Org culture

1 Cross-Cultural ManagementCross-Cultural Management

Chapter 3-Organizational Cultures and Diversity

Chapter 3(1): Organisational Culture, Diversity &MulticulturalismChapter 3(2): Organisational Culture Chapter 3(3): Diversity


Chapter 3(1): Organisational Culture, Diversity &

Multiculturalism


Acknowledging Culture

Cultural diversity can exist on a national and cross-national levelOften, managers assume that culture does not play an important role in shaping practices =>Universalistic approach: ‘if it works here, it will work there’Such approach contributed to high failure rates in expatriate missions and international mergersIn order to manage cross-cultural differences, managers need to acknowledge and understand them


Diversity-Related Problems

Increased ambiguityIncreased complexity and confusionDifficulty to converge meanings andMiscommunicationLower cohesivenessHarder to reach agreementHarder to make decisions and agree on specific actions


Diversity-Related Advantages

Expanding meanings andBroader cognitive frame & resourcesMultiple perspectivesMultiple interpretationsRicher alternatives & more ideasIncreased creativity and problem solving skillsIncreased flexibility


Diversity and Types of Organizations

• Organizational culture affects the acceptance and impact of diversity in organizations

• Parochial: Our is the only way• Ethnocentric: Our way is best• Pluralistic (synergetic): The best is combining

our ways and their waysIn large companies, different divisions may have

different sub-culturesThe more complex, unpredictable and global is the

business environment of a company, the more competitive advantages cultural diversity has.


Nature of Organizational Culture

• Organizational culture– Pattern of basic assumptions that are

developed by a group as it learns to cope with problems of external adaptation and internal integration and that are taught to new members as the correct way to perceive, think, and feel in relation to these problems

– An MNC’s organizational culture in one country’s facility may differ sharply from those in other countries


Nature of Organizational Culture

• Interaction Between National and Organizational Cultures– National cultural values of employees have

a significant impact on organizational performance

– Cultural values that employees bring to the workplace are not easily changed by the organization

– Substantial differences may be observed among subsidiaries that cause coordination problems


Organizational Cultures in MNCs

• Integration of organizational cultures is crucial following mergers and acquisitions– Integration process consists of:

• Establishing a common purpose, goal, and focus• Identifying important organizational structures

and roles• Determining who has authority over resources• Identifying the expectations of all involved parties

and facilitating communication between the parties


Organizational Cultures in MNCs (cont.)

• Family culture– Strong emphasis on hierarchy and person

orientation• Power-oriented with paternalistic leader• Leader looked to for guidance• Can catalyze and multiply employees’ energy• Reliance on intuition rather than rational

knowledge



• Eiffel tower culture– Strong emphasis on hierarchy and task

orientation• Employees know what to do• Coordination from the top• Methodic approach to motivating and

rewarding people and resolving conflict



• Guided missile culture– Strong emphasis on equality in the

workplace and orientation to the task• Work typically undertaken by teams or project

groups• Low priority attached to hierarchical concerns• Employs a “cybernetic” structure• Culture may change quickly



• Incubator culture– Strong emphasis on equality & personal

orientation• Organizations are secondary to the fulfillment

of individuals• Organization is an incubator for self-

expression and self-fulfillment• Participants have intense emotional

commitment to their work


Organizational Cultures

EIFFEL TOWERRule-oriented

culture

Fulfillment-orientedculture

INCUBATOR

FAMILYPower-oriented

culture

Project-orientedculture

GUIDED MISSILE

Equity

Hierarchy

TaskEmphasis

PersonEmphasis


Processes & Implications

Attraction-Selection-Attrition framework

• Where do you advertise for jobs?

• Who interviews and selects candidates?

• What type of people is the company (implicitly and explicitly) looking for?

• Who gets promoted?

• Mentoring

• Networking


Examples

• Knowledge workers

• Medical doctors & nurses

• University academics


Chapter 3(2) ORGANIZATIONAL CULTURE


CULTURE REVIEWED

• Organizations also have a learned, shared, interrelated set of symbols and patterns of basic assumptions

• The culture help the organizations cope with problems it faces– external adaptation– internal integration


CULTURE HELPS ORGANIZATIONS INTEGRATE INTERNALLY (PPS) AND ADAPT/SHAPE EXTERNALITIES (6 GLOB

AL ENVIRONMENTS) TO SURVIVE.

• Culture permeates the organization– Through knowledge acquisition– Organizational symbols– Organizational stories– Organizational rites

CULTURE REVIEWED


ORGANIZATIONAL KNOWLEDGE

• Explicit—formalized and widely distributed• Implicit—norms or “how we do things around

here”


EXAMINE ORGANIZATIONAL SYMBOLS

• What language is in use and where?• Who is pictured on annual reports, web pages,

or brochures?• What colors represent the company; where are

they used? • What logos are in use?


