Wharton@Work

November 2013 | Senior Leadership

Leading in a Foreign Market: Advice for Country Managers

Nissan CEO Carlos Ghosn summarized the challenges of country managers, noting, “Every single step you take [must be] explained so it is not being perceived as a preconceived idea or something that is as a result of your own culture or values but due to the fact that the situation requires you taking this kind of approach.” In other words, leading in a foreign country takes a willingness to see things from the perspective of someone from another culture and to adapt when necessary.

Z. John Zhang, faculty co-director of Wharton’s Country Manager Leadership Program, sees it a bit differently. Zhang says the key to success in the role is maintaining an “attitude of learning.” He explains: “When you are managing in a foreign country, you have to understand their ways of doing business. In some respects you need to check your experience at the door. What worked at home will not necessarily work in the new environment. You need to learn everything you can about the local culture, the sensibilities, and the ways of doing business. And as you learn, you need to be flexible. Be willing to adapt your strategy to the local environment.”

Zhang shares an example: “In many emerging economies, price wars are standard. You may come from a country or a region in which you will do almost anything to prevent one, and then your operations expand into a country where your competitors are trigger happy with price wars. If you hold onto the belief that you need to avoid them, you will get into trouble. They will happen, and once you get involved you need to compete and survive. This is a critical issue that country managers have to face.”

Although it’s not difficult to get information about a culture, lifestyle, and language, executives can still be caught off guard when they begin a management position in a foreign country. Zhang says those working in China are “completely surprised” by the complexity. “The people, marketplaces, and the whole macroeconomic environment is complicated. Nothing is straightforward. You have to find a way to navigate this maze of complexity. The program will give participants a healthy perspective for dealing with an issue like this, and give them different ways to manage it.”

The Country Manager Leadership Program brings Zhang together with eight of Wharton’s top faculty members who are highly experienced in cross-cultural consultancy and research. They include Michael Useem and Harbir Singh, co-authors of The India Way: How India’s Top Business Leaders Are Revolutionizing Management, who share perspectives on leadership and growth. Their research and consulting work highlights some of the innovative management models in India, and how fast-growing companies compete.

But, says Zhang, the program goes beyond faculty-led discussions about the challenges facing country managers and learning about cutting-edge ideas from different industries. “Country managers are under a lot of pressure. It is an incredibly demanding job. At Wharton, they can come together with other people who share their experiences. Some of the most powerful lessons come from the managers themselves, and from the connections they make with one another.”

The bottom line: some of the most profitable business opportunities come through expansion into foreign markets, and the demands those opportunities place on leadership are significant. Those demands, says Zhang, are more difficult to overcome when you are unwilling or unable to adapt. “If you always get your way, and you have specific ideas about how you want your business to grow, be prepared to find that your ideal may not square with the reality. Most executives can’t even imagine the complexity of doing business in China, for example. And so given that, you may need to adjust what you want to do. You need to be prepared to think in different ways, taking into account different culture, customs, and sensibilities. Learn how they think, how they deal with different issues. If you understand how people do business, no matter where you are, you know where you can exert your authority and where you might need to adjust.”