KNOWLEDGE EXCHANGE PROCESSES IN MULTICULTURAL … · a supportive MNC context, frequent failures to realize that potential waste valuable resources (Cramton & Hinds, 2014; Gibson

r Academy of Management Journal2017, Vol. 60, No. 1, 345–372.https://doi.org/10.5465/amj.2014.0442

KNOWLEDGE EXCHANGE PROCESSES IN MULTICULTURALTEAMS: LINKING ORGANIZATIONAL DIVERSITY

CLIMATES TO TEAMS’ EFFECTIVENESS

AIDA HAJROBrunel University London

CRISTINA B. GIBSONUniversity of Western Australia

MARKUS PUDELKOTuebingen University

We developed a model illuminating team knowledge exchange processes as a key linkbetween organizational diversity climate and the effectiveness of multicultural teams(MCTs). Our analysis is based on 143 in-depth interviews and extensive observations ofteam interactions that occurred in 48 teams from 11 companies. Our findings revealedthat teams that oscillated between assertive and cooperative knowledge exchange pro-cesses were more effective. We also found such dual processes were more prevalent inorganizations that had an engagement-focused diversity climate characterized by uti-lization of diversity to inform and enhance work processes based on the assumption thatcultural differences give rise to different knowledge, insights, and alternative views.Based on our findings we developed specific propositions about optimizing MCTknowledge-exchange processes to guide future research and practice.

Many multinational corporations (MNCs) utilizemulticultural teams (MCTs) so that members withdifferent nationalities can exchange their uniqueknowledge in order to capture market share in newlocations, exceed competitors’ customer service,secure local resources, or implement successfuldistribution in emerging economies (Gibson&Gibbs,2006; Hinds, Liu, & Lyon, 2011). In fact, many workteams inMNCs exist specifically to share and combineknowledgeacrossnationalandgeographicboundaries.Yet, features of the MNC context may inadvertentlyconstrain these processes. For example, corporatepolicies designed to create equality among employeesand encourage assimilationmaymean that in an effortto maintain harmony and acculturate members, di-verse knowledge never surfaces. MCTs offer potentialfor high performance in complex tasks, but, withouta supportive MNC context, frequent failures to realizethat potential waste valuable resources (Cramton &Hinds, 2014; Gibson & McDaniel, 2010).

This problem is widespread. A recent large-scalesurvey across 500 firms from various industries andcountries revealed that while most MNCs focus onattractingandretainingnationallydiverseemployees,they fail to critically examine their organizationaldiversity climates (Preveden, Schwarzinger, Jelicic, &Strobach-Budway, 2013), defined as perceptions thatan organization socially integrates underrepresentedmembers (McKay, Avery, & Morris, 2008). Almostnothing is known about diversity climates in MNCs,because research on suchclimates has been limited togender or racial diversity and has focused exclusivelyon domestic firms, often examining only a single or-ganization (Cox, 1993; Ely & Thomas, 2001; Nishii,2013). For example, Nishii (2013) demonstrated thatwithin more inclusive environments, characterizedby a collective commitment to integrating diverseidentities, gender diversitywas associatedwith lowerlevels of conflict. But in contrast to race and gender,nationality is a deep-level characteristic of diversity,is therefore more difficult to detect and manage(Tyran & Gibson, 2008), and yet incredibly impactful,given it is exactly the characteristic most likely tocoincide with unique knowledge stores that are crit-ical in MNCs.

We would like to acknowledge the helpful advice ofAparna Joshi and our three anonymous reviewers.We alsoappreciate the guidance we received from Prof. GerhardFink on data collection and analysis at the very early stagesof our project.

345

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https://doi.org/10.5465/amj.2014.0442

To develop theory addressing these issues, weformulate the following two research questions:(1) How does an MNC’s diversity climate influenceknowledge exchange processes in culturally diverseteams? and (2) How do these knowledge exchangeprocesses influence team effectiveness? In doing so,we contribute to an understanding of how the MNCdiversity climate links toMCT effectiveness throughits effects on knowledge exchange, thus integratingteam process research with diversity research. Moreprecisely, we discover and clarify the cross-levellinks between different types of diversity climates inMNCs and MCT knowledge exchange processes,uncovering the team activities, actions, and behav-iors that create these links. We then explicate howand why resulting patterns of knowledge exchangein MCTs give rise to a high or low level of team ef-fectiveness, advancing theory and research in thisdomain. In the sections that follow, we first reviewthe literature on diversity climates and knowledgeexchange in teams and describe our methodology.Then we report our empirical findings and developspecific propositions about the relationships amongthe core concepts. Finally, we conclude with theimplications of our findings.

THEORETICAL FOUNDATIONS

The Role of Organizational Diversity Climate

Diversity is a characteristic of groups that refers todemographic differences such as gender, race, ethnic-ity, or nationality, all ofwhichpotentially contribute toa cultural identity that stems from membership in so-cioculturally distinct demographic groups (McGrath,Berdahl, & Arrow, 1995). Members of these groupstend to share certain world views, norms, values,goals, priorities, and sociocultural heritage (Alderfer& Smith, 1982; Ely & Thomas, 2001). Their culturalmarkers can be realized through similarity in com-munication style, rules,meanings, and even language(Larkey, 1996), which are shared within culturalidentity groups, but differ across them, andare centralto knowledge exchange processes. In MNCs, manywork teams are multicultural, in that their membersare from several cultural identity groups, but researchhas yet to uncover whether, under what conditions,and with what consequences people actually expressdifferences associated with their cultural identi-ties in MNCs (Brannen & Peterson, 2009; Ely &Thomas, 2001).

Elements of organizational context pertinent to di-versity have been documented under various labels

and at a variety of analytical levels, including diver-sity climates (Avery, McKay, Wilson, & Tonidandel,2007) and organizational types (Cox, 1993) at the firmlevel; diversity perspectives, which exist within or-ganization’s departments (Ely & Thomas, 2001); andinclusiveness climates, which exist among smallercollectives (Nishii, 2013).Acommonelement of theseconcepts is that a shared approach to diversityemerges among collectives and potentially shapesbehavior among workers within them. Notably, thedominant construct in this literature is organizationaldiversity climate. Although we adopted this term, wesee much overlap between the concepts of climateand culture and the potential for their integration. Adistinction sometimes made between them has beenthat the climate literature considers a person as sep-arate from social context, so thatmanagers are seldomstudied directly but assumed to create the climate. Incontrast, the organizational cultural literature has of-ten assumed individuals are best regarded simulta-neously as both agents and subjects (Denison, 1996).Interestingly, as our findings will show, in con-sidering specific aspects of context related to di-versity we see a helpful merging of these concepts,in that diversity climate may be considered anelement of organizational culture, comparableacross organizations and affecting members ofteams within them, yet simultaneously subject tosocial construction.

Current research on diversity climate has limitedapplicability inMNCs. For example, Ely andThomas(2001) examined three domestic firms all of whichexisted to pursue social and economic goals relatedto communities of color (e.g., one firm’s mission wasto develop and revitalize an African–American ur-ban community). Three perspectives on workforceracial diversity indomestic firmswere identified: theintegration-and-learning perspective shares similari-tieswith the “multicultural”organizationdescribedbyCox (1993) and is characterized by a collective com-mitment to integrating diverse cultural identities; theaccess-and-legitimacy perspective resembles Cox’s(1993) “plural” organization that focuses on increas-ing representation of minority groups but continues toexpect employees to assimilate todominantnorms; thediscrimination-and-fairness perspective maps ontoCox’s (1993)“monolithic”organizational types that arehighlybiasedculturally. Ely andThomas (2001) linkedthe prevalence of these perspectives to intermediategroup outcomes, including race relations, conflictresolution, and feelings of being valued and respected,but did not focus on overall team effectiveness. Theyfound that only the integration-and-learningperspective

346 FebruaryAcademy of Management Journal

provided the rationale needed to achieve sustainablebenefit from diversity.

However, it is not clear that these types exist inMNCs, with their higher level of operational com-plexity and numerous national contexts, or whetherthey will be true for sources of diversity other thanrace and gender. Further, the existing research pro-vides no evidence to assess whether or how firmswhosemissions are not so readily linked to diversitywould reap any benefits from it. Most MNCs todaycreate nationally diverse MCTs to coincide with thediversity in markets and clients across nationalboundaries. While diverse teams stimulate innova-tion, they also need a supportive diversity climate tohelp them function at their best (Holvino, Ferdman,& Merrill-Sands, 2004). Yet, we still lack a rich de-scription and deep discovery process regarding di-versity climates in MNCs. These may be hidden byrhetoric delivered in formal internationally distrib-uted communications such as annual reports, sug-gesting a need to explore how employees interpretand experience the diversity climate in their dailylives and how it is manifest in their interactionsduring teamwork. Specifically, uncovering aspectsof diversity climate that pertain to deep-level diversitycharacteristics such as national cultures requiresa more nuanced understanding of the meaningascribed to them. Their dynamic and socially con-structed nature (Cramton & Hinds, 2014; Tyran &Gibson, 2008) complicates their detection throughdeductive quantitative approaches (Birkinshaw,Brannen, & Tung, 2011; Leung, Bhagat, Buchan,Erez, & Gibson, 2011). Exploring how MNCs thatrely on a nationally diverse workforce frame diversityand how this frame impacts MCT processes and ef-fectiveness remains uncharted territory, navigableonly by a contextualized and inductive approach.

Knowledge Exchange Processes in Teams

Knowledge exchange is the process during whichmembers’ perspectives, information, and know-howenter into team interactions and are shared and dis-cussed (Gibson, 2001). Several reviews in the man-agement and organizational behavior literature haveemphasized the need for research on knowledgeexchange processes in multicultural teams (MCTs)(Gelfand, Erez, & Aycan, 2007; Gibson & McDaniel,2010; Hajro & Pudelko, 2010;Hinds et al., 2011; Tsui,Nifadkar, & Ou, 2007). Studying such processes isimportant since they may mediate the effect of teamdiversity (Jackson, Joshi, & Erhardt, 2003). Knowl-edge exchange processes are therefore among the

most valuable, yet also most contentious, processesin MCTs (Baba, Gluesing, Ratner, & Wagner, 2004;Gardner, 2012; Gibbs, Grushina, & Gibson, 2013;Harvey & Kou, 2013).

Scholars have linked knowledge exchange pro-cesses with team effectiveness, defined most basi-cally as the extent to which a team accomplishes itsobjectives (Mathieu,Maynard, Rapp, & Gilson, 2008).Specifically, researchers have found that a key dif-ferentiator in this process is whether the team hasdeveloped a psychologically safe communicationclimate, defined as an atmosphere marked by open,supportive communication (Edmondson, 2003; Gibson&Gibbs,2006;Metiu&Rothbard,2013).However, someevidence suggests that it is not as simple as the “safer,”the better, and gives descriptions of the benefits ofevaluative responses such as ignoring ideas, advocatingforone’sownideas, andshowingenthusiasmforothers’ideas (Elsbach & Kramer, 2003; Hargadon & Bechky,2006; Harvey & Kou, 2013;Murnighan & Conlon, 1991;Sutton & Hargadon, 1996). For example, Cronin,Bezrukova, Weingart, and Tinsley (2011) found thatthe best performing teams were those that promoteddifferences in perspectives and thinking. Althoughthey did not examine why this benefited effective-ness, Cronin et al. (2011: 843) reasoned that theircounterintuitive results may have been because suchconditions forced teammembers into detailed debateand consideration of wider arrays of alternatives thatmade the emergence of new approaches possible (seeLeonard & Straus, 1997). This reasoning reflects theconstructive controversy argument (Tjosvold, 2008),which suggests that different thinking styles createhealthy debate.

