Grasshoppers are considered pests in North America, pets in China, and appetisers in Thailand. What does this suggest about the influence of local differences on perceptions of even the lowly insect? Indeed, what does this suggest about how and why tastes in general can differ so starkly across nations and regions? If different cultures can have such differing views about grasshoppers, imagine what they can do with people.

Philosophers and social scientists have long noted that if you want to understand why people – including managers – behave as they do, a good place to begin is with a serious look at the cultural environment in which they work. Think about the following three observations:

As Japan's third largest innovator pharmaceutical company, Daiichi Sankyo Co Ltd (Daiichi Sankyo), announced in June 2008 that it would acquire a majority stake (63.9 per cent) in India's largest generic drug company, Ranbaxy Laboratories Ltd (Ranbaxy), for US$4.15 billion. Daiichi Sankyo was formed in 2005 through a merger of Daiichi Pharmaceuticals and Sankyo Co Ltd, both established Japanese firms with more than a 100-year history and known for their strong research focus. With the acquisition of Ranbaxy, it became the first Japanese drug maker to be engaged in the four primary pharmaceutical fields – new prescription drugs, generics, over-the-counter drugs, and vaccines.

Ranbaxy was started in 1937 by Ranbir Singh and Gurbax Singh as an India-based distributor for a Japanese company, Shionogi. The name Ranbaxy originated from the combination of the names of its first owners, Ranbir and Gurbax. Bhai Mohan Singh bought the company from his cousins, Ranbir and Gurbax, in 1952 and Ranbaxy was incorporated in 1961. Shortly after, it started production of drugs in India and soon was known for producing cheap generic versions of branded drugs without compromising on quality. Bhai Mohan Singh's son, Parvinder Singh, joined the company in 1967 and launched an ambitious plan to transform Ranbaxy into a major generic drug manufacturer in India with the construction of a large manufacturing plant and the launch of the company's IPO in 1973 to tap public funds. Parvinder Singh then began building Ranbaxy's international distribution network by driving export sales of low-cost generic drugs to developing countries. His sons, Malvinder Mohan Singh and Shivinder Mohan Singh, further expanded the company's presence globally by undertaking foreign acquisitions, marketing generic versions of expensive drugs all over the world. The Singh family transformed a small, local company into a respectable multinational company that provided affordable and quality medicines to patients around the world.

Until 2000, both Daiichi and Sankyo had a focus on domestic markets. After 2000, the Japanese Ministry of Labour, Health and Welfare took a series of actions to control rising health costs of an ageing population, including issuing new guidelines on drug reimbursements, tightening approvals and cutting reimbursement amounts, which added pressure on Japanese innovator drug firms’ profit margins. The Japanese government had also set up a target for generic drug use of a 30 per cent market share by volume by 2012.

One of the earliest recorded experiments with global teams in an industrial setting occurred in the 1990s and involved Siemens, Toshiba, and IBM. The three companies created a partnership to jointly develop new state-of-the-art chips for the next generation of computing. To accomplish this, all three companies decided to bring their best people together, share their knowledge, and leapfrog the competition. Scientists from all three companies were brought to a state-of-the-art research facility in New York. Unfortunately, each group of scientists quickly identified problems with the joint venture. German scientists from Siemens were shocked to find their Toshiba colleagues closing their eyes and appearing to sleep during meetings. They failed to understand that such behaviour is a common practice in Japan for concentrating on what is being said. At the same time, the Japanese scientists from Toshiba, who were used to working in groups, found it uncomfortable to sit in small individual offices all day and speak English. And the US scientists from IBM complained that the Germans planned too much and the Japanese wouldn't make clear and decisive decisions. Inter-group trust evaporated as suspicions began to circulate that some researchers were withholding their best information from the group. Over time, the well-intentioned alliance simply melted away.

What is an ethical conflict? And what happens when our view of ethics is different from someone else's? Consider three short examples:

During a recent voyage through the Caribbean on the Allure of the Seas, one of the largest cruise ships ever built, two passengers discussed how much they had enjoyed the voyage. As they rode the glass elevator to the top of the ship's massive eleven-story atrium, one turned to the other and said, “I've been on this voyage for two days, and I haven't even seen the ocean yet.” This observation raises an interesting question: what was the purpose of the cruise? Relaxation? Adventure? A similar question can be asked about managers who seek global assignments in their companies, particularly those who want to live and work abroad. What is their motivation? What do they seek to gain from their experience? What will they actually see and learn as a result of their assignment? Is it to be a voyage of discovery, a “life experience,” or a serious career move? What will their employer gain from the experience and expense, come to that? Then there is a very different question: what if the assignment abroad is the company's idea, not yours? How should you evaluate this? And must you say, “yes”?

