Introduction to CPO Playbook Podcast
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Hello, everyone. I'm Felicia Shakiba, and you're listening to the CPO Playbook Podcast. Join me and my guests as we feature insightful conversations with HR leaders, people scientists, and executives from diverse industries and functions, offering valuable perspectives on the future of work.
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Discover a unique outlook on navigating the complexities of the modern-day working world, exploring innovative strategies in talent management and corporate culture from the chief people officer's perspective. Tune in to stay ahead of the game when it comes to all things people related.
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Organizations frequently find themselves compelled to undertake restructuring endeavors in pursuit of heightened efficiencies and cost mitigation.
Tech Industry Layoffs Discussion
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In tech alone this year, there have been over 22,000 employees laid off compared to the 16,000 in 2022, and the year isn't over yet according to layoffs.fyi.
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Effectively orchestrating a successful restructuring across borders demands a harmonization akin to a ballet performance. This endeavor is intricate as it navigates the interplay of diverse cultural dynamics. The challenge stems from the multiplicity of approaches, varying engagement depths and the cacophony of perspectives surrounding redundancy and workforce departures.
Meet Leo: Sustainability and Cross-Cultural Expert
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With us today from London is Leo Leo, a strategic leader for environmental and economic sustainability. For Tierfund, his cross-cultural expertise spans across 50 countries, including Asia, Africa, Latin America, the Middle East, and more. Leo Leo, I am thrilled to have you on the show today. Welcome.
00:01:58
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Thank you very much, Felicia, for having me on the show. I'm equally excited.
Challenges in International Restructuring
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In the realm of international restructuring, how would you define the core factors that differentiate it from domestic restructuring efforts? Well, I would say it's like whenever you watch any kind of property program,
00:02:19
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the catchphrase they use is always a location, location, location. So that really kind of catches your attention. But if you transfer that kind of phrase into this restructuring of the team, international team, particularly, this means you are carrying out these exercises in multiple locations. So meaning different countries or regions and having to deal with employees of different cultural backgrounds.
00:02:49
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So, in a way, you might think it is the same company how difficult it could be. But the people are not the same, even though they might be wearing the same uniform or speaking the same company jargon words. But inside them, the national cultures they grew up with will really manifest in such critical moments in a company life.
00:03:14
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Could you share an example from your experience where cultural differences significantly impacted the success or challenges of an international restructuring project?
00:03:24
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Yeah, sure. Recently, there is an international director of the International Organization came to me. She is the director in charge of teams expanding to 50 countries, six regions. And then she is tasked to restructuring three teams in order to review their function and efficiency. Some of them are sitting, the members of the team are sitting in the UK and some are sitting globally.
00:03:51
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Now, when the process started, she just noticed something that is quite different. So the purpose of this exercise is really to look at how to improve the 100 odd people, how they can be more efficient to support a new corporate level priority. So because out of these three teams, they need to create a new team to work on this corporate level priority.
00:04:18
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and streamline the internal technical support teams. So this means about 18 positions will be established. And then she said to me, I don't understand what's going on. I don't understand why there are
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So it's different in terms of responses from the team members based in the UK and the ones who are not based in the UK like in Africa and Asia and other regions. She's telling me that the feedback from the UK employee is just so many and they can't keep up.
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and the wording and the emotions so strong. And the review team had to spend a whole day just to read through all of them. And yet the feedback from the non-UK teams is very little. So I suppose in our conversation here, I really would like to unpack some of the cultural reasons behind this and make some suggestions to our listeners who might be handling the same challenging situation.
00:05:18
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Absolutely. I think that would be extremely valuable coming from your expertise and point of view.
Strategies for International Workforce Alignment
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And so when aligning disparate strategies within an international workforce, what are the key strategies or approaches you have found effective in fostering cohesion? I would say to align strategy within an international workforce, I believe there are two factors.