At least one meta-analysis of team effectivenesshas pointed to evidence that divergence and conver-gence are both necessary inMCTs (Stahl, Maznevski,Voigt, & Jonsen, 2010), and qualitative case studieshave revealed cycles of these activities (Maznevski &Chudoba, 2000).Divergence introducesdifferent ideasand juxtaposes them (Cramton & Hinds, 2014), whileconvergence aligns the team around common ob-jectives. Duality was also highlighted by Losada andHeaphy (2004) who discuss the balance in inquiryand advocacy. Yet, the knowledge exchange pro-cesses through which divergence and convergencedevelop in MCTs remain unknown.

Because such tensions are dynamic and likely in-volve dialectical processes (Cramton &Hinds, 2014),they are not easily revealed without observation ofteams in action. This has hidden them from re-searchers’ view,with only limited notable exceptionsas cited here. Hence, deep analysis of knowledge

2017 347Hajro, Gibson, and Pudelko

exchange in MCTs is an important next step. Wedo not know how these processes emerge inMNCsor how they contribute to MCT effectiveness. Sincethe questions we address require uncovering a highlevel of detail about features of diversity climates inMNCs andknowledge exchange inMCTs, advancingknowledge in this area necessitates the kind of fine-grained data provided by a qualitative study. Fur-ther, an inductive approachwas best suited to obtainrich and detailed descriptions of team knowledgeexchange processes that reflect their real-life contextand to recover and preserve the meanings respon-dents attach to these actions and settings to ultimatelymove theory generation forward (Birkinshaw et al.,2011).

METHODS

In the traditionof grounded theory (Glaser&Strauss,1967; Strauss & Corbin, 1998), we began with a broadobjective to investigateMCT interaction processes thatlink organizational context to team outcomes. Our in-terest in organizational diversity climate as a specificconstruct came only after several rounds of data ana-lyses; similarly, our focus on team knowledge ex-change emerged from the data on team interactionprocesses; and fromdata broadly concernedwith teamoutcomes, our analysis led us to focus on team effec-tiveness.As these specific foci emerged,we returned tothe literature. This iteration between our data andprevious studies spurred development of our researchquestions and became the starting point for the devel-opment of our theory (Edmondson&McManus, 2007).

Sample

We collected very rich data from 11 companies, 48teams, and 143 interviewees. The main criterion inselecting our case companies was their culturallydiverse workforces and reliance on MCTs as coreperforming units. We focused our analysis on na-tional cultural differences because nationality wasthe diversity aspect salient in all of them and wouldallow work group comparisons across firms. Thecompanies had from 31,400 to 410,000 employeesand operated in numerous industries. To keep thecountry context constant, all case companies werebased in Austria, either as Austrian owned or as re-gional headquarters of MNCs.

By establishing trusting relationships, we gainedextensive access to the organizations to collect thedata necessary for our case-based theory building(Eisenhardt & Graebner, 2007). Teams were selected

in collaboration with Human Resources (HR) man-agers familiar with the purpose of the study.We onlyselected MCTs that contained at least three nation-alities. Furthermore, all teams had to be collocated(no virtual teams) and we included a variety offunctions to increase conceptual relevance. More-over, we only included teams that had existed for atleast six months, with most teams having existed for13 to 26 months. By excluding teams still in theirformative phase, we kept a consistent level of ma-turity. Interviewees were primarily team membersand team leaders, but also HR professionals, de-partment heads, and internal corporate clients. Todetermine agreement, we interviewed the leader andone or more member(s) of each team. Team sizevaried from approximately four to 15 members. Weinterviewed from 14% to 75% of the people on eachteam, with a mean of 29% and with most teams rep-resentedby50%.Maleswere64%of the respondents,and femaleswere 36%. The average agewas 39 years.Teams included 43 different nationalities.

We proceeded according to the tenets of theoreti-cal sampling in that we simultaneously and re-cursively decided on sampling units aswe collected,coded, and analyzed data (Glaser & Strauss, 1967).We began with six to seven interviews in each com-pany to understand the organizational context. Weasked these respondents for incidents that theyfound somehow critical and to which the team hadresponded through some form of action and inter-action. To clearly understand these events, the peo-ple involved, their interactions, and the outcomes,we conductedmore interviews that raised the total to121 interviewees. Our empirical findings were thendiscussedwithHRmanagers, department heads, andinternal clients to ensure the trustworthiness of data.Conflicting information disclosed in the data analy-sis phase was used to initiate the collection of addi-tional information to resolve inconsistencies. Forinstance, at one firm, we interviewed three teamleaders. While the first two leaders suggested thatthere were aspects of their climate which decreasedthe scope of team learning (they referred to this asa tendency to “blame”), the third leader claimed thathe and his immediate subordinates felt psychologi-cally safe in the firm. To resolve this discrepancy,weinterviewed twoHR executives. Both explicated thatassigning blame for mistakes was an unfortunatepractice at ARC, hereby supporting the views of thefirst two team leaders, hence we utilized this cor-roborating evidence to code the climate at this firmasencouraging “assigning blame for mistakes.”We incor-porated only those teams with multiple respondents


(121 interviews from 48 teams) for the analysis ofteam interactions, but considered all interviewswhen assessing the organizational context and teameffectiveness. Our final sample consisted of 143respondents.

Data Collection

We used three data collection techniques: (1)semistructured interviews; (2) participant observa-tions; and (3) public documentation. The interviewswere our main source of data; the observations andarchival data were important triangulation sources.The first author and six researchassistants,whowererigorously selected and trained, collected the data.

Interviews addressed the same topics and withsimilar questions to allow meaningful comparisonsacross interviewees. Questions asked in every in-terview included: “What are the biggest challengesfor you in the team and how do you cope with thesechallenges?”What works very well in your team andwhat does not?” and “Are there any specific prac-tices for managing diversity in the company?”At thesame time, the semistructured nature of the in-terviews enabled interviewers to probe interestingcommentsand themesas theyemerged.Sampleprobesincluded, “Whydoyou think the teammember reactedin that way?” “What did you learn from this incident?”and “Has this experience changed the way you andothers work in the team, and if yes, could you pleaseexplain how/inwhat way?”On average, the interviewslasted for one hour, resulting in 1783 pages of tran-scripts. The interviews were conducted in German,Slavic languages, or English.

Our secondary data collection method was obser-vation. Researchers spent 224 hours in shadowingteam members and leaders in team meetings, work-shops, coffee breaks, lunches, and other activities.We observed how team members interacted and ex-changed knowledge, and how this knowledge wasused in making decisions. We also gained useful in-sights into the roleoforganizational context, assessingdiversity climate by comparing behaviors with pub-licly available written material (brochures, websites,and documents).

Coding and Analysis

WeusedATLAS.ti software to assist the coding.Asa first step, the first author developed a preliminarycoding system on the basis of 30 interviews. The re-search team subsequently coded 66 interviews (sixinterviews per company). Finally, the first author

and one research assistant coded the remaining 47interviews. We started with a detailed line-by-linedata analysis to generate initial first-order codes(open coding), most of which were in-vivo codes(i.e., verbatim termsusedby the respondents, Strauss& Corbin, 1998). We then merged these first-ordercodes into second-order codes and finally intohigher-order themes (Lee, 1999). In a later analyticstep, we coded activities, behaviors, and actions ofteam members and leaders that represented links orrelationships between diversity climate and teamknowledge exchange, as well as team characteristicsprompted by knowledge exchange.

We met weekly over the 17 months of data col-lection and analysis. All members of the researchteam were encouraged to contribute to the codingstructure. In thesemeetings, the researchers discussedthe emerging codes extensively and reexamined textsegments lacking immediate coding agreement so as toensure consistency. Although the researchers agreedon themeaning of statements, in several instances theydeveloped different codes for the same phenomena.For instance, the lead researcher used the term “inte-gration” to code when respondents talked about thesignificance of their original culture and at the sametime emphasized their desire to learn from other cul-tures. Other researchers originally used the same termfor text segments in which respondents showed littleinterest in maintaining their original culture, but werewilling to learn from other cultures. Such instanceswere discussed in team meetings to reach agreementon coding definitions. In this case, the code “integra-tion”was assignedwhen people showed an interest inmaintaining their original culture and participating inthe other culture; “partial marginalization” was usedwhen individuals showed little involvement in main-taining the culture of origin, but were interested inlearning about others.

Using ATLAS.ti’s memo function, observationalnotes and information from public documentationwere linked to the interview segments, and instancesin which it confirmed or negated our key themeswere noted. The research team discussed such con-tradictions, and resolved them through discussionswith key informants in the companies. For example,in public documentation, one company depicteditself as supportive of diversity; team members con-tradicted this. Our own observations coincided withthe teammembers,becausewesawculturaldifferencesignored in favor of confrontational communication.

We also engaged researchers who were not in-volved with the study to discuss emerging patternsin the data and to ask critical questions about our


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317

8312

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223hrs

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methods. Finally, we asked an experienced qualita-tive researcher involved in the development of AT-LAS.ti software to helpus assess the dependability ofour data. The researcher examinedour records (codingschema, several interview transcripts, and field notes)to confirm the plausibility of our conclusions.

In accordancewith the constant comparativemethod(Glaser & Strauss, 1967), we compared interview datawith observational data to examine whether theyprovided supporting or contrasting information. Sec-ond, interviews and observationswithin anMCTwerecompared to develop the most prevalent codes for theteam as a whole. Third, interviews and observationswithin the same companywere compared to developprevalent codes for the diversity climates. We alsocompared smaller and larger teams; we found nodistinct differences in the prevalence of codes basedon team size. Fourth, the data obtained in each com-panywere aggregated and compared, revealing subtlesimilarities and differences across companies. For in-stance, we noted several similarities across companiesthat pertained to issues such as ignoring cultural dif-ferences or suppressing discussions of cultural differ-ences. These companies differed from those in whichcultural differences were actively addressed and di-versity was viewed as a source of competitiveness.

Company profiles that included summaries ofeach team within the company were prepared andshared with key interview partners and HR execu-tives. These were used for further discussions tocorroborate our preliminary results with their expe-rience. In eight of the 11 companies, the first authorgave a presentation of the findings followed by in-tense discussions. These sessions were attended byinterviewees andexecutives of theHRMdepartment.During these sessions, further information that be-camepart of thedatawere obtained (e.g., examples ofbest practices in diversity management).

