Take a quick look at why global executives fail and you’ll likely see personality flaws. However, the reasons for failure are deeper and more complex.
Developing global executives is an expensive proposition, especially when expatriate assignments are involved. But the investment can produce a significant return—provided that the corporation uses the knowledge and expertise gained from the experience effectively. When things go wrong, the investment is lost, and usually, so too is a person who was judged to be quite talented. Can these loses be prevented? Maybe, but the answer to that question depends on what causes such derailments. If the complexity and ambiguity of international work makes selection errors unavoidable, then the derailment of executives is just another cost of doing business. However, if derailments occur because of something that can be corrected or prevented, then a significant payoff is possible.
To shed some light on the dynamics underlying the derailment of global executives, we interviewed 101 individuals who were successful in their international postings. With an average of nine years experience abroad, they were in a unique position to observe other global executives come and go. The 121 tales they told are the basis for the conclusions we have developed about the underlying causes of international executive failures.
Three factors contribute to the failure of international executives:
- The individual
- The cultural context
- Organizational mistakes
1. THE INDIVIDUAL
Executives contributed to their failure in two ways. Some personal attributes and types of behaviours just don’t play in international settings. However, more often, it wasn’t simply a personal flaw that prevented an individual from succeeding. Rather, it was the complex interaction of a person’s strengths or weaknesses with a change in the situation. We will consider both causes.
The successful executives we interviewed described over 300 flaws in the behaviour and management skills of the executives they had observed. A few of these flaws were factors regardless of the situation or context.
Foremost among them was a failure to adapt to change. What needed to be adapted to varied considerably—bosses, business strategy, leadership philosophy, changes in markets and technology. For many of those ill-fated executives, their inability or unwillingness to change was rooted in a career spent in a silo, or in a single function, which gave them a narrow perspective and made them unable to see the big picture. Unwilling to appreciate another point of view, some executives either refused to accept change or would not put energy into their effort to change.
Another flaw or set of flaws in the “clearly lethal” category resulted in bungled relationships with key people—customers, partners, senior management or peers. The bungling was especially toxic when it occurred in conjunction with a decline in performance or some significant mistake. In a global environment, quality relationships are crucial in certain countries and business situations (such as sensitive negotiations, joint ventures and cross-cultural alliances). Although a lack of people skills is annoying in any environment, the consequences are particularly severe in an international setting.
Other flaws led some executives to hesitate when action was needed, to default on promises made to senior management, and, when things subsequently went wrong, not to ask for (or accept) outside help. Powerful and successful executives in trouble may try to deal with matters on their own, viewing offers of assistance or advice as interference from the outside. This can be a fatal mistake, made all the more likely whenever, as an expatriate, the executive has lost contact with the rest of the company.
But just having flaws is too simplistic an explanation for the derailments that were described to us. As we have all observed, there are people who have glaring flaws who don’t derail, while some with overpowering strengths actually do. Still others with no apparent flaws early in their careers seem to develop them later on. And for still others, there is no apparent cause for the flameout. Moreover, the international executives in this derailed group were unusually talented to begin with. They were often described as having multiple strengths, rarely found together, such as brilliant and interpersonally skilled, technically skilled and shrewd about people, or people-and results-oriented. How could such gifted and successful people derail?
The paradoxes can be resolved if derailment is considered as a dynamic process rather than the inevitable result of some personality flaw. Indeed, if one assumes that there are no unqualified strengths and few universally fatal flaws, the data begin to make sense. We identified four patterns that describe the dynamics of many of the derailment scenarios.
1. Early strengths that led to success became weaknesses later on
Most often, this took the form of exceptional technical, functional or market expertise that resulted in early successes and promotions, but later on blinded the executive to the bigger picture or the need for different skills essential to a higher-level job.
2. Long-standing flaws that became salient when something changed in an executive’s situation
Some leaders, for example, had always been abrasive and arrogant, but because they got great business results, they were never damaged by their flaws. Their sins were forgiven in light of their bottom-line performance. When the results weren’t as good as expected or when the situation changed so that relationships (and not single-handed bravado) were critical to meeting the bottom line, the flaws “suddenly” emerged and the executive derailed.