ORGANIZATIONAL STORIES TELL US

• what the employee is supposed to do when in doubt

• what to do when a high-status person breaks the rules

• how the little person advances within the organization


ORGANIZATIONAL RITES REINFORM NORMS

• Rites of degradation dissolve a person’s organizational identity

• Rites of enhancement recognize accomplishments or enhance power

• Rites of renewal lubricate social relations• Rites of conflict reduction reduces conflict by par

titioning it• Rites of integration revive common feeling


NATIONS TRADITIONALLY SHAPE ORGANIZATIONS

HOW DOES CULTURE AFFECT FIRMS?

Traditionally: national culture shapes business

INDIVIDUALSINDIVIDUALSFAMILIESFAMILIES

NATIONAL CULTURENATIONAL CULTURE

BUSINESSBUSINESS ACTIVITIESACTIVITIES

Business culture


BUT INFLUENCES COME FROM MULTIPLE SOURCES

• Professional training/groups• Family • Subgroups, e.g., R&D or accounting


INCREASINGLY WE ALSO SEE

• business influences come not only from domestic influences but also from international and global business activities, e.g.,– subsidiaries– joint ventures and other strategic alliances


OFTEN CREATING CULTURE CLASH

• between parent and subsidiary• among managers


THUS IN A GLOBAL WORLD, BUSINESSES BECOME CULTURAL CONDUITS

See page 207 of Introduction to Globalization and Business by Barbara Parker


BUSINESS INFLUENCES CULTURE THROUGH

– Global entertainment and electronic media– Global travel– Global language – Global demographic groups

• Global elite• Global teens

– Business behaviors


GLOBAL INFLUENCES OF BUSINESS ON CULTURE

• Make global businesses more central to– Cultural change– Cultural concerns– And cause them to interact more with social

actors such as NGOs and governments


Chapter 3(3) DIVERSITY


Diversity Defined

• Human diversity– Visible– Less or invisible

• Diverse structural configurations• Diverse processes


Global Organizations Emphasize Inclusive Networks When They

• a) reexamine their norms or traditional ways of doing things

• b) seek and value similarities as well as differences as sources of competitive advantage, and

• c) train people for skills that enhance a sense of inclusion


Communications Education and Training Employee Involvement

CEO speeches Diversity briefings for managers

Task forces on diversity

Written diversity policy; diversity brochures

Awareness training for everyone

Interest groups for members of diverse populations

Second language publications Diversity skills training Company time provided for diversity planning

Reports to the public or to shareholders

Multicultural team training Networking groups

Press releases Sexual harassment training

Career Development Performance and Accountability

Mentoring Define behaviors that enhance inclusion

Succession planning for diversity

Monitor and report on diversity progress

Individual development plans Link rewards to achieving diversity objectives

Assign people to diverse jobs over a career

Develop diversity measures that are both qualitative and quantitative

Networking directories

Diversity Initiatives


Approaches to Managing Human Diversity

• Discrimination and fairness• Access and legitimacy• Learning


Pre

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Diversity and their Implementation Episodic Freestanding Systemic

1 Deny an assignment to an employee because a client might object to the employee’s nationality, race, gender, age, etc.

2Choose to risk fines or other costs, rather than engage in equal employment opportunity practices

3Choose geographic locations for the business which avoid diversity / where the local workforce does not contain protected classes

4In response to a governmental employment audit, provide a workshop for protected groups on “how to succeed by adapting to fit into the organization”

5Regular sexual harassment training which focuses on how to avoid legal liability

6Performance appraisal standards for managers include specific targets / quotas for hiring of protected groups

7To increase diversity awareness for managers, bring in a speaker to tell them how to value the diversity of their employees

8Sponsor an annual event that celebrates a protected group, e.g., Special Olympics

9To ensure equal pay, program the HR computerized management system to annually review and adjust pay differentials between non-protected and protected groups

10Pilot an employee network conference that engages employees and their managers in reciprocal learning activities

11Regularly include vendors, suppliers, and customers in the organization’s diversity training offerings to increase their involvement in and contribution to diversity efforts

12Different business units continually share information about their diversity successes and failures, then adapt and integrate them into their businesses

Marginal StrategicExecutive priorities for managing diversity

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Diverse Structures

• Hierarchical– Export office to functional to divisional to hybri

ds• Internal horizontal

– Networks, shamrocks, matrix, virtual• Interorganizational

– Joint ventures– Strategic alliances


Diverse Processes

• IT—integration depends on infrastructures that vary

• HR—selection, development, and compensation in different nations and regions

• Labor practices and conditions• Social responsibility and ethics initiatives

Org culture

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