Roger and Karl surprised – Product

A German company acquires an American. Their core strength is engineering. Executive management wants rapid integration of the two engineering organizations.

The respective leaders – Karl in Germany, Roger in the U.S. – agree on the steps to be taken. The first and most critical step is a full-week offsite workshop in the U.S. with their top ten people.

Their goal was to produce a draft roadmap. They failed. Instead it was five days of miscommunication and mistrust. And very costly.

Act 1 – An Acquisition

A German company acquired an American company. Industrial sector: complex technology, sophisticated engineering, plant construction demanding expert project management.

Some departments are to be combined as soon as possible. Other departments will be merged over time. Some will remain separate for the time being.

The core of the combined company is its technology, its knowhow, its engineering prowess. And design engineering is the core of that core. Executive management wants rapid integration of the two respective design engineering organizations.

Act 2 – Steps to an Integration Roadmap

The respective leaders of the engineering organizations – Karl in Germany, Roger in the U.S. – agree on the steps to be taken: the two of them together with the heads of their five key departments will formulate an integration roadmap.

They have given themselves six weeks to prepare for a full-week offsite workshop. It will take place in the U.S. Their job in the workshop is to produce a draft roadmap.

After that they will have two weeks to work out the details of the draft. This they will do separate from each other.

They will then come together for a second workshop. This time in Germany. Again for a full week. Their task in that second workshop is to finalize and commit to the integration roadmap.

In both workshops, each of the five departments will have an entire day. The day’s structure has three parts: the respective department heads present their recommendations on how to integrate – German proposal, American proposal; all colleagues discuss and debate; the two heads who presented then draft the roadmap for their department.

Each department should address five areas: product lines, processes & tools, organizational structure, collaboration with internal and external customers, and finances.

The two workshops are limited to twelve participants: the two heads per each of the five departments plus Roger and Karl. After this high-level roadmap has been finalized and committed to, each of the departments heads will then ask their key teams to break down the roadmap into more detailed roadmaps.

Act 3 – From the Strategic Perspective

The Germans would arrive in the U.S. on Friday afternoon, so that colleagues would have all of Saturday to socialize.

Immediately after lunch on Sunday, Roger and Karl would kick off the workshop by presenting their views on integration. Separately.

They agreed beforehand that their presentations should be of substance, from the strategic perspective, and set the tone for the process of creating the roadmap. They would be laying out their respective visions for the combined design engineering organization.

Both Karl and Roger would address the same five topic areas they asked their direct reports to address in their presentations: product lines, processes & tools, organizational structure, collaboration with internal and external customers, and finances.

Act 4 – Roger prepares

Roger thought carefully about who his audience was and how he would communicate his message. He would break down his two hours into sixty minutes of presentation and sixty for questions and answers.

Roger wanted the focus on interactivity, on an exchange of views. The colleagues in the room should get to know each other. Naturally, and to make a strong impression.

Roger prepared a lively and wide-ranging presentation, but he limited himself to ten slides per topic plus a few backups. He wanted his messages to be brief, compact, and clear, knowing that his colleagues would be taking in a lot of information over the five days.

After preparing a draft of his presenentation he asked for feedback from his direct reports. The atmosphere on both sides of the Atlantic was tense. Roger wanted to make sure that his team neither over- nor undersells itself. The Americans were particularly nervous about how the two companies would be integrated.

Only a very few colleagues were willing to discuss the fact that many departments in the company were in total disarray concerning integration. And although there were a few instances where integration was going fairly smoothly, in some areas the atmosphere was moving towards a kind of Cold War between the two cultures.

The American engineers were speculating about what the combined product portfolio would look like. They wondered (actually were worried) about what that would mean for their internal work processes, including what engineering tools they would be asked to use.

And most importantly they were preoccupied with the question who would get what resources (meaning bodies, employees) for which projects. Budgets are always a source of internal debate. The Americans were concerned about which side, or which teams, would get what financial backing.

For these reasons, Roger wanted to present the situation just as he and his team see it. His goal was to be honest, competent, and results-oriented. He believed in his people, in their ability, and in a good future. The Germans and their engineering world, however, he was not familiar with.

Act 5 – Karl prepares

Karl speaks fluent English, but is aware of his inability to decode the nuances communicated in American English. Like his colleague, Roger, he prepared his presentation carefully.

Karl wanted to get right the sequence of topics and their structure. And he focused on striking the right balance between depth and breadth. Karl aimed at ninety minutes of presentation and thirty of Q&A on clarification questions.

Like Roger, Karl asked his direct reports for input on their areas of specialty: product management, process harmonization, personnel, the marketing-manufacturing interface, and sales. In addition he spoke to a colleague in finance.

Karl’s intention was to provide a detailed and comprehensive picture of the facts and their correlations. Twenty slides per topic should be enough. Wanting to cover as much territory as possible, he saw no need in preparing all too many backup slides. After reviews from colleagues, as well as from his next-level manager, his presentation was good to go.

On the German side of the organization there was also much apprehension. Whose product line would get the lead? Which set of standards would be chosen? Would German engineers have to work for an American boss? And what about quality? How would that be maintained? And the R&D budgets?

The rumor mill on the German side also spoke of mixed results of the integration thusfar. Some merger initiatives were progressing positively. Most of the others not so well.

Not a small amount of Germans thought the merger was unnecessary, a pipe dream thought up by their managing board and their over-priced strategy consultants. The term synergy made them particularly nervous, which for them signaled headcount reduction.

Act 6 – Roger presents

As he did before every important presentation, Roger prepared himself mentally. His key messages were clear in his mind. He then imagined how his German colleagues might react to them.

He imagined the key critical questions they might raise and how he would respond to them in the Q&A session. Most importantly he practiced his closing arguments, those messages which simply had to come across clearly.

None of his efforts were much help, unfortunately. It all went rather strangely. Except for a few clarifying questions he was not asked one single question during his sixty-minute presentation.

All he could see were emotionless faces staring at him. At first he was just thrown off balance. Then he became nervous and tense. No feedback during the entire presentation!

He didn’t have a clue as to whether the Germans were even listening, much less if they understood him, agreed or disagreed or were neutral about his statements. The entire time he had to maintain his composure, yet try to draw out some kind of response from his German listeners. His mind was racing during the entire presentation. It was exhausting for him.

The moment Roger finished his presentation it was if the Germans had suddenly awakened from a deep sleep. They fired from all their guns at once. One critical and penetrating question after the other. And at no instance did they hint that what Roger had presented was in any way positive.

Most of the questions communicated clearly that the Germans were very skeptical. When American colleagues tried to come to Roger’s rescue the discussion (at least from the American perspective) turned into a open verbal fight. The German colleagues continued to pick apart Roger’s presentation.

Then it was time for a break. You could cut the tension in the air with a knife. The teams went in groups, separate of each other. The Americans were in agreement: the Germans were unfriendly, uncooperative, Q&A was like an interrogation. Roger was contradicted time and again, and in an almost insulting way. Very disrespectful.

But the German colleagues were no less irritated. They found Roger‘s presentation totally superficial. Too little information. Everything far too positive. Could it all be true? “Is this guy a spinmeister?” That’s why they listened politely and held their questions for the discussion part.

And they found the Americans to be overly sensitive, quickly insulted, losing their composure. They were poorly prepared to answer basic questions. The backup slides were also weak in content.

At the end of Roger’s presentation both sides were disappointed and aggravated. When they all returned to the conference room the tension was still high. Karl, Roger’s German counterpart, got up to present.

Act 7 – Karl presents

Karl’s presentation started out well. He had no problem responding convincingly to the handful of questions the Americans asked. Every now and then his American listeners nodded (seemingly) in approval, commenting: “very comprehensive”, “data-rich slides”, “serious theory”, “well, that’s certainly crystal clear.”

Halfway into his presentation, though, Karl had noticed something about their body language. The Americans seemed a bit fidgety, uneasy. A few had glanced at their watches. Several held their smartphones under the table. Were they texting to each other? Were they even paying attention?

Questions were asked about substance he had already addressed. Some slides he had to explain two or three times. And they repeatedly interrupted his presentation with their questions instead of demonstrating a minimum of courtesy and patience by holding them for the Q&A part.

When they did get to Q&A, however, Karl felt rather confident about his presentation. The American asked very few questions. None of them posed a problem for him. For Karl and his colleagues these were clear signals that all had gone quite well.

The Americans saw things much differently. Karl came across as pedantic, long-winded, condescending. Much of what he presented confirmed their opinions about German engineering: overly complex, too expensive, not customer-driven. They feared that the German side would not be open to their engineering solutions, to their fundamental approach to engineering.

The group broke for dinner. Again separately. The tension had not subsided. The Germans thought the Americans looked a bit depressed. They spoke very quietly, avoided eye contact with their German colleagues, kept their heads down.

The Americans, including Roger, were not sure what the Germans were thinking, much less how to interact with them. They were very guarded around them. At the forefront of their mind was the reality that their company had been acquired, that the Germans were their new bosses.

Act 8 – Five Days of Tension

The two presentations and their respective Q&A discussions did, indeed, set the tone. An unintentional tone. With a few exceptions, the atmosphere on that Sunday persisted during the entire week. It was an atmosphere of apprehension, tension, even mistrust.