00:05:42
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One is that you need to have a strategy that's quite obvious. And the second is how you communicate this strategy to your global force. Most companies have a strategy that is the easy part. But the difficult part is how the head office communicates this strategy to the workforce. For team-based, I call this task-oriented countries. Broadly speaking, like in the US, Canada, Northern Europe, Australia, New Zealand, and the most of the
00:06:12
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European people populate countries, and people want to understand the logic behind the strategy. If they don't understand the logical sense behind it, they won't buy it. On the other hand, for the teams based in relationship-based countries like Asia, Africa, and South America,
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they want to see how an individual connects and relates to this so-called strategy. And if they don't feel a part of it, you have a very difficult time to persuade them to interest them. They will just get on and do their job. So of course, there is also a different perspective on the strategy. So again, different cultures respond to them differently. So what I call a high-compax culture, which means countries with a little longer history,
00:07:01
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Relatively, in comparison to US and British new countries, about over 200, 300 years old, some of the older countries, they are high-context. So that means we like to view things from a micro to micro angle. While the other is true, that the low-context cultures, like those young countries, European cultures, particularly, they would like to see it from the micro to micro level, meaning
00:07:29
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We want to go into the details first. The strategy is like a big tree, so some would like to see the whole tree, where it is rooted, how are all the branches and leaves fit together, but the others might go straight to their own branch and leaves, and so to speak.
00:07:49
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So it's really to understand how to communicate to both groups to really help them to feel connected, understand what strategy is about. And therefore you can create their coherence for your company and for the work.
00:08:06
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And so essentially, you're saying when a leader communicates their strategy, they should really be communicating in a way where they're covering both the logic and the belonging to the solution piece to all of their employees. Absolutely. So even with my own organization, which is basically UK, I always tell them, when you come to communicate like we have this annual strategy planning, their approach is quite interesting.
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they will just tell people at different departments, different teams, just say, we know which page is your section, which is a very micro level approach. But they will never tell you to read the whole thing, understand how it's coming from and where it's coming from, what it's going to do. So yeah, they just go through to their say, your section is on page eight, do it. So well, for me, I really want to understand what's a big picture.
00:09:03
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Yeah, I'm the same way. I like to see big picture too. Could you elaborate on a particular complex engagement scenario during international restructuring and how did you navigate the multiple layers of engagement effectively?
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I think if we carry on with this case I mentioned just now, the challenge is about over-engagement versus under-engagement. So I mentioned that with task-oriented logic-based cultures, staff are really wanting to, when this change proposal is released, they really want to automatically question, why? Why do you want to do that? Why do you want to do that? And ask loads of questions left, right, and center.
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and then give their opinions on all the logical flaws they can think of and all the gaps they see in the proposal. And there's no holding back. And in this case, the director told me that some of them actually got quite heated. It's quite quite aggressive, the feedback. While on the other hand, that in the countries from the more relational
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relationship-based culture and high context, they are worried. They just say, oh, well, if this is a change proposal, so I suppose all the bosses have decided what to do. So in their perception, there's not much space for discussion.
00:10:32
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And then if they feel that if they question the reason, it might affect their relationship with their managers and bosses all being viewed as black sheep, if you like. So this explains why there's quite a lower level of engagement.
00:10:49
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So they might ask some more very gentle questions in terms of redundancy pay, how it can be treated fairly, if they got redundant, so on and so forth. But overall, they won't be as challenging as people from task-oriented countries.
00:11:07
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But from your vantage point, what are some strategies or best practices for tailoring restructuring approaches to align with the unique nuances of different countries or business landscapes? I would say definitely respect, honest, and then stand in the differences
Communicating During Restructuring
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and take into consideration of the cultural differences
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one embark on the change. As I mentioned before, although it's a big company, global company, and people assume we have this company culture, so therefore everybody understands what we are doing here. We embark on the change. There's no problem. I would say respect is very important. Tweet the employees as humans, not numbers, and be mindful that how the change will affect them. I remember there's a movie called Up in the Air.
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made back in 2009 with George Clooney and Anna Hendrick. And the movie shows that extreme version of restructuring and redundancy. So the two characters they played basically fly around the country to tell people they are fired because the employees of those companies don't see there's something wrong with it. You just see there's a task to need to be done. We don't have time to have the energy to do it. We just hired this company.
00:12:27
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to do it, tell people you're fired. I think that's quite brutal, so be mindful and respectful to people. Yes, and also taking the different approaches to people who give logic explanation to those who want it, who need it.
