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Why perceptions are problematic

5 common stereotypes to rethink in Southeast Asia

Diversity is an understatement in Southeast Asia. But beyond cultural differences, if we combine the 10 nations making up the region, we have the world’s third largest market. It comes in just behind China and India with over 600 million people.

While the Association of Southeast Asian Nations (ASEAN) hasn’t yet met all their goals in strongly unifying this group of nations, IMD Professor Margaret Cording, Regional Director of IMD Southeast Asia & Oceania, assures progress is being made.

“Despite far-stretching differences found from one nation to the next and even within a nation, Southeast Asia as a whole is on a path to reducing the transaction costs that it takes to effectively do business across nations,” Cording said.

“With the market’s overall attractiveness, if your business isn’t already looking this way, it’s my belief that within the next decade, you will be,” she told participants at IMD’s Orchestrating Winning Performance program in Singapore.

But of course, just because the market is attractive and the conditions for productive business are good, doesn’t mean success is certain. Cording warns that many ambitious companies have failed in their growth plans and many more will struggle if they are unable to grasp culture and defy their own well-intentioned but false perceptions.

There are three main things that link to a company’s growth potential in Southeast Asia – infrastructure, regulation and talent. While governments and the ASEAN community are addressing the first two, talent, is one that companies need to develop directly.

“A talent deficit is often cited as the biggest challenge facing companies looking to go across borders or enter Southeast Asia, yet the questions business leaders must ask are what causes the talent deficit and are there in fact talented people underutilized due to perceptions and cultural differences,” Cording said. 

When international companies look at Asia, they often find 5 common stereotypes. Asian culture teaches that one should:

-  Think before speaking
-  Only speak when worthwhile
-  Be humble
-  Do not challenge the norm
-  Never go against authority

While all of these traits are intrinsically associated with good values, they may also be perceived in a different light. For example, Westerners often view someone who doesn’t speak up as lacking deep knowledge expertise or not demonstrating leadership. Those that don’t question decisions may be seen as not ambitious. And the humble may be hiding something if they aren’t putting forward their success.

“There are unconscious biases that are keeping multinationals in a pattern that doesn’t allow for diversity,” Cording said. “Neuroscience tells us that our brains are wired to maximize rewards and minimize risks. When dealing with the unfamiliar, in this case culture, our brains make automatic decisions – without our knowledge or permission – that favor the familiar and disadvantage the unfamiliar without regard to contrary evidence.”

Likewise, local firms that are trying to expand across borders also find themselves in a dilemma that is linked to the same unconscious biases. The rigid top-down structures that led small and medium size enterprises to success are impeding growth and innovation. Young talented workers seeing opportunities are disillusioned with such structures and those within an organization are uneasy with moving away from time-tested traditions.

When it comes to talent development and selecting from talent pools, organizations of all types, both multinational and local, need to be more adaptable to culture and processes if they wish to grow and expand.

“It’s time to switch our notion of leadership and of what works,” Cording said. “No longer do we need a conductor to dictate how the music goes. Rather we must be jazz masters ready to improvise and adapt to rapidly changing situations.”

Learn more about IMD’s Orchestrating Winning Performance program, follow on Twitter at #imdgloballeaders or check out OWP pictures on IMD's flickr account.

For more on talent development, see IMD’s latest World Talent Report.

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