The Concept of Multi-Cultural Diversity With Relevance to the Hospitality Industry - Literature review Example

ABSTRACT Shortage of skilled workforce in the hospitality industry forced the sector to invite immigrant labour. This posed another challenge as different cultures have different dimensions of authority and power distance. To understand the dilemmas posed by multi-cultural diversity in the sector a study was conducted based on the qualitative method of research. Apart from literature review of the concept of diversity, of different leadership theories and different dimensions of culture according to Hofstede, primary data was also collected from one hotel on its training programs. Two dilemmas have been reported here – communication and empowerment. Industry examples have been provided on how the organizations faced the challenge and through right leadership they could overcome the challenges. Power distance and low and high context cultures can make a difference in interpreting words and expressions, while the English language is always an issue with different ethnic groups. Hotels conduct training in English language as well as cross cultural training have been found to be effective. Empowerment is also misunderstood due to the different cultural interpretations. Organizations undertake training programs through motivation of the employees by instilling in them a sense of belongingness. Appointing local managers reduces the power distance and has helped the Chinese local staff to accept responsibility and empowerment. Table of Contents 1. Introduction 1.1 Background – context of the problem 1 1.2 Aims and Objectives of the report 1 1.3 Definition of cultural-diversity 2 1.4 Challenges posed by cultural diversity 2 2. Methodology 3 3. Findings and analysis 3.1 Managing diversity 3.1.1 Benefits of managing diversity 3 3.2 Dilemmas due to multicultural diversity 5 3.2.1 Communication 6 3.2.2 Empowerment 9 4. Conclusion 12 References 13 Appendix 15 1. Introduction 1.1 Background – context of the problem Globalization is the process of strengthening the worldwide social relations that link distant localities in such a way that local events are shaped by circumstances as other places in the world (Giddeus, 1990; Gudykunst, 2003). Factors responsible for steady growth in the hospitality sector include higher disposable incomes, more time for leisure, cheaper and easier travel and increased longevity (Pinilla, 2002). This has led to the process of globalization in the hospitality industry. Being the world’s fastest growing industry, this sector has also been the major employer. The hospitality industry employs about 10% of the global population. Thus social concern needs to be considered as all external and internal factors may have significant effects on a considerable portion of the global population. Demographic changes in the workforce have led to shortage of skilled people in the hospitality industry. This led to the relaxation of the immigration policies in many countries to allow skilled and educated workforce from overseas (Baum, Dutton, Karimi, Kokkaranikal, Devine & Hearns, 2007). Thus globalization and increased migration resulted in high level of labor mobility across nations and continents thereby impacting the work and productivity. It also has an impact on the local society. The hospitality industry has to meet several challenges posed by cultural diversity. 1.2 Aims and Objectives of the report With the change in the work force the interest and concern in managing cultural diversity has grown steadily. With the aim to understand the right approach in managing multi-cultural diversity, the objective of this report is: 1. To examine the theoretical concepts of multicultural diversity 2. To consider its implications in the hospitality sector – identification of dilemmas 3. To understand the different approaches – leadership and management - used by the international hospitality organizations to overcome dilemmas with particular reference to communication and empowerment. 1.3 Definition of cultural-diversity Diversity refers to visible and non-visible differences (Pinilla, 2002) in race, ethnicity, language, nationality or religion (Konrad et al., 2006; Pinilla, 2002), personality and work style (Pinilla, 2002) among various groups within a community/organisation. Mok discusses primary and secondary dimensions of diversity or the characteristics that describe people. The primary dimensions are the core elements that do not change and while they are inborn, they are interdependent. These include age, gender, race, sexual orientation and physical traits. An individual views the world through these elements and hence the greater the number of primary differences between people, the more difficult it is to establish mutual trust and respect. Culture clash is the most common occurrence and has a negative impact on human relationships. 