Interview: Professor Andrew Kakabadse
Andrew Kakabadse on Rice Wine with the Minister
Steve Macaulay
Can you drink rice wine with a group of dignitaries and
drink them under the table as a virility challenge? This
was the remit given to Professor Andrew Kakabadse and
he has written this in a new book, Rice Wine with the
Minister, which he has co-authored with Nada
Kakabadse.
Now Andrew, congratulations on passing the test. You
have decided to give us in this new book, twenty one
shots of rice wine wisdom [on global management].
Now it occurs to me, hasn’t the world moved on? Isn’t
the world increasingly becoming similar?
Andrew
Kakabadse
In one sense that is absolutely right. You go to
Shanghai and you will find Starbucks with a menu very
similar to London or Washington or New York; you will
go to Tokyo and you will find an Italian restaurant with a
menu very similar to Naples, and probably even cooked
better than most of the Italian restaurants that you will
find in Italy. You will go to Ireland and you will find the
cheeses made in Ireland are sold in the North of France
– they are all French cheeses, Irish made under French
brands. Yes, the world is getting smaller economically.
What is interesting is the implicit emotional reaction to
that. Now more than ever, at least Nada and I are
finding, that when you go round the world,
consciousness to local customs, awareness of the
context you are in, remarking for example when you go
to one of the Starbucks cafes in Shanghai how in fact it
looks more like the Ritz than Starbucks in London, is a
very important factor.
So we do have an economic narrowing and that is a
shame because in certain parts of the world like Greece,
some of the old and very good diets are really being cut
out of the menu, and even the Greeks – the new
generation of Greeks – do not know their own diets,
which I am very familiar with. But on the other hand, the
Greeks, the Italians, the Chinese are particularly
conscious of their identity. And now more than ever the
emotionality behind identity rather than just its physical
shape, is becoming an issue for the global manager.
Steve Macaulay
Now you see some key qualities that are required of
somebody if they are to be successful on the global
Professor Andrew Kakabadse
stage; I have noted them down here as reach, readiness
and roll out. I wonder if we could explore those? You
have grouped the twenty one shots, if you like, of
wisdom into those areas. So let’s start with reach; what
does that actually mean in practice?
Andrew
Kakabadse
What it means in practice is what is the extent of your
reach; how far can you network? These three
categories apply to individuals, they apply to teams and
they apply to whole corporations. So as a person, do
you have the reach to, for example, contact Nelson
Mandela in South Africa to discuss the corporate
responsibility issues in a pharmaceutical industry and tie
that all up with a deal. That is you as a chief executive.
Does the corporation have the reach into a supply chain
on a responsible basis right across Asia?
So the reach bit is the capacity of the organisation to
extend into different countries and cultures. The skill of
the individual to have developed a network that will allow
that. The ability of a team which is multinational and
located in different areas to reach out to different parts of
the organisation and their own stakeholders and yet still
come together and work together as a team that hardly
ever meets, but is electronically linked together.
Steve Macaulay
The second one is readiness; what does that entail?
Andrew
Kakabadse
This is the preparation in terms of organisation and
person again. The readiness of the organisation; are
you an organisation that is flexible? If you have very
hierarchical rigid structures, which certain organisations
have and use them very well by the way because one of
their competitive advantages is the management of costs
- so they need a very disciplined structure. Well at the
same time, do you have a capacity to be flexible in x, y
and z?
At a personal level, do you understand what it means to
operate in different cultures? One of the most
interesting things for executives today is not just their EQ
and their team skills and their skills of communication,
which really are important and have been promoted and
talked about over the last decade. We are finding that
those are important, but there is something just above
them and that is their intellect. And intellect we classify
under various headings; the ability to think, the ability to
analyse and also the ability to almost soak in knowledge.
We are find some of the most gifted CEOs and chairmen
and general managers, they read a lot. When they go to
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Professor Andrew Kakabadse
a new area they read about the whole customs and
cultures; they are briefed. They try and remember one
or two bits of poetry or one or two elements of that
culture that will impress people. It could even be
language, or how you say hello or how you say goodbye.
That is part of the readiness stuff. Do you know how to
prepare yourself for entry into a context which could be a
supply chain, it could be a ministerial meeting and you
have learnt enough to impress.
Now, you have to be able to create the time for that.
