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Cultural Intelligence

by P. Christopher Earley and Elaine Mosakowski

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Knowing what makes groups

tick is as important as

understanding individuals.

Successful managers learn to

cope with different national,

corporate, and vocational

cultures.

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Cultural Intelligence

by P. Christopher Earley and Elaine Mosakowski

harvard business review • october 2004 page 1

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Knowing what makes groups tick is as important as understanding

individuals. Successful managers learn to cope with different national,

corporate, and vocational cultures.

You see them at international airports like
Heathrow: posters advertising the global bank
HSBC that show a grasshopper and the mes-
sage “USA—Pest. China—Pet. Northern Thai-
land—Appetizer.”

Taxonomists pinned down the scientific def-
inition of the family Acrididae more than two
centuries ago. But culture is so powerful it can
affect how even a lowly insect is perceived. So
it should come as no surprise that the human
actions, gestures, and speech patterns a person
encounters in a foreign business setting are
subject to an even wider range of interpreta-
tions, including ones that can make misunder-
standings likely and cooperation impossible.
But occasionally an outsider has a seemingly
natural ability to interpret someone’s unfamil-
iar and ambiguous gestures in just the way
that person’s compatriots and colleagues
would, even to mirror them. We call that

cul-
tural intelligence

or

CQ

. In a world where cross-
ing boundaries is routine, CQ becomes a vitally
important aptitude and skill, and not just for
international bankers and borrowers.

Companies, too, have cultures, often very
distinctive; anyone who joins a new company
spends the first few weeks deciphering its cul-
tural code. Within any large company there are
sparring subcultures as well: The sales force
can’t talk to the engineers, and the PR people
lose patience with the lawyers. Departments,
divisions, professions, geographical regions—
each has a constellation of manners, meanings,
histories, and values that will confuse the inter-
loper and cause him or her to stumble. Unless,
that is, he or she has a high CQ.

Cultural intelligence is related to emotional
intelligence, but it picks up where emotional
intelligence leaves off. A person with high
emotional intelligence grasps what makes us
human and at the same time what makes each
of us different from one another. A person
with high cultural intelligence can somehow
tease out of a person’s or group’s behavior
those features that would be true of all people
and all groups, those peculiar to this person or
this group, and those that are neither universal
nor idiosyncratic. The vast realm that lies be-

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harvard business review • october 2004 page 2

P. Christopher Earley

is a professor
and the chair of the department of or-
ganizational behavior at London Busi-
ness School.

Elaine Mosakowski

is a
professor of management at the Uni-
versity of Colorado at Boulder.

tween those two poles is culture.
An American expatriate manager we know

had his cultural intelligence tested while serv-
ing on a design team that included two Ger-
man engineers. As other team members floated
their ideas, the engineers condemned them re-
peatedly as stunted or immature or worse. The
manager concluded that Germans in general
are rude and aggressive.

A modicum of cultural intelligence would
have helped the American realize he was mis-
takenly equating the merit of an idea with the
merit of the person presenting it and that the
Germans were able to make a sharp distinc-
tion between the two. A manager with even
subtler powers of discernment might have
tried to determine how much of the two Ger-
mans’ behavior was arguably German and
how much was explained by the fact that they
were engineers.

An expatriate manager who was merely
emotionally intelligent would probably have
empathized with the team members whose
ideas were being criticized, modulated his or
her spontaneous reaction to the engineers’
conduct, and proposed a new style of discus-
sion that preserved candor but spared feelings,
if indeed anyone’s feelings had been hurt. But
without being able to tell how much of the en-
gineers’ behavior was idiosyncratic and how
much was culturally determined, he or she
would not have known how to influence their
actions or how easy it would be to do that.

One critical element that cultural intelli-
gence and emotional intelligence do share is,
in psychologist Daniel Goleman’s words, “a
propensity to suspend judgment—to think be-
fore acting.” For someone richly endowed with
CQ, the suspension might take hours or days,
while someone with low CQ might have to
take weeks or months. In either case, it in-
volves using your senses to register all the ways
that the personalities interacting in front of
you are different from those in your home cul-
ture yet similar to one another. Only when
conduct you have actually observed begins to
settle into patterns can you safely begin to an-
ticipate how these people will react in the next
situation. The inferences you draw in this man-
ner will be free of the hazards of stereotyping.

