Today’s workplaces are more multicultural than ever, with employees from many different places and backgrounds. In this article, we explore the significance of cultural intelligence in the workplace and its impact on productivity, innovation, and organisational success.

Cultural intelligence has increasingly become a topic of interest in management.

With teams comprising individuals from various cultural backgrounds, it’s only fair that managers strive to appreciate and understand differing cultural factors in their teams.

According to the Office for National Statistics, the proportion of non-UK nationals working in the country has been steadily increasing over the past decade, making cultural diversity a key feature of the modern workplace. It’s wise for employers to remember that each employee has different perceptions and perspectives that can help elevate business success.

The ability to understand, communicate, and collaborate across cultural boundaries is essential for company growth and talent attraction.

What is cultural intelligence?

Cultural intelligence, or cultural quotient (CQ), is the ability to relate to and interact with other cultures effectively. It is a crucial skill for employees who work in diverse and global environments, as it helps them understand, communicate and collaborate with people from different backgrounds, with different values and perspectives.

CQ has four main components according to professors P. Christopher Earley and Soon Ang. They are:

  • Drive (motivation): the ability to direct attention and energy toward learning about and functioning in cross-cultural situations
  • Knowledge (cognition): describes the wide scope of general knowledge individuals hold about cultures
  • Strategy (metacognition): refers to a person’s mental capability to acquire and evaluate cultural knowledge
  • Action (behaviour): the capability to put knowledge into practice and to demonstrate an extensive range of culturally appropriate verbal and non-verbal behaviours.

It’s important to remember that cultural intelligence can play a significant role in how employees evaluate your company culture. By bridging gaps related to traditions, customs, disciplines, and nationalities, you can influence greater awareness and understanding of cultural differences among your workforce. This will help with collaboration, increase productivity and enhance organisational reputation.

Why is it important in the workplace?

According to research published by School for CEOs, 76% of senior business leaders lack cultural intelligence – hindering their chances of creating a greater sense of belonging and inclusion within their teams.

Owing to its impact on team building and diversity of opinion, CQ is becoming an increasingly important skill in business. Here are some of the key reasons cultural intelligence is important in the workplace:

Enhances productivity and innovation

Cultural intelligence plays a pivotal role in enhancing productivity and driving innovation. When employees possess the ability to understand each other, they are more likely to work collaboratively and harmoniously, regardless of cultural differences.

This, in turn, creates a positive work environment, where individuals bring unique perspectives and ideas to the table – making them better equipped to solve complex problems by drawing from a wide range of experiences and viewpoints.

Creates effective communication and collaboration

One of the most significant benefits of cultural intelligence is its role in creating and maintaining effective workplace communication – especially in large organisations, where individual thoughts and opinions can easily be overlooked.

Individuals with high cultural intelligence are skilled at bridging communication gaps, mitigating misunderstandings, and building trust across the workplace. This is essential in a globalised economy, where businesses often engage with international partners, clients and stakeholders.

By leveraging CQ, employees can build stronger, more meaningful relationships with stakeholders from diverse backgrounds, leading to enhanced business outcomes, long-term partnerships and reduced risk of miscommunication.

Promotes customer relations

As business models grow and strategies expand beyond localised areas, businesses must cater to a diverse customer base. Cultural intelligence is instrumental in understanding and meeting the needs of different customers.

When teams understand diverse cultures and their requirements, they can deliver more personalised and culturally sensitive services, thereby enhancing customer satisfaction and loyalty. Cultural intelligence enables businesses to avoid misunderstandings and missteps that could jeopardise customer relations and lead to reputational damage.

Builds inclusive workplaces

With inclusion and diversity now a prominent part of internal business strategy, cultural intelligence is key to creating inclusive workplaces where all employees feel valued and respected.

By promoting a sense of belonging and understanding of others, organisations can create an environment that celebrates diversity and encourages individuals to bring their authentic selves to work. This supportive culture then leads to higher levels of employee satisfaction, engagement, productivity and retention.

Developing cultural intelligence

Improving cultural diversity in the workplace requires everyone, especially leaders responsible for strategy and innovation, to practice cultural intelligence.

Some of the ways to develop and encourage a multicultural mindset are:

  • Helping employees learn the basics of different cultures, such as values, beliefs, customs, and etiquette
  • Observing and reciprocating the physical cues and gestures of other cultures, such as eye contact, body language, and personal space
  • Practising empathy and curiosity when interacting with people from different backgrounds and viewpoints
  • Seeking feedback and learning from mistakes when engaging in cross-cultural situations
  • Providing opportunities for cultural exchange and collaboration, such as mentoring, training, and social events.

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