These techniques were important, because notionsof reliability and validity applied in quantitative re-search are not directly comparable in qualitative re-search (Shah & Corley, 2006; Van Maanen, 1979).Instead, Lincoln and Guba (1985) introduced the no-tion of data trustworthiness and furnished an alter-native set of criteria by which to judge the rigor ofqualitative research: credibility, transferability, depend-ability, and confirmability. Bymeeting these criteria,weensured the trustworthiness of our data.

Resultant Codes and Higher-Order Themes

Belowwe first present the three higher-order themesthat emerged from the raw data and the codes that

comprised them, followed by linking codes andthemes that represent causal relationships betweenthem. Code definitions and text excerpts appear inAppendices 1–3.

Diversity climates. At the organizational level,three diversity climate codes emerged: policy-focused,awareness-focused, and engagement-focused. Policy-focused climates were characterized by a concern fordiversity, primarily from a policy perspective. Policiesandnorms required all employees to assimilate to thedominant organizational culture. For example, thecodes of conduct contained written non-negotiableprinciples, including standardized diversity practices.The main emphasis was on conformity. As result, mi-norities were expected to decrease the significance oftheir culture of origin in an attempt to conform to cor-porate norms. Awareness-focused climates chieflyused diversity for access and legitimacy in new mar-kets, but had low integration of diversity into workprocesses. Core principles were not a priori defined,andemployeeswere free todecidehowto interact andwork together. A strong belief in cooperation andharmonious interactions existed as means to facilitatecross-cultural interaction. Employees from minoritygroupswereencouraged to retainastrongsenseof theircultural identity and consequently showed less in-volvement in learning from others. In contrast, ma-jority group employees strongly emphasized learningabout other cultures andwere considerate ofminoritycultures. Finally, the engagement-focused climatescharacteristically used diversity to inform and en-hance work processes based on an assumption thatcultural differences give rise to different insights. Alimited set of core values considered central to theorganization was emphasized, but otherwise differ-ences were allowed to flourish. As a result, membersdemonstrated interest in maintaining their culture oforigin but also in learning about other cultures.Table 2 depicts the three diversity climates thatemerged. Aggregating across data sources (interviewsand observations), we were able to clearly developa diversity climate code for each organization.

Knowledge exchange processes. We discoveredthree primary codes for knowledge exchange pro-cesses: assertive, cooperative, and oscillation. Wedeveloped the code assertive knowledge exchangewhen the exchangeof perspectives, information, andknow-howwas clear, direct, andunambiguous. Suchexchanges involved members defending their pri-orities and views and communicating them plainlyand explicitly. We developed the code cooperativeknowledgeexchangewhenanexchangewas implicit,suggestive, or exploratory, expressing willingness to


remain open to others’ ideas and views, and was ac-companied by active listening. Finally, the code os-cillationbetweenassertiveandcooperativeknowledgeexchange emerged to capture when a team was char-acterized by a fluctuation between both modes withinteam interactions. Across data sources (interviews and

observations), we found it clear which of the threemodes prevailed in each team, and assigned thatcode to the team.

Effectiveness. We coded each team according tothe degree respondents reported they had accom-plished the objectives, aggregating across data

TABLE 2Diversity Climates Documented in the Current Project

Dimensions

Policy-focused diversityclimate (maps ontomonolithic and

discrimination-and-fairness)

Awareness-focuseddiversity climate(maps onto plural and access-and-

legitimacy)

Engagement-focused diversityclimate (maps onto multiculturaland integration-and-learning)

Firms AGEC, AFTC, MCC, GEC, ARC AEC, FCC GCC, AOC, ABC, CTCKnowledge

processesMainly assertive Mainly cooperative Mainly assertive and cooperative

1. Acculturation Assimilation (a unilateral process bywhich members of a minorityculture adapt to the norms andvalues of the dominant group in theorganization)

Partial marginalization (dominantgroup focuses on learning aboutother cultures, while minorityemployees hold on to their originalculture and show less interest in thenational culture of the dominantgroup)

Integration (interested inmaintainingthe original culture and in learningand participating in the otherculture)

2. Structuralintegration

Low Partial High

3. Informalintegration

Low High High

4. Cultural bias High Low Low5. Organizational

identificationLarge majority–minority gap Small majority–minority gap High identification No majority-

minority gap6. Rationale for

diversificationTo eliminate discrimination To gain access to diversemarkets and

clientsTo inform and enhance work

processes based on assumption thatcultural differences give rise todifferent knowledge, insights, andalternative views regarding howbest to accomplish goals

7. Value ofculturalidentity

Low; culture-blind ideology; culturaldifferences taboo subjects;illegitimate to offer work-relatedperspectives informed by culturaldifferences; norm requiresassimilation to the cultural valuesof the dominant group;membership characterized ascontradictory and ambivalent

High; companies differentiate to gainaccess to diverse markets andclients; employees from differentcountries are encouraged to valueand express themselves; membersof the dominant group oftenhesitate to express themselves in anattempt to remain cooperative

High; a resource for change andrenewal; encourages members toopenly discuss different points ofview;members of different culturalidentity groups highly valuedopportunities for learning

8. Connectionbetweenculturaldiversityand work

Limited; tendency to assimilateculturally diverse employees

Indirect; less able to integrate culturaldifferences into core work

Direct; incorporated throughout corework

9. Indicators ofprogress

High representation of culturallydiverse groups; yet weakinterpersonal integration of diverseemployees and lack of inclusion indecision making

Moderate interpersonal integration ofdiverse employees but inclusion indecisionmaking; little guidance onappropriate degree of adaptation tothe local context; tend to over-adapt

High interpersonal integration ofdiverse employees and inclusion indecision making; a very culturallydiverse workforce

10. Teameffectiveness

Mainly low effectiveness High and low effectiveness Mainly high effectiveness

Note: Highlighted findings deviate from prior conceptualizations of plural (Cox, 1993), and access-and-legitimacy (Ely & Thomas, 2001).


sources—including interviews with team leadersand members and with internal clients, HRM repre-sentatives, and department heads—to arrive at asingle code for each team. For example, one team thatworked on consulting projects in the oil and gas in-dustry had objectives regarding budget, risk de-termination, and alignment of projectswith corporatestandards. Respondents reported that they nearly al-ways completed projects on budget and on time, withaccurate risk assessment, and consistently upheldcorporate policy, hence the teamwas coded as highlyeffective. In contrast, a team tasked with accessingfeasibility of hydropower projects was described ashaving failed to collect information on critical pa-rameters in the designated time frame, and even afterrepeated extensions, was unable to complete theproject, and hence lost the customer. This team wascoded as very low on effectiveness. Perceptions wereremarkably consistent; no contradictory evidencewas presented in any of the teams, making it easy forcodes to emerge regarding effectiveness. Effectiveteams in our sample met important deadlines andsatisfied clients and various stakeholders; ineffectiveteams did not.

Relationships among the three higher-orderthemes. To explore how and why diversity climatesencourage specific knowledge exchange processes inMCTs and how and why these processes affect teameffectiveness, we searched for linking codes or re-lationships among our codes. To begin, we coded ourtranscripts for activities, actions, and behaviors thatlinkdifferent types of diversity climates to knowledgeexchange. We then aggregated our first-order linkingcodes into second-order codes representing keymanifestations of climate for knowledge exchange(see Table 3). For example, within the policy-focusedclimate, we uncovered processes thatwe coded as:“assimilating to the dominating culture,” “leavingbehind one’s own national culture,” and “expressingconviction that only the organizational culture mat-ters.” We collapsed these three first-order codes intothe second-order “assimilating”code, noting that theseprocessespromptedassertiveknowledgeexchange.Asdepicted in Table 3, moving from our set of 43 first-order linking codes, we arrived at 12 second-ordercodes representing key manifestations of climate.Subsequently, we gathered similar second-ordermanifestation codes into three overarching themesthat encompassed the core focus of diversity cli-mates for knowledge exchange: “navigating differ-ences,” which included the dynamic processes thatoccurred when culturally diverse employees hadsustained contact; “coping with exceptions,” which

illustrated how companies responded when thenorms of the majority were not upheld; “legitimizingflexibility/inflexibility,”whichcapturedprocessesbywhich features of the climate were translated intoorientingprinciples for teammembers’ interactionsorbecame social forces that ensured control over action.

Next, we developed codes for the link betweenknowledge exchange processes and team effective-ness (see Table 4). Analysis revealed an array of 24first-order linking codes that comprised the charac-teristicsof the teams thatwerepromptedbyknowledgeexchange. We collapsed them into nine second-ordercodes that comprised the key resulting features forteam outcomes. For example, we found that asser-tive knowledge exchange prompted distrust amongminority and majority members and interpersonalapprehension,whichwecollapsed tocreate the second-order code “distrust and tense relationships.” From thenine second-order feature codes, three themes thatrepresent core implications for effectiveness emerged:“quality of relationships,”which described how actorscoped with interpersonal connections in teams; “goalaccomplishment,” which indicated the degree of taskgoal congruence and acceptance; “task processes,”which detailed the efforts by team members andleaders to complete tasks. These three themes werethe foundation for effectiveness, resulting in theteams being able to accomplish their objectives.

AN EMERGENT MODEL OF KNOWLEDGEEXCHANGE IN MCTS

Wenext focus on the key themes fromour data thatillustrate the relationships amongdiversity climates,team knowledge exchange, and effectiveness. We pres-ent short case descriptions of six teams which providethe clearest illustration of these relationships.

Assertive Knowledge Exchange: Team 29 andTeam 15

Team 29. Exemplifying a team characterized byassertive knowledge exchange, Team 29was formedwithin GEC, a German multinational conglomerate,to manage high voltage substations in Central East-ern Europe (CEE). The team’s objectives were to en-sure on time delivery of several types of parts andapparatus. In addition, it worked on several turnkeyinfrastructure projects that needed to be completedon time andwithin budget whilemeeting the highestquality standards. It consisted of Austrians, Croa-tians, Slovakians, and Hungarians. Respondents re-ported that vertical structures and authoritarian


TABLE 3Elaborating the Manifestations of Diversity Climate on Team Knowledge Exchange Processes

Actions, activities and behaviors thatcharacterize diversity climate

Key manifestations ofdiversity climate

Core focusof diversityclimate

Policy-focused nnn Assimilating to the dominating culture Assimilating [promptsassertive]

Navigatingdifferencesnnn Leaving behind one’s own national culture

nnn Expressing conviction that only the organizational culture mattersnnn Not recognizing culture differences Ignoring cultural

differences [promptsassertive]

nnn Suppressing discussion of cultural differencesnnn Privileging dominant culture

Awareness-focused nnn Connecting across cultures Connecting [promptscooperative]nnn Valuing good relationships

nnn Bridging acts encouragednnn Frequently discussing cultural differences Celebrating cultural

differences [promptscooperative]

nnn Perceiving cultural differences as enriching without knowing howto integrate

nnn Readily adapting to others at expense of own valuesEngagement-focused nnn Recognizing the individual (“I” statements) and individual

differences within orienting principlesIncorporating and

integratingdifferences [promptsoscillation]

nnn Actively addressing cultural particularitiesnnn Voicing country-specific valuesnnn Recognizing and legitimating the roots of cultural differences (e.g.,

communism)nnn Viewing cultural diversity as a source of competitiveness, change,

and renewalCapitalizingoncultural

differences [promptsoscillation]nnn Communicating need to incorporate diversity at a deeper level in

markets and products, not just in processes or policiesPolicy-focused nnn Openly criticizing others with focus on honesty Responding critically

to exceptions[prompts assertive]