The people who are socially the most suc-
cessful among their peers often have the great-
est difficulty making sense of, and then being
accepted by, cultural strangers. Those who

fully embody the habits and norms of their na-
tive culture may be the most alien when they
enter a culture not their own. Sometimes, peo-
ple who are somewhat detached from their
own culture can more easily adopt the mores
and even the body language of an unfamiliar
host. They’re used to being observers and mak-
ing a conscious effort to fit in.

Although some aspects of cultural intelli-
gence are innate, anyone reasonably alert, mo-
tivated, and poised can attain an acceptable
level of cultural intelligence, as we have
learned from surveying 2,000 managers in 60
countries and training many others. Given the
number of cross-functional assignments, job
transfers, new employers, and distant postings
most corporate managers are likely to experi-
ence in the course of a career, low CQ can turn
out to be an inherent disadvantage.

The Three Sources of Cultural
Intelligence

Can it really be that some managers are so-
cially intelligent in their own settings but inef-
fective in culturally novel ones? The experi-
ence of Peter, a sales manager at a California
medical devices group acquired by Eli Lilly
Pharmaceuticals, is not unusual. At the de-
vices company, the atmosphere had been mer-
cenary and competitive; the best-performing
employees could make as much in perfor-
mance bonuses as in salary. Senior managers
hounded unproductive salespeople to per-
form better.

At Lilly’s Indianapolis headquarters, to
which Peter was transferred, the sales staff re-
ceived bonuses that accounted for only a small
percentage of total compensation. Further-
more, criticism was restrained and confronta-
tion kept to a minimum. To motivate people,
Lilly management encouraged them. Peter
commented, “Back in L.A., I knew how to han-
dle myself and how to manage my sales team.
I’d push them and confront them if they
weren’t performing, and they’d respond. If you
look at my evaluations, you’ll see that I was
very successful and people respected me. Here
in Indianapolis, they don’t like my style, and
they seem to avoid the challenges that I put to
them. I just can’t seem to get things done as
well here as I did in California.”

Peter’s problem was threefold. First, he
didn’t comprehend how much the landscape
had changed. Second, he was unable to make

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harvard business review • october 2004 page 3

his behavior consistent with that of everyone
around him. And third, when he recognized
that the arrangement wasn’t working, he be-
came disheartened.

Peter’s three difficulties correspond to the
three components of cultural intelligence: the
cognitive; the physical; and the emotional/
motivational. Cultural intelligence resides in
the body and the heart, as well as the head. Al-
though most managers are not equally strong
in all three areas, each faculty is seriously ham-
pered without the other two.

Head.

Rote learning about the beliefs, cus-
toms, and taboos of foreign cultures, the ap-
proach corporate training programs tend to fa-
vor, will never prepare a person for every
situation that arises, nor will it prevent terrible
gaffes. However, inquiring about the meaning
of some custom will often prove unavailing be-
cause natives may be reticent about explain-
ing themselves to strangers, or they may have
little practice looking at their own culture an-
alytically.

Instead, a newcomer needs to devise what
we call learning strategies. Although most peo-
ple find it difficult to discover a point of entry
into alien cultures, whose very coherence can
make them seem like separate, parallel worlds,
an individual with high cognitive CQ notices
clues to a culture’s shared understandings.
These can appear in any form and any context
but somehow indicate a line of interpretation
worth pursuing.

An Irish manager at an international adver-
tising firm was working with a new client, a
German construction and engineering com-
pany. Devin’s experience with executives in the
German retail clothing industry was that they
were reasonably flexible about deadlines and
receptive to highly imaginative proposals for
an advertising campaign. He had also worked
with executives of a British construction and
engineering company, whom he found to be
strict about deadlines and intent on a media
campaign that stressed the firm’s technical ex-
pertise and the cost savings it offered.

Devin was unsure how to proceed. Should
he assume that the German construction com-
pany would take after the German clothing re-
tailer or, instead, the British construction com-
pany? He resolved to observe the new client’s
representative closely and draw general con-
clusions about the firm and its culture from his
behavior, just as he had done in the other two

cases. Unfortunately, the client sent a new rep-
resentative to every meeting. Many came from
different business units and had grown up in
different countries. Instead of equating the
first representative’s behavior with the client’s
corporate culture, Devin looked for consisten-
cies in the various individuals’ traits. Eventu-
ally he determined that they were all punctual,
deadline-oriented, and tolerant of unconven-
tional advertising messages. From that, he was
able to infer much about the character of their
employer.

Body.