It was clear to everyone that there was significant disagreement in two foundational areas: in product philosophy, what defines a great technical solution; and in processes and tools, how great engineers fundamentally do their work.

Their intense, at times very emotional, debates in these two areas left too little time to discuss the other three topic areas: possible organizational structures, collaboration with internal and external customers, and finances.

Their attempt to formulate a draft integration roadmap had failed.

Act 9 – The Cost of Cultural Misunderstanding

Let’s estimate what the failure of this first workshop cost to the company. For the sake of simplicity, all numbers are in U.S. dollars and in Euros.

Failed First Attempt

Workshop Preparation
They gave themselves six weeks for preparation. Each of the twelve participants invested 120 hours (20 hrs. per week). The hourly rate for Karl and Roger 150. The hourly rate for the department heads 100.

Karl and Roger: 36,000. Their department heads: 120,000. Total: 156,000

Workshop
Five full days in the workshop: 40 hours each. Karl and Roger: 12,000. Their department heads: 40,000. Total: 52,000

Expenses
Six participants fly business class across the Atlantic: 24,000 (6 x 4,000). Offsite-workshop in a hotel for twelve people: 12,000 (12 x 5 x 200). An administrative assistant supports the workshop: 3,000. Total: 39,000

Total Costs
Preparation: 156,000. Workshop: 52,000. Expenses: 39,000. Total: 247,000

Second Attempt or New Approach
The first workshop did not produce a draft integration roadmap. They will need to either meet for a second time or to rethink their overall approach.

Second Attempt
The costs of the first first workshop was 247,000. Would the costs for a second workshop be the same as the first, less or more? Let’s assume that the second workshop succeeds without any need for preparation. The expenses alone would be 91,000.

New Approach
What if Karl and Roger decide that they need to come up with an alternative approach. What would be the cost of that internal decision making process? What would the execution of the new approach cost? What are the chances that it will succeed? What will be the costs if the new approach fails?

Roadmap Implementation
We assume that all participants are both capable and willing to integrate their organizations. Yet, they “departed in an atmosphere of apprehension, tension, even mistrust.”

The cultural factors which led to the failure of this first workshop will also be at play when the integration roadmap is passed down to the individual cross-Atlantic teams for implementation.

In other words, whatever approach leads to an integration roadmap, the cultural factors involved will also be at play when German and American colleagues at the lower levels are asked to implement that roadmap. For it will be their job to work out the details of integration at their working level.

At a minimum each of the five key departments will have to formulate and then implement their own integration roadmaps. What additional costs will be incurred if those five teams struggle with cultural differences? 5 Teams x 50,000 per team = 250,000.

Post-Integration Productivity
We assume that, one way or another, the two organizations will be integrated. But, what impact will cultural differences have on productivity? In other words, will these engineers work just as effectively across cultures as they do within their respective native culture?

Integration on paper is one thing. Collaborating day in and day out is a wholly different thing. It’s the difference between a wedding and a honeymoon, and then actually living together. Month in, month out. Year in, year out.

Let’s assume that post-integration productivity decreases by 5%. What will that cost the company?

5% decrease in productivity x 250 (only 25% of the engineers collaborate cross-Atlantic) x 150,000 average yearly salary per engineer = 1,875,000.

Design Engineering Work Results
If cultural differences influence how the two organizations work together, what will be the impact of these differences on work results, on the engineering designs they produce? In other words, if their work is often over budget, or over schedule, or in suboptimal quality.

Back to Ten Stories.

Job Swap – Leadership

Luke, an American, and Theo, a German, are colleagues in a global company. Early-50s, experienced, successful, in leadership positions.

They decided to exchange positions for one year. It went well. Luke had a great year in Germany. As did Theo in the U.S. And their direct reports gained deep insight into the differences between how Americans and Germans lead, and want to be led.

It could have gone differently, however. Delegations often underperform or fail outright. How high would the costs have been with Luke and Theo?

ACT 1 – Job Swap

Luke and Theo are colleagues in a global company in heavy industry. They are in their early-50s, experienced, successful, and in leadership positions in a engineering organization. The both lead teams of roughly two hundred and fifty people.

Several years ago they decided to exchange positions for one year, a so-called job swap. Luke moved to Germany, Theo to the U.S. In the mid-2000s their respective companies – one American, the other German – had been combined. It was a major transatlantic merger. So both Theo and Luke were fairly familiar working with the other culture.

ACT 2 – Addressed cultural differences

In the weeks leading up to the job swap, there was a fair amount of speculation, even concern, in the German organization about having Luke as their lead for a year. They feared American-style management, which they believed to be defined by micromanagement.

As is often the case in the German-American space, much of what each side thinks of the other is based either on cliches or on hearsay or on limited, misunderstood and unreflected interaction with each other.

On the American side there was a good amount of familiarity with Theo, since directly after the takeover he had worked in an American-dominated part of the company. Unfortunately, that assignment did not go well for Theo. Apparently, he and his American boss did not get along all too well. But the Americans didn’t pay much attention to that.

Immediately after Luke and Theo made their moves to the respective other country, I executed customized workshops separately with them and their direct reports. We focused on key topics such as communication, decision making, leadership, conflict resolution, processes philosophies, and customer approaches.

As is my method, we addressed the differences in approaches between Germans and Americans, enabling Theo and his team, and Luke and his team, to establish groundrules for the next year.

ACT 3 – Luke’s Year in Germany

Luke was able to modify his leadership style in ways which met the needs and expectations of his German direct reports. He scheduled less staff meetings, kept them to a tighter schedule, reduced the number of participants in the meetings, and gave his team the level of independence they felt was needed in order to do their jobs well.

In the workshop we discussed the American concept of management-by-walking-around, (MBWA) and why that is so critical to the success of American teams. Luke and I referred to Tom Peters’ best-selling book In Search of Excellence from the mid-1980s.

We cited numerous examples in American culture – not just in business – where the leadership logic requires that team leads be in close touch with their people – their work, the atmosphere in the team, their problems and concerns.

As a shared logic, we explained, American team members expect their leads to be in constant touch with them. I then asked Luke’s German team members to define their understanding of micromanagement. Luke and his team were able to come to an agreement rather quickly.

I recall being on-site one day and passing by Luke’s office. His door was open. I peeked in without being noticed. With their backs to me and sitting at Luke’s oval meeting table, I could sense immediately the level of trust between Luke and one of his key engineers.

Luke was listening carefully, sincerely. The engineer’s body language signaled that he was relaxed, deeply involved in the subject matter, communicating clearly and openly with Luke.

It was only a quick snapshot impression, but I knew Luke rather well, what kind of person, therefore manager, he was. He cared deeply about his people. Months later I would hear several comments from the German team that they were thrilled with Luke.

He’s always there for any of us when we have a problem. Luke senses quickly when we need his help. We can go to him at any time with any issues, or he comes to us.

ACT 4 – Theo’s year in the U.S.

Theo’s year in the U.S. was no less successful than Luke’s. In the workshop I customized for him and his team it was critical that the Americans understand the German leadership logic. They discussed, debated and decided over two very full days how best to work together.

I had them address the same topics as in Luke’s workshop. Much was eye-opening for the Americans. Up until that point they had not done much thinking about the differences in leadership approaches.

In fact, in the early weeks it took some adjustment for the Americans. Theo spends too much time in his office. He doesn’t get out and work with the organization, was a comment I heard several times. After relaying the feedback to Theo, he addressed it in one of his staff meetings. At the same time, I emailed my white paper on German leadership style to his staff.

Theo, and I in a handful of phone calls, reminded the Americans that when German management does not proactively communicate or get involved in the daily work of their direct reports it is a positive sign that the team is performing well. I suggested to Theo to lay out in his staff meeting when German management does, indeed, get involved at the tactical level.

On the phone to me, and in his staff meeting, Theo was very clear: I get involved proactively if I am asked by my team or by an individual team member; if I see a problem which only I can resolve; or if there are structural barriers in the organization or in processes, etc. which need to be removed.

Otherwise, if my folks are performing well, the last thing I want to do is interrupt, distract or otherwise stick my nose in their business. My job is strategy; making sure that the general organizational parameters within which we work are supportive; and anticipating long-term problems.

I recall very well an instance early on during Theo’s year in the U.S. when his German approach to leadership did not meet the (perceived) needs of one of his direct reports. I was in the meeting. Jerry, one of Theo’s top engineers, said: Theo, I need your help. Whenever I have meetings on Project X, people from other organizations show up.

I don’t know who they are or why they are present. They claim that their work is influenced by ours, but I cannot judge if that is true or not. And on top of that, they then bill us for their time. You need to talk to their bosses and get them to stop this!

Everyone looked over to Theo, who was very calm, reflected for about five seconds, then said: Jerry, what’s the problem? It’s your meeting. If you don’t want them in it, just ask them politely to leave.

Jerry was not happy with the response. He repeated the problem and his request that Theo get involved, as if Theo had not fully understood him. Theo smiled and replied supportively: Jerry, just pull out the process on how we do design engineering.

It spells out very clearly how gate meetings are run, including who attends, etc. Just bring it to the next meeting, read it to those who you think should not attend, then ask them why they are there. If they don’t have a plausible reason, ask them to leave.

It was clear to me, after so many years in Germany, what Theo meant and where he was coming from. And it was also clear to Jerry and his other American colleagues. Nonetheless, it was equally clear to me as an American that Theo’s response was not enough.