1.4 Challenges posed by cultural diversity Cultural differences can lead to differences in goals, expectations, values and proposed course of action thereby giving rise to conflicts within an organization. Diversity is an attribute that is specific to an individual that makes him/her feel that he/she is different from others (Friday & Friday, 2003). Cultural differences impact the belongingness, love and esteem needs of individuals and thereby reverse the Maslow’s hierarchy of needs theory. Even subtle cultural differences could impact the decisions, outcomes and organizational effectiveness (Korac-Kakabadse & Kouzmin, 1999). This is because different cultures imply different mental programming, according to Hofstede (1984) and this governs activities, motivation and values (Gilbert & Tsao, 2000). The secondary dimensions of diversity can be changed and one such important element is the communication style. Differences in communication styles can lead to conflicts due to language barriers, misunderstandings, difficulties in achieving the goals, and affects the human relationships. Thus one of the major dilemmas in a multicultural environment is communication – both verbal and non-verbal – of other members in an organization. The second dilemma which again arises due to cultural differences is that the standards and interpretation of empowerment differs, leading to complexities. Empowerment is essential because it fulfills the individual’s need for a sense of control (Kappelman & Richards, 1996). However the feeling of empowerment is fundamental to understanding the concept of empowerment (Lashley, 1995). This can differ due to differences in the culture of the work force. 2. Methodology Qualitative method of research has been chosen over the quantitative method as it covers a range of material covered from previous research (Jones, 2004). Literature review has been considered sufficient for this research as plenty of data is available. Literature review permits a quick and easy collection of general information on the subject to be studied. It enables to understand and synthesize different perspectives and understand the strengths and weaknesses of the existing studies. It helps to understand the context in which the piece of literature was written, which suggests that change occurs over a period of time which is not possible in a single research (Toracco, 2005). Secondary data from journals and from organizations’ websites have been discussed and analysed. Articles have been obtained from academic databases like Emerald, EBSCO, and also through search engines like Google, Yahoo and Altavista. Keywords like diversity, managing diversity, workforce diversity and hospitality industry have been used to extract literature on culture theory, management theory and to find good practices adopted by organizations. Primary data could be obtained from one Hotel. 3. Findings and analysis 3.1 Managing diversity 3.1.1 Benefits of managing diversity Managing diversity is essential because each individual feels valued and his talents are recognized and fully utilized. It is a strategic response to the changes and focuses on the utilization of the entire work force (Sippola, 2007). Apart from cost advantages, managing diversity leads to enhanced customer service. While a homogenous workforce may not come with creative ideas, ideas for new products generate from subcultures. When employees’ abilities can be enhanced by managing diversity, it leads to organizational effectiveness by combining individual talents, maximizing individual potentials and increasing productivity (Kim, 2006). It helps firms compete in international markets. It helps to understand the needs of the diverse customer base and enhance the firm’s image. On the other hand ineffective diversity management can alienate diverse consumers that have considerable buying power. Failure to respond to social norms and values can discourage potential employees from applying to the company. 3.1.2 Approaches to managing diversity There is no ‘best’ method to manage diversity and it would depend upon the size of the firm, the number of employees and the elements of diversity to be handled. Efforts to manage diversity in the hospitality industry have failed as most of the efforts have been based on the social identity theory which states that people are attracted to groups that can enhance their self-esteem rather than to groups that can be potentially esteem damaging (Kim, 2006). There has to be a shift from the theory that group heterogeneity cause conflict and homogeneity leads to organizational effectiveness. 3.1.3 Leadership vs. management Individual differences at the workplace can foster creativity, enjoyment and satisfaction but can also be the root cause for conflict and harassment (Baum, 2007). Managers need to value the difference between individuals and be sensitive to contrasting needs. They need to recognize that people are not homogenous and the needs of the individual have to meet with the requirements of the organization. Overcoming challenges of managing dilemmas requires the leader to take three steps – recognition (understanding what is going on in the internal and external environment), definition (exploratory process) and translation (identifying options and making informed choices). Managing cultural diversity in the hospitality industry can be possible only if there is a change in the attitude and behaviour of the organization’s leadership. Leaders manage dilemmas; managers solve problems (Lowy and Hood, 2004). Leadership, like all personal relations, always has something unknown, something mysterious about it (Adair, 2006). According to Potter and Hooper (2005) managing cultural diversity requires strategic leadership as it requires clear mission and values, communication, individual focus and empowerment culture. Leaders have a more active attitude towards goals. They believe in effective communication, motivating, encouraging and involving people as they have empathy with people (Mullins, 1999). Managers on the other hand see themselves as the conservators and regulators of the existing order. Management has predefined functions including planning, staffing, organizing and controlling. Management has to be followed and obeyed while leaders influence. While there are different approaches and styles of leadership, in overcoming challenges due to multicultural diversity in the hospitality industry, transformational leadership is necessary. This requires establishing one’s beliefs and values and being consistent with them (Working Futures, 2005). Such leaders have the ability to influence others and determine the course of change. Transformational leadership has a long term focus and inspires others to act; the leader simplifies the process for the followers and empowers them to take responsibility. 