You will not disarm your foreign
hosts, guests, or colleagues simply by showing
you understand their culture; your actions and
demeanor must prove that you have already
to some extent entered their world. Whether
it’s the way you shake hands or a coffee,
evidence of an ability to mirror the customs
and gestures of the people around you will
prove that you esteem them well enough to
want to be like them. By adopting people’s
habits and mannerisms, you eventually come
to understand in the most elemental way what
it is like to be them. They, in turn, become
more trusting and open. University of Michi-
gan professor Jeffrey Sanchez-Burks’s research
on cultural barriers in business found that job
candidates who adopted some of the manner-
isms of recruiters with cultural backgrounds
different from their own were more likely to
be made an offer.

This won’t happen if a person suffers from a
deep-seated reservation about the called-for
behavior or lacks the physical poise to pull it
off. Henri, a French manager at Aegis, a media
corporation, followed the national custom of
greeting his female clients with a hug and a
kiss on both cheeks. Although Melanie, a Brit-
ish aerospace manager, understood that in
France such familiarity was de rigueur in a pro-
fessional setting, she couldn’t suppress her dis-
comfort when it happened to her, and she re-
coiled. Inability to receive and reciprocate
gestures that are culturally characteristic re-
flects a low level of cultural intelligence’s physi-
cal component.

In another instance, a Hispanic commu-
nity leader in Los Angeles and an Anglo-
American businessman fell into conversation
at a charity event. As the former moved
closer, the latter backed away. It took nearly
30 minutes of waltzing around the room for
the community leader to realize that “Ang-

Cultural intelligence:

an outsider’s seemingly

natural ability to

interpret someone’s

unfamiliar and

ambiguous gestures the

way that person’s

compatriots would.

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harvard business review • october 2004 page 4

los” were not comfortable standing in such
close physical proximity.

Heart.

Adapting to a new culture involves
overcoming obstacles and setbacks. People
can do that only if they believe in their own
efficacy. If they persevered in the face of chal-
lenging situations in the past, their confidence
grew. Confidence is always rooted in mastery
of a particular task or set of circumstances.

A person who doesn’t believe herself capa-
ble of understanding people from unfamiliar
cultures will often give up after her efforts
meet with hostility or incomprehension. By
contrast, a person with high motivation will,
upon confronting obstacles, setbacks, or even
failure, reengage with greater vigor. To stay
motivated, highly efficacious people do not de-
pend on obtaining rewards, which may be un-
conventional or long delayed.

Hyong Moon had experience leading ra-
cially mixed teams of designers at GM, but
when he headed up a product design and de-
velopment team that included representatives
from the sales, production, marketing, R&D,
engineering, and finance departments, things
did not go smoothly. The sales manager, for ex-
ample, objected to the safety engineer’s at-
tempt to add features such as side-impact air
bags because they would boost the car’s price
excessively. The conflict became so intense and
so public that a senior manager had to inter-
vene. Although many managers would have
felt chastened after that, Moon struggled even
harder to gain control, which he eventually did
by convincing the sales manager that the air
bags could make the car more marketable. Al-
though he had no experience with cross-func-
tional teams, his successes with single-function
teams had given him the confidence to perse-
vere. He commented, “I’d seen these types of
disagreements in other teams, and I’d been
able to help team members overcome their dif-
ferences, so I knew I could do it again.”

How Head, Body, and Heart Work
Together

At the end of 1997, U.S.-based Merrill Lynch
acquired UK-based Mercury Asset Manage-
ment. At the time of the merger, Mercury was
a decorous, understated, hierarchical com-
pany known for doing business in the manner
of an earlier generation. Merrill, by contrast,
was informal, fast-paced, aggressive, and en-
trepreneurial. Both companies had employees

Diagnosing Your Cultural Intelligence

These statements reflect different facets of cultural intelligence. For each set,
add up your scores and divide by four to produce an average. Our work with
large groups of managers shows that for purposes of your own development,
it is most useful to think about your three scores in comparison to one another.
Generally, an average of less than 3 would indicate an area calling for improve-
ment, while an average of greater than 4.5 reflects a true CQ strength.

Rate the extent to which you agree with each statement, using the scale:
1 = strongly disagree, 2 = disagree, 3 = neutral, 4 = agree, 5 = strongly agree.

Before I interact with people from a new culture, I ask
myself what I hope to achieve.

If I encounter something unexpected while working in a
new culture, I use this experience to figure out new ways
to approach other cultures in the future.

I plan how I’m going to relate to people from a different
culture before I meet them.

When I come into a new cultural situation, I can
immediately sense whether something is going well
or something is wrong.