Sure it might all be spelled out in the process, but Americans expect their team leads to step up and fight for them if requested. That’s what leadership means. Referring to a document is not leading, at least not from the American perspective.

When I communicated this to Theo he looked at me squarely in the eyes and said: John, I can’t spend my time running around bothering other senior-level managers with this kind of stuff (he used another term). Jerry needs to demonstrate a little backbone. He can do it.

Theo had a great year in the U.S., as did Luke in Germany. Even more important was the learning curve that their respective teams went through. Both sides gained deep insight into the differences between how Americans and Germans lead, and want to be led. What they learned continues to benefit them long beyond that one year.

ACT 5 – The Cost of Cultural Misunderstanding

What if Luke and Theo had failed? What would have been the overall damage to the engineering organization had Luke and Theo failed in their leadership roles?

If they had switched back after six months? If productivity in their teams had decreased by 10%? If their respective organizations produced results suboptimal by 10%? Can you estimate those costs if this situation were in your own company?

Leading translatlantic Teams
Ok, let’s extrapolate. We assume that there are clear differences in how Americans and Germans lead, and want to be led. And that these differences have immediate and constant impact on transatlantic teams.

Look at you company. Estimate how many organizations – on different levels, and in different areas – involve Americans leading Germans or Germans leading Americans. Similar to Luke and Theo.

Then assume that due to cultural differences their productivity, and their results, are reduced by 5%. Estimate that cost to the company.

Back to Ten Stories.

Game Day – Persuasion

Mark works for a German company in the U.S., a major automotive supplier. His team discovered a serious opportunity. Detroit clearly stated its interest.

Mark’s team prepared the business case. Key departments were on board. They then got the green light from their otherwise very critical U.S. management.

With high hopes they were off to Germany to persuade the board. Four days of intense scrutiny. Then rejection. It wasn’t pretty. What went wrong?

Act 1 – Mark in the U.S. in a German Company

Mark works for a German company in the U.S. With a proud, one hundred year old tradition. Located in the Black Forest in the southwest of Germany. Roughly ten thousand employees, and about 1.75 billion Euros in annual revenue.

It is a supplier to the automotive industry in the U.S., and not just to VW and Mercedes Benz, but also to GM, Ford and Chrysler. The company has first-rate technology, a clear organizational structure, efficient internal processes, and an intense desire to innovate.

Mark has a mechanical engineering background and spent many years in development. He then went on to head up the supply chain organization in North America. Two years ago he moved into sales/marketing. After a year he became that area’s Vice-President for North America.

Act 2 – A Serious Market Opportunity

Mark and his top people saw a serious market opportunity. In early discussions, Detroit – GM, Ford, Chrysler – showed high interest, while the German car-makers remained somewhat reluctant. The project requires modification of one of the company’s best-selling products. And this means both significant investment and close collaboration across the Atlantic.

Mark’s sales/marketing organization had first to get a high level of clarity about the potential market demand. They held many discussions with their customers. From there they went to their colleagues in engineering who evaluated the technical challenges. Engineering recognized the potential immediately and identified both what was feasible technically and what might present a challenge. Engineering was on board.

A product innovation does not always translate into financial performance, however. So they refined the business case and took it to their commercial-financial colleagues. Initially not convinced, the numbers-folks requested additional information. Mark’s team worked three straight days on their calculations and were able to convince even the most skeptical ones on the financial side of the organization. Finance was on board.

Act 3 – Game-Day in the U.S.

Finally, they had to get approval from the board of the North American organization. This was not going to be easy, regardless of their level of support from the engineering and business sides. Not every product innovation is necessarily good for the overall business longer term.

Mark assembled his team of presenters. They formulated their line of argumentation very carefully. Each knew exactly what message they had to get across and how. They worked for four straight weeks, coming together on Saturdays to tighten up and practice their team presentation, recruiting other colleagues to play the part of skeptical board members. It was intense, but also great fun for all, going out for pizza dinner on each of the four Saturday days.

When it came to game day, they got approval. The critical questions were asked, and there were several moments where it seemed that they would fail at getting the support of one powerful member of the board. The presentation and discussions took them well over the budgeted time.

During the breaks Mark and his team huddled together with their laptops re-doing calculations, moving slides around and pulling in images from their server. A few subject area experts had to be brought in quickly to respond to detailed questions. At times the tension was very high, but they remained consistent in their message and cohesive as a team.

That was convincing to the board. A few, not unimportant, issues remained unsolved, but that was ok for all in the room. Innovation always involves risk. At the end of what seemed to be a marathon meeting, the CEO of the North American organization broke out a big smile and said:

Great work, team. We’re behind you 100% on this. I‘ll talk to the big boss in Germany and get a date for you to present to them. But remember, our German colleagues will be do their best to find the weaknesses in your plan. You’ll need to dress warmly as they would say!.

Mark and his colleagues glanced at each other, smiled, stood up. Mark thanked their board members for affording them so much time. Once out of the conference room they broke into cheers, laughter, back-slapping. Mark pumped his tight-fisted right arm into the air: Yes!!! Let’s go celebrate!

Act 4 – Why Game Day in U.S. succeeded

With each round of analysis, presentation and critical review the team became more confident of the project’s potential. More and more they identified with it personally. And Mark can really sell, balancing emotion and inspiration with facts and analysis. He is a firm believer in the motto sell yourself first, then your product or service, something his father preached time and again.

But he also made sure that the analysis was close to airtight. Sure there were risks involved, but he and the team never saw them as problems, in fact, they very consciously phrased problems as opportunities. Mark asked his team to always speak positively, to be optimistic. Always look for the silver lining in a dark cloud he would say.

Whenever they communicated the status of the project – whether in a formal presentation, a written report, in face-to-face meetings – the team made sure to have a good mix of hard facts and analysis along with stories and anecdotes. They believed that professional experience – past projects as stories – were just as relevant.

And the team had a few members who could tell those stories so that they really came alive. One of them, an engineer, was particularly good at explaining the most complex technical aspects so that the man on the street could understand them. They called him the Great Simplifier.

But Mark made sure that no one spent too much time talking about the past. For him it was all about the future. He would even go through the respective presentations slide for slide counting how many were devoted to the future, to the present context, and to the past.

Innovation was key. They had to sell their ideas as something really new even if much of it was incremental in nature. It had to come across as a leap forward. The team thought long and hard about how to speak to the imagination of those they were trying to persuade. Some would joke that Mark should have gone into either politics or advertising, comparing him to the character Don Draper in the U.S. television series Mad Men.

He did not have a problem with leaving out certain facts which argued against what he was selling. He took an American approach to the weakpoints of whatever his team was presenting: Hey, if our audience doesn’t ask the critical questions, we’re not obligated to voluteer information about the weaknesses of our plan. They need to pull those out of us. Caveat emptor. Let the buyer beware he would tell his team with a hint of a smile on his face.

Act 5 – Game Day in Germany

The presentation to the company board, as well as the meetings thereafter with engineering, quality, sales/marketing, and commercial did not go well, in some cases they went very poorly. By noon of their second day they were quite unsettled, not knowing what had gone wrong. They even began to suspect that the Germans were against the project just because it originated in the U.S.

As they had in the U.S., they worked day and night, responding to the questions they had not anticipated. Mark and his team reached out to all possible supporters in the key disciplines, and on both sides of the Atlantic. And although their German colleagues listened patiently and sincerely, none felt comfortable with committing in any way.

By the time Thursday had rolled around, Mark and his team were physically and emotionally exhausted. They had presented, discussed, debated with more people and groups than they could count. Every meeting seemed to be a battle. Argument, counter-argument. Facts, counter-facts. Experiences, counter-experiences.

Their flight was scheduled for Friday morning from Frankfurt. They had had no time to do any sight-seeing, something the Germans always encouraged their Americans colleagues to do. Only a few meetings were scheduled for Thursday, and with folks who were not influential in terms of the project.

At breakfast Mark asked his colleagues for their assessment. Did the project have a chance? The team put their prospects at fifty-fifty. They could not have been more disappointed, dejected, almost despondent.

Friday late morning Mark and his team flew back to the U.S. They knew that their meetings and presentations were going to be difficult. But, they had underestimated just how difficult. They felt defeated. Did the project have a chance?

The answer came two weeks later. Their German board thanked them for a motivating, and at times very interesting, presentation. They saw many positive aspects. The proposed project, however, would be not be funded.

Act 6 – Why Game Day in Germany failed

What Mark & Co. did not know is that game day in Germany is not the same as game day in the U.S. And that Germans persuade differently than Americans. Which, in turn, means that they are persuaded differently, allow themselves to be persuaded differently.

The Germans reacted ambivalently. On the one side, Mark and his team came across as energetic, personal, as believers in their mission. They put themselves on the line, meaning they put heart and soul into the project. This all was seen positively. For the Germans also have strong emotions, identify themselves intensely with their work, especially when it comes to technology. And they often want to show these emotions to each other, to their customers, and to the world.

But they are taught to be objective, unemotional, to separate self from substance. Only seldom do Germans put themselves front and center. For them arguments should speak for themself, which is the exact opposite of sell yourself, then your product or service.

