Academy for Chief Executives Blog Rotating Header Image

Why you need Cultural Intelligence

– By David Livermore

If you’re operating internationally – be it the other side of the world or just the other side of the Channel – you are going to need to cultivate a degree of Cultural Intelligence (CQ). At its core, CQ is about viewing and treating people from various cultures with respect and dignity and developing the capability to function effectively across national, ethnic, and organisational cultures.

cq_002_240CQ is obviously a critical component of organisational effectiveness, for companies expanding internationally. But it also enhances interpersonal interactions in a wide range of social contexts. And like these other forms of intelligence, CQ complements IQ by focusing on the specific capabilities that are important when operating in culturally diverse settings.

The point about cultural Intelligence is that it is an individual capability. This means it is not an aspect of personality or personal interests. It is a set of skills that leads to specific outcomes – such as sound decision making, performance, and adjustment to cultural differences. So it shapes the way you pursue marketing, negotiation, sales, and a whole lot more in a culturally diverse context.

Cultural Intelligence is a state-like capability. This means it is malleable – that cultural intelligence is not fixed, but that it changes based on people’s interactions, efforts, and experiences. Restated, you can enhance your cultural intelligence.

Cultural Intelligence is a specific individual difference capability. This is because it focuses on culturally relevant capabilities. Cultural intelligence is more specific than general mental ability or personality.

Cultural Intelligence is NOT specific to a particular culture. For example, it does not focus on the capability to function effectively in France or in Japan. Instead, it focuses on the more general capability to function effectively in culturally diverse situations wherever these may be.

CQ gives employees and their organisations a competitive edge in our shrinking world. It consists of four different capabilities (drive, knowledge, strategy, and action), all of which can be assessed and developed in individuals and full management teams.

Research also demonstrates that cultural intelligence has a direct correlation to the bottom line and to a company’s sustainability in our increasingly globalised world. Some 92 percent of companies that have used the cultural intelligence approach (through training, hiring, strategizing etc.) saw increased revenues within 18 months of implementation.

Even if you don’t plan on booking an international business flight anytime soon, today’s economic crisis may be tomorrow’s great opportunity for tapping into new markets in your own neighbourhood.

In fact, I’m hard pressed to think of any objective you want to accomplish that won’t be enhanced with improved CQ. Sometimes, it can be the critical difference between success and failure. But we’ll have more credibility when we demonstrate how it integrates with several other critical considerations that are necessary.

When cross-cultural experiences are moderated with higher levels of CQ, there’s a big difference.

For example:

International Travel + Low CQ= Ethnocentrism and Confirmation Bias
International Travel + High CQ= Lifetime Impact

Diverse Teams + Low CQ = Frustration and Low Participation
Diverse Teams + High CQ = Engagement and Innovation

Expat Assignment + Low CQ = Stress, Burnout, and Financial Loss
Expat Assignment + High CQ = Satisfaction, Cost-Savings, and Profitability

Cross-Cultural Interactions + Low CQ = Judgment and Mistrust
Cross-Cultural Interactions + High CQ = Broadened Perspective and Effectiveness

Leadership Skills + Low CQ = Glass Ceiling
Leadership Skills + High CQ = Borderless Possibilities


That’s because culture shapes nearly everything we do, from forging a compelling vision for a future in the “flat” world, to adapting to an increasingly globalized economy, appealing to the tastes of culturally diverse customers and constituents, managing, motivating, and evaluating a culturally diverse workforce, creating and managing organizational culture, and to making effective use of international travel. Cultural intelligence offers a common model and language for approaching these varied tasks.


Image credit:


david-livermoreDavid Livermore is president and partner at the Cultural Intelligence Center in Michigan, USA. The center offers the first academically-validated instrument to measure CQ and provides training and coaching for improving CQ. He is also a visiting research fellow at Nanyang Technological University in Singapore and the author of “Leading with Cultural Intelligence”.



Leave a Reply