The knowledge of cultural intelligence in employees is very important for decision-making, implementing organisational strategies and for smooth functioning of daily business processes. According to Triandis (2006), the definition of intelligence is culturally orientated. Earley and Mosakaoski (2004) defined cultural intelligence as, “ an outsider’s seemingly natural ability to interpret someone’s unfamiliar and ambiguous gestures the way that person’s compatriots would”. There are various definitions of cultural intelligence with moreover the same meaning touching different aspects of business processes. Cultural intelligence in general is the course of motivated actions in an adaptive environment. It refers to making adjustments with people of different cultures to carry out business operations around the world. Cultural intelligence is of great significance in today’s employees as it is the basic necessity in deals around the globe. Many enterprises especially the family-owned ones still believe in the traditional form of business, whereby they hire employees whom they can easily trust and rely on. But in such cases it becomes difficult for the company to exploit the foreign markets as these employees may not have the necessary knowledge of cultural differences. Hence Cultural intelligence is of great importance in today’s world. For example, Lloyds TSB believes in hiring culturally intelligent people to enhance its customer relationships across the globe. Culturally intelligent individuals help to achieve the organisational goals in the local market conditions and give a competitive advantage to the local competitors. In this report, we try to analyse the importance of cultural intelligence in today’s global managers. To achieve this we will try to analyse the importance of cultural intelligence, analyse various components of it and find out other alternatives to it. We will also look at its effectiveness on a global level and discuss its various other components. According to Earley and Mosakowski (2004), cultural intelligence is closely related to emotional intelligence. An emotionally intelligent person can understand the minds of different people, whereas a culturally intelligent person understands the thought process of an individual and has the ability to act in such a way that the goals are achieved. The three sources of cultural intelligence are head, heart and body. * Head - a first hand understanding of the foreign cultures and awareness about their customs and traditions helps an individual to easily adapt to that environment. * Heart – adaptation to new cultures involves overcoming the problems of the culture. It also involves having belief in ones own self and acting accordingly. * Body – for effective functioning of business processes a mere knowledge of another culture does not help. To please the host or colleague necessary actions and efforts are needed to make the individual realize that you have already entered their world. Another research by lmai and Gefland (2010), said that a high congnitive CQ is one of the sacred possessions of the employees in various negotiation sequences. According to this study CQ helps individuals with various psychological traits, which facilitate the acceleration of the negotiation between individuals of different cultures. It is considered that people with higher CQ have higher co-operative motives in a negotiation. Therefore high CQ along with such negotiation skills helps to adopt an integrative negotiation strategy and achieve higher success in business. There are various real life implications involved in the concept of cultural intelligence. CQ is highly relevant to employees in today’s world. In current situation the ever-increasing global interdependence demands the employees to have a high CQ to effectively sustain in this competitive market. To effectively negotiate and to ensure smooth functioning of the business a high cognitive CQ is important in the employees. To improve the level of CQ companies could also indulge in motivational CQ training to the employees. Improvising and updating the employees on their CQ level is crucial for a company to operate globally. According to Triandis (2006), interactions in multicultural organisation can be improved by having the knowledge to integrate information, to look for implied hints and to ensure suspending of judgements on the basis of existing information for an effective interaction in a multicultural meeting. These factors help to achieve extensive attributes needed by a global manager. Cultural differences do play a role in today’s business processes, but a too close concentration on it may result in losing on the individuality of the person in front of you. Too much of a consideration of cultural intelligence can negatively affect the quality of the business operations. In this context Morris (2005) is of the opinion that there are a certain cultural schemas that may be from behavioural biasness but it negatively affects the negotiation process of the business. He talks about three triggers, which affects the cultural schemas in the minds of the decision maker. These triggers are, Attentional pressures, emotional stressors and cognitive context.
Attentional Pressures: This refers to the fact that negotiators must take the deadlines and distractions into consideration while making decisions within a culturally diverse company as avoiding to do so could weaken the relationship with the person of the other culture.
Emotional Stressors: In case of an emotional turmoil or any other danger people tend to slip back into their own culture, whilst they are working in another culture.
Cognitive Context: Contextual factors like accountability and priming are expected to be affected by this culturally based thought process. Similarly, in the same context Leung et al (2005), feels that in this world of globalization where the economic interdependence between the countries is increasing continuously there has been a start in generalising of corporate cultures around the world. The classic work of Hofstede (1980) has accelerated further research in the area of culture and international business, which relates to convergence and divergence. According to Leung et al, with the rise in partial globalisation there arises the concept of cultural convergence and divergence. In today’s world there is rapid change in the culture. In most of the western countries such a rapid change is predominant which results in cultural convergence. On the contrary, there are a few countries for which it is difficult to adapt to the new culture and it results in cultural divergence. Due to this concept of convergence Vs divergence, cultural intelligence is not that significant in businesses. According to Ward, Fischer, Lam and Hall (2008) there have been extensive studies on the measurement of CQ and the issues arising from this new construct of CQ. According to them there are four components of CQ namely, cognitive, meta-cognitive, behavioural and motivational. They conducted tests on university students to find out the effectiveness of CQ against emotional quotient. According to Earley and Ang ( in Fischer, 2008) cultural intelligence is different from emotional and social quotient. But on the contextual level, it can be said that CQ is similar to the latter two. According to the findings of this report there is still scope for research on different components of CQ. Even though this article is not that old the findings of its studies can be questioned as they targeted only university students to evaluate the importance of CQ at workplace. After discussing the importance of cultural intelligence and analysing its alternatives, let us concentrate on its role globally. According to Van Vianen, Pater, Brown and Johnson (2004), expatriates who go abroad for work should have a thorough knowledge of surface-level and deep-level understanding of culture. A deep-level knowledge of different culture helps a global manager to easily integrate in business processes overseas. Similarly according to Selmer (2002), professional training given to the expatriates can achieve high level of satisfaction in their work but does not really guarantee success for their company. This article by Selmer can be linked to the deep-level analysis by Van Vianen, as a mere surface-level understanding does not really help managers to be culturally intelligent. Similarly on the other hand, Selmer and Lam (2004) talks about third culture kids, who have in the early stage of life have lived in another culture and has the knowledge about that culture. They are either expatriate, adolescent or third culture kids. They have thorough understanding of the adaptation, which is needed to succeed in a new culture. Hence, for a global manager to be truly effective, a along with understanding and knowledge of the new culture they also need appropriate actions to succeed in their respective tasks. To conclude it can be said that, to a certain extent a culturally intelligent manager does can effectively function globally. It always cannot guarantee success in their business but surely gives them an upper hand in all their negotiations and other business processes. According to me, cultural intelligence is not the only driving force to function effectively on a global level but its does helps you to understand the persons temperament and guides you to act accordingly. A culturally intelligent manager can surely ensure smooth functioning of business operations around the globe as they have prior knowledge and experience of the desired actions in the new environment. In this report, we discussed the importance of the cultural intelligence and also analysed its alternatives. Cultural intelligence truly benefits a manger on a global level and companies should ensure to update its employees with cultural training on a timely basis.