So in the end their reaction to the sell-yourself-first approach was more negative than positive. Germans become wary and skeptical. They view Americans as putting on a show, as substituting form for substance. In some cases, they suspect that Americans intentionally try to distract their audience from the weakness of their arguments.

Also, Germans reject any attempt to play on emotions, to push the buttons, in the sense of identifying the emotional drivers of the audience without that audience realizing it, and then manipulating those drivers.

Nor were the German convinced that their U.S. colleagues had truly penetrated the complexity of the subject matter. Several potential problems were not even addressed, much less in detail. Again and again the Americans used euphemisms. If there is a problem Germans expect to hear the word problem and not challenge or issue.

They zeroed on contradictions, also. Germans are taught to look for illogical statements, for gaps in reasoning. They’re very proud to be known as Schwachstellenanalytiker, literally weak-point-analysts. They expect stringent methods of analysis.

The bottom-line is that Mark and his team did not come across as competent. They did not meet the high standards which their Germans colleagues set for themselves, therefore for the Americans. In some instances they found their American colleagues to be rather naive. The picture they painted was too positive, too hopeful.

In addition, the Germans did not recognize any kind of systematic approach. Individual questions and factors were analyzed, but not wholistically. The pieces of the puzzle were there, but no understanding of the entire puzzle. It was what Germans call Stückwerk or patchwork.

And all the talk of experience, war stories etc. was interesting, at times even entertaining, but not relevant. Where is the data and analysis explaining the experience, they wondered. And a lot of over-simplification. The Germans felt that their U.S. colleagues did not question critically enough the fundamental operating assumptions of the project.

The overall thrust of the presentations, as well as in the talks with the various departments, was future oriented. This was expected. Germans, too, know how to envision a future. But Mark and his team failed to convince them that they had a clear definition of the starting point, of the status quo. The Germans feared that they would find themselves rushing in the wrong direction.

Especially in terms of market trends and customer developments they sensed strongly that their American colleagues did not do enough thinking about what the changes would mean longer-term for the overall product portfolio. The Germans were anxious about changes moving the company off the path of the last two decades. Germans value continuity very highly, preferring careful, incremental change instead of big jumps.

In the German business context Mark and his team’s job was to inform their German colleagues in depth and in breadth. Instead they gave a total sales presentation, pushing for a decision. The Germans purposely did not react. They felt it was far too early to give any indication. Germans seldom make important decisions based on presentations. Instead, the presentations kick off the internal decision making process.

In addition, they sensed that the Americans did not always tell the full story. They recognized certain weakpoints rather early, but expected Mark and his team to address them. They waited, then probed a bit. A few of the Germans began to suspect that the Americans might be holding back critical information.

Act 7 – The Cost of Cultural Misunderstanding

Mark & Team had failed. What did it cost the company?

Time and Effort
Mark & Team invested serious time and effort into the development of their project proposal, as well as into selling it internally. Many folks were involved. Not only Mark’s sales/marketing organization, but also engineering and finance. And, of course, the U.S. board and the German board, who invested valuable time to listen, deliberate and decide.

Travel Costs
In the overall scheme of things travel costs are very minor. But they are costs and they can be calculated. Assume that Mark and four colleagues made the trip to Germany. They were there for five days: flights, hotels, transportation, meals.

Lost Revenues
The American OEMs were clearly interested in the project. Had Mark & Co. been given a green light to develop the project, and had they teamed up with their German colleagues, there may have been a good chance that they gained interest among the German OEMs, also.

This would have been the big payoff, the sought after return-on-investment. Although this is not a detailed case study of the company, the nature of the technical innovation proposed by Mark’s team, or the market parameters, we know that the company does about 1.75 billion in Euros per year in revenues.

Business Relationships
The American OEMs were interested, but saw that the German board said “No.” Will the American OEMs now expect less innovation from Mark’s company? If yes, what impact will that have on their business relationship? In other words, was the business relationship damaged? Can that damage be estimated?

Motivation
Mark and top people felt defeated. The U.S. board was fully supportive. But the German board rejected them. How will Mark and his top people react?

Will they be less motivated to search for new business opportunities? Will their personal work productivity decrease due to lower motivation? Will the defeat influence their desire to continue working for the company? The cost of these are all very difficult to estimate.

Back to Ten Stories.

“It’s only a car!” – Decision Making

A two-day offsite workshop. Americans and Germans. Engineers. They had problems integrating their respective decision making processes in a critical area.

Day One: Understand the fundamental differences in decision making approaches. Day Two: Integrate how they make the recurring decision.

They were asked to contrast how the two cultures go about buying a used car. The cultural differences jumped off the flipcharts.

The workshop succeeded. And we all had great fun. But what would have been the cost to the company had they failed?

ACT 1 – Harmonize a Decision-Making Process

It was more than a few years ago. A two-day off-site workshop with Americans and Germans. Engineers. They had problems integrating their respective decision making processes in a critical area. Their manager came to me and said:

“John, these are very capable people. First-rate engineers. And they work well together for the most part. Six months ago I asked them to harmonize their decision making processes. But they are making no progress. This is taking far too long. I think cultural differences might be the cause.”

ACT 2 – The Right Analogy

After doing background interviews and analysis I had to think about what analogy I could use on the first day of the workshop in order to get the participants to look more deeply into what they were trying to do.

My belief was, and continues to be, that you can’t effectively integrate that which you don’t fully understand. So how could I help them as quickly as possible to understand where they diverge in how they fundamentally make decisions. In other words, where they diverge in their respective national cultural decision making logics.

Step One: Understand the fundamental differences in decision making approaches. Step Two: Apply that insight into the task at hand of harmonizing two different ways of making the same kind of recurring decision.

We had two full days together. I decided to have them compare and contrast how the two cultures – Germans, Americans – go about buying a used (or new) car. Why that?

Many people make that kind of decision several times in their life. The decision involves a sizable financial investment. The basic elements in the decision making process are the same in both countries. It will be easy to compare the respective approaches. And it will be fun.

ACT 3 – The Exercize

We had only a day. It sounds like enough time, but it would be tight. In the morning the two groups would work separately on the exercize. After lunch they would present, we would discuss and draw conclusions for how best to integrate their decision making processes.

The scenario was rather straightforward. The parents of a eighteen year old son, Peter, decided it was time to buy him a car. Peter and his younger sister had very active lives. The mother was tired of playing taxi driver for them. The son had his driver’s license and was very responsible behind the wheel. “Let’s get Peter a decent used car.”

How do people in the two cultures basically go about making this decision? The German engineering colleagues would respond for Germany, the Americans for the U.S. I gave them five questions:

Scope: What is the overall goal of the decision? What should it accomplish?

Process: Map out the steps, and their sequence, taken in order to make the decision.

Resources: How many hours would be invested into making the decision? Including what would be the shortest and the longest time-frames their respective culture would need to make the decision. What was the maximum price the parents would spend?

Information Gathering & Analysis: How systematically (depth and breadth) would they gather information? And how precise and detailed (stringent) would be their analysis?

Risk: What potential risks would they identify? What would make them nervous, so to speak?

Those in the workshop who had never worked with me were more than skeptical. “What does this have to do with the decision making processes we need to harmonize?” Those who were familiar with my approach responded for me: “This is cool. John knows what he’s doing. Let’s get started!”

ACT 4 – “But, it’s only a car!”

The cultural differences between Germans and Americans jumped off the flipcharts hanging on the walls.

Scope: The German colleagues had a detailed, intricate, very well thought-through description of the role of the car as a kind of new member of the family. It bordered on the philosophical. The Americans were as pragmatic as they could be. Five bullet points: save Mom time; give Peter and sister max. flexibility; etc. etc.

Process: Again well thought out was the German response. Stick to the sequence. Repeat steps if necessary. “A decision is only as good as its decision making process.” The Americans had fewer steps, reserved the right to alter the sequence, including skipping steps. “All processes are a means to an end.”

Resources: “Get it right the first time”, was the German motto. Take your time. Remain patient. A fast decision would be within six weeks, a slow one six months. When it came to money, they calculated with a very sharp pencil. The Americans gave themselves between a week and thirty days. “Hey, the parents might find the right car at the first dealership they visit.” Price was important, but not critical.

Information Gathering & Analysis: The German engineers went into overdrive, creating a comprehensive and complex matrix of the key attributes they were seeking in a car, displayed on several flipcharts taped together. The Americans had two flipcharts, with eight attributes, ranked based on importance.

Risk: Both sets of colleagues identified many of the same risks, but they weighted them differently. Germans worried about the long term, the Americans the short term.

One of the biggest contrasts was how methodical, analytical, academic the German approach was. And the colleague who presented their flipcharts on information-gathering and -analysis was particularly detailed in his description.

Once he was finished, and both groups sighed in relief, one of the American participants – a woman, quiet, respectful, intelligent – could no longer hold it in: “But, Joerg, it’s only a car!” We all erupted in laughter. Joerg turned a bit red, smiled, laughed, then said: “Yeah sure, Laura, but this is a serious investment. We want to make the right decision!” We all erupted again.

On the second day the group quickly applied the differences in approaches to their engineering decision making process. Their solution wasn’t perfect, but over the weeks and months thereafter they refined it. In the end they had a very effective approach. And they had great fun together.