Coping withexceptionsnnn Assigning blame for mistakes

nnnNot displaying any tolerance regarding norm violations emanatingfrom cultural differences

nnn Preferring formal meetings for the sake of transparencyAwareness-focused nnn Avoiding confrontation to maintain harmony Responding favorably

to exceptions[promptscooperative]

nnn Encouraging a non-blame approachnnn Displaying tolerance regarding norm violations emanating from

cultural differencesnnn Hiding values and preferences behind silencennn Creating pockets of passivity to protect harmonynnn Creating safe and non-threatening atmosphere

Engagement-focused nnn Displaying proactivity and tolerance Expressing freely andremaining open toexceptions [promptsoscillation]

nnn Incorporating mutual respect into delivering critiques

Policy-focused nnnFollowing standardized formats prescribedby corporate templates,rules, and principals

Standardizing around‘objective’ criteria[prompts assertive]

Legitimizinginflexibility/flexibilitynnn Punishing non-adherence to policy

nnn Strongly focusing on performancennn Not tolerating significant variance in values/norms across teams

Awareness-focused nnn Showing flexibility in adapting to circumstances Adapting to specificteam contexts[promptscooperative]

nnn Focusing on behavior orientationnnn Tolerating significant variance in values and norms across teams

Engagement-focused nnn Following “best practices” but leaving room for flexibility andadaptation

Adapting to specificteam contexts underthe limits of orientingprinciples [promptsoscillation]

nnn Balancing act by leadernnnWillingness to rethink, revisit, and learn from each othernnn Screening social skills and emotional intelligence during hiringnnn Focusing on both performance and behavior orientationnnn Tolerating some variance in values and norms across teams


decision-making remained the rule in CEE. Delega-tion entailed managers precisely instructing sub-ordinates who were expected to perform their taskswithout discussion. While Austrians complained ofa lack of initiative fromnon-Austrians; theCroatians,Hungarians, and Slovakians bemoaned the lack ofclear directions from the Austrian managers.

Against this backdrop, we observed two incidentsin Team 29 that illustrate assertive knowledge ex-change. In one meeting, Austrians dominated dis-cussion and other team members remained silent.Trying to gain their involvement, the Austrian teamleader referred to a corporate template for teamprocedures. All members were asked to sign a stan-dardized corporate contract that emphasized theimportance of involvement. This attempt to assimi-late themembers fromCEEultimately backfired, as itfurther diminished motivation:

It immediately came to a, well, I wouldn’t say crash,but it resulted at least in a strong disagreement ... We

just wanted to assure that each member’s obligationswithin the team are duly noted by having everyonesign off his personal areas of responsibility. However,the Hungarians and Croats put their foot down be-cause they were not used to something like that.(Team member, Austrian, GEC)

A second incident was observed later. The teamwas finishing project documentation with an ap-proaching deadline; the atmospherewas intense,witha lot of uncertainty, and emotions were high. We wit-nessed a screaming match in which competencieswere questioned. A team member told us later:

You can awfully misinterpret people if you do notrecognize, if you cannot read their faces, or if youcannot see behind their masks. In such cases, I wouldsay that social skills are at least on the same level ofimportance as technical expertise . . . For the Croats,pride is of great value. Thus, criticizing a Croat in thepresence of all the others . . . No. That is simply notacceptable. (Team member, Austrian, GEC)

TABLE 4Identifying the Implications of Knowledge Exchange Processes for Team Effectiveness

Characteristics prompted byknowledge exchange Resulting key features of outcomes

Core implications foreffectiveness

Assertive nnn Distrust among minority groups versus themajority group

Distrustful and tense relationships:“authoritative family”

Quality of relationships

nnn Interpersonal apprehensionCooperative nnn Primarily positive interpersonal relations Positive relations: “happy family”

nnn Interpersonal problems avoidedOscillation nnn Satisfactionwith the team and high degree of trust

among minority groups versus the majority groupHealthy relationships “progressive

family”nnn Interpersonal problems addressed to overcome

Assertive nnn Low acceptance of goals Low task goal acceptance Goal accomplishmentnnn Disagreement on appropriateness of goals

Cooperative nnn Relational goals have primacy over task goals Incongruent task goalsnnn Passive task goal pursuit

Oscillation nnn Iteration to arrive at goal clarity and acceptance High task goal congruence andacceptancennn Roles in task goal achievement clear

nnn Proactive task goal pursuitAssertive nnn Insufficient flow of information Unequal effort and inefficient

completion of tasksTask processes

nnn Lack of timeliness due to reworknnn Low level of effort among some members

Cooperative nnn One way flow of information (from majority tominority group)

High effort but inefficient completionof tasks

nnn Lack of timeliness due to efforts at interpersonalharmony

nnn Inefficient use of team resourcesnnn High level of effort across most members, but not

always on taskOscillation nnn Two-way flow of information (from majority to

minority and from minority to majority group)Shared effort and efficient

completion of tasksnnn Timely completion of tasksnnn Efficient use of team resourcesnnn High level of task effort across members


Our interviewees reported that the intense asser-tive knowledge exchanges that we saw were moti-vated by the policy-focused diversity climate of thefirm. This climate was linked to knowledge exchangethrough the processes by which the respondents saidthe team navigated differences, the manner in whichits members coped with exceptions to rules, andthrough the legitimization of inflexibility. First, al-though GEC depicted itself in its annual reports assupportive of diversity (“Diversity provides inspira-tion, unleashes creative potential and expands hori-zons”), when asked about the significance of theircultural heritage, participants answered that “nation-ality is not something that matters in this business.”The company expected individuals to lessen the sig-nificanceof theirnationalcultureandassimilate into theorganizational culture. Exceptions were viewed criti-cally and behavior counter to corporate values andnorms was accorded little tolerance. New employeeswere expected to act within the non-negotiable param-etersof corporate rules thatwerecodified into templatesfor team processes and the “GEC code of conduct.”Standardization around them was expected from ev-eryone, regardless of background. As result, the corpo-ration legitimized inflexibility. These manifestations ofa policy-focused diversity climate in combination withminority members’ struggles to retain their cultural in-tegrity prompted assertive knowledge exchange.

Assertive knowledge exchange in turn resulted ininterpersonal apprehensions and distrust in Team29, and these tense interactions took a negative tollon the quality of relationships in the team. Both in-sufficient information flow and poor effort by teammembers, whowere alienated by the confrontationalteam meetings, caused the need to rework key de-liverables and were detrimental for task processesand goal accomplishment. These implications meantthat the team failed to meet its objectives, misseda deadline, and was rated as ineffective:

Given that it was a turnkey project, it was very compre-hensive and complex. We had to undertake the entireresponsibility from design through completion and com-missioning. The client only had to turn the key to makeeverything function as it should. The initial deadline inSeptember was missed. (Team leader, Austrian, GEC)

Team 15. Team 15, formed within AGEC, anAmerican multinational technology and consultingcompany, had the primary task of developing a Webstrategy for 43 different countries. Japanese, CentralEastern Europeans, Austrians, and Americans workedtogether to determine how the Web presence couldextend the corporate brand, what it should offer to its

audience, and how it could effectively market and sellproducts and services online. We saw similar dynam-ics in Team 15 as in Team 29. Moving all team mem-bers, irrespective of cultural background, to a moreassertive communication style was strongly encour-aged. This was encapsulated by the team’s belief in“straight talk,”meaning speaking directly and explic-itly, using a straightforward, concise, and efficientmeans of exchanging knowledge:

Straight talk is a competence, something that’s valuedhere, a leadership competence . . . It is an imperativefor action. Straight talk is a norm and an importantaspect ofAGEC’s corporate culture. It shouldbeappliedin different contexts and regardless of individuals’ cul-tural preference. (Team leader, American, AGEC)

As described by this respondent, the assertiveknowledge exchange was prompted in numerousways by the policy-focused diversity climate atAGEC. Like GEC, AGEC depicted itself in docu-mentation as fully supportive of diversity (“AtAGEC,our goal is to enhance awareness, open-mindedness,knowledge, tolerance, and respect for other cul-tures”). Corporate policy espoused the belief thatcultural discrimination had to be eliminated and anyprejudicial attitudes suppressed. In that sense, allemployees were considered equal. However, at thesame time AGEC neglected important cultural dif-ferences at the workplace and demanded instead thatemployees follow the corporate way of communicat-ing and doing business which was clearly reflectingthe value system and behavioral patterns of the homecountry (the U.S.). In interviewsmembersmentioned“pretending to be blind to cultural differences” eventhough they were well aware of them:

Our boss from the U.S. was pretty straightforward, hecorresponded so to the American cliche . . . he wasextremely direct and believed in saying exactly whatone thought at all times. As a consequence, we con-tinued to drift apart. (Teammember, Austrian, AGEC)

Hence, the policy-focused climate encouraged asser-tive knowledge exchange, as team members navigatedtheir cultural differences. Punishment for non-adherence to policy, which legitimized inflexibility,was a second keymeans by which the policy-focusedclimate encouraged assertive knowledge exchange.Violation of principles was strictly disciplined:

According to this rule, youmust notmake anydifferencebetween people of different gender, race, age, and sexualorientation . . . Even a simple, well-meant joke about Af-ricans can . . . lead to dismissal. (Team leader, Austrian,AGEC)


Such directness showed a tendency to assignblame and to be highly critical when normative ex-pectations were not met. Teammates who readilyconformed to norms were rewarded; those whoresisted were subjected to peer pressure to conform.Such exchanges also involved minority membersdefending their priorities and views vehemently.The dynamics of assertive knowledge exchange, re-gardless of context, demotivated many minority em-ployees. They reported that their competence seemedunderestimated, and they often felt devalued in oneway or another. They tried to suppress these negativefeelings by distancing themselves from the team,which translated intoa lackofgoal acceptanceand lesseffort. And when suppressed, these emotions wouldoften build and grow, until they spilled over into time-consuming debates about justice and equality as wellas second-guessing of the team’s purpose, and overallinefficiency. The core implications for the team’s ef-fectivenesswere that goals regarding theWeb strategydevelopmentwerenotmet. The teamfailed to arrive ata concept of how the firmcould effectivelymarket andsell products and services online:

People in our team tend to think business is businessand give little thought to different world views thatcan actually cause performance problems. It is be-cause of this attitude that we face so many problemshere, which has definitively impeded good perfor-mance. (Team member, American, AGEC)

In summary, these two key cases reveal the pro-cesses thatwealso foundin the largerdataset.Assertiveknowledge exchange was most common in the fivefirms characterized by a policy-focused diversity cli-mate. Assertiveness was prompted by an emphasis onequality and antidiscrimination and inflexible enforce-ment of corporate templates and protocols. Culturaldifferences were suppressed, and the dominant culturewasprivileged. Insuchaclimate,blamewasassignedformistakes and employees were dismissed for not follow-ing procedures. In turn, assertive knowledge exchangeprompted conditions that resulted in distrustful andtense relationships, disagreement about goals, and un-equal and inefficient effort on tasks, limiting the teams’potential to accomplish objectives and be effective.

