Comparative International Management - Research Paper Example

COMPARITIVE INTERNATIONAL MANAGEMENT Contents Sr.# Topic Pg Introduction 2 2. Organizational Culture 3 2 Emergence of Global Organizations 2.2. Analysis and Discussion 6 3. Cultural Aspects 11 References 14 List of Figures a. Hofstedes Ethnicity Typology of Culture 3 b. Dimensions of Organizational Culture 4 c. The Balance of Values versus Practices at the National, Occupational and Organizational Levels 11 1. Introduction The concept of organizational culture has elicited a substantial amount of curiosity and attention, in the field of International Management, during the past couple of decades and is being increasingly regarded as a crucial element in facilitating far reaching development and growth within the organizations, ultimately leading to enhanced organizational performance and profitability. The basic underlying premise of the concept of ‘corporate culture’ refers to the significance of the individuals in economic undertakings and has gained rapid momentum in terms of familiarity and popularity of use in corporate jargon. It is commonly described as an amalgamation of a range of ideals, values, principles as well as ideas which are shared unvaryingly across all levels in the organization. However, such monumental visualization by certain authors regarding the perception of organizational culture in international management is commonly discarded by most social scientists and researchers alike. This paper strives to analyze, investigate and discuss a range of aspects related to organizational culture, particularly in terms of international organizations, and establish the fact that organizations, in present times, have evolved to accept and adapt the increasing workplace diversity, and multiculturalism. It further describes the manner in which organizations across the globe tend to have more or less similar corporate practices and how international businesses in recent times, are characterized by predefined set of standards and a collective set of behavioral anticipations with respect to both: organizations as well as the various stakeholders involved. 2. Organizational Culture One of the key outcomes of globalization is the formation of a new and specialized group of individuals who belong to an evolving international culture and as associations within this new global culture develop, it is increasingly being perceived by researchers, theorists and critics alike, as a distinctive risk to the sustainability and survival of national cultures, consequently and predictably resulting in its definitive desuetude. Organizational culture comprises of a range of critical elements such as the affinity that governs the development of this newly emerging global culture, the method by which key stakeholders in the organization are accommodated within it, its individuality, or key elements, which describes the characteristics of the organizational members, as well as the likely impact of such an emerging global culture on the national cultures. Figure 1: Hofstede’s Ethnicity Typology of Culture1 Hofstede (1984) defines culture as: "The collective programming of the mind which distinguishes the members of one human group from another" According to Jenks (1993) "Culture is the collective body of arts and intellectual work within one society. It includes a firmly established notion of culture as the realm of the produced and sedimented symbolism"2 Figure: Dimensions of Organizational Culture3 2.2. Emergence of global organizations Global organizations are a byproduct of globalization. Contrary to widespread belief, the term ‘Globalization’ refers to the capability of conducting business operations irrespective of the geographical aspects, rather than other general factors such as being preoccupied with the manner in which organizational operations are conducted, or whether the decision making structure is centralized or decentralized. In order to become a global organization, it is necessary for organizations to be able to develop internal competencies which facilitate efficient and smooth communication and interaction across all organizational sectors and departments, irrespective of place or location of such sector or department. The current rise in technological developments have facilitated organizations to achieve this objective of free and fast inter and intra organizational communication, which permit the members (employees as well as management) of the organization to communicate with anyone within the company with an aim to add value to their business. For instance, Digital Equipment Company engineers in Augusta, Maine, may communicate with the computerized and technologically efficient systems based in databases accessible from Reading, England; modify it and resend it to the desired destination within minutes. Similarly, engineers at Ford, Cologne, Germany may scrutinize and analyze a broken down part of machinery with their counterparts based in Essex, England through technologically driven gadgets. Such incidences have become common across the globe. Over time, increasing amount of customers and corporate associates would demand similar services which are quicker and faster and yet cost effective and hence the fact whether the organization is multi cultural or autonomous or follows a centralized administration system is of hardly any consequence. The ultimate test for the sustainability of the organizations would be efficient services and better products. This is made possible through the emerging trends in organizational culture whereby more and more international organizations are increasingly becoming single cultural whereby they share the same set of beliefs and shared set of organizational expectations. According to an executive at the CNX Corporation, U.S.: "Today global companies have no boundaries. A global company is one that undertakes its mission-critical activities wherever it makes the most sense; its research and development can occur wherever the skill or talent for performing it physically resides. We are trying to achieve globalization by making connections between assets across countries without putting assets on the ground in a particular country". The essential modification / transformation in the equilibrium that exists in global markets over the past couple