3. An executive’s constant success
Some executives began to believe that they were as good as they seemed and, like the Greek tragic heroes, their hubris led to their demise.
4. Some executives appeared to be just unlucky, ending up in the wrong place at the wrong time or running afoul of the wrong person
What happened, at least on the surface, was not the person’s fault. But while ill fortune appeared to cause these derailments, other factors usually contributed to the fall. It was frequently suggested that the same events might not have derailed someone else—that there was something about the way the executive handled the situation, or about bridges burned in the past, that contributed to the outcome. In short, one of the other dynamics—not bad luck—may have been the real culprit. While some flaws were uniformly problematic (e.g., failing to adapt to changed situations or an “appalling lack of people skills”), and others emerged when an executive’s immediate situation changed, the vast majority of international derailments were anchored in the cultural context itself.
2. THE CULTURAL CONTEXT
It was rarely sufficient to say that an executive’s traits or flaws “caused” him or her to derail—most of these executives were extraordinarily talented individuals—unless one could place that trait or action in a larger context. For global executives, that context was almost always cultural.
Working abroad increases stress through its isolation, family pressures, and the broader job responsibilities it often entails. International executives may find themselves dealing with political issues, government corruption, bribery and a variety of contextual issues without the help that would be available in the home country. Contributing to the stress, but demanding in their own right, are the difficulties of understanding and being understood in one or more foreign languages, and the often subtle differences in values, norms, beliefs, religions, economic systems, and group and community identities.
The natural reluctance of people in organizations to be candid with each other can be magnified by cultural norms, as well as by the inability of outsiders to read the subtle cues. One executive, quite successful in a series of functional assignments, was promoted to a general manager’s job outside of his own country. He did well initially, probably because of his functional expertise, but when things started to go wrong, he did not realize it. When he realized it, he didn’t have the ability or business knowledge to diagnose the problem and figure out what was wrong. One can’t help but wonder if he could have drawn on the expertise of others had this happened in his home country.
Different economic, religious, government and social systems in some countries have direct effects on how business is carried out. Here, complexity again takes several forms, including the potentially lethal—or at least convoluted—web of relationships and the presence of different business models and practices. As we interviewed executives, we saw how the web of relationships can grow more and more complex: from subordinates from a different culture who don’t speak the executive’s first language, to subordinates from multiple cultures speaking multiple languages in one region, to subordinates from multiple cultures speaking multiple languages and physically dispersed around the globe. To thicken the mix, add a boss from a different country who speaks a different language or multiple bosses from different countries in a matrix structure, and so on, through suppliers, customers, partners, shareholders, peers, consultants and others. As if that weren’t complicated enough, different countries may have different business models, different definitions of ethical behaviour and different business approaches and systems.
All these complexities and others too numerous to recount, create a fertile context for derailment. The more relationships an executive has to cultivate, and the more varied they are, the greater the chances that some of them will go wrong. The greater the differences in how business operates in the countries involved, the greater the likelihood that an executive will make erroneous assumptions or commit errors without even knowing that anything is amiss. The more diverse and culturally different the countries, the greater the likelihood that seemingly extraneous factors—or what would be extraneous factors in the home country—will affect business results, the outcomes of deals and negotiations, and other activities for which the executive is accountable. In other words, not only are the executive’s actions more likely to be ineffective or even counterproductive, but more circumstances will be beyond the executive’s control and more likely to affect outcomes, regardless of the executive’s actions. And for all the reasons we pointed out above, the executive may not get timely feedback or pick up the clues that anything is wrong in time to do anything about it.
Although cultural and business differences create a complex and sometimes treacherous context for executive action, international assignments also come with particular seductions that can lure executives onto the path to derailment. Being on their own, often far from direct supervision and with tremendous authority over local operations, global executives can come to believe that they are all-powerful, even above the law. Feeding self-aggrandizement were the perks of foreign duty, which might include servants, cars and drivers, luxurious homes, impressive expense accounts, invitations to galas and state affairs, and other special treatment that, over time, some executives began to view as entitlements.