3.2 Dilemmas due to multicultural diversity Culture has been defined as “the collective programming of the mind which distinguishes the members of one group or category of people from another” (Hofstede 1997, cited by Hope & Mühlemann, 2001). National cultures hence become important employees from varying national origins perceive and relate to their work. National cultures, according to Hofstede distinguish one group of people from another and a leader is the conduit through whom communication of management practices and organizational policies occurs (Testa, 2004). National cultures impact how leaders interact with the subordinates and how the subordinates respond. Leaders who come from low power distance cultures are more successful in communicating with the employees. Those from high uncertainty avoidance cultures demonstrate higher level of control and are low on delegation and approachability. Individuals express their cultures and their qualities through the values they hold about all aspects of human life and the world around them. These values in turn influence their attitudes about what behavior is considered appropriate in any given situation. This is because culture is a way of life and a form of communication. Culture is communication and communication is culture but cultural diversity can lead to communicational problems (Seymens, 2006). 3.2.1 Communication Communication is seen as a dilemma because both verbal and non-verbal communication styles vary among cultures and this can hinder working relationships and productivity (Devine, Baum, Hearns, & Devine, 2007; Baum 2007). An awareness of the significance of communication is important in determining the ways in which communication can be enhanced – inclusive language, ethical issues, communication behaviour, effective communication processes, cross cultural training, language courses, listening and feedback mechanism, and rewards and recognition (Baum, 2007). In an intercultural encounter there is lack of knowledge and experience in understanding how the person from a different culture would respond to communication (Devine, Baum, Hearns, & Devine, 2007). It involves simultaneous encoding and decoding of verbal and non-verbal messages (Ting-Tommey, 1999). It is also difficult to interpret their behaviour. To speak up and ask questions is considered disrespectful in some cultures, an example of low-context culture. A French waiter was disciplined for providing “slow” service which would have been considered normal in his own country (Devine, Baum, Hearns, & Devine, 2007). Difficulties in cross-cultural communication arise people from different cultures have different understanding regarding the interaction process and different styles of dialogue. It becomes essential for the local workers and managers to know about these differences so that they can monitor their own perceptions. Contradictory situation may also arise due to cultural differences. For instance, if simple instructions to “delight the customer” are given out, employees may balance a number of tensions between the customers – say between smokers and non-smokers (Lashley, 2000). Some may interpret it as a balancing act between the customers and the service organization over the right levels of service and cost control. The hospitality sector has faced communication problems at different levels but has found solution as well through the application of different management theories. Overcoming the communication dilemma Through the use of language courses To overcome the communication dilemma, at Westin Palo Alto, CA strategic leadership has been demonstrated. To influence others empathy has to be shown. It is not sufficient to conduct communication classes by distributing manuals as was done at The Great Wall Sheraton Hotel Beijing (Muwara, Sutton & Roberts, 1998). The staff has to be involved to bring about transformation and this prompted the leaders at Westin to conduct regular language classes for the Hispanic workers. Through an email (Appendix A), the language instructor, an anthropologist conducting ESL and diversity training, informs that onsite English has helped to improve skills and empower the careers of immigrant staff. It creates a space for learning, reflection and guidance, all of which, if it can be afforded and willingly prioritized by management, create huge benefits, he says. These benefits could range from engagement, guest satisfaction and low turnover amongst other benefits. At Toronto hotels, apart from training in ESL for different ethnic groups, the hotels employed translators in conducting interviews, orienting and training new employees and conducting performance reviews (Christensen-Hughes, 1992). Written translations were provided to the employees of job description, employee handbook and training manuals. Through Cross cultural training (CCT) of the local staff Integration and socialization of international workers with local employees and the wider community is a challenge. The indigenous staff does not understand and respect the cultural