Despite widespread recognition that we live and work in an increasingly interconnected global economy, it is curious how little many people understand about other countries and cultures. When we travel on holiday, we often seek out collective experiences where we can travel with people from our own cultures, eat food that is familiar, and then get back on our tour bus. When we go abroad on business, we often sequester ourselves in meeting rooms in five-star hotels with air conditioning and BBC World News. Then we return home saying that we have been to Thailand or Costa Rica or France. Unfortunately, there is a big difference between having been somewhere and having learned something about where we have been.

And even when we seek deeper understanding, it is often difficult to come by. Indeed, a pivotal question facing both training directors and managers themselves is exactly how to expand global awareness, understanding, and skills. In this pursuit, managers often turn for advice to those who specialise in cross-cultural training and development for help in preparing for foreign assignments. This over-reliance on others – instead of on oneself – can carry risks, however. How do we know if what we hear is correct or biased?

Merrill J. Fernando surveyed the tea industry in 1950s Sri Lanka and decided that it had to change. Although Sri Lankans grew the tea and processed it, they did not profit from what was a world-wide trade. At that time there were not even any Sri Lankan tea-tasters – the first step to professional recognition in the industry. Bulk tea was exported and value was added overseas, where the real profits were to be made.

The first step for Fernando was a personal one – an ambition to lead, but it was also an ambition to link the lowest steps of the tea production chain to an already globalised industry. Embedded in that industry were strong links with other diverse cultures, especially the major consumer markets in the British Commonwealth and the then USSR, where tea itself was a cultural institution. Sri Lanka had an established tea brand – Ceylon tea. Fernando saw that his country needed a new model of behaviour for its corporate producers.

The steps to achieve these goals seemed clear to Fernando, if challenging. First, he secured training and then a position as a taster, with an established firm, AF Jones & Co, a British company, in 1954. Through a single-minded pursuit of gaining professional recognition and skill, followed by employment, investment, corporate purchases and divestments, the building of his own firm, and implementation of new processes and products, his profile in the industry grew rapidly. By 1973 his then-firm, Merrill J. Fernando Co Ltd, was yielding the highest net profit per pound of tea sold in Sri Lanka. In 1985 the Russian market provided his company with an opportunity to sell pre-packed tea into a major world market. In 1988 Dilmah Tea was formally launched, to supply the Australian market with pre-packaged tea.

Dilmah from its earliest days repudiated the profit motive as its sole raison d’être; nevertheless, it also showed business acumen. It chose a more challenging path than its competitors within Sri Lanka in seeking to export pre-packaged teas, targeting specific markets and building new ones that had express preferences for a particular quality and for varieties of teas. In a market that seemed secure, with little impetus to change its fundamental structures and practices, Fernando's vision was as much revolution as innovation. Not unexpectedly, his quest attracted resistance.

A recent World Economic Forum in Davos, Switzerland, brought together over 1,000 corporate executives, 50 heads of state, and 300 cabinet ministers to discuss world challenges ranging from deficits to competitiveness to deadly diseases. At the conclusion of the conference, an observer from The Economist characterised the meeting as having one overriding theme: the importance of developing global leaders – in corporations, nation states, and NGOs. “The two most popular words in the business lexicon today are ‘global’ and ‘leadership.’ Put them together and people in suits start to salivate.” Indeed, global leadership is both an important topic and a topic about which we understand far less than we pretend.

More books have been written about leadership than any other topic in the field of management. Many of these books examine various theories of leadership, comparing the relative advantages and disadvantages of each. Other books represent serious empirical studies of actual leader behaviour. Still others are popular books that seem to offer a secret elixir designed to transform ordinary managers into extraordinary leaders. What most of these books fail to do, however, is to recognise that leadership processes can vary significantly across geographic regions.

Asia is often perceived as a region playing “catch-up” with the urbanised West, battling lower wages, longer working hours, and enjoying less leisure time. However, while this was true a decade ago, recent years have seen a significant development in the Asian market. The emergence of an affluent middle-class that is keen to enjoy its wealth has encouraged governments and international entertainment companies to invest heavily in Asia's leisure and attractions industry. In 2012, Asia accounted for one-third of the world's total theme park ticket sales (US$103.3 million), second only to North America (US$127 million). Attendance at Asia's top 20 parks rose 4.9 per cent to 122.5 million in 2014, compared with 2.2 per cent and 138.1 million for the 20 largest parks in the United States.