ACT 5 – The Cost of Cultural Misunderstanding

Process Harmonization
That workshop was great fun. And it was very productive. But let’s be honest. Harmonizing how decisions are made can quickly become a very bloody battlefield within global companies.

Think of the most important recurring decision your organization makes. It is critical to your success. Now imagine that decision making process being integrated with a similar process in a company from different business culture.

Estimate the cost to the company to complete the harmonization. In other words, to get it right. Now estimate the cost to the company if the two sides get it wrong?

Decision Execution
Now, what if the harmonization did not go well. What if neither side fully accepts the new joint approach. How effectively will they make decisions according to the joint process? And how motivated will they be to then implement the decisions the harmonized process produces?

Collaboration
If, for example, American and German colleagues are not happy with how they make decisions together, how motivated will they be to collaborate? Estimate the cost to your organization if suboptimal cross-Atlantic collaboration leads to a 5% decrease in productivity.

Back to Ten Stories.

“I’m fired!” – Feedback

Aaron, an American, is a first-rate engineer and manager. Sent to Germany on a three-year delegation, his tasks: knowhow transfer, process integration, help with cross-Atlantic teams.

The first year is up. Time for Aaron’s first formal performance review. With Martin, his boss. Aaron expected a B+. And Martin saw him as a B+. But German feedback is not American feedback.

Their meeting did not go well. Aaron was disheartened. Martin confused. Neither understood why. Nor did they figure it out over time. They continued to work well together. But they could have achieved far more.

ACT 1 – Aaron and Martin

Aaron, an American, is a first-rate engineer and manager. Sent to Germany on a three-year delegation, Aaron’s job was to increase technical knowledge transfer, integrate critical processes, and to help cross-Atlantic teams based on transparency and trust. A very tall order for the particular organization he worked in.

After the first year it was time for his structured feedback discussion with his German boss, Martin. The employer, a German multinational, has a systematic and detailed approach to such evaluations. They influence to a significant degree compensation and further career path.

Central to its effectiveness is self-evaluation. Team-members measure themselves against the goals they formulated a year prior together with their team-lead. Aaron is focused, understated, not one to put himself front and center.

ACT 2 – In Agreement: B+

From Aaron’s perspective, the year has gone quite well, surprisingly so. A few days before the feedback discussion he reflected on his performance. Aaron believes to have an accurate assessment of where he has performed well and less well. He tends to be overly self-critical.

Martin, a German, a few years older than Aaron, is also a first-rate engineer and manager. Very grateful to have Aaron in his team, Martin saw this as a unique opportunity to make difficult, but necessary, changes.

A year before they had met and set down ambitious goals. From Martin’s point of view the year has gone very well. With few exceptions, and those in less critical areas, Aaron has more than met the goals defined. Martin is looking forward to an even better second year for Aaron and the organization.

ACT 3 – “I’m fired!”

They meet for the discussion. Aaron is quiet, listening carefully, respectful of Martin as a fellow engineer and as his superior. Aaron is also very much looking forward to a meeting-of-the-minds on his performance over the last year, and to discussing the goals they want to reach in the upcoming year. The same goes for Martin.

The discussion does not go as expected, however. Neither from Martin’s point of view, nor from Aaron’s. On the contrary. Aaron departs the meeting confused, almost shocked, in a bit of a daze. “I’ll be fired within six months!”, he thought to himself. “How could I have been so wrong in my self-assessment?”

It took several days for Aaron to steady himself. Self-doubt had dominated his thoughts and emotions. Was he out of touch with reality? Did he misunderstand what the goals for the year were? How could he have so grossly misread the situation? Were the achievements over the last twelve months average, mediocre or worse?

ACT 4 – German Feedback Logic

Martin had focused almost exclusively on Aaron’s weaknesses. There weren’t many, but Martin managed to find some. There was so little talk about the positives, about the progress made.

Information was flowing between Germany and the U.S. Two of the three key engineering processes had been just about fully integrated. It had been decided to leave the third process separate on each side of the Atlantic.

Clearly there was a new Teamgeist, team spirit. Aaron was respected and accepted by his German peers and team-members. He had even found time to study German and could hold basic, non-technical, conversations in a language he had taken only for a few years in high school and college.

Martin left the meeting a bit surprised, also. Aaron seemed distracted, not fully engaged. When it came to formulating the coming year’s goals, Aaron had little to contribute. Martin sensed that something was wrong and decided to schedule another meeting in a week to discuss the goals.

“Strange. That’s not the Aaron I know and respect”, thought Martin. Personal problems? Family? Homesick? Lousy winter weather in Germany getting to him? Martin just couldn’t figure it out. “Such an excellent engineer and manager of people!”

So little talk about the positives. True. But why waste time on what works, on what has worked very well? Martin had voiced his satisfaction very early on in the conversation. Aaron had not picked up on it. “You’ve done very good work, Aaron. No goal has gone unmet. You’re a strong member of my team.”

Any German in the room, especially those who know Martin, would have been in agreement. Aaron got a “B+” for the year, a high grade in Germany, where “nobody can be considered perfect”, where “there is always room for improvement”, where an A is truly seldom, especially from Martin.

Martin then proceeded to focus on how Aaron can go from B+ to A-, how he can steadily, incrementally, systematically address and improve on those areas, not many, where he can stretch even further. Aaron felt that he was nitpicking, being small-minded. Untypical for Martin.

ACT 5 – Off Balance

For Martin it was a source of great satisfaction to have such a capable person in his team, to discuss with that person how to become even stronger. Aaron was the kind of engineer and manager every German wants to mentor, to coach, to work with.

All of these thoughts and sentiments remained hidden from Aaron, however. And his reactions hidden from Martin. Although they continued to work well together over the next two years, they were never again on the same wavelength.

Twice more they would have these formal discussions, as well as dozens and dozens of communications in which informal feedback was given and received. Aaron always felt a bit off balance with Martin.

Martin sensed it, but could not quite articulate it, much less address it. They were successful together. And that was recognized by senior management. But, they could have gone far higher.

Back to Ten Stories.

“You got it wrong!” – Customer

A very important client. German. Head of a thousand-person engineering organization. I had done nine months of work for it. Dinner at a restaurant. I finally meet him.

Friendly, relaxed, anything but self-important. He had every reason to be formal, intimidating, testing. None of that. All signals were positive. At least those in the first few minutes. Then he picks a fight with me. Verbally, intellectually, of course.

“You know, I was against you doing any work for my organization. I think you have it wrong.”

ACT 1 – Meeting the man

I was very tired. Had just executed a three-day management workshop. The participants were active, asking good questions, challenging me when it was legitimate, demanding that we go deeper whenever I had hit a nerve.

I try to pack as much into a day as possible, probably overdoing it. My body was still on German time. It was seven p.m. U.S. East Coast. For me it was one o´clock in the morning.

I got out of my rental car, walked across the parking lot, went through the entrance of the restaurant. The cold air hit me hard. Why does it always have to be so frigid in American restaurants, buildings, other public spaces?

I’m in the Southeast of the U.S. It is early summer. Very warm, sunny, the breeze too soft to cool anything or anyone down. Finally I would meet the person whose organization had been giving me work for the last six months.

His company: a major German multinational, which just a few years before had been merged with an American competitor. His organization: a thousand-person engineering organization, with two major locations. One in Germany. The other in the U.S. He is German. I am American.

ACT 2 – “I think you have it wrong.”

The hostess brings me to him. One of those places where you step up to sit at the table. The place was packed, all sorts of ages represented, the music surprisingly not disruptive. I had never met the man, but sure had heard much about him, and was both curious and nervous.

We shook hands. His meaty, firm, dry and warm. The forearm brown and muscular. Mine? A bit pale, thin, but taut. He had a big smile on his face. Friendly, relaxed, anything but self-important.

As the head of a critical engineering organization in a division of one of Germany’s largest and most famous global companies, he had every reason to be formal, intimidating, testing, as if to say me client, you service provider. Me master, ou slave.

Nope. None of that. All signals were positive. At least those in the first few minutes. Then he picks a fight with me. Verbally, intellectually, of course.

“You know, I was against you doing any work for my organization. But my people had reported such good things about you, that I just let you continue working with them. You know, I think it’s all about corporate and not national culture. I think you have it wrong.”

ACT 3 – “Your thinking is naive and superficial.”

Was it a slug to the jaw or pat on the back? Too tired and too unprofessional to control myself, I snapped back that he was the one who has it wrong. And what’s more, “your thinking is naive and superficial.”

Now, for those who have little or no experience with Germans, you can’t hit back much harder at a German than to say those kinds of things. It goes to the heart of their self-understanding.

Tired and unprofessional, yes, but unfamiliar with Germans, no. They like to rough it up intellectually, mentally, with ideas. Often on purpose just to test the other person. Again, we had just met. My beer, or was it juice, hadn’t even arrived at the table.

No small talk. No pleasantries. No “how is the training going?” His organization would shell out a large amount of Euros to me in that first year, and here I was slapping the guy right back.

He ate it up. I did, too. We debated with each other for well over two and a half hours. It went on to be the beginning of a multi-year engagement, and an inspiring multi-year conversation.

But wait, in our very first meeting, in the very first minutes, we basically said to each other: “You got it wrong!” Shouldn’t that have killed my consulting engagement, killed the business relationship?

