnicity.

An outgroup person will receive far less information than an ingroup person because of lower trust. Their ideas and behaviors will be viewed with skepticism and distrust, hence making their project management task much more difficult. Conflicts can easily come up with outgoup people.

To be continued...

Copyright © 2008 Knowledge Century Limited.

Common Cultural Traits in Asia (3 of 3)

The Art of Indirectness

Metaphors and allegories are part of Chinese culture. In the past government officials used metaphors and allegories to drive home a different opinion to the King, lest they would offend him by being too direct. This tradition is still practiced today and can be observed in everyday conversation in East Asian societies. Underlings seldom express direct feeling such as anger or discontent in front of their boss. In business meetings and negotiations people seldom give a direct answer, and use different ‘yes’ expressions to mean ‘no’.

Other notable values and traits commonly found in East Asia include:

Respect for age and seniority – Grey hairs and senior managers are seen as wiser than the younger members, regardless of their formal positions.

Importance of education – Learning and education is seen as the best way to climb up the social ladder. The highly educated are well respected in the society.

Masculinity – Hofstede (1991) said “Masculity pertains to societies in which social gender roles are clearly distinct (i.e. men are supposed to be assertive, tough and focused on material success, whereas women are supposed to be more modest, tender and concerned with the quality of life).” This fits in quite nicely with the dominant trait in East Asian countries like Japan, Korea, Taiwan, Hong Kong, and China. Although social status of women has improved significantly over the past five decades, men are still seen as the decision maker and bread winner.

Financial prudence – East Asians tend to save a much higher proportion of their income for future use, and hence are more financially prudent when spending. This can be explained by a strong sense of insecurity. Owning more money is usually seen as a symbol of success. Job security and monetary reward can be powerful motivating tools.

Avoiding conflicts – Conflicts are usually seen as bad and should be avoided. Emphasis is put on maintaining a harmonious relationship among all people in the society.

Work ethics – Diligence is seen as a virtue and a justifiable price to pay for success. From their primary education to college, East Asians are educated to “give out their best”, meaning studying long hours for the best results they can get. In the workplace, workers are willing to work extremely long hours.

To be continued...

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Common Cultural Traits in Asia (2 of 3)

The Importance of Personal Network

Personal Network (or alternatively known as guanxi in Chinese, ningen kankei in Japanese) is mentioned in many literatures. To get things done in East Asia, it’d be easier to utilize a personal network of family members, relatives, friends, business partners, and government officials. Although the effect of guanxi has been exaggerated to a certain extent, it is common experience of business people that getting support from a few key contacts or pushing certain “hot buttons” can greatly facilitate the resolution of difficult problems. Although in a sense this also happens in the West, people in US or Europe tend to observe and stick to procedures, formal processes, rules and regulations, whereas Asians in general are easily influenced by personal relationship.

The Concept of Shade

Yin-Yang is another essential concept in East Asia. Chinese traditional thinking emphasizes the importance of maintaining a harmonious state between yin and yang in almost everything, resulting in notions that pervade in all aspect of life – balance, harmony, equilibrium, and steadiness. The ideal state is not a state that goes to one extreme, but rather between extremes. It also leads to the concept of shade, an area between black and white, or yin and yang. It can even be both yin and yang. Chinese and Japanese can usually accept ambiguities in business, can go ahead with a business deal without contract, and try to resolve an issue from the perspective of balance and equilibrium. This also shows in daily conversation, as few Chinese or Japanese will say things too definitive.

Humbleness

Being perceived as modest and humble is a virtue in East Asia. People showing off their possessions, knowledge or achievement are usually seen by the others as arrogant, and therefore in negative light. A common mistake for Western managers in China or Japan is that they appear too dominating in meetings, or to put forth their objections too blatantly. East Asians tend to be very quiet in meetings partly due to their upbringing and partly to their acting humble. They want to appear as modest by not saying too much, and even if they have to raise different viewpoints they would use words very carefully and indirectly.

To be continued...

Copyright © 2008 Knowledge Century Limited.