The evolution of the Asian region is also evident from Disney's recent expansion activities. Since its success with Tokyo Disneyland in the 1980s, Disney has realised the vast potential of the Asian market and started its expansion in Asia. In 2014, Disney announced plans to invest $4.6 billion to expand and improve the two theme parks in Japan over the next 10 years, which is the largest expansion in Tokyo Disney's history. Disney has been one of the major participants, opening Hong Kong Disneyland in 2005 and its $5.5 billion Shanghai Disney Resort in 2016, which may become Disney's most-visited park.

Disney in Japan

Tokyo Disney Resort, located next to Tokyo Bay in Urayasu, Chiba, Japan, started on 15 April 1983. It opened as a single theme park, Tokyo Disneyland, which was the first Disney theme park to be opened outside the United States. Much has changed around the resort, with several resort hotels and even a companion theme park, Tokyo DisneySea, operating from 4 September 2001 to satisfy the needs of the millions who visit each year. Now the resort has two theme parks, three Disney hotels, six non-Disney hotels and a shopping complex.

The Tokyo Disney Resort is fully owned and operated by the Oriental Land Company (OL), which licenses Disney's characters. In fact, Tokyo Disneyland and Tokyo DisneySea are the only Disney parks not wholly or partially owned by the Walt Disney Company (WD). The partnership between OL and WD floundered when differences in management philosophies and decision-making techniques created tensions.

Sam Mitchell looked through the window and realised that she had to make a decision in five days on whether to accept an international assignment to Hong Kong. She had just finished a meeting with her boss, who proposed to transfer Sam to the subsidiary there. Her boss said that she would be able to climb the corporate ladder and become the regional vice president if she was successful in Hong Kong. At this moment, Sam was trying to assess how her job was going, the situation her family would face if she took the offer, and what her career could look like after completing the assignment. Of course, she also recalled her first international move, to Philadelphia.

Born in Sydney, Sam went into the IT industry after earning an IT bachelor degree. She started with a small internet services company and, three years later, she began to work with her current employer, a large American technology company with offices around the globe. Sam's career was flourishing – so much so that, within 12 months of commencing, she was promoted into an international program manager role and offered the opportunity to move to headquarters in Philadelphia. She accepted immediately and without hesitation. Although the US job was on local terms – no “expat package” – the company was willing to pay relocation expenses, a rent-free townhouse, and US salaries were much higher than those in Australia.

Sam sought out an expatriate community after arriving in “Philly”. At a weekend expat get-together Sam met her future husband, Chris, who worked in a global technology company and had moved from Melbourne to Philly at a similar time to Sam. They got married quite soon after they met and bought a house on the “main line” in leafy, middle-class Montgomery County, about a 30-minute drive from downtown Philly. To better adapt into the local community they joined the Philadelphia Country Club, where Sam made many American friends and became active in golf. They figured out that, though there were some differences between Australia and the United States in terms of living style and mentality, the cultures of the two nations shared many similarities.

Negotiating agreements and building global partnerships can be a perilous enterprise. The stakes are often very high, both for the firms and for the negotiators. Indeed, problems often begin as soon as negotiations are opened, with each side trying to gain an advantage at the other's expense (e.g., lower prices, royalty distributions, proprietary technology, market access, and so forth). If and when a contract is signed, the problems only multiply. How do we manage the partnership? Who is in charge? How do we build trust between the partners? How do we harmonise our long-term interests? Indeed, what is the meaning of the contract on which the partnership itself is based? Throughout the process, moreover, the personalities and private agendas of the principal negotiators and their teams and organisations have different goals, demands, and constraints, which can also play a significant role in determining success or failure. Learning from others may be the best way to avoid similar problems in the future.

Did you ever wonder how Pfizer built such a successful global pharmaceutical firm? In part by absorbing other failed pharmaceutical companies like Pharmacia and Upjohn that had the technologies and patents but not the necessary global management know-how to succeed. Several years back, Sweden's Pharmacia and America's Upjohn Pharmaceutical began working on a merger. The goal was to combine both companies’ strengths and become a stronger player in the highly competitive global pharmaceutical industry.