It’s easy for me to change my body language (for
example, eye contact or posture) to suit people from
a different culture.

I can alter my expression when a cultural encounter
requires it.

I modify my speech style (for example, accent or tone)
to suit people from a different culture.

I easily change the way I act when a cross-cultural
encounter seems to require it.

I have confidence that I can deal well with people from
a different culture.

I am certain that I can befriend people whose cultural
backgrounds are different from mine.

I can adapt to the lifestyle of a different culture with
relative ease.

I am confident that I can deal with a cultural situation
that’s unfamiliar.

+

Total ÷ 4 = Emotional/
motivational CQ

Cognitive CQ

Physical CQ

+

+

Total ÷ 4 =

Total ÷ 4 =

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harvard business review • october 2004 page 5

of many nationalities. Visiting Mercury about
six months after the merger announcement,
we were greeted by Chris, a Mercury person-
nel manager dressed in khakis and a knit shirt.
Surprised by the deviation from his usual uni-
form of gray or navy pinstripes, we asked him
what had happened. He told us that Merrill
had instituted casual Fridays in its own offices
and then extended the policy on a volunteer
basis to its UK sites.

Chris understood the policy as Merrill’s at-
tempt to reduce hierarchical distinctions both
within and between the companies. The inten-
tion, he thought, was to draw the two enter-
prises closer together. Chris also identified a
liking for casual dress as probably an American
cultural trait.

Not all Mercury managers were receptive
to the change, however. Some went along
with casual Fridays for a few weeks, then gave
up. Others never doffed their more formal at-
tire, viewing the new policy as a victory of
carelessness over prudence and an attempt by
Merrill to impose its identity on Mercury,
whose professional dignity would suffer as a
result. In short, the Mercury resisters did not
understand the impulse behind the change
(head); they could not bring themselves to
alter their appearance (body); and they had
been in the Mercury environment for so long
that they lacked the motivation (heart) to see
the experiment through. To put it even more
simply, they dreaded being mistaken for Mer-
rill executives.

How would you behave in a similar situa-
tion? The exhibit “Diagnosing Your Cultural In-
telligence” allows you to assess the three facets
of your own cultural intelligence and learn
where your relative strengths and weaknesses
lie. Attaining a high absolute score is not the
objective.

Cultural Intelligence Profiles

Most managers fit at least one of the following
six profiles. By answering the questions in the
exhibit, you can decide which one describes
you best.

The provincial

can be quite effective when
working with people of similar background
but runs into trouble when venturing farther
afield. A young engineer at Chevrolet’s truck
division received positive evaluations of his
technical abilities as well as his interpersonal
skills. Soon he was asked to lead a team at Sat-

urn, an autonomous division of GM. He was
not able to adjust to Saturn’s highly participa-
tive approach to teamwork—he mistakenly as-
sumed it would be as ly and deferential as
Chevy’s. Eventually, he was sent back to
Chevy’s truck division.

The analyst

methodically deciphers a for-
eign culture’s rules and expectations by resort-
ing to a variety of elaborate learning strategies.
The most common form of analyst realizes
pretty quickly he is in alien territory but then
ascertains, usually in stages, the nature of the
patterns at work and how he should interact
with them. Deirdre, for example, works as a
broadcast director for a London-based com-
pany. Her principal responsibility is negotiat-
ing contracts with broadcast media owners. In
June 2002, her company decided that all units
should adopt a single negotiating strategy, and
it was Deirdre’s job to make sure this hap-
pened. Instead of forcing a showdown with the
managers who resisted, she held one-on-one
meetings in which she probed their reasons for
resisting, got them together to share ideas, and
revised the negotiating strategy to incorporate
approaches they had found successful. The re-
vised strategy was more culturally flexible than
the original proposal—and the managers
chose to cooperate.

The natural

relies entirely on his intuition
rather than on a systematic learning style. He
is rarely steered wrong by first impressions.
Donald, a brand manager for Unilever, com-
mented, “As part of my job, I need to judge
people from a wide variety of cultural back-
grounds and understand their needs quickly.
When I come into a new situation, I watch ev-
eryone for a few minutes and then I get a gen-
eral sense of what is going on and how I need
to act. I’m not really sure how I do it, but it
seems to work.” When facing ambiguous multi-
cultural situations that he must take control of,
the natural may falter because he has never
had to improvise learning strategies or cope
with feelings of disorientation.