Common Cultural Traits in Asia (1 of 3)

East Asian cultures are heavily shaped by traditions and thinking of Buddhism and Confucianism (whereas Central Asia is strongly influenced by Islam, South Asia by Islam and Hinduism, and Southeast Asia by Buddhism and Islam). (Cauquelin, Mayer-König & Lim, 1998) In East Asia the ideas of yin-yang, duty-based society, obedience to power, and personal network have been recurring themes. The followings are several cultural characteristics that appear consistently in most studies of East Asian cultures and values:

Face The concept of face (mianzi in Chinese) is very important in East Asia. Face is loosely associated with respect, but at a more superficial level. In most occasions, it’s critical not to make a person lose face in front of the others, regardless of the respect borne by the same group. To make a person lose face is equivalent to insult. This code of conduct can lead to phony behavior or sometimes extreme pretense. Foreign speakers in China or Japan have the following common experience. Accompanied by an interpreter, the speaker told a joke which received loud laughter and applause from the audience. Afterwards in a dinner, he was told by his local colleague that the interpreter did not actually translate his joke. Instead the interpreter told the audience that “the speaker just told a joke which I don’t think you’d find funny but please laugh anyway.” And the audience dutifully laughed and applauded. This is an example of saving face even for a guest people barely know.

We vs. They Mentality The concept of ‘we’ group (ingroup) in contrast to ‘they’ group (outgroup) was defined by Hofstede (1990). This is related to his individualism-collectivism construct. In general ‘we’ group is associated with collectivistic cultures. The ‘we’ group members in a narrow sense include family members and close friends and, in a broad sense people with a common race, religion, or political orientations. East Asians engage more easily in conflict with ‘they’ group members than with ‘we’ group members. In the business world, the mentality of they applies to people outside of one’s company or one’s industry, or foreign companies.

To be continued...

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Defining Geography and Methodology

Geography - Which Asian Countries?

We first try to define which Asian countries are to be covered here. The most common way to divide up and identify all Asian countries is listed below:

• East Asia: China, Hong Kong S.A.R., Japan, Mongolia, North Korea, South Korea, Taiwan
• South Asia: Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka
• Central Asia: Afghanistan, Iran, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan
• Southeast Asia: Brunei, Cambodia, East Timor, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam
• AustraAsia: Australia, New Zealand, Pacific Island Countries, Papua New Guinea

This paper will focus on East Asia and will touch upon South Asia and Southeast Asia. Central Asia and AustraAsia will not be covered.

Theoretical Framework

Culture is “everything that people has, think, and do as members of their society.” (Ferraro, 1997) Culture of a society evolves over many generations from religion, belief, history, and pervading values. Culture can affect people’s attitude, behavior, ethics, communication patterns, and etiquettes. (Blake, Walker, & Walker, 1995)

External behaviors originate from internal values, which cover the following: truth, honesty, harmony, order, liberty, democracy, justice, mercy, compassion, forgiveness, patience, love, respect, family and kinship, friendship, politeness, education, wisdom. (Cauquelin, Mayer-König & Lim, 1998) It’s generally agreed that Asian values are different from Western values in substantial ways, despite the fact that over the past fifty years or so they come much closer due to increasing interaction between the two worlds.

Of particular significance to the study of culture and its implication to work is Hofstede’s four dimensions of work-related values. (Hofstede, 1980) The four dimensions are: Individualism-Collectivism, Power Distance, Uncertainty Avoidance, and Masculinity-Femininity. They provide a useful framework for our analysis of cultural behaviors in Asia.

This paper will use the Hofstede’s four dimensions of work-related values as a basis for dissecting values and behaviors. We will focus on (1) project management and other related issues; and (2) the practical aspects of all these studies as applying to real-life project delivery in Asia. In particular, there will be in-depth discussion on several areas that a project manager will be particularly interested in namely, Authority, Conflicts and Their Resolution, Team Motivation, and Negotiation.

To be continued...

Copyright © 2008 Knowledge Century Limited.

Managing Projects in Asia

I've had the privilege of working in a multi-cultural environment in Asia for many years. So many times I've seen conflicts arising from a clash of values, practices, and behaviors due to diverse cultures, particularly between people from different parts of the world. The old saying "East vs. West" may be a bit simplistic, but it's not far from the truth that Westerners do not truly comprehend subtleties of Asian culture.

I presented a paper three years ago at the first PMI Asia Pacific Congress in Singapore. The feedback to the session was very good and many people came back to me for more advice. I'll use this blog to share both this paper as well as some new thoughts on this topic.

