Chapter Fifteen Cultural Diversity and International Organizational Behaviour

Chapter FifteenChapter Fifteen

Cultural Diversity and Cultural Diversity and International Organizational International Organizational

BehaviourBehaviour

Copyright © 2007 by Nelson, a division of Thomson Canada LimitedCopyright © 2007 by Nelson, a division of Thomson Canada Limited 22

ObjectivesObjectivesAfter reading and studying this chapter, you should be able to:After reading and studying this chapter, you should be able to:

1.1. Understand the scope, competitive advantages, Understand the scope, competitive advantages, and success factors associated with cultural and success factors associated with cultural diversity.diversity.

2.2. Identify and explain key dimensions of cultural Identify and explain key dimensions of cultural differences.differences.

3.3. Describe what is required for managers and Describe what is required for managers and organizations to become multicultural.organizations to become multicultural.

4.4. Be more aware of barriers to good cross-cultural Be more aware of barriers to good cross-cultural relations.relations.

5.5. Explain how motivation, ethics, appropriate Explain how motivation, ethics, appropriate negotiation skills, conflict resolution, and negotiation skills, conflict resolution, and empowerment practices can vary across empowerment practices can vary across cultures.cultures.

6.6. Appreciate the nature of diversity training and Appreciate the nature of diversity training and cultural training.cultural training.


The Scope of Cultural The Scope of Cultural DiversityDiversity

Valuing diversity means to respect and Valuing diversity means to respect and enjoy a wide range of cultural and enjoy a wide range of cultural and individual differences.individual differences.

Scientifically measuring diversity is fairly Scientifically measuring diversity is fairly easy; in practice, diversity may not be easy; in practice, diversity may not be visible or manifest itself readily.visible or manifest itself readily.

The goal of a diverse organization:The goal of a diverse organization: for persons of all cultural backgrounds to for persons of all cultural backgrounds to

achieve their full potentialachieve their full potential..


The Diversity Umbrella The Diversity Umbrella (condensed)(condensed)

RaceRaceSex or genderSex or genderReligionReligionAgeAge (young, middle-(young, middle-

aged, and old)aged, and old)Generation Generation

differencesdifferencesEthnicityEthnicityEducationEducationAbilitiesAbilitiesMental disabilitiesMental disabilitiesPhysical disabilitiesPhysical disabilitiesValues and motivationValues and motivation

Sexual orientationSexual orientationMarital statusMarital statusFamily statusFamily status

Personality traitsPersonality traitsFunctional Functional

backgroundbackgroundTechnologyTechnology

interest interestWeight statusWeight status

Hair statusHair statusStyle of clothing Style of clothing and appearanceand appearanceTobacco statusTobacco status


The Competitive Advantage of The Competitive Advantage of DiversityDiversity

Gain a marketing advantage, including increased Gain a marketing advantage, including increased sales and profits.sales and profits.

Reduce costs for absenteeism and turnover Reduce costs for absenteeism and turnover through increased job satisfaction; avoid through increased job satisfaction; avoid discrimination lawsuits.discrimination lawsuits.

Recruit talented peopleRecruit talented people

Provide useful ideas for favourable publicity and Provide useful ideas for favourable publicity and advertising.advertising.

Workforce heterogeneity may offer a Workforce heterogeneity may offer a creativitycreativity advantage.advantage.


Factors Associated with Factors Associated with Diversity SuccessDiversity Success

Comparison of conglomerates with differing Comparison of conglomerates with differing success in diversity showed importance of:success in diversity showed importance of: CEO initiation and support; active visible roleCEO initiation and support; active visible role Extensive human resources initiativesExtensive human resources initiatives Organizational communication: employees Organizational communication: employees

involved in shaping human resource policiesinvolved in shaping human resource policies Diversity is a corporate philosophy; no opting Diversity is a corporate philosophy; no opting

out by unitsout by units Treating diversity as serious measure of Treating diversity as serious measure of

company company successsuccess


Cross-Cultural ValuesCross-Cultural Values

Key dimensions of differences:Key dimensions of differences: Individualism versus collectivismIndividualism versus collectivism Power distancePower distance Uncertainty avoidanceUncertainty avoidance Materialism versus concern for othersMaterialism versus concern for others Long-run versus short-run orientationLong-run versus short-run orientation Formality versus informalityFormality versus informality Urgent time orientation versus casual time Urgent time orientation versus casual time

orientationorientation High context versus low context culturesHigh context versus low context cultures Work orientation versus leisure orientationWork orientation versus leisure orientation