00:12:45
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and also give time for them to fit back and be ready sometimes very feisty feedback and to show gratitude and relationship to those staff from the culture that they want to know that contribution to the company means something or meant something if they are living a job and then you need to tell them
00:13:08
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quite clearly that if they need to leave the job, it's not about who they are, that they are bad people because it's just the need for the company to grow, to move on, or to reduce whatever reason is, it's not about themselves personally. And just as a follow-up question to that, what is the cost of doing it differently than you're suggesting? I would say one could be time if you need to
00:13:37
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taking into consideration to give enough time for people to give feedback to allow them to feel being hurt. The other is about actually you will obviously need to have more people to deal with different scenarios, different locations and you like rather than a very cookie cutter, one size fits all approach. So that actually leads on to a very good point.
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is that when companies take on restructuring, very often the sort of initiator comes from the headquarter from the head office, but actually you can really
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empower the local level in-country team leaders to be part of that process to help you to understand those cultural differences and what the best way is to deal with the restructuring in your country. Because obviously, including myself, we can't know it all. So the best strategy is actually to really include the local leaders in your company to help you to go through this.
Trends Influencing Restructuring Dynamics
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And as the global landscape evolves, how do you foresee the dynamics of international restructuring adapting to incorporate emerging trends and technologies? I would say the biggest trend that is also sped up by the COVID is working remotely. I remember before COVID, it was considered a company per for me and my wife, we can work two days at home. So all of a sudden, everybody works from home.
00:15:11
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so that many companies ever since the real world actually return hire people from around the globe. They didn't have to come to a physical location together to work together. This might be a very exciting, very good opportunity to tap into the global talents. While it also poses a problem
00:15:32
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which is often hidden, is that the differences in culture. So particularly when people come work in remotely, they appear on the screen, but a lot of things don't appear on the screen. So I think the team or the company have far higher increased challenge of coordination among teams, far from a different cultural background.
00:15:57
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I think this is an area very often, or still is overlooked, and also you are looking at the increase as many of the companies expand their operations globally, the clashes between the uniformed company culture and the diversified national cultures and identities of their employees.
00:16:18
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This could be a source of stress for the staff and for the managers to have to deal with. The other interesting development which everybody is talking about today is the development of the AI, the artificial intelligence. So for better or for worse, this will really affect our lives.
00:16:36
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greatly in the coming years. However, I would like to point out to people that AI also has a cultural aspect, a cultural bias, because if you think about it, all this AI is fed on data, right?
00:16:52
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So how the data is collected and analyzed by the algorithms, it really affects the output. So looking around today in the AI field, it's USA, China, and a few other countries are in a leading position in this piece of work. So whoever is in that position
00:17:12
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We will have a cultural bias on this thing. So that means the AI can be culturally biased. So we need to be really mindful of that. And then drawing
Maintaining Employee Morale
00:17:24
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from your experiences, could you provide insights into how leaders can maintain employee morale and a sense of stability while orchestrating changes that transcend international boundaries?
00:17:36
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Absolutely. It is a very difficult thing when you are starting a change process, everybody feels so insecure, feel stressed, so they don't know what's going to happen to them. But I think the key thing is to really step back to look at the big picture.
00:17:53
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to really remind the employee. One is the long-term vision of the company or the organization to really refresh and remind people what is the compelling vision of the company and also to explain how the change will benefit the employee and benefit the organization. It might not be everybody, but will benefit the organization for the long run. Clear communication is absolutely very key. Again,
00:18:19
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communication based on the needs of different types of employees from different types of culture, very important. I would also add to personal connections. I think particularly for those teams from relationship-based countries, during the process, they want to feel personally connected. So it's vitally important for the managers, for the directors, for the executive team members
00:18:48
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to really show your face wherever you are, either virtually or in person, show your face. Remain connected so people don't feel abandoned. So that's very important. In the meantime, while people are going through this uncertainty and the sense of instability, we could carry on
00:19:09
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to recognize people's contribution, carry on with rewarding those who are still doing well, and celebrate the success, because particularly important during the change process, people end up in this mode of wait and watch and see, so the productivity can go low. So it's therefore this celebrating the success
00:19:33
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reward and recognize those who are carry on to do well, to really set a good example for the teams to really carry on doing that job. And I mentioned previously already is to really empower the local leaders of your company to be part of it, to work together, help to use their way, the way they know best to keep the morale of their local teams, keep them going.