Cooperative Knowledge Exchange: Team 7 andTeam 45

Team 7. The objective in Team 7 was to developa plan for a power station rehabilitation project inMalaysia for AEC, an Austrian technology provider.The team’s aim was to replace inefficient oil-fired

power plant facilities with highly efficient combined-cycle gas turbine power generation facilities. The teamhad to negotiate project conditions with local officials,get procedures approved on time, and find adequateproject partners. Austrians, Germans, and Malaysiansworked together on this task. TheAustrian team leaderemphasized that the company valued cultural diver-sity and individuals were expected to engage in co-operative knowledge exchange. He believed thatcooperative processes were necessary to effectivelyovercome unproductive social categorization andcommunication barriers:

The first thing you have to do if you are exposed toa serious problem is to laugh about it and then solveit . . . Stay away from pounding your fist on the table!You do not get a cooperative approach this way.(Team leader, Austrian, AEC)

AEC was described as an organization with strongfocus on “awareness” of differences, but not neces-sarily on their incorporation into work processes. Itsawareness-focused diversity climate encouraged em-ployees to respond favorably to exceptions and legiti-mize flexibility. For instance, adaptation to minoritygroupmembers was strongly encouraged at AEC. Thiswent so far that Austrian employees hesitated to speakfrankly in an attempt to remain cooperative. Further,the climate promoted considerable flexibility, in thatthe company exerted little socialization pressure on itsinternational workforce. As result, many minoritygroup members retained a strong sense of their owncultural identity.

We observed that conversations in Team 7 con-sisted mainly of exchanges among the Austrians andGermans, but the Malaysians, although cooperative,weremostly silent. OneMalaysian said that inMalaysiacertain conditions are associated with speaking andothers with listening, and, consequently, not every-one is entitled to speak. Despite their goodwill,Austrians were unaware of these cultural charac-teristics and, mistaking the Malaysian behavior asunwillingness to get involved, requested more engage-ment. Malaysians remained cooperative on the surface,but confided that these requests were offensive. Theyexplained that they preferred to withhold opinions tomaintain harmony at work and that they anticipatedthat sharing knowledge that was contradictory in anassertive manner could undermine that cooperativespirit. However, this behavior brought increasingdisorientation. Therefore, in an informal meeting theAustrian team leader encouragedMalaysians to sharetheir viewsandemphasizednobodywouldbeblamedfor mistakes:


And what they all probably have in common is thatnobodywants to admit when they’vemade amistake.With clearly expressed objections, which are per-ceived as criticism, youwon’t achieve anything . . .Andif you make it personal, that’s the end. You needto develop the right feeling for this . . . So, I tried to putin place incentives for speaking up, emphasizing the“non-blame aspect” of our organizational culture.(Team leader, Austrian, AEC)

Another meeting was organized with Austriansand Germans in order to inform them about theMalaysian approach. They were asked to pay moreattention to tone of voice and facial expressions andto avoid assertive statements. As result, they adoptedmore carefully worded knowledge exchange pro-cesses that they hoped would bridge cultural com-munication barriers. Meanwhile, the Malaysianscontinued to value harmony within relationshipsover work outcomes, and thus brought only limitedknowledge variety to the process.

Hence, interpersonal relationships were primarilypositive, but the underlying interpersonal problemswere not addressed. Importantly, the emphasis onharmony and cooperation compromised assertiveknowledge exchange and diminished the potentialof the team to engage more actively in mutuallearning. Information flow was obscured, with onlycertain members contributing to task processes.Somemembers activelypursued relational goals, butpreserving interpersonal harmony was time con-suming. Others saw this pursuit as coming at theexpense of task goals; thus across members, goalswere incongruent. Several instances were reportedin which the team missed a deadline. Nevertheless,members hesitated to address this directly. The ulti-mate implications were that the team failed to accom-plish its objectives andwas codedasvery ineffective. Ithad difficulty establishing project conditions with lo-cal officials and was unable in many instances to de-velop the intended relationshipswith project partners.Few combined-cycle gas turbine facilities could betracedback to thework of this team, hence the contracttargets were not met:

To execute the project is also very challenging. It isalso very challenging to interact with all these differ-ent cultures. One of the greatest challenges was tofacilitate between us and our project partner inMalaysia. This didn’t work that well. We could notnegotiate fair project conditions or get proceduresapproved on time. (Team leader, Austrian, AEC)

Team 45. As a second example of cooperativeknowledge exchange, consider Team 45. FCC,

a Finnish consulting and engineering company,formed this team towork on a hydropower project inIndonesia. The teamwas chargedwith collecting thestatistics and data to assess feasibility, design, andenvironmental impact; to negotiate with authorities;and to develop technologies in collaboration withlocal partners. It consisted of Indonesian, German,and Austrianmembers. During knowledge exchange,cooperation and harmony were emphasized. We ob-served in a team meeting that the Indonesians wereespecially modest and reserved. Afterwards, an In-donesian member explained that downplaying one’sown achievements and emphasizing the success ofothers was essential for strong relationships to de-velop. Austrians assumed that Indonesians believedany form of confrontation would bring a loss of face:

You can see it immediately in the facial expression ofa European if he is angry . . . Yet an Indonesian willnever showhis emotions.Thiswas indeeda challengefor us . . . We didn’t know how . . . to give them feed-back, how to address problems or to communicate tothem that something went wrong. Asking them toaccomplish more than they were able to deliver wasdetrimental to team harmony and had to be avoided.(Team leader, Austrian, FCC)

Respondents at FCC described a corporate focuson awareness of differences, which prompted co-operative knowledge exchange. FCC tried to bringits diverse employees together in a safe and non-threatening environment. Frequent discussions ofcultural differenceswere an importantmanifestationof theawareness-focused climate. Several respondentsdescribed this as “celebrating cultural differences.”Acts of connecting across cultures were valued andmembers were encouraged to respond favorably toexceptions. In this spirit, the company offered its em-ployees “culture assimilator training.” A consultantshared and explained scenarios that involved culturalmisunderstandings between Indonesians, Germans,and Austrians. Although Austrians and Germans em-braced this type of training, Indonesians remained re-served. A German member reported:

I would say that we have shown a high integrationcapability. We have definitively changed the way wecommunicate, we share feedback, we approach in-dividuals, etc. So, there has been a big adjustment onour side. Definitively! We have been confronted withthe Indonesian culture, we have had an interculturalexperience, andwehave learned tounderstand and toincorporate this new learning into thewaywe interacttoday. What has not changed is the behavior and ex-pectations of our Indonesian colleagues. They remain


very cooperative but also very reluctant. What im-plication does this have for us? I don’t believe that wehave reached our maximum level of effectiveness. Ithink that there are still many areas where we couldimprove and learn more from each other. (Teammember, Germany, FCC)

Respondents indicated that relational goals oftensuperseded task goals to the extent that employeeshesitated to communicate frankly. Without construc-tive task-related confrontation, important informationremained hidden in the team. In particular, the teamwas unable to build on the contributions of allmembers because it lacked a clear sense of howAustrians could incorporate the culture-specificknowledge of Indonesians. Important issues werenever explicitly addressed, and the absence of clar-ification caused inefficiency and missed deadlines,and an inability to effectively complete tasks, evenwith extensive effort. The team was ineffective, fewnew technologies were developed in collaborationwith local partners, despite that being the explicitteam objective:

The team is responsible for a hydroelectric powerproject . . . in Indonesia . . . Indonesia is an ideal can-didate for run-of-river mini-hydropower schemes.However, their development is often hampered bya lackof reliabledata . . . I askedMr.M. toworkon this.He delegated the task to five employeeswho came fromIndonesia. We needed specific information on the area,soil type, rainfall parameters, etc. My expectation wasthat I would receive this by June. However, they couldnot get this data. I gave them an extension. After onemonth, the data was still not there. Thus, our clientwas unable to proceed. (Head of Department, Aus-trian, FCC)

In summary, cooperative knowledge exchangewas most dominant in firms with an awareness-focused diversity climate. Thiswas because of a strongemphasis on celebrating cultural differences, whileat the same time being unable to integrate acrossthem. Employees were free to adapt to circum-stances, resulting in distinct variances in valuesand norms across teams. Exceptions attributed tocultural differences were tolerated, with little ef-fort to align across them. Consequently, teamswith cooperative processes expended significanttime on preserving harmony. Members describeda high level of effort, but not always on completingtasks. They seldom mentioned any encourage-ment to engage in constructive controversy thatcould have benefited task processes. Hence, teamswere often characterized as ineffective.

Oscillation Between Assertive and Cooperative:Team 32 and Team 2

Team 32. This teamworked on several consultingprojects in Romania. Its primary tasks were to cal-culate the required budget, determine project risks,provide regular status reports about project progress,and align projects with corporate standards andguidelines within AOC, a large Austrian industrialoil and gas firm. The teamwasmade up of Austrians,Romanians,Germans, andSwiss. In our observationswe noticed that many statements in this team beganwith “I”. For example, “I have noticed that we havedeviated fromour initial aim,” or “I strongly disagreewith this andbelieve thatwe cannot do this under thecurrent circumstances.” This type of knowledge ex-change communicated ideas and needs to othersdirectly, gained the attention of teammates, andcarried weight. At the same time, employees sharedinformation politely in a non-threatening way. Thisin turn enhanced the workplace experience byeliminating fear, or conflicts, and increasing the levelof cooperation. The general attitude was that if thecompany valued individuals and individual di-versity, it would have more ideas to draw on. Yet tomotivate teams to implement individual ideas, re-lationships between employees were developed soas to be collegial and participative.

We coded this process as oscillation between as-sertive and cooperative knowledge exchange. Ourdata revealed that the diversity climate at AOC en-couraged such oscillation by integrating and incorpo-rating differences, remaining open to exceptions, andadapting to specific contexts under the limits of ori-entingprinciples.Employeeswereencouragedtovoicecountry-specific values. They also recognized the rootsofmanyculturaldifferences, thereby legitimizing thesedifferences. For example, although the Swiss, Ger-mans, andAustrianswerehighlyproactive anddidnothesitate to communicate their ideas, the Romanianswere less apt to do so, at least initially. Austrians be-lieved the former personality cult of President Ceau-sescuexplained theapprehensivenessofRomanians toexpress themselves freely:

During the Ceausescu-era, people were sent to Russiafor punishment . . . Therefore, we always have to em-phasize to our Romanian team members: Please raiseyourhand if you think somethinghas gonewrong . . .Noone will lose his head. (Team leader, Austrian, AOC)

Corroborating this, a Romanian employee told us:

The fear of penalization was always present. Giventhat in Romania managers are still regarded as the


actual decisionmakers, we expected an authoritarianleadership style also here at the headquarters. (Teammember, Romanian, AOC)

TheAustrian leader echoed this. Rather than try tochange the cultural proclivities of Romanians, heviewed them as a source of competitive advantage.The path to realizing these potentialities was not al-ways easy. He had to be forthright about his plans,but at the same time he listened carefully to Roma-nians and gently encouraged them to speak up. Bydoing so, he simultaneously engaged in assertive andcooperative knowledge exchange and encouragedthe rest of the team to do the same. He described hisrole as “a tough balancing act.”