Even if an executive completes an expatriate assignment successfully, he or she still faces a final risk that may cause derailment—repatriation. Though it is tempting to view coming home as an easy transition, it turns out to be anything but. Executives may return to find that they have lost their business networks and their friends, that their home country is not the same as it was when they left, and—perhaps the unkindest cut of all—that no one cares. Their living conditions may actually be worse, with no servants, drivers, luxurious homes, access to exciting events, or relationships with top business and government leaders. They may come back to less important jobs and reduced responsibility, they may find themselves outside the mainstream, and they may feel that their organization does not take advantage of or appreciate what they have learned. In such circumstances, the skids are greased for derailment.
3. ORGANIZATIONAL MISTAKES
Neither individual attributes and behaviour, nor the cultural context, were sufficient to explain all of the derailments. The organizations for which the derailed executives worked made numerous mistakes that contributed to, or in some cases directly caused, their derailment. The fall of one executive provides an example: “The company contributed [to the derailment] when they led him to believe they would back him up no matter what. But they didn’t. They backed him when things went right, but they deserted him when things went wrong.” Absence of honest feedback was pervasive, as were mixed messages or unclear expectations from “back home.” Companies picked people who were obviously wrong for the assignment, promoted people too fast (they were “untested”), or kept them out too long. Frequently, expatriate executives did not have access to the kinds of technical or other support that domestic executives could call upon.
The complexity of the global context increases the odds that the organization will make various mistakes that contribute to derailments, most of which are avoidable: giving little or no feedback, little monitoring, tolerating existing flaws and lack of support. Because organizations can influence these and similar factors, we fault them for being lazy, or worse, negligent. Although we don’t absolve executives from being responsible for their actions, the organizations’ lapses increase the probability that flaws and inappropriate or ineffective behaviour will go unnoticed and uncorrected until it is too late.
Some cases of global derailment resulted from poor selection decisions, usually made for technical or political reasons without considering the potential consequences. Organizations chose people who obviously would not fit in the environment, failed to prepare them properly for the challenges ahead, and/or failed to communicate their expectations or changes in expectations. In still other cases, organizations made decisions that directly affected the executive’s operation without considering the situation “on the ground.” At times, an organization made strategy or design changes without consulting, or even informing, the local executive.
Derailment risk is high for foreign nationals coming to headquarters and for other executives returning home. Organizations seem to botch their part in both events consistently, contributing to an already difficult situation for the executive.
Finally, we were told of derailments in which an executive’s career was exploited for short-term gain. In these circumstances, the organization, purposely or not, knew that the situation was not viable—the executive was assigned an impossible job, or one that would almost certainly create an aftermath so intolerable that the executive could not survive.
A single intervention or a smattering of human resource programs for international executives will not prevent events as complex as those leading to global derailments. Like global executive development itself, preventing derailment requires an integrated approach that connects strategic intent with the systems and practices that affect the selection, development and movement of global executives.
To begin with, solutions must address all three culprits in derailment: the executives’ strengths and weaknesses, the global context in which the executives are placed, and the organizational practices that surround the whole process. All three depend on the fundamental strategic issues facing a global business. Only the strategy can determine how many and what kinds of global executive jobs are required, and how many and what kinds of executives are needed to fill them. Only the strategy can determine how many truly global executives are needed (if any), how many foreign nationals are necessary, how the international jobs will be structured and positioned, the extent and nature of alliances, how business will be done internationally, and so on.
There are important differences in the development of local nationals, host-country nationals and third-country nationals, and for this reason lock-step or undifferentiated development programs are likely to be ineffective for many in the international pool. Further, global executive jobs, whatever the home country of the executive, are fraught with dangers, not the least of which is the increased probability of derailment associated with poorly designed and poorly managed assignments.
Much can be done to improve the ways these jobs are structured, the processes by which performance is monitored, and the feedback processes associated with them.
To emphasize the strategic and structural aspects of developing international executive talent is not to say that individual development should be ignored. There is no question that many of the essential skills needed in global careers can be learned, and that very few individuals are so naturally gifted that they need no further development. While there are limits to what an organization can do to make someone grow, there is a lot they can do to help people who want to grow. These include providing opportunities, early in a career, to work with people from other countries and to be part of activities that cross borders, to work under competent bosses with international experience and perspective, and to live and work as an expatriate. These kinds of experiences, combined with effective assessment and feedback, seem to be essential ingredients in developing global talent.