ACT 4 – The customer isn’t king

Germans reject any relationship which even hints at a master-slave relationship. As suppliers, vendors, consultants – call them what you want – Germans want first and foremostly to be treated respectfully.

Seldom are they willing to sacrifice their self-respect, their self-understanding, doing whatever the customer demands, accepting anything the customer throws at them, even if it is profitable to do so. Germans would rather turn away the business. For them, the customer is not a king.

And here’s the flipside of that logic. The German customer doesn’t want a slave. They want an expert with backbone, who focuses on what is best for the customer, even if it involves telling the customer what she or he does not want to hear.

Even if doing that can threaten the business relationship. German customers don’t see themselves as king. They’re customers. “We have a need. You have the expertise. Let’s work together.”

And Germans especially respect people who have the ability to dig deep, to drill through the thickest boards, as one of their common figures of speech goes. They want to be challenged, their ideas and operating assumptions.

When a German hires someone – whether as an employee or an external service provider – they want that person to know more than they do. It’s implicit in the transaction that there is a gap to be filled, an area where they do not have the knowhow.

During my multi-year engagement for this customer I had witnessed on several occasions – and had heard of several other – how he treated folks who did not challenge him, who were not prepared, who kowtowed to him, who did not “stick to their guns.” It wasn’t a very pretty scene.

ACT 5 – We accepted each other

My client’s expertise, and his organization’s, was engineering. But they were a product of two companies which had been merged a few years before – one German, the other American.

My expertise was in explaining where Germans and Americans, who happen to be engineers, diverge in their fundamental thinking, where these divergences could cause them problems, and how to handle them.

So we went into battle with each other during that dinner on a warm American summer evening. My message was clear: A corporation’s culture is deeply imbedded in its national culture. Even if it has become global, it has its roots somewhere, in some country, in some national culture.

He listened, was intrigued, also had good arguments for his point of view. The debate became secondary, however. He had accepted me. And I him.

Back to Ten Stories.

Interviews – Process

If we are honest, we Germans think many times that the Americans have no real processes. If they do, we do not see them or understand them. Either they do not understand them or they do not follow them!”

Our German colleagues always talk as if the entire success of our technology and our company were dependent on processes. Sure they are important, but more crucial is whether they help us reach our goals.”

Act 1 – German colleague about American processes

The senior management wants us to harmonize our processes cross-Atlantic. We have been working on it already for one year. It is a really big problem. I think sometimes that we and our American colleagues talk about totally different things when we sit down to integrate these complex structures.

We have our thinking about how process should look. Based on this we have our Verfahrensanweisungen and Arbeitsanweisungen, sort of like processes and procedures. Anyways, those are the words they use in the U.S.

If we are honest, we Germans think many times that the Americans have no real processes. If they do, we do not see them or understand them. Yes, they do write down a lot of things and have many books with lots of detailed steps written down. But either they do not understand them or they do not follow them! Everything is very unsystematic. We call them long to-do lists or checklists.

If they do follow their own processes, they do it in a strange way. Often they jump over important steps, or they do steps out of order. No process discipline. What we really dislike is when they do not follow the set process, but at the same time do not tell us that they do this! We have no time to adjust what we do or to react.

Sometimes they hold themselves to their to-do lists very exactly, as if they were not competent enough to make their own decisions, other times they just go in another direction away from the process we agreed to. All very confusing.

I think sometimes, how are we to achieve good results when our work processes are so full of chaos? I think our process are very professional and scientific and that we should use them. Our US-colleagues do not want to see it this way, however.

They are very good, but a bit stubborn. We will harmonize our processes. It will take more time and many will be angry a lot. But they will see at some time that their processes should be adapted to ours. Then all will be ok.“

Act 2 – American colleague about German processes

Our German colleagues takes their processes a bit too seriously. They always want to talk about our processes, as if the entire success of our technology and our company were dependent on processes. Sure they are important, but more crucial is whether they help us reach our goals.

I mean, processes are nothing more than tools. If they work, great. If not, either modify or get rid of them. Heck, we have processes that frankly noone really pays attention to. Often they are outdated or things change so rapidly that we have to react quickly.

Their German processes are so complicated. It’s as if they want to connect everything that exists into one big system. If you take a look at some of their graphs you’ll see this thinking. They’re true works of art! It can take an hour to figure them out, following all of the solid and dotted lines, the arrows, colors and numbers. Great to be systematic in thinking. Key, however, is to break the complexity down so that you can move forward.

What none of us has quite figured out is when our German colleagues stick to a process and when they deviate. Sometimes when it is clear to us that we have to stick literally to a certain process or procedure one of our German colleagues goes off and interprets it they way he feels.

And the other way around, too. I mean, there are steps in some processes where it is clear, you have to interpret, or even in somes cases simply skip over. That’s when an exasperated German colleague comes along and demands that we stick to the process.

Oh, and by the way, never assume that your German colleagues have documented their processes. When we asked to see their documentation, they said that they didn’t have it. At first we didn’t believe them. Then we realized that they were telling the truth. Nothing, or very little, was documented!

And to top it off, they did all they could to avoid having to write down how they work. Very strange. Once you do get your hands on their documentation be prepared for a surprise. They are short, totally general and the procedures sometimes aren’t there! We all swore that they were hiding again.

Anyway, we’ve lost a lot of time in our team, and I suspect in the company, fighting over processes. Now we’re supposed to integrate them, but that will be a long hard ordeal. Nobody on this side of the Atlantic is thrilled with the prospect of using the German processes. We all think we should use ours. They can use theirs.

Back to Ten Stories.

What a shame – Agreements

Steven works in Atlanta. Anna in Stuttgart. Steven’s needs data from the most important projects company-wide. Anna had worked on one of those projects. Steven reaches out to Anna, who wants to help. But they fail to agree on how to collaborate. All lose: Steven, Anna, the company. It was avoidable.

ACT 1 – “Rude and impatient”

Steven works in Atlanta. Anna in Stuttgart. They’re colleagues in engineering. Steven has a new task: FastTrack, a high-profile development project.

He needs to gather valuable data from the most important recent projects company-wide. As soon as possible. Anna had worked on one of those projects. Steven and Anna know of each other, but not very well.

Steven sends Anna an email in telegraph style and ends it with a request: „Please send any and all analysis and data which could be relevant for FastTrack.

Anna reads the email, but isn’t sure what to do with it. It is very brief, has almost no background information, and is kind of rude. She decides not to react, thinking: if Steven is serious, he’ll write again with more information.

Steven follows up by email the next day. Anna responds that she received the first email, is busy, will get to it next week.

Steven is annoyed. He calls Anna’s by phone and leaves a message. The next day Anna listens the voicemail, but ignores it, thinking: He’ll just have to be patient.

In the meantime, Steven’s team lead – Craig Smith – asks him about his progress. Steven is beginning to get nervous. But, he waits one full day, then calls Anna again.

One of her colleagues takes his message. Anna returns to her desk, reads that Steven has called, wonders why this guy is so pushy. She responds by email, restating that she’ll get to it next week. When Anna’s email pops up on his computer screen, Steven grabs his phone immediately and calls her.

ACT 2 – The First Phone Call

Anna picks up. They do the usual smalltalk. Steven mentions Craig Smith, his boss, and Mary Miller, senior vice-president for innovation, then asks for Anna’s help.

Anna responds that she is very busy, will get to it at end of next week, and asks for background information. Steven wants to explain FastTrack to her on the phone. Anna interrupts him: “Send me the project charter.” Steven replies: “I can email the info but it is incomplete. Anna, I’m under time pressure.”

Anna tells him to send her what he has, she will read it, and then get back to him. She thought: “He needs to do his homework before he can expect me to do the work for him.”

The next morning he sends over bits and pieces of information about FastTrack. That afternoon Steven bumps into Mary Miller, who asks how things are going on FastTrack. He hints at German slowness. She offers her support if he needs it.

ACT 3 – Annoyed but Interested

The following week, Wednesday evening late, Anna has time to get to Steven’s email. She recognizes immediately that the information was thrown together hastily. It takes her an hour just to put the material into some kind of logical order, thinking to herself: Can you believe this?

Anna emails Steven: “Too much information. Send the project charter. And please state simply what you need.” Steven reads and thinks: “She doesn’t know what to send over to me? That’s why I sent her the background information!”

He writes back: “Because we don’t know about your project from last year, Anna, it is difficult for me to know what results you produced. Hoping you would figure that out. Can we discuss tomorrow by phone?

Anna reads Steven’s email during lunch and realizes that he will continue following up until he gets what he needs. And FastTrack does sound interesting. She wants to be helpful, so she decides to schedule a phone call with Steven.

ACT 4 – The Second Phone Call

The second phone call actually goes quite well. Steven explains FastTrack. Anna: Ok, now I understand what it’s about. Give me a week or so.”

Steven thanks her, but tries to schedule a third phone call. He wants to keep her focused. Anna is reluctant: Let’˜s first see how far I get”, thinking again how impatient he is.

Steven tries to nail her down: Good. Friday at 2 pm your time? Anna: I’ll send you an email on Thursday. Please be a bit more patient. Steven mentions again the time pressure, and hints at his conversations with Craig Smith and with Mary Miller. He wants Anna to recognize the urgency of the situation.

ACT 5 – Anna keeps her word. But, Steven gets even more nervous.

