2 Organizational Cultures and Diversity Chapter 6Organizational Cultures and Diversity
3 Organizational Cultures and Diversity The specific objectives of this chapter are toDEFINE exactly what is meant by organizational culture, and discuss the interaction of national and MNC cultures.IDENTIFY the four most common categories of organizational culture that have been found through research, and discuss the characteristics of each.PROVIDE an overview of the nature and degree of multiculturalism and diversity in today’s MNCs.DISCUSS common guidelines and principles that are used in building multicultural effectiveness at the team and the organizational levels.
4 The Nature of Organizational Culture Shared values and beliefs enabling members to understand their roles and the norms of the organization, including:Observed behavioral regularities, typified by common language, terminology, ritualsNorms, reflected by things such as the amount of work to do and the degree of cooperation between management and employeesDominant values that the organization advocates and expects participants to shareHigh product and service quality, low absenteeism, high efficiency
5 The Nature of Organizational Culture Other values and beliefsPhilosophy set forth regarding how to treat employees and customersRules dictating dos and don’ts of employee behavior pertaining to productivity, customer relations, and intergroup cooperationOrganizational climate as reflected by the way participants interact with each other, treat customers, and feel about how they are treated by higher-level management
6 Interaction between National and Organizational Cultures National cultural values of employees may significantly impact their organizational performance.Cultural values employees bring to the workplace are not easily changed by the organization.
10 Organizational Cultures in MNCs Shaped by numerous factors including cultural preferences of leaders and employeesSome MNCs have subsidiaries that (aside from logo and reporting procedures) would not be easily recognizable as belonging to the same MNC
11 Organizational Cultures in MNCs There are four critical steps to successfully integrate organizational cultures after international expansion via mergers/acquisitions:The two groups establish the purpose, goals, and focus of their mergerThen, mechanisms are developed to identify most important structures and management rolesNext, the groups determine who has authority over resourcesFinally, the expectations of all involved participants are identified and communication between departments and individuals is facilitated
13 Organizational Cultures in MNCs Family Culture Strong emphasis on hierarchy and orientation to persons.Power oriented, headed by leader who is regarded as caring parentManagement takes care of employees, ensures they’re treated well, and have continued employmentCatalyze and multiply energies of personnel or end up supporting leader who is ineffective and drains energy and loyalties
14 Organizational Cultures in MNCs Eiffel Tower Culture Strong emphasis on hierarchy and orientation to taskJobs well defined; employees know what they are supposed to do; coordination from topCulture narrow at top; broad at baseRelationships are specific and status remains with the jobFew off-the-job relationships between manager and employeeFormal hierarchy is impersonal and efficient
15 Organizational Cultures in MNCs Guided Missile Culture Strong emphasis on equality in workplace and orientation to the taskCulture oriented to workWork undertaken by teams or project groupsAll team members equalTreat each other with respectEgalitarian and task-driven organizational cultureChange can happen quicklyLoyalty to profession and project often greater than to the organization itself
16 Organizational Cultures in MNCs Incubator Culture Strong emphasis on equality and personal orientationOrganization as incubator for self-expression and self-fulfillmentLittle formal structureParticipants confirm, criticize, develop, find resources for, or to help complete the development of an innovative product or serviceEnvironment where participants thrive on an intense, emotional commitment to the nature of the workEmployees often overworked but happy
18 Managing Multiculturalism and Diversity Both domestically and internationally, organizations lead workforces with a variety of cultures consisting of largely diverse populationsWomen and menYoung and oldBlack, White, Latin, Asian, Arab, IndianMany others
19 The Evolution of International Corporations continues
21 Locations of International Cross-Cultural Interaction
22 Types of Multiculturalism Domestic MulticulturalismMulticultural and diverse workforce operating in MNC home countryGroup MulticulturalismHomogenous groupsToken groupsBicultural groupsMulticultural groups
23 Potential Problems Associated with Diversity Perceptual problemsWhen cultural diverse groups come together, they often bring preconceived, erroneous stereotypes with themInaccurate biasesInaccurate communicationMiscommunicationMisinterpretationsDifferent perceptions of timeAttitudinal problemsMay cause lack of cohesion resulting in unit’s inability to take concerted action or be productive
24 Advantages of Diversity Enhances creativityLeads to better decisionsGenerates more effective/productive resultsLeads to more unique and creative solutions and recommendationsPrevents groupthinkCan facilitate highly effective teams under right conditions
25 Building Multicultural Team Effectiveness Select team members for task-related abilities, not solely based on ethnicityTeam members must recognize and be prepared to deal with their differencesThe team leader must help identify and define the overall goalEqual power of all team members; distribution of power according to ability for taskMutual respect among members is criticalManagers must give team positive feedback on process and output
26 Review and DiscussSome researchers have found that when Germans work for a U.S. MNC, they become even more German, and when Americans work for a German MNC, they become even more American. Why would this knowledge be important to these MNCs?When comparing the negotiating styles and strategies of French versus Spanish negotiators, a number of sharp contrasts are evident. What are three of these, and what could MNCs do to improve their position when negotiating with either group?
27 Review and DiscussIn which of the four types of organizational cultures― family, Eiffel Tower, guided missile, incubator― would most people in U.S. feel comfortable? In which would most Japanese feel comfortable? Based on your answers, what conclusions could you draw regarding the importance of understanding organizational culture for international management?Most MNCs need not enter foreign markets to face challenges of dealing with multiculturalism. Do you agree or disagree with this statement? Explain your answer.
28 Review and DiscussWhat are some potential problems that must be overcome when using multicultural, diverse teams in today’s organizations? What are some recognized advantages? Identify and discuss two of each.A number of guidelines can be valuable in helping MNCs to make diverse teams more effective. What are five of these?