Read the full script of Module 9, Episode 5 of the Global Growth Master Class below. Want to get certified on global expansion? Simply click here to access the complete course today.

In one of our conversations with an expansion leader, he shared a story of a company he helped expand to China. He helped set up the office, went back to HQ and then returned a few months later. Upon his return, he saw 4 core values written on the wall of the office. The issue was that the company had 7 core values. 

When he inquired with the local team about where the missing 3 were, he was informed that they didn’t align with the local culture, so they didn’t add them to the wall, and thereby didn’t focus on them.

To avoid situations like these, companies need to ask:

How do we create a company culture that empowers a global team?

The key is to universalize company core values.

When formulating their core values, companies typically consider their interactions with essential stakeholders, such as employees, partners, and above all, customers. However, environmental and societal concerns have become integral components of company's core values in recent times.

Global Class Companies differ from legacy companies in the scope of their core values. While legacy companies typically focus on their initial market, Global Class Companies consider a global audience. For instance, while concepts like liberty or Walmart's "Respect for the individual" may appeal to an American audience, these values may not align with the collectivist values prevalent in many Asian cultures. Therefore, Global Class Companies develop core values that are more inclusive and sensitive to diverse cultures and global impact.

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A company's core values must have universal appeal beyond its initial market to resonate with stakeholders in other markets. If the values are too specific to a particular market, it can lead to less engagement with customers and less employee empowerment, making it difficult to achieve company-market fit. Rakuten's early issues with employee morale in their European office could have been avoided if their core values had been more understandable to a non-Japanese audience from the outset.

On the other hand, Slack lists its core value of “empathy" to create a workplace environment in which everyone's opinion is valued and respected. In Japan, concepts like empathy are seen as deeply important to their corporate culture—making it a great value for the company to emphasize when communicating with potential customers there.

The process of universalizing core values is about discovery as much as creating consistency since local teams interpret and understand things differently

When values are universalized, you have the foundation for consistency.

Differences in local business culture can sometimes result in varying interpretations of core values and strategies. Amazon's "is right, a lot" core value, which emphasizes the importance of making informed decisions based on diverse perspectives, can be difficult to comprehend for some in India where there is a high regard for authority. Local employees interpreted the core value to mean that the boss's decisions are always right and should not be questioned. To ensure that core values are understood across different markets and business cultures, it is important to adapt them accordingly. Global Class Companies create core values that are universal and easily comprehensible worldwide. By universalizing their core values, they are able to attract top talent and connect better with customers globally, breaking down geographical barriers.

Companies can struggle with this. The SendBird team had a core value, “the buck stops here,” referring to a quote popularized by American President Harry Truman as a response to the notion of passing the buck, pushing problems off to other people instead of resolving them. This is a great notion that fosters taking action, but it is a very American concept and phrase, which didn’t resonate with the Korean team members (which is where the company was established) or other team members from other countries. 

Interestingly enough, in this case, Sendbird was founded by a Korean, and it goes to show that universalizing core values is not an easy task, even for someone who understands the local culture well. 

The process of universalizing doesn’t just happen once. They must regularly ensure core values are universal and align with local values, especially when entering a new market. From a practical perspective, as you hire, validate your core values by asking candidates if they align with local culture, and make the topic of core values part of the Localization Discovery process.

The agile mindset is important in finding the right balance between company and local cultures, and Global Class Companies understand the need to discover rather than create core values. As companies scale, they may need to change elements of their core values to incorporate the influences of an increasingly global operation. For example, Flexport had a core value of "fill the gap" that empowered employees to find solutions to challenges as they arose, but as the company began to scale in multiple markets, this value could create additional complexity. 

As you can see, core values can result in confusion and lead to actions not intended. Companies that struggle to universalize core values can bridge the gap between company culture and local market culture. Apart from being culturally aware, adapting principles familiar to local teams can also gain buy-in. As an example, Slack attempted to connect its core values of courtesy, craftmanship, empathy, and playfulness with local culture. The core value of craftmanship resonates with the Japanese people as they value quality work, while empathy is a quality harder to understand as people in Japan tend to avoid talking about their feelings in a professional setting. Therefore, it may be more effective to focus on core values to have local counterpoints rather than get every core value adopted. 

The company ultimately decided to change this value to achieve global scale

LinkedIn's mission and vision were crafted with simplicity and universality in mind to ensure that people worldwide could easily understand and connect with them. Their message is focused on creating economic opportunities for anyone in the world, which directly contributed to their business success and ability to access new markets. As a result of this simplicity and universal appeal, LinkedIn was the only non-Chinese social media platform permitted to operate in the country for a period of time.

By having clarity around your mission and vision, which has universal appeal, and having employees with these instilled in their mindset, they will internalize the core values and ask themselves important questions in their everyday work to stay aligned: 

- Does my decision/action conflict with company core values?

- Are my actions aligned with company culture?

And so on.

While the process of universalizing core values is not EASY,  there are SIMPLE STEPS that you can take as an organization. If you’re already global, you can bring together a diverse group of stakeholders (ideally team members, if your organization is diverse enough), and evaluate whether each of your core values and overall culture RESONATE WITH or ALIENATE people in their business culture. 

If any of your COMPANY core values conflict with LOCAL beliefs, norms, and core values, then the COMPANY core value should be adapted to be more universal. As an example, the spirit of Walmart’s “respect the individual” could be encapsulated in a more universalized concept like - “respect communities and the individuals that make them up”,” for instance.

Here are 6 ways to build a process that can help you in universalizing YOUR core values:

- If already global, bring together a diverse group of stakeholders and evaluate whether each of your core values/cultures RESONATE WITH or ALIENATE people in their business culture.

- Involve the leadership team in LOCALIZATION DISCOVERY to better understand LOCAL culture and how potential hires respond to COMPANY core values

- Include HR in the localization discovery process and integrate open-ended questions on culture that can identify a potential conflict with core values

- EMPOWER local teams to educate HQ (feedback loops) on cultural nuances and conflicting core values

- Hire the right Interpreneurial team members who understand and buy into companies values BUT ALSO can communicate the differences back to HQ

- Make cultural bias training a standard part of the onboarding process AND leadership communication

In summary:

- UNIVERSALIZE your company core values to resonate across borders

- INVESTIGATE cultural differences when doing Localization Discovery of new markets and ITERATE when conflicts arise as you enter new countries

- Ensure core values are INTERNALIZED and SUPPORTED by team members in all markets

NOTE: Don't miss out on the next episode! If you want to continue learning about global expansion strategies and dive deeper into the course material, simply click here to access Module 9, Episode 6 of the Global Growth Master Class.