Anna kept her word. She re-read many of the documents from the project she had worked on. Talked to her colleagues. And she wants to go deeper in order to send valuable information.

Anna emails Steven: “Gotten my head back into the project. We have really good data for FastTrack. I want to put more time into it. Will get back to you next week.”

Steven was in a staff meeting with his boss, Craig Smith. He reads the email on his smartphone, holding it under the table. Oh no, Anna needs another week. This is insanely slow!

Smith then asks Steven about the status on his work. Steven takes a deep breath: “Good progress on U.S. side. Slower on the German side. I’m pushing, but have to be careful not to lose their cooperation. Smith: Ok. Stay persistent. If you need help, I can go up chain of command.”

Steven fires a response back to Anna: Great. Thanks. Can we discuss now?

Anna responds: No time. Husband and I sitting down for dinner. Please wait til next week. It will be worth it. I’m uncovering valuable material.

Steven, getting very nervous, writes: “Pressure increasing here. Need to talk tomorrow as planned. I call you. Anna: Tomorrow won’t work. How about on Tuesday?” Steven: I’m out of office Monday til Wednesday. Please, can we talk over the weekend?

For Anna this was simply too persistent of Steven: “Why can’t he just calm down and trust that I will get the job done. Does he want quality results or just some data thrown over the wall?”

Anna writes back: Be a bit more patient. As a good German, I like to perform my tasks properly. And by the way, I try to spend my weekends with my husband and our children.”

Steven thought: Good German? Slow German. Over-analytical German. Bureaucratic German.

ACT 6 – An Email 

Steven decides to speak with his boss: I may need your help. The German side is dragging its tail. Craig Smith: Should I make a phone call or send an email?”

Steven gave it some thought, then got the email address of Dr. Klaus Habermas, who is Craig Smith’s counterpart in Germany at the same management level.

He formulated an email from Smith to Habermas asking for better cooperation.

Habermas reads the email. He has worked with Americans, and sensed what was happening. Americans like to escalate up the hierarchy in order to apply pressure.

Habermas was annoyed, but forwarded the email to several people, including to Anna. She immediately suspected Steven. She was not the least bit amused, to put it mildly.

Anna decided to send an email to her boss, who reported directly to Habermas: You know how impatient the Americans can be. They’ll get solid data from me. They just have to be patient.

ACT 7 – What a shame !

The communication between Steven and Anna went from bad to worse. On top of that, Anna’s manager asked her to help out another team which had run into unexpected technical problems. Suddenly she had even less time to help Steven.

In the end, Anna did send over valuable data to Steve. But it was neither comprehensive, nor in depth, nor did it include the kind of insightful analysis that Anna was well-known for. All that takes time.

From Anna’s perspective Steven was sloppy in his work. And his constant and impatient follow-up got on her nerves, signaling to her that he had little confidence in her abilities. And the Smith-email to Habermas was very poor form. Professionals simply don’t do those kinds of things.

From Steven’s point of view Anna could have at a minimum sent partial results so that he could show progress. She also could have asked about the level of detail he needed. And her response time was just terrible. Anna had no sense of urgency!

It was a missed opportunity. For both sides.

Anna had become very interested in FastTrack, and in helping. Steven would have gotten first-rate data and analysis. Anna lost out, too. Had she continued, she would have gained Steven, Craig Smith and Mary Miller as friends and allies within the company.

The FastTrack-project lost out, too. It all could have been avoided. What a shame !

Back to Ten Stories.

Up. Over. Down. – Conflict

USA. Joe in manufacturing is in conflict with Judy in supply management. Joe goes to his boss, Anne, explains the problem, requests that she speak with Rich, Judy’s boss. Anne gets Joe’s side of the story. Rich gets Judy’s.

The two managers then work out a compromise. They call in Joe and Judy to discuss. The conflict parties like the compromise, tweak it, accept it. The deal is done. They both get back to work. Up, over and down.

But wait. What happens if they’re working cross-Atlantic?

Joe is Joe. Anne is Anne. Both in Houston. But, Judy is Ingrid. And Rich is Manfred. Both in Dortmund. How does up, over and down play out?

Scenario 1 – Up Over Down works

American business context. Joe in manufacturing is in conflict with Judy in supply management. Perhaps they made an attempt to resolve their differences. Perhaps not. Either way, the conflict for Joe is serious. He’s way behind schedule.

Joe could go directly to Judy’s boss, Rich. They’ve always worked well together. He declines, however, to go this route. Instead, he goes to his boss, Anne, explaining the problem and requesting that she speak with Rich.

Anne and Rich know each other well from past projects. Their children attend the same high school. Anne gets Joe’s side of the story. Rich gets Judy’s.

The two managers then work out a compromise quickly, after which they call in Joe and Judy to discuss. The two conflict parties listen carefully. They like the compromise, tweak it a bit, accept it. The deal is done. They both get back to work.

Joe in conflict with Judy. Joe up to Anne. Anne over to Rich. Rich down to Judy. Anne back down to Joe. Up, over and down. Another day, another conflict resolved. In an American company.

Scenario 2 – Up Over Down doesn’t work

But wait. A second scenario. What happens if they’re working cross-Atlantic? Joe is Joe. Anne is Anne. Both are in Houston. But, Judy is Ingrid. And Rich is Manfred. Both work in Dortmund. How does up, over and down play out?

Joe has little patience with Ingrid. Joe escalates up to Anne. Anne reaches out to Manfred.

Stop! How does Manfred react? Does he engage with Anne? Does he call in Ingrid? Does he allow Anne to speak directly with Ingrid? Would he speak directly with Joe?

What if Anne corresponds with Manfred by email, putting both Joe and Ingrid in cc:?

The Cost of Cultural Misunderstanding

Up, over and down is about just one fundamental difference in how conflict is resolved in the American and in the German business contexts. Stated simply: Americans escalate conflict rather quickly. The next management level gets directly involved. In Germany it is the opposite.

If you work in the USA-Germany business space, this little story should ring a bell. It will be familiar to you. You most likely will have experienced or observed some version of it in your work.

And this difference – escalation – is just one fundamental difference. There are more: How the two business cultures handle a hearing of the conflict parties; which types of evidence are considered; how quickly they attempt to resolve conflict; and finally what is necessary so that the resolution is accepted by both parties, and therefore lasting.

Resolving conflicts within and between organizations is absolutely critical to success. If there are fundamental differences between business cultures, and these are neither known nor understood, overall success is threatened.

Let’s try to estimate that threat to success. Let’s put some numbers on it.

Conflict not resolved
You know your organization. Think of a recent major conflict either within the organization or between it and another organization. Or imagine such a conflict. What would be the negative finanical impact – in dollars or in euros – if the conflict goes unresolved?

Resolution Rejected
Another calculation. What would occur if a resolution to the major conflict above was considered by the one side to be unjust, unworkable, or simply bad for the company? Surely they would do everything in their power to have the resolution overturned, to fight it secretly, or to ignore it.

What would any of those scenarios cost the organization?

Productivity
Let’s assume again that the one side considers the resolution to be unjust, unworkable, or simply bad for the company. But they are forced to live with it, and it impacts negatively motivation, productivity, and the willingness to collaborate across the Atlantic.

What would a 5% loss in productivity cost the organization – in dollars or in euros?

Back to Ten Stories.

Hans in Chicago – Communication

2008. Hans is German. Competent, respected, liked. A seventy-five American engineers were added to his team. He wants to introduce himself to the organization, especially to three new American direct reports. Hans flies over to Chicago. The four meet for dinner. It starts off fine. Until Hans brings up topics which for the Americans are controversial.

ACT 1 – Hans and 75 American Engineers

Hans is German, a senior-level manager, in a major, global German company. He is an excellent manager, very experienced, and a first-rate engineer. About 50 years old, Hans is married, and has two children. He is respected and liked. Hans is a good guy, a solid guy.

Hans and the U.S. have a long relationship. His father did business in the U.S. The family went on vacations to Florida and to California. As a engineering student, Hans even took a course on American History.

When he married, he and his wife took a vacation to the U.S., and they’ve been there with their children. And, of course, his work has taken him to the U.S. time and again over the last fifteen years.

But for Hans it was always something fresh and fascinating to visit the United States. Always eager to learn something new, to get to know the people, to introduce himself, Germany and Germans to the Americans.

Hans takes the German-American relationship very seriously. He knows how critical it is for both countries politically and economically. Hans’ company did a major reorganization. Two hundred American engineers were added to his team.

Hans has managed Americans before, but not that many. He decided to hop on a plane over to Chicago to spend a week with his new colleagues. Especially important was meeting his three new American direct reports.

They would meet several times over four days. There was a lot to discuss and to clarify. The reorganization of the business unit meant all sorts of changes in its structure, in key work processes, and internal hand-offs of work results.

ACT 2 – Burgers and Beers

Hans flew over to Chicago on a Saturday. The weather was beautiful. It was early autumn. He checked into his hotel. Then went for a long walking tour of downtown Chicago. Hans took it all in with wonder. Looking for any and every opportunity to speak with the locals about life in one of the world’s great cities.

Hans had suggested meeting his new American direct reports for burgers and beers: Maria, Jack and Nancy. He wanted it to be informal, relaxed, personal. And not stiff and formal.