Key Dimensions of Key Dimensions of DifferencesDifferences

IndividualismIndividualism mental set in which people see themselves first mental set in which people see themselves first

as individuals and believe their own interests as individuals and believe their own interests take prioritytake priority

Employees more concerned with own career Employees more concerned with own career than firmthan firm

CollectivismCollectivism Mental set in which group and society take top Mental set in which group and society take top

prioritypriority Will lead employee to be more concerned with Will lead employee to be more concerned with

the organization than themselvesthe organization than themselves

Note that current emphasis on teamwork Note that current emphasis on teamwork is softening individualism in individualistic is softening individualism in individualistic culturescultures


Key Dimensions of Key Dimensions of DifferencesDifferences(continued)(continued)

Power DistancePower Distance Extent to which employees accept idea that Extent to which employees accept idea that

members of an organization have different levels members of an organization have different levels of powerof power

High – positive orientation to authorityHigh – positive orientation to authority Low – do not readily recognize power hierarchyLow – do not readily recognize power hierarchy

Uncertainty avoidanceUncertainty avoidance Extent to which society wants predictability, is Extent to which society wants predictability, is

uncomfortable with risk, the unknownuncomfortable with risk, the unknown High – want certainty, predictabilityHigh – want certainty, predictability Low – accept the unknown, tolerate risk & the Low – accept the unknown, tolerate risk & the

unconventionalunconventional


Key Dimensions of Key Dimensions of DifferencesDifferences(continued)(continued) MaterialismMaterialism

Emphasis on assertiveness & acquisition of Emphasis on assertiveness & acquisition of money or material objectsmoney or material objects

Concern for othersConcern for others Emphasis on personal relations & concern for Emphasis on personal relations & concern for

welfare of otherswelfare of others

Long-term orientationLong-term orientation Long-term perspective, thriftyLong-term perspective, thrifty

Short-term orientationShort-term orientation Demand for immediate results and propensity Demand for immediate results and propensity

not to savenot to save



FormalFormal Importance attached to tradition, ceremony, Importance attached to tradition, ceremony,

social rules, ranksocial rules, rank InformalInformal

Casual attitude toward tradition, ceremony, Casual attitude toward tradition, ceremony, social rules, ranksocial rules, rank

Urgent time orientationUrgent time orientation See time as scarce resource, tend to be See time as scarce resource, tend to be

impatientimpatient Casual time orientationCasual time orientation

View time as unlimited, tend to be patientView time as unlimited, tend to be patient



High-context cultureHigh-context culture Attach importance to surrounding circumstances Attach importance to surrounding circumstances

of an event, e.g., body language used extensivelyof an event, e.g., body language used extensively Low-context cultureLow-context culture

Little concern with contextLittle concern with context

Work orientationWork orientation Expect to work many hours, may not take all Expect to work many hours, may not take all

vacationvacation Leisure orientationLeisure orientation

Take extensive holidays and lunch breaksTake extensive holidays and lunch breaks


Culturally-Based Differences in Culturally-Based Differences in Management StyleManagement Style

Culture provides values that guide Culture provides values that guide acceptable managerial behavior and acceptable managerial behavior and leadership styles.leadership styles.

Transplanted managers may need to Transplanted managers may need to adopt some of the characteristics of the adopt some of the characteristics of the national stereotype of an effective leader national stereotype of an effective leader in the local in the local culture.culture.