00:19:59
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I think that makes a lot of sense. And I think you said something really important, which was showing your face and just being there as a leader, being connected and not delegating that type of very sensitive work to someone else.
00:20:14
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But actually having that presence as a leader and having the courage just in front of someone during a restructure, I think is really important, both with employees that are leaving and also employees that are moving around in the organization, as well as those who are still there who may have lost some team members.
00:20:34
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Yeah, I think because if you do that, show your face, I think people will know you do care about them. It's not just you don't just see them as numbers and figures. Yeah. Is there anything that we haven't talked about today that you think is important for us?
00:20:51
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I would have to say, I think it's very important for the leaders to do, if necessary, is to be honest, go one step further, if not honest, is to say sorry if you have to. Because during the current financial climate, the resources are scarce, and many companies have to shrink in size because of the financial resources.
00:21:16
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restrained so as leaders and managers even for the ET member and the board member just be honest and say sorry so this is where we are if you have to we are really sorry to let you go I think people understand but if you try to come up with those very pretentious reasons that we want to move forward do this and do that
00:21:40
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People can see right through it and then you actually make
Importance of Honesty and Empathy from Leaders
00:21:43
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it worse people think you are disingenuous But if you say yeah, we are hitting a bad patch. We are sorry. We have to let you go I think people would really take it more too hard more understanding then you're trying to come up with some cover-up reasons and
00:22:00
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That's interesting that you say that because in my experience during a restructure, I've actually been told not to say sorry because it strikes a chord and in the person who might be leaving and gets them upset and organizations don't want that type of emotion to pop up. What I'm hearing from you is that there are some people who just want to feel like their manager who might be moving them or
00:22:27
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letting them go in a new direction. They just want to know that they feel that empathy for them is what I'm hearing you say. Yeah, I would say so. I would say that because at the end of the day, whichever culture you are coming from, we are all human beings. So there's some very universal value where it transcends the cultural difference. So if you are genuine towards people, I think people can see that. They understand it in the saying like,
00:22:57
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from my home culture in China is that if you give people your heart, they will return with their heart. Taking a step back from the topic of restructuring and just thinking about how do we communicate with people internationally, because I'm sure there are a lot of people out there that are having or struggling with communication across borders.
00:23:19
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how do teams or individuals or leaders best understand the right way to communicate internationally with other team members?
Effective International Communication
00:23:28
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I have touched on a few concepts like the task-oriented culture, relationship-based culture, eye context or context. You probably people would have heard other sort of concepts as well. I think the key thing to really come out that blind spot
00:23:45
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The bigger the company becomes internationally, I think the bigger blind spot it can become because they are so successful in expanding. Therefore, the so-called company culture can really feel like, oh, this is their culture and company.
00:24:03
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And that is a big blind spot of overlooking the cultural differences in different locations, different teams. That becomes quite a stumbling block. I think, yeah, as managers of all levels, they really need to come out of that. So we do have a company culture, but we equally don't ignore and overlook your employees' national identity and their own cultural background.
00:24:32
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Leo Leo, thank you so much for being here. It's been a great pleasure and I can see a lot of what we talked about here today transcend through a lot of people and the work that they're doing and the experiences that they're having. So thank you so much.
00:24:50
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Oh, it's my pleasure to really share with you and with your listeners. So yeah, I can carry on to a lot more. So yeah, I really hope we have other opportunities to explore other areas of this cross-cultural work. That's Liu Liu, Strategic Leader for Environmental and Economic Sustainability, for Tierra Fund.
00:25:16
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If you like today's podcast, we have more podcasts on innovative HR strategies, talent management, organizational culture, and more, and how to navigate the complexities of modern day HR. Find them at cpoplaybook.com slash podcasts, or search CPO playbook on Apple podcasts, Spotify, or wherever you listen. Thanks for listening to the CPO playbook podcast. We'll be back with a new episode next time.
00:25:46
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I'm Felicia Shakiba.
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And if you have an idea you would like us to talk about or a guest you'd like to nominate, visit cpoplaybook.com slash contact us to suggest an idea.