They met at a popular restaurant located halfway between the office and Hans’ hotel. Hans had gone there Saturday and Sunday for lunch and liked it. Evelyn joined them. She’s German, one of Hans’ direct reports on delegation to the U.S.

It was a Tuesday evening. The place was packed with young professionals. The five colleagues got a booth on the street side with a nice view. The booth was a bit small. They sat closely together. Certainly one way to get to know each other.

ACT 3 – Obama or McCain

The dinner started off just fine. The food was good. The atmosphere started out very positive. Then Hans asked his American colleagues who they favored, Barack Obama or John McCain. It was October 2008, just weeks before the presidential election.

Maria, a Democrat, was a native of the Chicago area. For her it was clear that the junior senator from Illinois would win the election. Jack said he liked Democrats and their basic political direction, but was worried about their economic policies, and about Obama’s lack of experience.

Nancy was reluctant to engage in a discussion about politics. But in a few words it was pretty clear that she was a loyal Republican. Evelyn played fly on the wall, just listening.

Hans couldn’t wait to get into the discussion. He had followed American politics ever since he was in high school in Germany. He was familiar with the two parties, their political platforms. He knew about their candidates for president going back at least four elections.

But not just politics. Born and raised in Germany, America had been ever-present in his life: politically, culturally, economically. From his perspective, how could any well-educated German not be interested in the U.S., in Americans, in what and how they think!

ACT 4 – Hans probed further

Hans probed further: “Well, I think Obama is really great. He is so smart, a real intellectual, not like George W. Bush. I mean, Bush could hardly formulate intelligent sentences.”

Nancy cringed, but tried not to show it. Maria was in full agreement, but smiled discreetly. Jack, no fan of Bush, responded: “Well, maybe Bush wasn’t an intellectual by European standards, but he did graduate from Yale, then got his MBA from Harvard.”

Which led Hans to say: “Yes, of course. But he was a Yale legacy. His father and grandfather had gone to Yale. So he got accepted. And fellow students said he was a weak academically.”

Hans was proud to show how well informed he was. And he was: “And wouldn’t it be great to have an African-American president?” His eyes were wide open and all lit up. “Think about it. Not long after two hundred years of slavery, to have a black man in the White House. Awesome!”

Nancy began to focus in on Hans. Maria, with her Latin American background, liked what Hans had to say, even if he was a bit too direct. Jack, too, was proud that America truly did offer opportunity to all, saying: “Yeah, sure. But in the end the key is what he and the Democrats will actually do if they win the election.”

Evelyn then asked if the Americans had seen news reports about Obama’s speech in Berlin in front of over two hundred thousand people: “It was unbelievable. Not since John F. Kennedy’s speech in the August 1963 was there so much excitement! Bush did not go over so well with us Europeans.”

Hans corrected her: “Not with us Germans. He was too unilateral. Ignored the International Court in the Hague. Went to war in Afghanistan and Iraq without any real consultation with us. He was a real cowboy. Shoot first, then ask questions. How could the majority of Americans vote for him? And twice!”

ACT 5 – “Oh, no!”

“Oh, no!” thought even Maria. Hans is going in the wrong direction here. Jack quickly pulled out the dessert menu and waived for a waiter, hoping to change the subject of the conversation. Nancy was furious. All three Americans had had some degree of experience with, well, rather opinionated Germans.

“Don’t you Americans worry that those two wars are going bad, that they might be lost, like Vietnam?”, Hans asked concerned.

Nancy did not agree in the least. But again, she was very careful not to state her opinion. She reported directly to Hans, was new in the organization, and not familiar with the German side of the company. And besides, she was not at all comfortable with mixing business and politics.

Hans looked at her as if asking for her point of view. Nancy replied discreetly and in a serious tone: “Well, it’s a complex situation. Too complex for me to know what is best.”

The conversation went on like this for another half an hour. Hans probed other topics: health care reform, high crime rates and gun control legislation, control of the U.S.-Mexican border, the influence of money in American elections.

Each time he sensed that his American colleagues were not in the mood for discussing politics. Maybe because it was a Tuesday and not a Friday or a weekend, he thought. Eventually, they moved on to lighter topics like sports, weather and Chicago.

For Hans it was an enjoyable dinner, even if they didn’t get into a good debate about topics of real substance. Evelyn found the interaction between Hans and the Americans rather amusing, making only a few comments here and there.

ACT 6 – From furious to outraged

And the Americans?

Maria started off amazed at how well-informed Hans was about the U.S. Jack was also impressed, but thought that Hans was a bit too enthusiastic. Especially as an outsider picking such sensitive topics about the U.S.

Nancy went from furious to outraged, but without showing it. She thought to herself: “Who was this guy? Comes over here and does nothing but point out our faults? What arrogance! He thinks he’s so smart, just because he reads newspaper and watches TV. Does he have any clue about the things that work well in our country?”

Nancy is an engineer. Her academic studies were very rigorous. She paid her way through college with loans and any job she could get. There was little time to take courses in American or European History.

But she did know the basics of U.S. foreign policy since the end of World War II. And for Nancy it was clear that her country had done good things in Europe, especially in Germany. She thought to herself: “With their history, doesn’t Hans have any sense of shame?” But she bit her tongue during the entire conversation, making only brief and neutral comments.

ACT 7 – What Hans did not know

That was Tuesday evening. The five colleagues met several more times during that week. What Hans did not know, however, was that many of the Americans in the organization asked Maria, Jack and Nancy how the dinner and the other meetings with Hans had gone.

All were curious about Hans, his background, how he thinks. He’s a Senior Vice President with a lot of authority. His influence at senior management levels is very significant. And he’s their boss.

The three Americans gave their impressions. At lunch, on the phone, between meetings, always discreetly. Never by email. The feedback was mixed, from somewhat positive to very negative:

Smart guy. Very open. Enthusiastic. Very opinionated. Always pointing out America’s problems. Critical. An arrogant know-it-all. A real jerk. Avoid any contact with him outside of the workplace!

For those Americans who had similar experiences, what Maria, Jack, and especially Nancy, had to say only reinforced their own negative opinions about Germans.

Word began to spread around the office about Hans. Some of the Americans ignored the gossip. Others became cautious around Hans, and now even around Evelyn. A few decided to do their best to stay clear of him.

ACT 8 – What the Americans did not know

When Hans and Evelyn met for lunch on Thursday, they, too, discussed their dinner Tuesday evening. Hans was clearly disappointed. He had hoped for some vigorous debate. Nancy seemed particularly disinterested and disengaged.

Like most Germans, he wanted to address topics of substance, and not waste time talking about the weather and sports. “I did my best to provoke some conversation, Evelyn, but just couldn’t get them engaged. Strange.”

Evelyn smiled and said: “Well, maybe they were reserved because you head up the organization.”

Hans: “Sure, I understand that. But what better way to get to know each other than to talk about real issues. Issues which are so important to all of us. I wanted them to see how interested and informed I am about America. I love this country. I want to know how they see things.”

Act 9 – What went wrong?

Smalltalk
In smalltalk situations Germans consciously choose topics which Americans consider to be controversial. In stark contrast, Americans choose topics which Germans consider to be superficial. Those two approaches could not be more different.

“Family”
America and Americans have been very present in the lives of Germans – especially West Germans – since 1945. U.S. foreign, security and economic policy has always had significant influence on Germany and the Germans. For these – and other reasons – Germans feel as if they were closely related to America and Americans, as if they were members of a wider American family.

Germany and Germans have had a minimal presence in the lives of Americans since 1945. Although Americans like and admire Germany and the Germans, they do not feel as if they are closely related to them, they do not regard Germans as members of a wider American family.

Leadership
German team leads want, expect, and invite their team members to challenge them. German team members want and will challenge their team leads.

American team leads allow their team members to challenge them, but only certain team members, under certain circumstances, and in certain ways.

Direct
Germans are direct in their communication. They believe that people should say what they mean, and mean what they say. That people should choose clear and unambiguous words. Germans believe in addressing the heart of the matter, regardless of how sensitive that matter might be.

Americans are more indirect in their communication. They believe that people should not always say what they mean, and not always mean what they say. Depending on the topic and the context, Americans do not choose clear and unambiguous words. They do not drive to the heart of the matter about sensitive topics.

Blind Spot
Both sets of approaches, both sets of logics, are legitimate, correct, and effective. But only in their native national cultural context. When applied in another national culture, they can lead to problems. Problems which are serious, painful and expensive.

Neither Hans and Evelyn on the German side, nor Maria, Jack and Nancy on the American side, were aware of these cultural differences.

Their lack of awareness was their blind spot. They were blind to the cultural differences. Both sides. Both cultures. Blind to the each other.

Act 10 – The Cost of Cultural Misunderstanding

If this and other differences in how the two cultures communicate are constantly at play when Germans and Americans collaborate, what influence or impact will the differences have:

Leadership
On the productivity of the working relationship within the leadership team: meaning between Hans and his German direct reports on the one side, and his three new American direct reports on the other side?

Productivity
On motivation, and therefore on productivity, within the American organization of two hundred engineers?

Collaboration
On overall cross-Atlantic collaboration within Hans’ organization: meaning between the American and the German engineering colleagues?

What is the cost impact on Hans’ bottom-line in dollars or euros?

Now consider how many similar situations there are within your company. What do those costs add up to?

Back to Ten Stories.