differences of the international workers. Due to communication requirements the international staff does not work in direct customer contact areas like conferencing and reception (Baum et al., 2007), an example of Hofstede’s uncertainty avoidance where the employees feel threatened by uncertain or ambiguous situations. They are generally confined to departments like food and beverage, housekeeping and kitchen, again because of uncertainty avoidance, as was the case of the Toronto Hotel. Due to language difficulties misunderstandings with the local staff are also common. Cross-cultural education of the local workforce has been found to help the local staff overcome the resistance to the importance given to the migrant labour. When training in English language is given to the migrant staff, the local may regard this as 'dumbing down' the organization and develop resentment towards the migrant staff. This is one of the problems that were faced at the Toronto hotel having four different ethnic groups (Christensen-Hughes, 1992). The local staff was offered cultural diversity awareness education so they understand that they too benefit from a diverse workforce. This aids the transition for both sets of employees. Educating for the indigenous staff is essential to accept and integrate with a multicultural workforce. This helps to break down employee ignorance and create a culturally rich environment. Both sets of workers should be able to accept the differences in culture (Hearns, Devine & Baum, 2007). Consciousness about differences in values, attitudes, patterns of behaviour and communication that may exist across cultures or sub-groups have to be communicated. . Through training the expatriate managers before overseas assignments There can be differences in attitude, mannerisms and behavioural patterns (Celaya & Swift, 2006). An expatriate manager, apart from his managerial duties, has the responsibility to supervise a workforce that is culturally diverse. Psychic difference can exist which pertains to the difference that people of one culture perceive between themselves and people of another culture. CCT can enhance the expatriate’s cultural knowledge, skills and facilities. The training would depend on the country of destination, the background of the expatriate and the managerial role to be undertaken. Lance Ourednik, the GM at Sheraton Xiamen, China received culture shock when he joined in 1995 (Hand, 2008). China was a very difficult place to work in at that time. In China it is important to be patient and tolerant. One has to be a people’s person and there is plenty of responsibility placed on the manager. Hence Starwood Hotels & Resorts subsequently gave him cross-culture training and the opportunity to develop as a manager and work in an environment with diverse cultural workforce. Through empathy towards the employees from diverse cultural backgrounds Managers experience frustration when dealing with different ethnic groups. The employees sit on information and would not pass it on and would not even inform the management if they had understood the information. Besides, it has been felt that the communication received is not the same one that was sent. At Cornell University’s Statler Hotel, the Managing Director found that the employees from diverse cultural backgrounds have to be dealt in their own comfort zones (Stevens & Hisle, 1996). You cannot call them to your office and expect them to open up. The management has to learn and communicate with them by walking to their work areas because people from diverse cultural backgrounds feel out of place or nervous by executive trappings in the GM’s office. It pertains to Hofstede’s power distance which states that power in institutions and organizations is distributed unequally. This also demonstrates low-context culture as among the different ethnic groups (Fritz, Brown, Lunde & Banset, 2005). In high-context cultures role relationships and non-verbal cures are more important since meaning in communication is internalized in the person (Nguyen, Heeler & Taran, 2007). 3.2.2 Empowerment Managing diversity requires change in mindsets, attitudes, behaviors, organizational practices, structure and culture as well as in regulations, procedures and power relations (cited by Sippola, 2007). Managing diversity can lead to resistance which can be overcome with supportive learning environments. This can happen when there is inequality of power between the leader and the employees, due to the power distance as described by Hofstede. Empowerment through having a local manager In high-power distance cultures like China, employee empowerment programs may not be successful. This is because the subordinates feel it is the boss’s responsibility to tell them what to do. It is difficult to make them take initiative to perform the job. According to King-Metters and Metters (2008) the situation across different cultures would differ when the boss has a bad idea. In a high power-distance country like Venezuela, the employee would likely agree with the boss while in a moderate power-distance culture like the U.S, the employees’ response could possibly be that while the idea is interesting may be there is a better way to do it. In low-power distance culture like Denmark, the employee might just remark that the boss’s idea was stupid! The Chinese employees have resistance to the western concepts of corporate culture including empowerment. At The Great Wall Sheraton Hotel Beijing, empowerment by the front office staff was misunderstood or the powers misused to cause embarrassment to the guests at the time