Introduction

Over the past thirty years, Asian cultures have become a dominant theme when companies are considering business ventures or making investments in Asia. It started with Japan in the seventies, then the four “little dragons” – Hong Kong, Korea, Taiwan, and Singapore in the eighties, and then China, India, ASEAN, and the rest of Asia in the nineties. When managers from the West thought that they’d understood Asia based on their experience in one country, they discovered that in another not-so-far-away country, people with similar color and look think and behave differently. We are talking about a very diverse cultural environment – multi-racial, varied historical background, different values, and multi-lingual, in Asia.

Hand-in-hand with business ventures and investments are projects. So project managers are facing more or less the same, if not more complex, cultural issues. Even experienced managers with good people management skills find it daunting to manage projects in Asia which has more than thirty countries/territories based on geographical classification (excluding Pacific Islands), at least ten major languages spoken, and more than twelve major economies. A project manager typically faces issues like miscommunication, clash of values, disparity in religions and customs, misunderstanding resulting from petty etiquettes, and difficulties in motivating people.

This paper will provide an analysis of Asian culture from four perspectives that a project manager is most concerned with – Authority, Conflicts and Their Resolution, Team Motivation, and Negotiation. Asians exhibit dissimilar behaviors and thinking due to their diverse cultural background, yet on a closer look some commonalities exist in most countries irrespective of their geographies, ethnicities, and languages. Based on real-life experience in managing large and complex projects in Asia, this author will share his views on handling tough cultural issues and conflicts, and offer a list of do’s and don’ts. In particular, he will focus on areas that have prevalent impact on a project, namely stakeholders’ interests and behaviors, team building, and conflict resolution, all under the context of diverse cultures.

To be continued...

Copyright © 2008 Knowledge Century Limited.

A Pragmatic Model for Managing Project Risks （4 and Final）

Execution Phase

During the project execution phase, risks should be regularly monitored and properly controlled. Just like any other activities during execution, this sounds like common sense, and I’ve not seen any organizations that say they are not doing it. There are also no hard and fast rule on who, what, when or how to do it. Overall speaking, we think the following guidelines should add value:

Regular meetings – Most people include risk review as part of the regular progress meeting. For really large projects there may be separate meetings. Sometimes regular meeting may not be able to help the team to deal with some unforeseen and urgent risks. Having said that, this is still the occasion when risks can be detected through discussion with team members.

Alertness to risks and open communication –Most risks can be discovered early if every project team member is alert to symptoms of risk. A seemingly harmless comment from the client, a minor concern expressed by a senior executive, or a report on the newspaper about your client being acquired by another company – All of these can indicate trouble for the project you are currently handling. And one person cannot do it all. If all team members have a high level of alertness to risk that would be a big plus to your project. Sure this sounds easier said than done, or even a bit far-fetched. In real life this differentiates a good team from an ordinary one. The project manager should at least cultivate an atmosphere of open communication and encourage sharing of any signs of risk, no matter how unlikely or remote they look, within the team.

There are a few things that should be consistently and regularly done to properly control risks:

Documentation – This is a very effective impact mitigation measure, in particular if there are external organizations involved. For example, vendors can use documentation such as meeting minutes, project reports etc. to protect themselves in an unfavorable situation. For in house projects, documentation can also be used by the project team to shield themselves from unnecessary accusation, albeit to a lesser extent.

Negotiation – This is a very effective means to avert the course of risk, or at least to reduce impact of certain risks. Before and during negotiation, you need to understand: What is at stake? The degree of criticality of each project objectives to key stakeholders? What are your bargaining chips? Any evidence to support your arguments? (Supportive documents would be very useful here.)

Communication - Information transparency through effective communication is an effective means to:

• Foresee new risks and re-evaluate known risks
• Avoid or control damage from risks
• Get support from senior management
  
• Open communication strengthens team spirit and the sense of being in a team. However, project team needs to be political savvy for external communication.
  

So that’s it. Our discussion of managing project risks stops here. Although we’ve spent 11 posts over a time span of 3 months to explore the subject, this can only represent the beginning of a somewhat long and difficult journey to shape the best risk management methods for projects of various scales.

Copyright © 2008 Knowledge Century Limited.