Successfully Executing an Enterprise Strategy in a Multi-Cultural or Multi-National Organization

There are five key elements that must be in place at any organization hoping to successfully execute strategy using Balanced Scorecards:

1. Strong, involved leadership to establish the focus and drive accountability
2. A clear 3-5 year strategic focus on the top strategy map and scorecard, plus a “focus within that focus” for a few key enterprise improvement areas
3. Alignment of that focus to all functional and cross-functional departments/entities
4. Orchestrated improvement of the key “focus within a focus” areas throughout the organization
5. Accountability at all levels to manage and improve in a way that is consistent with the strategy

And, based on my experience from working with many multi-cultural and multi-national organizations, there are five additional areas that need to be addressed carefully to ensure success within these types of more complex organizations:

1. Communication of the strategy must be multi-faceted and tailored to the various cultures.
2. Training on what you want executed, why, and the resulting benefits to each person must be handled as a priority.
3. Leadership must be sensitive to the various cultural mores in the ways that they communicate the benefits of the strategy execution framework, communicate the strategy itself, set individual and departmental expectations, and hold people accountable.
4. The focus on under-performing areas must be crystal clear, but sensitivity to culture must be taken into account.
5. Different cultures react differently to individual recognition, so you may need different ways to recognize success within different cultures.

Here are a few more details on each item:

1. Communication:
Communication of a high-level strategy is, of course, important in any culture. But it is even more important when various parts of the staff see the world differently, speak different languages, and come with different expectations of management. A multi-pronged approach works best. Consider:

• using multiple forms of media to accommodate different styles of learning and to provide helpful repetition of the key messages
• providing tangible examples of exactly how the strategy might be translated to lower levels
• allowing ample time (more than you think you need) for questions
• scheduling follow-ups to test and confirm understanding

2. Training:

Training on why the new framework is important, what the strategy means, how it applies to each person and their scorecard, and what’s in this new framework that benefits them is always important. With people from different cultures, more one-on-one follow ups are needed to ensure that you have broken through the language barrier and/or cultural paradigms. Individual coaching and mentoring is almost always required, as many people will not communicate that they don’t understand if they fear that they will “lose face” or be viewed as not very intelligent or knowledgeable on the subject matter.

3. Leadership:

Without a senior leader communicating why the new strategy, scorecard, and business review framework is important, setting expectations around accountability for goal achievement and improvement, and then holding people accountable for execution, no systematic approach will ever work effectively. In all cases, but especially in multi-cultural and multi-national environments, translation of those measurable goals and improvement initiatives to the various levels is critical. Also, periodic performance reviews must occur in a way that absolutely ensures “win-win” for all individuals through proper training, mentoring, preparation, and through the tenor of the review itself (read the next section for more on this).

4. Focus on Under-performing Areas:

In scorecard vernacular, under-performing areas are usually portrayed by red stoplights. The reason scorecards have reds is to draw attention to issues that require action so that the appropriate owner(s) can improve performance. In some cultures, however, I have experienced the color red to be a huge barrier to scorecard adoption because any red stoplight is seen as a major embarrassment. 

What you care about, of course, is not having red on scorecards, but driving the focus on under-performing measures and late milestones. If using red is a problem, use a different stoplight convention. Some organizations I've worked with, for example, have had good luck using blue for excellent performance, green if performance is good, and yellow to indicate that action is needed.

5. Recognition:

In my many years of helping organizations around the world manage performance and execute strategy, I've seen that different cultures across Europe, Asia, and the Americas view personal recognition quite differently. In Italy and Japan, for example, recognition that most Americans would relish is not appreciated in the least. To be sure that the recognition you bestow on your teams is proper, talk to the employees and staff and pay particular attention to what is appropriate for individual cultures. The last thing you want to do when trying to praise an employee is embarrass him or her!

What cultural issues have you encountered when deploying scorecards and performance management at your organizations? I'd love to hear your thoughts, insights, and questions that you have.