of check-in (Muwara, Sutton & Roberts, 1998). The underlying difference lies in the deep-seated culture that men in China are superior to the women. It also suggests that the corporate culture of an organization cannot be transferred to a country where strong national culture exists. The local Chinese managers and the subordinate staff were not prepared to take responsibility even when they had the authority. They prefer to pass on the responsibility to the expatriate managers. A study of the Shangri-la International group in China revealed that the local staff viewed the expatriate managers as emotional, volatile and demanding but with a high degree of skill and listening abilities (Huyton & Sutton, 1996). These characteristics were viewed by some staff to be due to frustration caused by communication difficulties and others saw it as a cultural problem. The expatriate managers had difficulty in delegating responsibility to the local staff because they felt the manager is the solution to all problems. Empowerment is neither accepted in China nor in Hong Kong. This is because of their deep-rooted belief in the Confucianist analect of filial piety. While the local staff complains of hard work while the Western manager simply says that the perceived hard work by the employees is merely the pressure felt by the staff. The Chinese do not accept constructive criticism from anyone who was not local. Starwood Group has found a solution to such issues where the local staff is unwilling to be empowered, by developing its local associates in China. Earlier they used to require about 30-40 expatriates for opening a new 5-start hotel but now they can manage with less than ten. These managers being local are able to influence the Chinese local staff and the integration is better. The staff now accepts responsibility and feels empowered. Empowerment communicates that they are valued and gives them a feeling of belonging to the organization. It satisfies their need to belong and live up to the rules of the organization, especially in cultures with high uncertainty avoidance. Empowerment develops a sense of personal efficacy in employees. It leads to a sense of responsibility and performance improvement (Lashley, 2000). Training and motivation help to instill the right meaning of empowerment among employees in a multi-cultural setting (Cacioppe, 1998). Training offers a tool for becoming empowered and in itself is empowering. Empowerment through training Ritz-Carlton conducts advance training seminars for their employees to achieve TQM in their organization. A select group of top managers and employees from different departments, with a focus on culture, assess the fit between that culture and the TQM principles (Advancedtrainingseminars, 2007). They identify the strengths and weaknesses and then set priorities. The real work in achieving TQM occurs from ‘bottom-up’. Hence at Ritz-Carlton, the employees are trained to sue their authority effectively. They even modify policies and practices to suit the different cultural elements that empower employees. According to Kappelman and Richards (1996), if employees are allowed to schedule their own trainings they have a small degree of control over the change process. Hence empowerment helps to overcome the resistance to change. Empowerment of service employees requires very important prerequisites including knowledge, information, rewards, and power (Melhem, 2004). Empowerment through motivation In collectivist cultures like Asia performance almost always improves when workers feel a sense of responsibility for the success of the team. This was demonstrated at the Portman Ritz-Carlton, where the Chinese staff had been slow to embrace empowerment. However, consistent messages that their initiative would be rewarded, has brought about a change in their behaviour (King-Metters & Metters, 2008). This also shows that leadership at Ritz-Carlton had a long-term orientation and they were able to influence others to bring about a change. This action was based on the human relations approach by Mayo (Hawthorne Studies) which suggests that employees can be motivated to work when they have a sense of belonging and their need for recognition is satisfied. ‘Individual behaviors may be altered because they know they are being studied’ (Envision, 2007). 4. Conclusion The objective of the report was to examine the concept of multi-cultural diversity with relevance to the hospitality industry. This report has studied the various dilemmas that arise due to a diverse workforce from different cultural backgrounds. Two dilemmas have particularly been looked into – communication and empowerment. Different hotels have encountered different problems in communication – both verbal and non-verbal, and depending upon low-context and high-context cultures. While lack of English language is common among the ethnic groups, non-verbal communication problems and understanding the verbal expressions are equally important. Training in language as well as cross-cultural training of the local staff as well as the expatriate managers has been found to be useful. Empowerment has also been misunderstood due to the power distance among different cultures. This too is possible to overcome through training and motivation of the employees. In addition, in low power distance countries like China, having a local manager has been helpful in making the local staff feel empowered. A sense of belonging and recognition, based on Hawthorne studies, can help the employees to feel the state of empowerment. 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