Romanians . . . want you to tell them what to do andhow to do it. It requires being forthright about yourwants and needs . . . But, as I said, it is not my style toyell at someone. Balancing was indeed a big chal-lenge. I would tell them what my expectations are,what they need to do and by when. I would explainwhy. In one-on-one discussions I would then en-courage them to speak up. (Team leader, Austrian,AOC)

The leader’s freedom to develop his approachwasindicative of the engagement-focused diversity cli-mate. Flexibility was legitimized at AOC, in that itencouraged best practices, but also adaptation. Wenoticed that the Romanians gradually began to showinitiative and take on responsibility. This develop-ment promoted both cooperative and assertiveknowledge exchange within the team. This oscilla-tion enabled Team 32 to solve interpersonal prob-lems directly,while simultaneously creating healthyrelationships among its members. To keep a strongsense of orientation in teams, roles were clearlycommunicated, but an iterative process of point–counter-point was used to arrive at goal clarity andacceptance. Time and resources were dedicated to-ward task completion, and the resulting task andgoalcongruence enabled individuals to accomplish theirgoals on time and led to high team effectiveness.Respondents external to the teamnoted the accuracyof its budgets, risk projects, as well as the timelinessof status reports. Projects were viewed as wellaligned with corporate initiatives. In short, the teamsuccessfully accomplished its objectives:

Our exploration and production business segmentnowhas a very strong base in Romania and is growingits international portfolio steadily. Our main in-vestment focus is currently on the Romanian BlackSea. Mr. M. is monitoring the progress of our projects

in the country. His team is very good at ensuring thatinformation is available to all involved groups, ontime and quality. (HR manager, Slovakian, AOC)

Team 2. As a second example of oscillation be-tween cooperative and assertive knowledge ex-change, Team2’s objectivewas to develop regionallyaligned market initiatives for detergents in CEE forGCC, a German-based company. The team was re-sponsible for managing the product portfolio, col-laborating with the local marketing and sales teams,selecting appropriate channels of distribution, andpositioning the products in terms of price. Memberswere from Ukraine, Poland, and Austria. Beforejoining the team, the Austrian team leader had spentthree years as an expatriate in a subsidiary in Serbia,where he developed an authoritarian managementstyle that worked well there but threatened commongoals in Team 2. Team members immediatelyaddressed the problem; they remained supportive,encouraging, and polite, and they translated con-structive criticism into requests for action:

At the beginning, when this senior manager was new,there was a bad flow of information. And we did notlike the way discussions were carried out. He askedfor our opinions but made the decision all by himself.We addressed this issue; we told him that we wantedthis to be changed. And it did. (Team member, Aus-trian, GCC)

Becoming aware of the problem, the team leaderchanged, which team members interpreted to meanassertively voicing critical opinions within the teamwas acceptable. Yet, constructively and politelyaddressing topics that could have hindered interac-tion and cooperation also reflected the cooperativespirit in the team:

He always says: “Let’s discuss it.”He listens to us verycarefully and responsively. He expresses a lot of ap-preciation for what we are doing. (Team member,Poland, GCC)

Again, interviews and observations revealed thisoscillationwaspossiblebecauseofGCC’sengagement-focused diversity climate. GCC operated in 75 coun-tries. Its formally stated mission was to “achieveconsistency while encouraging openness for changeandallowing flexibility” across its foreign subsidiaries.The company recognized that each employee broughtunique cultural values and perspectives that shouldbe preserved, while also emphasizing the needto establish a corporate “way of doing business” asa common bond among its culturally diverse work-force. Thus employees were expected to adapt to


specific team contexts under the limits of orientingprinciples. Cultural particularities were activelyaddressed with members remaining open to excep-tions to the majority norms. GCC integrated culturaldifferences into its core work just as depicted in itspublic documentation:

Our Global Diversity and Inclusion Strategy is aimedat reflectingourmarkets andproducts throughadiverseworkforce. Ourmarkets and products are diverse—andso are our people. Because ourmarkets aremultifacetedanddiverse,we takeaholistic approachandembraceallaspects of diversity, with a special focus on the di-mension of culture.

The majority of GCC teams engaged in both co-operative and assertive knowledge exchange; thesealternating processes helped make the teams highlyeffective. Clarity about each person’s role, togetherwith high task effort across members, bolstered sat-isfaction and trust within the team. By relying ontheir own knowledge and seeking that of others,members were able to satisfy the needs of variousstakeholders reliably and on time. The team wasdescribed as innovative, adept at selecting appro-priate channels of distribution, and skillful in posi-tioning products in terms of price, indicating that theteam was highly effective:

The medium-price brand team is very good at de-velopingregionallyalignedgo-to-marketinitiatives . . .Theyhave a very strong cooperative and collaborativeapproach toward the local marketing and sales teamsas well as the global marketing team. Overall, I amvery happy with their progress. (Head of Department,Austrian, GCC)

Findings such as these demonstrated that the os-cillation between cooperative and assertive processeswas encouraged by an engagement-focused diversityclimate. Firms with such climates emphasized thata direct approach is often needed to communicatenew ideas and broaden perspectives, but at the sametime it is essential to build a supportive and collabo-rative environment in teams. As connections andcommonalities were established, engagement-focusedfirms incorporated cultural differences into core workprocesses, enabling the teams to capitalize on differ-ences. When cultural norms were questioned, mem-bers expressed their reactions freely and remainedopen toadaptation inaspecific teamcontext,while stillworking within orienting principles established at thefirm level. The oscillation during knowledge exchangein teams promoted a high level of team effectivenessbecause itmeant thatmembers addressed interpersonal

problems to develop satisfaction and trust. In turn, thisenabled the team to pursue its goals by using an it-erative approach to clarify roles and objectives. Thistranslated into efficient use of team resources andshared effort.

Summary of Findings

Our exploration suggests that the type of diversityclimate that prevails in an organization encouragesor constrains the knowledge exchange in its teamsand ultimately results in low or high team effective-ness. These relationships are illustrated in the emer-gent theoretical model in Figure 1, along with severalorientingpropositions (Blumer, 1969),whichweofferas a means of generalizing from our research andguiding future research.

It is noteworthy that a diversity climate, in and ofitself, was notwhat determined teameffectiveness. Itwas only when the diversity climate encouragedoscillationduring knowledge exchange that themosteffective teams emerged. A few teamswere effective,even if the diversity climate was not engagement-focused, because they arrived at processes for bothassertive and cooperative exchange. MCTs did so bynavigating differences and coping with exceptionsusing tactics that resembled those in engagement-focused climates, even when the climate in theirfirms was policy-focused or awareness-focused.For example, Team 20 was embedded in a policy-focused climate. Nevertheless, its leader recognizedthat emphasizing clarity and assertiveness some-times caused conflict as an unintended consequenceof the corporate norm directed at fostering processconsensus across teams.As result, he adopted amorebalanced approach that prompted oscillation duringknowledge exchange. This oscillation harmonizedsocial relationships in the team. The outcome washigh effectiveness.

We observed similar dynamics in Team 6 in a com-pany coded as awareness-focused. Teammembers re-alized exclusive implicit communication left manyimportant issues unclear, which disoriented the team.Members who recognized these dysfunctional dynam-ics addressed the cause explicitly in a team meeting.Their goal of increased clarity prompted oscillationduring knowledge exchange. This in turn helpedmembers gain a more holistic understanding of task-related issues. As result, the team was better able tomeet deadlines.

On the other hand, not all teams within firmscharacterized by engagement-focused climate oscil-lated between assertive and cooperative processes.


CTC, a Canadian global transport company, wascoded as having an engagement-focused climate.Nevertheless, its Team 31 was characterized by as-sertive knowledge exchange and was ineffective.Memberswere very direct andwe observed a serious

confrontation in ameeting. The assertive knowledgeexchange sowed distrust among the minority groupand caused an insufficient flow of information andultimately, low team effectiveness. This was not thetypical pattern in firmswith an engagement-focused

FIGURE 1Model Linking Diversity Climate, Knowledge Exchange and MCT Effectiveness

Policy-focuseddiversity climate

Engagement-focuseddiversity climate

Awareness-focuseddiversity climate

Cooperative knowledge exchange

Proposition 1: Awareness-focused organizational diversity climates encouragecooperative knowledge exchange and discourage assertive knowledge exchange processes in MCTs, through processes of connecting across and celebrating differences,responding favorably to normative exceptions, andadapting extensively tospecific team contexts.

Oscillation

Proposition 3: Engagement -focused organizational diversity climates encourages oscillation between cooperative and assertive knowledge exchange processes in MCTs, through processes of incorporating, integrating, and capitalizing on differences, remaining open to normative exceptions,and adapting only within the limits of orientating principals.

Assertive knowledgeexchange

Proposition 2: Policy-focused organizational diversity climates encourage assertive knowledge exchange and discourage cooperative knowledge exchange processes in MCTs, through processes of assimilating, ignoring differences, responding critically to normative exceptions, and standardizing across teams.

Team effectiveness

Proposition 4: Knowledge exchange processes are the means by which organizational diversity climates influence MCT effectiveness; those climates that enable an oscillation between cooperative and assertive knowledge exchange result in more effective teams because they help develop healthy relationships, enable high task goal congruence and acceptance, and encourage sharedeffort and efficient completion of tasks.

Navigating DifferencesCoping with Exceptions

Legitimizing Inflexibility/Flexibility

Quality of RelationshipsGoal Accomplishment

Task Processes


climate; however, Team 31 illustrates that effec-tiveness is ultimately the product of knowledge ex-change. Merely creating a specific diversity climatedoes not automatically yield effective teams. Ourfindings suggest that adiversity climate is not adirecteffect but instead affects team outcomes through itseffect on knowledge exchange.

DISCUSSION

Our study makes three important theoretical con-tributions. First, we develop the concept of diversityclimate in MNCs, delineating important manifesta-tions that pertain to national cultural diversity.Identifying the peculiarities of diversity climatewhen firms span national boundaries and when theaspect of diversity in question is as complex anddeep level as national culture has not been addressedin prior research focused on domestic firms andgender or racial diversity. Second, we clarify thecausal relationship between organizational diversityclimate and knowledge exchange in MCTs by ex-ploring the activities, actions, and behaviors of or-ganizational actors that create that link. Third, ourcounterintuitive findings show that being coopera-tive is not the best way for MCTs to succeed. Incontrast, by oscillating between cooperative and as-sertive knowledge exchange, team members andleaders enable the development of healthy relation-ships, high task and goal congruence and accep-tance, and shared effort for efficient completion oftasks—all of which translate into the ability of theteam to accomplish its objectives, whether thosepertain to staying on budget, meeting clients’ needs,reaching contractual targets, or creating new ser-vices. Next we highlight the theoretical and practicalimplications in these three areas.