Culturally-Based Differences in Culturally-Based Differences in Management Style: Management Style:

StereotypesStereotypes

GermanyGermanyTechnically expert,Technically expert,authoritarians authoritarians

FranceFranceElitist,Elitist,

authoritarians authoritarians

JapanJapanFormal,Formal,consensus seekersconsensus seekers

ChinaChinaLow-profile,Low-profile,

tough negotiatorstough negotiators

United StatesUnited StatesEmotional,Emotional,

egalitarians egalitarians


The Multicultural ManagerThe Multicultural Manager Relates effectively to and can motivate people across Relates effectively to and can motivate people across

race, gender, age, social attitudes and lifestyles.race, gender, age, social attitudes and lifestyles. Respects and values cultural differences.Respects and values cultural differences. Attempts to learn another language where Attempts to learn another language where

appropriate.appropriate. Can conduct business in a diverse, international Can conduct business in a diverse, international

environment.environment. Is aware of and interested in why people of other Is aware of and interested in why people of other

cultures act as they do.cultures act as they do. Does not assume that the ways of one’s culture are Does not assume that the ways of one’s culture are

the only ways things should be done. (is not the only ways things should be done. (is not parochial)parochial)

Is not ethnocentric in assuming the superiority of one Is not ethnocentric in assuming the superiority of one culture over that of another culture.culture over that of another culture.


Exhibit 15-2: Protocol Do’s and Exhibit 15-2: Protocol Do’s and Don’ts in Several CountriesDon’ts in Several Countries


The Multicultural The Multicultural OrganizationOrganization

Values cultural diversity and is willing to Values cultural diversity and is willing to encourage and even capitalize on such encourage and even capitalize on such diversitydiversity

Benefits of a multicultural organizationBenefits of a multicultural organization Achieves the benefits of valuing diversityAchieves the benefits of valuing diversity Avoids the problems of not managing for diversity:Avoids the problems of not managing for diversity:

Increased turnoverIncreased turnover Interpersonal conflictInterpersonal conflict Communication breakdownsCommunication breakdowns


Developmental Stages for the Developmental Stages for the Multicultural OrganizationMulticultural Organization

NONDISCRIMINATORYUnfair advantage of majority group removed, but no culture change

MONOCULTURALExclusion of minorities and women from power

MULTICULTURAL Shares power and influence with all; major culture change


Exhibit 15-4 Diversity Exhibit 15-4 Diversity Initiatives at Major Business Initiatives at Major Business

FirmsFirms


Barriers to Good Cross-Cultural Barriers to Good Cross-Cultural RelationsRelations

Perceptual expectationsPerceptual expectations Predispositions about the appropriate appearance Predispositions about the appropriate appearance

and physical characteristics of individuals.and physical characteristics of individuals. EthnocentrismEthnocentrism

A belief that one’s culture is the best and judging A belief that one’s culture is the best and judging other cultures by how closely they resemble one’s other cultures by how closely they resemble one’s own culture.own culture.

Intergroup rather than interpersonal relationsIntergroup rather than interpersonal relations Stereotyping individuals based on their group Stereotyping individuals based on their group

membership and not making the effort to relate.membership and not making the effort to relate.


Barriers to Good Cross-Cultural Barriers to Good Cross-Cultural Relations (cont.)Relations (cont.)

Stereotypes in intergroup relationsStereotypes in intergroup relations Assuming an individual’s personal Assuming an individual’s personal

characteristics are based on their group characteristics are based on their group membership.membership.

Language differencesLanguage differences When people do not understand each When people do not understand each

other’s languages, the possibility for other’s languages, the possibility for misunderstanding multiplies.misunderstanding multiplies.


Cross-Cultural Processes: Cross-Cultural Processes: MotivationMotivation

In order to use motivational concepts across In order to use motivational concepts across cultures, managers must know two key factors:cultures, managers must know two key factors: Which needs the people are seeking to satisfy.Which needs the people are seeking to satisfy. Which rewards will satisfy those needs.Which rewards will satisfy those needs.