The ambassador

, like many political appoin-
tees, may not know much about the culture he
has just entered, but he convincingly commu-
nicates his certainty that he belongs there.
Among the managers of multinational compa-
nies we have studied, the ambassador is the
most common type. His confidence is a very
powerful component of his cultural intelli-
gence. Some of it may be derived from watch-

People who are

somewhat detached from

their own culture can

more easily adopt the

mores and even the body

language of an

unfamiliar host.

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harvard business review • october 2004 page 6

ing how other managers have succeeded in
comparable situations. The ambassador must
have the humility to know what he doesn’t
know—that is, to know how to avoid underes-
timating cultural differences, even though
doing so will inflict a degree of discomfort.

The mimic

has a high degree of control over
his actions and behavior, if not a great deal of
insight into the significance of the cultural cues
he picks up. Mimicry definitely puts hosts and
guests at ease, facilitates communication, and
builds trust. Mimicry is not, however, the same
as pure imitation, which can be interpreted as
mocking. Ming, a manager at the Shanghai re-
gional power authority, relates, “When I deal
with foreigners, I try to adopt their style of
speaking and interacting. I find that simple
things like keeping the right distance from the
other person or making eye contact or speak-
ing English at a speed that matches the other
person’s puts them at ease and makes it easier
to make a connection. This really makes a dif-
ference to newcomers to China because they
often are a bit threatened by the place.”

The chameleon

possesses high levels of all
three CQ components and is a very uncom-
mon managerial type. He or she even may be
mistaken for a native of the country. More im-
portant, chameleons don’t generate any of the
ripples that unassimilated foreigners inevitably
do. Some are able to achieve results that na-
tives cannot, due to their insider’s skills and
outsider’s perspective. We found that only
about 5% of the managers we surveyed be-
longed in this remarkable category.

One of them is Nigel, a British entrepreneur
who has started businesses in Australia,
France, and Germany. The son of diplomats,
Nigel grew up all over the world. Most of his
childhood, however, was spent in Saudi Ara-
bia. After several successes of his own, some
venture capitalists asked him to represent
them in dealings with the founder of a money-
losing Pakistani start-up.

To the founder, his company existed chiefly
to employ members of his extended family
and, secondarily, the citizens of Lahore. The
VCs, naturally, had a different idea. They were
tired of losses and wanted Nigel to persuade
the founder to close down the business.

Upon relocating to Lahore, Nigel realized
that the interests of family and community
were not aligned. So he called in several com-
munity leaders, who agreed to meet with man-

agers and try to convince them that the larger
community of Lahore would be hurt if poten-
tial investors came to view it as full of business-
people unconcerned with a company’s sol-
vency. Nigel’s Saudi upbringing had made him
aware of Islamic principles of personal respon-
sibility to the wider community, while his Brit-
ish origins tempered what in another person’s
hands might have been the mechanical appli-
cation of those tenets. Throughout the negotia-
tions, he displayed an authoritative style ap-
propriate to the Pakistani setting. In relatively
short , the managers and the family
agreed to terminate operations.

Many managers, of course, are a hybrid of
two or more of the types. We discovered in our
survey of more than 2,000 managers that even
more prevalent than the ambassador was a hy-
brid of that type and the analyst. One example
was a female African-American manager in
Cairo named Brenda, who was insulted when a
small group of young, well-meaning Egyptian
males greeted her with a phrase they’d learned
from rap music.

“I turned on my heel, went right up to the
group and began upbraiding them as strongly
as my Arabic would allow,” she said. “When I’d
had my say, I stormed off to meet a friend.”

“After I had walked about half a block, I reg-
istered the shocked look on their faces as they
listened to my words. I then realized they must
have thought they were greeting me in a
friendly way. So I went back to talk to the
group. They asked me why I was so angry, I ex-
plained, they apologized profusely, and we all
sat down and had tea and an interesting talk
about how the wrong words can easily cause
trouble. During our conversation, I brought up
a number of examples of how Arabic expres-
sions uttered in the wrong way or by the wrong
person could spark an equivalent reaction in
them. After spending about an hour with
them, I had some new friends.”

Brenda’s narrative illustrates the complexi-
ties and the perils of cross-cultural interactions.
The young men had provoked her by trying,
ineptly, to ingratiate themselves by using a bit
of current slang from her native land. Forget-
ting in her anger that she was the stranger, she
berated them for what was an act of cultural
ignorance, not malice. Culturally uninformed
mimicry got the young men in trouble;
Brenda’s—and the men’s—cognitive flexibility
and willingness to reengage got them out of it.

You will not disarm your

…