People have busy schedules on a personal level. So
part of the readiness thing is the discipline. And it is a
discipline to understand what you must do which adds
that extra value in terms of your presence, but doesn’t
necessarily get you the business deal. It creates the
platform for making you look impressive so that the
business deal then can be that much easier negotiated.
You will find exactly the same issues at the
organisational level as well and at the team level. And
that is what that whole section talked about.
Steve Macaulay
Now once you have negotiated the deal you have got
this whole area, which is the third ‘r’ which is roll out.
What do you see that entails?
Andrew
Kakabadse
Well the roll out part is now you are rolling out all these
skills in these different contexts. You have a capacity to
call upon stakeholders, you already have governance,
for example, at the corporate level that has looked at the
responsibilities and how they are exercised in the supply
chain. You have a consciousness from board level
down in the organisation. There is a stewardship and a
discipline there to really understand some of the
dilemmas managers face.
Many corporations today have that as a serious concern
because you may, in terms of your policies, be very
responsible in attitude and in intent. But then when it
comes to managing costs – which is a major issue today
– you will find there could be three to four levels in the
structure where the line managers are being pushed so
hard on the management of costs, they do not know how
to integrate the responsibility requirements because they
will in a sense counter your capacity to control costs, it
literally involves money, and integrate that in a way that
makes sense for that context.
Now is that the chief executive’s responsibility? We
have come to conclude no, it is actually the chairman
and the board’s responsibility to look at those tensions
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Professor Andrew Kakabadse
and provide guidance to the management because at the
end of the day the management has to run the business
and they have to achieve their financial product pricing
targets.
So that is what the readiness roll out bit really is all
about; when you roll things out. No matter how ready
you were and no matter how smart you are, what
happens in practice? What are the contingencies you
have to deal with? How many of those contingencies
can you spot? When it comes to handling the politics of
the place, do you know what those are really like? Do
you know enough about the personalities? Have you
been experienced in handling different personalities?
Allowing a conversation to go off beam for a while just to
build a relationship at that moment in time, overcome a
sensitivity and then bring the conversation back.
Steve Macaulay
Now lastly Andrew, you have got twenty one pieces of
advice, you have distilled them into three areas; how
would you suggest that people take on board this
wisdom that you have acquired through research,
through observation and so on?
Andrew
Kakabadse
If you wanted a very quick glance at the book in the
introduction you really have the principles of the three
areas and then a very quick overview of each of the
shots. So if you wanted to distil it quickly, my advice is
read the introduction and read nothing else.
What we have tried to do in the book is play less the
academic research part and provide more of the stories;
the real life experiences, the challenges that people
faced, that corporations faced an how in a very real life
way, also, they overcame those.
So the second thing to do is to look at the stories. But
from a life perspective all that the book does is it really
tries to make you aware of what it means to operate in
different cultures. Going to different place and being
polite and being nice is no longer possible.
Let me give you a very interesting example, as a chief
executive something goes wrong in Asia, you are talking
to the Asian team and if you are talking to your American
or British team, admitting to a mistake. Coming up and
saying we didn’t get it right this time, but we will do better
next time. Now, you may go and be exactly the same in
intent in Asia, very polite, to find ultimate resistance. If
you have not prepared yourself for different cultures, you
won’t understand that just admitting to a mistake is
actually a Judo Christian principle. It is almost 4,000
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Professor Andrew Kakabadse
years old. You go to China, there is a 5,000 year old
principle which is no shame, no loss of face. It is
absolutely impossible to admit to a mistake because
what you have done is you have lost face.
So for the executive who has not prepared themselves,
they have not really thought about the situation, they
have not extended a network in such a way that it makes
sense for the Asians or the South Africans or whatever,
they will go in a very polite way and create an uproar. In
China that politeness would be seen as political,
manipulative behaviour. And that is something that
executive never intended.
So if you do go to China and there is a mistake, the first
thing you do is you talk about issues with no loss of face;
talk about some issue out there, talk about somebody
else’s company, talk about how that company faced a
problem and then found a way round it. And then with
your own team, only talk about ways round it. So
nobody looses face, everybody gains face. The implicit
message is guys we made a mistake; the explicit
behaviour is there isn’t a problem and we are now going
to do things better.
Steve Macaulay
Andrew, thank you very much, that is some very valuable
advice.
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