Part Two: Culture and organizations

CHAPTER 12
CULTURAL DIVERSITY IN ORGANIZATIONS

• Concept 12.1: Cultural competence in

transnational organizations

Slide 12.1 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Management of cultural differences

• Globalization of companies seems to be:

- linked to cultural diversity of organizations
- connected to internationalization of organizations
• Effects of the globalization process on
managerial functions
• The way executives conceive the interaction
between different cultures
• Strategy of proclamation or strategy of
learning?
Slide 12.2 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Management culture

There are three types in multinationals:

• Dominant management culture

– a copy of the multinational’s home country
• Dominant transnational management culture
– created by the mother’s company
• Minimum management culture
– leaving room for national culture
Two Roles: Integrating & adapting
Slide 12.3 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Transnational company

• ‘Transnational’ combines the abilities:

- flexibility, efficiency, transfer of expertise
• of a
- multinational, global, international firm
• Role of top management is to:
- Create a common vision
- Shared set of values to reflect managers’
goals

Slide 12.4 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 What is diversity?

• Notion of diversity
• Individual characteristics
• Characteristics of an individual such as:
- Work background
- Geographical situation
- Education
• In the business life managers see their
employees:
- As individuals
- With the characteristics of a specific group
Slide 12.5 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Diversity and transnational organization

• Managers perceive diversity as a source of

both problems and advantages
• Problems caused by cultural diversity
- communication and integration-esp when employees
required to think & act in the same way.
- practices adopted by the organization across
the board-eg same mrktg campaign
• Diversity among employees :
- may cause misunderstandings
- obstruct team work and productivity
Slide 12.6 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Advantages of cultural diversity

• Multinationals are described as being

- More flexible
- Open to new ideas
- More aware of consumers needs
• Diversity is considered an advantage when the
concern needs to:
- Reposition itself
- Generate ideas
- Develop projects
- Open itself to fresh perspectives
Alder (2002)
Slide 12.7 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Intercultural management

• To act effectively at international level:

• Management which adapts its way of
communicating, negotiating and leading to the
cultural context of the country in question.
• What is needed?
– Dos and don’ts are not the answer
– Nor is providing instruments for ‘cracking’ cultural codes
• Applying a global approach across the board or
a country-by-country approach
• Involving manager-shd be aware of their oe
cultural preferences. Look for working
Slide 12.8
strategies adaptable to another cuture.
Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Transcultural competence

Ability to bridge the differences between the native

and destination culture
• Developing the propensity to reconcile seemingly
opposing values
• Some cultures start from their own orientation &
accommodate the opposing dimension in reconciliation
• At the heart of transcultural competence: principle
of reconciliation (Trompenaars & Williams, 2000)
• Acquiring a transcultural competence. Success:
peer feedback on bus performance-degree of
success achieved abroad. Experience on
international assignments & working with diversity
Slide 12.9 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 What is competence?

Figure II.1 What is competence?

Figure based on the concept developed by Le Boterf (1994)

Slide 12.10 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Competence

• Competence cannot be defined as the

capacity to solve a problem.
• Competence involved a full range of
resources:
- Knowledge, skills, cognitive abilities
• Key to competence:
- ability to integrate these resources
- through the channel of communication and
human interaction
Slide 12.11 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 How to acquire transcultural competence?

• Development of cognitive abilities (memory)

• Integration of knowledge and know-how in a
particular situation
- Knowledge (database of cases)
- Know-how (identification of a problem)
Goal of a transnational manager
• Appropriate attitude in a specific situation
• Building up a ‘memory’ of case-studies/ critical
incidents
Slide 12.12 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009
 Conclusion to Chapter 12

• Internationalization has reinforced cultural

diversity
• Management can use the intercultural
situations within/outside the companies
• Managers need to acquire tools and working
methods
• They have to develop competence in a cross-
cultural context
• Intercultural competence is everyone’s
business
Slide 12.13 Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009