Ubiquitous internet connectivity, sophisticated transportation systems, multiculturally diverse communities, and workplaces all contribute to the world becoming smaller while at the same time more complicated to understand and navigate. Cross-cultural interactions, full of potential difficulties rooted in cultural differences, have increased beyond all expectations, bringing with them the need for organizations to develop the intercultural skills of their workforces. Here are seven reasons why you should contemplate increasing your investment in this core skill. 

1.  To futureproof your business

Research by Professor Scott E. Page and the University of Michigan has shown that multicultural teams significantly outperform teams of experts with a similar cultural background.

The Institute for the Future at the University of Phoenix has translated this, along with their own research into naming intercultural skills as number four in their top 10 skills that all workers will need by 2020.

Team intelligence and productivity comes from the diversity of perspectives, opinions, and backgrounds, but only when each member can communicate and collaborate effectively. 

Soft Skills Development

Building the critical skills needed to succeed in the modern workplace

2.  To safeguard your organization’s financial security 

The Economist Intelligence Unit rates cultural issues as a significant factor that increases the risk of international mergers and acquisitions. Communications misunderstandings can damage cross-border relationships and incur significant losses for businesses. 

They also say that, “…[e]ffective cross-border communication and collaboration are becoming critical to the financial success of companies with international aspirations.”

Companies that have not invested in intercultural skills may find that they lose out to their competitors.

3.  To win new clients, and retain existing ones

A survey by the British Council found that in-house talent teams considered the ability to work effectively across cultures was a key factor in retaining clients, through building effective relationships. It was also considered a significant advantage in winning new clients.

Conversely, 25% of failed negotiations could be partially attributed to a lack of intercultural skills.

4.  To minimize the risk of international assignments

Despite the growth of the interconnectedness of the world, international assignments still fail. Although the number of assignees who return home early appears to be reducing, the number of assignments that fail to meet expected productivity or performance levels remains high. 

Further reading

How Cross-Cultural Communication Skills Drive Workplace Success

In the 2015 Global Mobility survey by E&Y, reinforced by subsequent surveys by Santa Fe, failure rates are as high as 40%.

In separate research published in 2010, intercultural training was shown to reduce the failure rate to below 10%.

5.  Globalization has increased the importance of national/regional identity

In an age when international travel is common and communication with anyone in any country of the world is instantaneous, many predicted that national identity would blend into the background.

In reality, we have seen a reaction: globally national identity is becoming more prominent. We have experienced in the past three or four years a move to the right in global politics, most recently evidenced in Brazil. 

As national and local identity assert themselves, cultural differences become more accentuated. Cultural sensitivity and strong intercultural skills are now needed more than ever. 

We have experienced in the past three or four years a move to the right in global politics, most recently evidenced in Brazil. 

6.  Global markets are changing

Globalization has brought with it instability. The markets are in constant flux and organizations that are unable to react quickly are at risk of losing out. The BRIC countries that even five years ago were being promoted as the key growth targets have all stagnated, and new markets appear.

Organizations need to have the agility to respond immediately to new market opportunities: that means that organizations with high levels of intercultural skills already are prepared to act as the opportunity presents itself. Those who delay will miss out.

Soft Skills Development

Building the critical skills needed to succeed in the modern workplace

7.  Intercultural skills impact every part of the work of every employee

Migration and international communication mean that monocultural teams have vanished.

All of our interactions and business transactions take place in a melting pot of cultures, backgrounds, languages and lifestyles.

If we have to influence, lead, communicate, meet with, critique, brainstorm with anyone, there is a significant chance that you will be engaging in an intercultural encounter.

Intercultural skills equip individuals to thrive in this environment and to add value to their organization. In the search for greater efficiencies, intercultural skills may well be the key to a competitive advantage.

Adapt or pay the price 

Anyone hoping to compete in a global marketplace must develop their intercultural skills to remain competitive. If you want to safeguard your business, attract new clients and make your international assignments a success then investing in intercultural communication training is a must. Developing a workforce of interculturally competent employees is vital for organizations that recognize that their future is global.