Theoretical Implications

Diversity climate. Several characteristics of thethree types of climates we identified map onto thosepresented in prior literature (see Table 2). For ex-ample, the climate we coded as awareness-focusedshare similarities with Cox’s (1993) plural climate,and Ely and Thomas’ (2001) access-and-legitimacyperspective. Given our sample consisted of MNCs,andwe focused on national diversity, demonstratingthat our codes for diversity climate resemble aspectsof those in prior literature extends that research,since work in the past has only examined depart-ments within domestic organizations, and did notexamine national diversity. However, some nuances

of our research depart from the prior literature. Thetwo companies we coded as awareness-focusedexhibited more informal integration of diverse em-ployees and also valued cultural diversitymore thanin plural (Cox, 1993) or in access-and-legitimacyfirms (Ely & Thomas, 2001). Consequently, employeesdid not assimilate to the dominant culture, theminority–majority gap was smaller, and cultural biasremained low. This may have been because in the1990s these particular firms quickly grew into globalplayers through acquisitions in both developed anddeveloping countries—employees from the latterwerehighly respected. This may have encouraged them toretain a sense of self-identity and a high level of au-tonomy. Such nuances underscore that accurate char-acterization of a firm’s diversity climate requires anunderstanding of its type of diversity, the historicalcontext that created this climate, and the experiencesof the employees that helped shape the climate.

Our highlighting of these unique enactments oforganizational diversity climates illustrates thevalue of considering the integration of concepts oforganizational climate and culture. Many years ago,Payne and Pugh (1976: 1168) ended their review ofclimate research with a call for “deep involvementfrom the members of a complex system to gathermeaningful data which accurately reflects thesepeople’s experience” Few researchers have answeredthis call, but we have. In doing so, our study revealsthat organizational diversity climates affect membersof teams within them, while being simultaneouslysubject to social construction. While they enable orconstrain team processes, negotiation at the team en-acts the diversity climate, such that some teams areparticularly skilled at maintaining an oscillationduring knowledge exchange despite the climate.This occurred when team members and leaders re-alized that the climate was dysfunctional for knowl-edge exchange.

Processes that link diversity climate to knowledgeexchange and knowledge exchange to teameffectiveness. We extend the work of Cronin et al.(2011), Edmondson (2003), and Gibson and Gibbs(2006), revealing a deeper understanding of cooper-ative processes and psychological safety, in that wedemonstrate how organizational context enablessuch emergent team level characteristics. Awareness-focused diversity climates most often encouraged co-operative exchange, albeit at the expense of assertiveprocesses. They did so by navigating cultural differ-ences primarily though acknowledgment and byestablishing connections; by responding favorablyto exceptions; and by legitimizing flexibility. These


manifestations were linked to cooperative exchange.However, the positive intra-team relationships hidavoidance and incongruent goals, resulting in ineffi-cient task completion.

By enabling individuals to bring more variedknowledge to the exchange process, assertive knowl-edge exchange appeared to be conducive to team ef-fectiveness. The literature contains some precedentsfor acknowledging this. For example, Woodman,Sawyer, and Griffin (1993) argued that to increasecreativity, teamsneed somedistinctiveness of thought,while Polzer, Milton, and Swann (2002) found thatteam processes benefit when members express thecharacteristics that make them unique. We extendthis prior research by noting the importance of orga-nizational diversity climate in creating opportunitiesfor individuals to assert their knowledge. Policy-focused climates encouraged assertive knowledgeexchange by navigating cultural differences throughassimilation and ignoring differences; by coping withexceptions critically; and by legitimizing inflexibility.Assertiveness in turn caused tense relationships, lowgoal acceptance and unequal effort, and inefficientcompletion of tasks.

Hence, our findings point to the value of oscillat-ing during knowledge exchange. The inclination toassertiveness that seems natural to members fromsome cultures can help MCTs achieve high levels ofeffectiveness if that assertiveness is complementedby cooperative processes valued by members frommore harmony-based cultures. Consequently, cooper-ative processes help increase integration, while asser-tive exchange in which members communicate theirviews plainly and explicitly, produces adequate di-vergence so as to build on all members’ contributions.Thus, in MCTs, both types of knowledge exchange arenecessary; emphasis on one kind of exchange at theexpense of the other reduces effectiveness.

The importance of this duality between inquiry(similar to cooperative exchange) and advocacy(similar to assertive exchange) in teams has also beenemphasized by Losada and Heaphy (2004). Amongtheir sample of 60 teams working in a computerizedlab, a balance between “inquiry and advocacy” en-abled teameffectiveness,while lowperformance teamswerehighlyunbalanced toward “advocacy.”Likewise,Earley andGibson (2002) posited that social regulatoryprocesses in MCTs can create a balance between whatthey called integration anddifferentiation. The authorsnoted a temporal element in which a diverse groupmay initially experience a strong emphasis on in-dividuality, but counterbalancing forces maymotivatethe creation of commonalities among its members.

However, neither Earley andGibson (2002) nor LosadaandHeaphy (2004) could specify how this equilibriumcanbeachieved.Weaddress this byprovidingevidencethat engagement-focused diversity climates promptspecificbehaviors,manifestations, andfoci that result inthe oscillation. Specifically, such climates allow for thenavigation of differences, means for coping with ex-ceptionsandbehaviors thathelpto legitimize flexibility,which in turn result in the oscillation.

We also contribute to the work of Ely and Thomas(2001), who found an integration-and-learning per-spective resulted in the best performing teams, butwere unable to determine exactly how this influenceoccurred. By elaborating on the links between di-versity climates, knowledge exchange in teams, andMCT effectiveness, we offer an explanation. Ourfindings show that engagement-focused climatesprompted oscillation during knowledge exchange.In turn, the oscillation served to helpmembers buildpositive intercultural relationships, develop goalcongruence and acceptance, and share work effi-ciently toward completion of tasks.

Limitations and Future Research

Research that quantitatively tests our model is animportantnextstep.Collectingdata fromabroadsampleof organizations and teams and conducting statisticalmediation models would help confirm if diversity cli-mate and MCT effectiveness are related throughknowledge exchange. This also would enable iden-tification of alternative mediational and moderatingprocesses. For example, we suspect that role negoti-ation (Bechky, 2006) and team engagement (Metiu &Rothbard, 2013)may be critical forMCT effectiveness.

Furthermore, by keeping the home country con-text constant, our sample yielded a disproportionatenumber of responses from Austrians. In order tomore broadly test ourmodel,we suggest including inresearch additional regions and nationalities as wellas different corporate and team contexts. We alsoencourage further exploration of team tasks. Al-though the teams in our sample had very diverseresponsibilities, we suspect some patterns based ontask may exist, such as the degree to which team in-novation is required (Gibson&Gibbs, 2006).Ourdataindicate that the key challenges of MCTs lie in teaminteractions (not team functions), but comparisonsare a useful extension of our research.

We also anticipate that other contextual factorsmay influence knowledge exchanges within MCTs,including factors such as power dynamics, controlmechanisms, and corporate strategies. As particularly


promising, we see the exploration of time perspectivesthat may have special relevance as diverse membersof an organization collaborate (Gibson, Waller,Carpenter, & Conte, 2007; Waller, Conte, Gibson, &Carpenter, 2001; Zellmer-Bruhn, Gibson, & Aldag,2001). An examination of other team interactionprocesses, such as knowledge acquisition or imple-mentation (Gibson, 2001), are also welcome exten-sions of our theory.

Finally, although our data suggested that organi-zational context influences teams, we encourage in-vestigation of the opposite causal relation. It wouldbe interesting to explore how internal navigation ofcultural differences within teams may affect themacro-organizational context; whenMCTs reinforceor undermine corporate values andnorms; andwhenthey serve as catalysts for organizational change.These questions have not been addressed, despitetheir potential to take the study of MCTs and culturein new and fascinating directions.

We have developed a novel theory of knowledgeexchange processes in MCTs that reveals how orga-nizational context, specifically diversity climate,affects team effectiveness. We hope that our modelwill guide future research in this domain and that itsapplicationwill ultimately increase theeffectivenessof MCTs across the globe.

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AidaHajro ([email protected]) is Senior Lecturer inInternational Business at Brunel University London. Aidareceived her PhD in Business Studies from the ViennaUniversity of Economics and Business. She studies howdifferent aspects of organizational context influence col-lective cognitive processes in teams, how team learningprocesses drive organizational change, and coping strat-egies and acculturation processes of highly qualifiedmigrants.

Cristina B. Gibson ([email protected]) is Win-throp Professor of Management and Organization at Uni-versity of Western Australia School of Business. Shereceived her PhD in Organizational Behavior from theUniversity of California, Irvine. Her area of expertise is thenexus of organizational behavior, international manage-ment, and cross-cultural psychology. She has developedand tested theories of organizational context, culture, andcollaborative processes in multinational, geographicallydispersed, and electronically enabled teams.

Markus Pudelko ([email protected]) isProfessor of International Business and Vice Dean of theFaculty of Economics and Social Sciences of the Uni-versity of Tubingen. He earned his PhD in BusinessStudies at the University of Cologne. His current research ison headquarters–subsidiary relationships, multinationalteams, the impact of language on international business,international HRM, and cross-cultural management.


mailto:[email protected]



APPENDIX 1Text Excerpts Illustrating Codes for Knowledge Exchange

Code Definition Text excerpts

Assertive knowledgeexchange

Knowledge exchange that isclear, direct, explicit, andexpressed with strong andunambiguous intent

Criticism? There is a lot. That you fight, well, we also had screaming matchesthat’s usual. That’s included, and it is important that you do it from time totime, at least in my opinion. I think you have to definitely . . . I simply thinkpassion is important. For everything you do in life. I prefer somebody ispassionately of a different opinion than somebody who says: “I don’t care, justtell me what I have to do.” (Team leader, Austrian, AGEC)

Problems occur quite often because the English have quite a temper. If they don’tlike something . . . then they tend to blow things out of proportion. Then thereare furious e-mails going back and forth, fighting over who is to blame, who isresponsible, whohas to take care of it, andwhyno one cares about it. Then, thiswill be forwarded to the boss who will pass it on to his boss and so on. (Teammember, Austrian, AFTC)

Our colleagues from Hungary never feel time pressure. This is not a positivequality. For us, time is very important. If we say: “We will discuss this issuetogether. Can this be done in 14 days?” And the Hungarian colleague replies:“Yes. I cando it. I will try. Let us see.”And I tell him: “Please finish it by the 14ofSeptember.”And after four weeks I ask him again: “Could you please sendmethe final draft?”He replies: “I am still working on it.”My immediate reaction is:“Thedeadlinewas14daysagoandyoustill havenot finished thedraft!!! This isunacceptable!!! I can’t believe this!!! It doesnotwork like that!” (Teammember,German, ARC)

