Intercultural competence: a success factor in a globalised economy

How can companies be truly successful in a globalized world? Intercultural competence is the answer. It not only promotes effective communication and collaboration between different cultures, but also creates an innovative, inclusive corporate culture. Find out how this skill strengthens corporate success in global markets and enables a creative and productive working environment.

1. What is intercultural competence?

Intercultural competence is the ability to communicate and collaborate effectively and respectfully with people from different cultural backgrounds. This skill is becoming increasingly important in a networked world in which location, time, country and language barriers can be overcome more and more easily with the help of technology. In international companies, English has long been the corporate language in order to integrate foreign specialists. Outsourcing and offshoring to save costs requires smooth communication with people from other cultures in different time zones. Different expectations, working styles and mindsets have to be brought together and managed, which are not always obvious.

How do you create a heightened awareness of cultural differences? Intercultural competence involves understanding that as an individual you are operating within a universe of contradictory cultural and historical conditions. These influences can include different conceptions of reality and divergent historical, political, geographical and social backgrounds.

This means that, in addition to basic character skills, knowledge of modernization, globalization and the transformation of society through technology and science is necessary for a change of perspective. Without knowledge, there can be no understanding of different attitudes and behaviors. This also includes a fundamental understanding of ethical, philosophical and religious principles.

An essential component of intercultural competence is the ability to critically reflect on one’s own cultural background. What understanding of roles has shaped me? Which values are particularly important to me and why? Much of what we learned in our childhood has solidified into automated behavior patterns that we no longer even notice in later life. But this conditioning significantly determines our thought process and therefore also how we see the world.

External perspectives on our own lives can reveal this conditioning: This can sometimes be painful because we have to say goodbye to cherished truths. But if you open yourself up to this, it can also bring new insights. Only those who understand their own background and question the associated values and norms can view foreign perspectives on their own in an enriching light.

2. Intercultural competence and diversity

Conflicts between cultures usually arise from misunderstandings. Every culture and every language is part of an institutional order that creates accepted and standardized imagery. Those who know these different systems of order and can relate them to each other have a clear advantage.

Diversity in companies refers to the diversity of the workforce not only in terms of culture, but also in terms of gender, age, ethnic origin, religion, sexual orientation and other characteristics. Intercultural competence plays a central role in promoting and utilizing this diversity. A company that promotes intercultural competence creates an environment in which employees are sensitized to understanding different points of view. They should thus be better able to react professionally, calmly and empathetically to conflicts and, first and foremost, to question possible cultural misunderstandings. This can also be helpful in other types of conflict, as it trains them to put themselves in the shoes of the other party and understand the problem from their perspective.

Diversity has been proven to increase corporate success. The ability to recognize and appreciate cultural differences leads to a more inclusive corporate culture. This allows employees to feel safe and valued, which in turn increases their satisfaction and productivity. In addition, a diverse and interculturally competent team can develop creative and innovative solutions as they can draw from a wider range of experiences and perspectives.

Another benefit is the improvement of international business relations. Companies that promote intercultural competence are better able to operate in global markets. They can understand and accommodate cultural differences in negotiating styles, business etiquette and customer preferences, leading to more successful international partnerships and business deals. In addition, companies can better position themselves strategically, professionally and communicatively for a planned internationalization if they are aware of common pitfalls in intercultural cooperation in advance and prepare themselves accordingly.

3. Intercultural competence and innovation

Focusing on diversity by bringing different cultures together is not an easy model to implement and is not suitable for all companies. Successfully implementing a diversity strategy requires an understanding of innovation that most traditional companies do not have.

It sees innovation not as an exception but as the rule and integrates open innovation networks in which different stakeholders are involved from the outset. It pursues a bottom-up strategy that uses agile, customer-oriented and data-supported insights from operations in iterative processes to align them with the management strategy. It relies on unusual, risky and untested thinking models outside the norm instead of chasing the zeitgeist. This is the only way to achieve a genuine knowledge advantage beyond conventions and established interpretations.

Smooth collaboration works best in local, small networks – the so-called social fabric – which is characterized by similarities in characteristics such as wealth, level of education, but also ethnicity or regional culture. If you want to harness diversity here, you first need to train an understanding of intercultural competence, critical thinking and diversity of perspectives.

To achieve this, educational institutions and companies need to focus more on promoting creative processes instead of passing on canonized knowledge. Canonized knowledge quickly becomes outdated in a world that generates an abundance of information and new specialized knowledge at an unprecedented speed. On the other hand, those who are able to critically assess and make judgments themselves will continue to be superior to computers and so-called artificial intelligence in the future.

Conclusion on intercultural competence

Intercultural competence is indispensable in today’s globalized and diverse working world. It enables companies to fully exploit the benefits of diversity and drive innovation. Only through the targeted promotion of intercultural skills can misunderstandings be minimized, an inclusive corporate culture created and international business relationships successfully shaped.

Companies that recognize this and integrate it into their strategies not only position themselves more successfully on the global market, but also create a working environment in which creativity and collaboration can flourish. In a rapidly changing world, intercultural competence is therefore not only an advantage, but a necessity for sustainable success.

Simone Belko

Simone Belko is a media generalist with a strong focus on digital literacy. With experience in IT, operations, localisation, marketing, PR, journalism and training she has excelled in Germany and abroad. As a manager for digital products both in start ups and in large companies she gained deep insights into online platforms and communities. Simone is the author of "Digital Consciousness" ("Das digitale Bewusstsein") and is currently writing a book about narratives in the age of globalisation.