By Paul Holland, Consulting Partner at Signium Ireland. Originally published at LinkedIn.

The dawn of the Fourth Industrial Revolution with mind-blowing advances in areas such as genetics, artificial intelligence, robotics, nanotechnology and 3D printing, will cause unprecedented levels of disruption in all major industry sectors. Indeed it is predicted by some industry experts that 65% of the world’s primary school children will end up working in new jobs that currently don’t even exist!  Increased global connectivity is set to become a defining feature of the new industrial paradigm where traditional borders will become largely obsolete as cross-cultural infusion becomes the norm. This “connected” economic landscape, has fundamental implications for the type of leadership talent required to succeed in the 21st century.

 It has long been accepted that it’s not enough for leaders to have high levels of IQ. This only measures relative mental ability and while a good barometer of technical proficiency, IQ does not identify a potential leader’s ability to effectively interact with and lead others. Emotional intelligence (EQ) https://www.linkedin.com/pulse/emotional-intelligence-x-factor-great-leaders-paul-holland?trk=prof-post, with its ability to understand how skilfully one manages personal emotions and harnesses the emotional drivers in others, will continue to be fundamentally important. But in the connected world where all global markets are accessible with the click of a mouse, another dimension will be critical -  Cultural Intelligence (CQ).

 CQ is can be broadly defined a person's “capability to function effectively in situations characterized by cultural diversity” (Ang, Van Dyne, & Koh, 2005; Earley & Ang, 2003; Earley & Mosakowski, 2005). Cultural Intelligence therefore provides important insights into a person’s ability to cope with multi-cultural situations, engage in cross-cultural interactions and lead culturally diverse work groups.

 In modern society, key global challenges like climate change will require leadership with acute awareness of and ability to achieve consensus within different cultural perspectives. In a business context, international leaders will need to clearly understand the cultural contexts in which they operate and how this influences stakeholder behaviour in the communities they are part of. Leaders with high levels of CQ demonstrate enhanced leadership skills including; judgement and decision making, negotiation, creativity and innovation and trust building.

In some ways, CQ could be considered as an extension to EQ and like EQ (and unlike IQ), it can be learned and improved through modified behaviour. However, a growing number of market leaders in the digital age are recognising CQ as a critical leadership attribute worthy of separate analysis in its own right. 

Broadly speaking, there are 3 key elements to determining ones level of Cultural Intelligence; Cognitive CQ, Physical CQ and Motivational CQ:

 Cognitive CQ relates to proactive strategies for understanding the nuances of different cultures and planned actions focussed on how they can be most effectively managed. Successfully adapting to these new cultures could involve working in a new country or continent or indeed developing an understanding of the challenges associated with adapting to a new sub culture within the same organisation. For example, different functional areas eg sales, HR, finance, within the same organisation will probably have distinctly different operating cultures. Leaders with strong Cognitive CQ will readily identify each and adapt behaviours and leadership strategies accordingly.

 Physical CQ involves the understanding of physical dynamics appropriate to different cultures and appropriately modifying ones physical behaviours to respect them. Take the simple smile for instance. Amercians are comfortable to smile freely at strangers while in Russia this can be considered rude. In Asia, a smile can mean not just an expression of joy but also of pain and humiliation. Understanding these subtle cultural nuances and their implications is important for culturally intelligent leadership. 

 Motivational CQ is about how genuinely motivated and determined one is to effectively understand different cultures and adapt to them. People with high levels of CQ genuinely love interacting with and learning from people from diverse cultural backgrounds. They want to do it and they show it. Queen Elizabeth speaking in the Irish language at a State Dinner in Ireland in 2011, was a very powerful illustration of Motivational CQ, particularly in the context of historical relations between the two countries.

In summary, Cultural Intelligence will become increasingly important in the connected world as it helps business leaders adjust emotionally and psychologically to leading in new cultural environments and managing culturally diverse teams. My personal view is that it that Cultural Intelligence might best be analysed and managed as a fundamental element of overall Emotional Intelligence. I would contend that there is an inherent cultural sub-context to the 5 key dimensions of EQ namely: self-awareness, self-regulation, motivation, empathy and social-skills and that CQ could best be evaluated and embedded within these.

Whether Cultural Intelligence is analysed as part of EQ or as a separate measurement in its own right, what is irrefutable though is that, in the connected world of the Fourth Industrial Revolution, CQ will be a critical skill of all great business leaders.

Paul Holland is a Dublin based Partner of Signium – one of the world’s leading Executive Search companies with over 40 offices in 30 countries. He works with many leading Irish and global brands in helping them to identify and hire leadership talent in a wide variety of functional and specialist roles. 

Please visit www.signium.com for more information on Paul and the services Signium provides in a global context.