Austrians . . . are more likely to jump into the matter immediately with a short to-the-point question. They express their concerns straight to the point and usemore succinct wording. They are more precise and don’t waste too much timecommunicating what they intend to get across to others. (Team member,Slovakian, AFTC)

Cooperative knowledgeexchange

Knowledge exchange that isindirect, suggestive, orexploratory in manner,expressed with willingnessto remain open to others’ideas and perspectives andactive listening

So the first clause here says ... that we should act under the spirit of mutual trustand cooperation. Spirit of mutual trust and cooperation! It is very importantdespite your having a contract and you know exactly what you need to do, youstill should have the ability to act within the spirit of mutual trust andcooperation. (Team leader, South-African, AEC)

It is important that we resolve these issues in a non-threatening and politemanner. I always tell my employees to be cooperative, to change the course oftheir relationship at work for the better. (Team leader, Austrian, FCC)

Of course, these things are always discussed with him. But for the rest, alldecisions are made by the team. It’s not like only one must or should make thedecision. It actually works more the way that we ask for different opinions andask ourselves, “Now,what is the best solution?” or “Are there any other aspectswhich we have not considered yet?” That is actually quite cooperative. (Teamleader, Bosnian, ABC)

Criticizing people is a terrible issue . . .You have to wrap up any form of criticismin very nice words. Don’t tell who is responsible for a mistake, who is to blameeven if you know this. You have to pretend that you have no idea. Rather say:“Somebody seems to havemade a terriblemistake.”Avoid eye contact with theperson responsible for the mistake. Don’t let him lose face. (Team leader,Spanish, AEC)

Oscillation betweencooperative andassertive knowledgeexchange

Knowledge exchange that isclear, direct, and explicit aswell as indirect, suggestive,or exploratory during thesame team interactions

A new associate arrives and you realize the group building process starts all overagain.Thiswas a crucialpoint, because she is quite different from the rest of theteaminherwayof thinking, forotherpeople, thiswasalmost a little bit insultingand that’s quite a difficult situation, and that needs to be discussed early,because otherwise it might lead to a gap or to a barrier, that would have seriousconsequences . . .Weaddressed the issue directly and brought it to the point. Atthe same time, we offered her our support by trying to be cooperative andconstructive in our argumentation. (Team leader, Austrian, GCC)

Theexpectation is thatweareproactive, thatweaskdirect questions, andnot onlypassive statements that indicate reluctance to take personal responsibility. Atthe same time, we are expected to be sensitive to cultural differences. We don’t


APPENDIX 1(Continued)

Code Definition Text excerpts

want to be offensive but collaborative in our approach. (Team member,Hungarian, AOC)

Very soon we had to learn that everything you say to a person from Spain isreceived in an interpersonal context. Even though we tried not to be too directwhen expressing our criticism and complaints, it was perceived as harsh, cold,andoftenas apersonaloffenseby them.So,we learned tousea softer tonewhencommunicating. However, if there was an important issue and we felt that thisneeded to be takenmore seriously, wewould say it. Certain things needed to becommunicated straight away and without small talk.” (Team member,Austrian, CTC)

APPENDIX 2Text Excerpts Illustrating Codes for Diversity Climate

Engagement-focused diversity climates: characterized by utilization of diversity to informand enhanceworkprocesses based on assumptionthat cultural differences give rise to different knowledge, insights, and alternative views; limited set of core principles that are seen ascentral to the organization, yet differences allowed to flourish in other respects; practices included cross-cultural training, languagecourses, and frequent expatriate–inpatriate rotational assignments included in personal development plans

GCCa Number 1 is continuous communication, what we have here, if you have gone through the hallways, maybe it’s still a little bittoo early at 8 a.m., but if you takea look, youwill realize that the officedoors are open, not closed.Therefore, a lot of businesstakes place just bywalking by and talking, exchangeof information, a short questionhere, some information there, all of thiscontinuous and open communication. (Team leader, Austrian, GCC)

AOC Weput greater emphasison forward-thinkingplanningasopposed to reactive strategies todealwithproblems.Beingproactiveoffers us a lot of advantages when approaching opportunities and dealing with everyday cultural challenges. (Teammember, Croatian, AOC)

ABC For us, diversity management is an inclusive process. Taking the time to recognize other employees’ values can be a hugeadvantage . . .We very much value self-initiative. (Team leader, Austrian, ABC)

CTC As a companywe are very committed to actively promoting cultural diversity . . . there is a lot of freedom.Well, freedom in thesense of displaying personal commitment, and, of course, integrity. (Team leader, Austrian, CTC)

Policy-focused diversity climates: characterized by focus on elimination of discrimination and norms requiring assimilation to dominantculture; non-negotiable core principles recorded in the code of conduct and strictly enforced; standardized diversity practices thatemphasize conformity

AGEC They believe that corporate norms can be imposed on people from different countries and cultures, that behaviors can bechanged . . . This is, if you ask me, a typical US thing. (Team member, Austrian, AGEC)

GEC Because the company was founded in Germany, all technologies . . . are German, and once the company started expandingabroad, it transferred its know-how to foreign subsidiaries. (Team leader, Bosnian, GEC)

MCC Here we have a very standardized diversity management system. Diversity is a very broad topic. An area where we coulddefinitively do more is cultural diversity. Here we don’t offer cross-cultural training or stuff like this. (Team member,Austrian, MCC)

AFTC What is happening right nowhere is thatAFTC tries to enforce its corporate culturewithout taking into consideration our localand corporate context. They say that they recognize, value, and accept cultural diversity. However, their goal is to imposetheir own values. (Team member, Canadian, AFTC)

ARC Wedon’t call it ethnocentric.Wecall it “Austrozentrismus”.Weareproud tobeanAustriancompany.Yes,weare.Dowe judgeothers negatively in comparison to us? Unfortunately, we do. (Team leader, Austrian, ARC).

Awareness-focused diversity climates: characterized by utilization of diversity for access and legitimacy but low integration of diversity intocore work; no a priori defined core principles, emphasis solely on cooperation and harmony; practices include voluntary expatriateassignment opportunities andvoluntary cross-cultural trainings and language courses, but neitherwere included inpersonaldevelopmentplans

AEC We are expected to be cooperative because we are working with people from so many different cultures. Thus, our aim is toestablish a climate of cooperation and harmony across a variety of cultural practices in our teams. (Team leader, SouthAfrica, AEC)

FCC Culture is a very powerful force. It is central towhatwe see, howwe communicate andmake sense of ourworld. Yet sometimesvalues conflict, and make partnership ineffective. In such situations, we are expected to be cooperative. Maintaining goodrelationships is very important.” (Team member, Austrian, FCC)

a Company acronyms.


APPENDIX 3Text Excerpts Illustrating Codes for Team Effectiveness

High team effectiveness5 the team outputaccomplishes the team’s objectives

Low team effectiveness 5 the team output does notaccomplish the team’s objectives

As a team, we have been very successful in the past. As I alreadymentioned, we are responsible for detergents, powders, and gels,everything that is related to removing spots from your clothes.According to the most recent customer survey our customers inAustria and Poland are very happy with the quality of our products.(Team member, Polish, GCC)

The cultural differences are really huge here. That is also whymanyprojects are actually never implemented.Goodprojects,strategic projects, which would pay off, are not implemented.(Team member, Austrian, MCC)

Wow, it is very complicated. It was signed in 2003 and the project wasextended for twoyearsand then relaunchedagain.Anda supply-ablesubstation was installed in the container. The place of installation isbeyond the polar side circle whichmeans in Siberia in Russia in verytough conditions where the temperature may fall down below263degrees Celsius. So the design of the container had to be adaptedaccordingly. We worked day and night for several months on thisproject. At the end and despite some additional logistics’ problemsthat we faced, we managed to finish all the work and deliver thecontainer to our customers on time. (Team leader, Slovakian, AEC)

And this is something that really makesme very angry. You findout about this at the worst time, or even worse, the mistake isdetected by somebody who was not supposed to know. Forinstance, your boss. And this creates only trouble. This issomething that is so difficult to cope with, a problem thatconstantly appears when we deal with our colleagues fromCentral Eastern Europe. To say and admit when they havedone amistake. Impossible. What is the consequence?We failto accomplish our objectives. Why? Simply, because you can’tfix a problem you are not aware of. (Team leader, German,ABC)

I will give you one example. In each project, you have to decide whatkind of cables have to be used and what type of isolators. The cablesare sometimes made for single conductors, sometimes for multipleconductors. You have to decide how big they should be, how manyyou need, what types, etc. Isolators used for high-voltage powertransmission are made from porcelain, sometimes glass but alsocomposite polymer materials. You have different types of isolators,e.g. cap and pin isolators, suspension isolators, etc. It is up to you todecide what is needed. These are engineering philosophies. We didthis, we looked at six projects, and we found which things are goodand which might cause trouble. Everything worked very well. Thetasks were completed and appropriate cables and isolators wereshipped to our customers in the following week. (Team member,American, AEC).

What emerges, however, is silo thinking, so that people are nolonger approaching problems directly, but instead problemsare shuffled back and forth between the separate functionalareas. That is to say that when looking at our team . . . then itcan emerge as well that things are shuffled back and forth andeverybody is inventing reasons why he isn’t responsible for it.As a consequence, things don’t get done on time. (Teammember, Austrian, AGEC)

I mean, of course, the deadlines for the reports are important and theyhave to be taken seriously. We must submit our reports on time. So ifa report is requested, the expectation is that it will be delivered ontime. Basically, if there are deadlines for whatever, then this shouldbe respected. I am happy that we have been able to keep thesedeadlines. (Team leader, Austrian, MCC)

I tried to explain tomy colleague at the construction site that thiswould not work and that the fuse did not fit. But then, he onlyshrugged, and started to disassemble the machine. In thatmoment, I told him to stop, because if he disassembled it, wewould be left without warranty. “No!” he said, “we must dosomething now. We cannot simply leave it and do nothingabout it. Do you really think we French are too stupid to builda fuse?”Then, I responded“that hasnothing todowith the factthat you French people are stupid, but the fuse is tooweak.Wehave to think of something else.” “No!” He said again, “wehave to dismantle the machine.” This caused a big clash. Ofcourse, he became spiky. At the end nothing was done. (Teammember, Austrian, AFTC)

The most important thing as I said earlier was the communication.Getting the people to share the information in a way that everybodycould use it. If I had sent the inquiry, the whole spectrum of 2500pages toeverybodyandsaid:“Read thisplease!”Wewouldbewaitingtoday, two and a half years later to get everything done. It wasimportant that we sat down, and I communicated the sharedresponsibilities to the team.We worked very hard on this project, butas result we ended up having the best offer and winning the tender. Iwas very proud of my team. (Team member, Austrian, CTC)

In my department, it’s often about graphics, photos, whatever,and there it did happen that somebody said for a certaincampaign: “I want no Asian face,” because the campaign wasabout theEU.That’snonsense.Theseare suchconflicts. In thisparticular case, things took too long, wemissed the deadlines.You can imagine how pleased out colleagues in New Yorkwere. (Team leader, Austrian, AGEC)


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