Research findings:Research findings: A motivational concept with a good cultural fit to the A motivational concept with a good cultural fit to the

culture can be successfully applied to that culture.culture can be successfully applied to that culture. E.g., extrinsic rewards and E.g., extrinsic rewards and behaviouralbehavioural management management

successful with Russian weavers but successful with Russian weavers but participativeparticipative management was notmanagement was not

Some evidence for similar needs across cultures, e.g., Some evidence for similar needs across cultures, e.g., attachment/affiliation and exploratory/assertiveattachment/affiliation and exploratory/assertive


Cross-Cultural Processes: Cross-Cultural Processes: EthicsEthics

Global business practices and behaviours create Global business practices and behaviours create ethical and legal dilemmas for managers:ethical and legal dilemmas for managers: The choice of which culture’s code of ethics to follow.The choice of which culture’s code of ethics to follow.

Conflicts between individual and organizational Conflicts between individual and organizational responsibilities for ethical behavior.responsibilities for ethical behavior.

The ethics of outsourcing when doing so may create The ethics of outsourcing when doing so may create a health or environmental safety hazard in another a health or environmental safety hazard in another culture.culture.

Pay practices; is any executive really worth so much Pay practices; is any executive really worth so much more than the lowest paid worker?more than the lowest paid worker?


Cross-Cultural Processes: Cross-Cultural Processes: NegotiationsNegotiations

Negotiation styles vary across Negotiation styles vary across cultures and require significant cultures and require significant adaptationadaptation

E.g., differing levels of E.g., differing levels of competitiveness and focus on competitiveness and focus on building a relationshipbuilding a relationship

Trust is weaker when ethically Trust is weaker when ethically problematic negotiation tactics usedproblematic negotiation tactics used


Cross-Cultural Processes: Cross-Cultural Processes: Conflict ResolutionConflict Resolution

National cultures influence which method of National cultures influence which method of conflict resolution a manager will choose.conflict resolution a manager will choose.

E.g., research with international joint E.g., research with international joint venture managers showed:venture managers showed: Western managers tended to use forcing & Western managers tended to use forcing &

problem solving style more than Chinese & problem solving style more than Chinese & other Asian managers, were more legalisticother Asian managers, were more legalistic

Chinese & other Asians tended to prefer more Chinese & other Asians tended to prefer more compromising stylecompromising style


Cross-Cultural Processes: Cross-Cultural Processes: EmpowermentEmpowerment

Research suggests empowerment Research suggests empowerment programs might be readily accepted programs might be readily accepted in low power distance countries but in low power distance countries but may not be successful in high power may not be successful in high power distance countriesdistance countries


Diversity TrainingDiversity Training

Attempts to bring about workplace Attempts to bring about workplace harmony by teaching people how to get harmony by teaching people how to get along better with diverse coworkers.along better with diverse coworkers.

Objectives of diversity training:Objectives of diversity training: Fostering awareness and acceptance of individual Fostering awareness and acceptance of individual

differences.differences. Helping participants understand their own feelings Helping participants understand their own feelings

and attitudes about people who are different.and attitudes about people who are different. Exploring how differences might be tapped as assetsExploring how differences might be tapped as assets

in the workplace.in the workplace. Enhancing work relations between people who are Enhancing work relations between people who are

different from each other.different from each other.


Training in Cross-Cultural Training in Cross-Cultural RelationsRelations

Cultural trainingCultural training A set of learning experiences designed to A set of learning experiences designed to

help employees understand the customs, help employees understand the customs, traditions, and beliefs of another culture.traditions, and beliefs of another culture.

To avoid culture shockTo avoid culture shock The physical and psychological symptoms The physical and psychological symptoms

that can develop when a person is abruptly that can develop when a person is abruptly placed in another culture.placed in another culture.

Culture shock is a major contributor to the high Culture shock is a major contributor to the high failure rate of overseas assignments.failure rate of overseas assignments.

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Chapter Fifteen Cultural Diversity and International Organizational Behaviour