of decades signifies a major shift from the western dominance whereby the emergence of global customers has redefined the traditional concepts related to corporate management. Following the disintegration of Communism in Eastern Europe countries, the likelihood for a superior allocation of prosperity in the Middle East, the development of the new and fresh consumerist regimes in Southern American continent the emergence of a new globalized generation is likely to take over whereby organizational norms and policies are uniform across all nations irrespective of geographical limitations and constraints. Such an intercontinental organizational culture has initiated the transformation of corporate practices by challenging the conventional multi cultural organizational practices and catering to a whole new global market through increased competence achieved by revolutionizing its management practices and implementing uniform set of beliefs and organizational expectations at all levels within its corporate hierarchy4. 2.2. Analysis and Discussion The concept of corporate culture, which is currently referred to as organizational culture, has been extensively researched and analyzed by researchers. The underlying theme of organizational culture is a means to highlight the significance of the contribution of human factor in economic production and has gained tremendous popularity and success in the field of international business management. Organizational culture has been described as a key element which helped in facilitating organizational performance, assimilation of businesses, information exchange, and investor worth, competitive edge, implementation of creative and innovative promotional tools by firms, performance of firms overseas as well as internationalization of businesses. Preliminary studies and historical research in the field of organizational behavior have largely described the organizations as vehicles of a single or unique culture. It is commonly described as a group of standards and thoughts that would be widely and collectively shared by the entire organization. The culture within such global organizations is described as closed, common and well defined standards or sets of beliefs wherein several super ordinate cultures co-exist and govern the approaches and performances of the individuals associated with it5. The colossal approach of organizational culture led to the formation of a new definition which referred to organizational culture as normative typologies, with the underlying principle that any specified organization can be acknowledged as having a singular and specific type of culture. The single culture perception within organizations usually regards management heads as the key foundations and facilitators of culture within the corporate framework. Schein (1985) proposed that organizational cultures were shaped by the creators and top level management and hence "culture and leadership are two sides of the same coin"6. Such a mention of Scheins previous studies is normally used to rationalize the pervasive practice of managing organizational culture which deals exclusively with the practices and response of top managers. The manifestation of a unified individuality throughout an organizational structure can be enticing. According to Welch (2003) "The mere fact that senior management articulates and actively promotes a certain set of corporate values, reinforced through actions, particularly those relating to promotion and reward, will almost automatically ensure that the majority of personnel will at least overtly espouse adoption and even engage in appropriate behaviors".7 The single culture organizations may be perceived as an ideological management of the ethnological and sociological perception of culture, intended to regulate the mode of work practices within organizational settings. Global organizations serve as an unrefined corporate body as opposed to something which comprises of an assortment of incoherent constituents travelling in diverse courses. In order to achieve global competence organizations must transform from the conventionally rigid and mechanistic associations to a renewed holistic corporate structure whereby any component of the business reveals its inherent policies. With respect to employees, the concept of global holism is synonymous with those organizations which represent shared beliefs, attitudes, and values. Such uniformity within corporate cultures generates reliability in the manner in which organizations deal with its network of corporate associates including its customers, sellers, other business partners, as well as with each other, irrespective of the place where such a business is being conducted. John Mullen, CEO of TNT Express Worldwide states that: “We try to protect a corporate culture worldwide. Managing directors, travel widely and each middle manager is driven by a similar set of requirements and a short term focus on results. They all talk the same language." Michael Sprindler, CEO of Apple Computer, Inc., states that: "The concept of global business does not allow for a company that is based in one country or location to look at the rest of the world as one big market. IT must have a truly international perspective. The new global company starts with a clear vision behind a product and then adjusts or adapts that idea to products uniquely suited to each country or market. It not only manufactures and markets worldwide; it interacts culturally in a dynamic way so that the original idea or product becomes part of the local society.8 3. Cultural Aspects Today, companies look for competitive advantages in several ways. One of such ways is through the development of organizational processes and practices and ensuring its implementation in the most efficient manner. Organizational culture plays a significant role in facilitating and promoting organizational development and hence has been widely studied and researched since decades. The concept of organizational culture reaffirms the fact that organizations have their own distinct cultures. It is defined by several authors in varied ways. According to Hofstede culture means the collective programming of mind that distinguishes one group or category of people from another. It can be found in different levels, such as national, occupational and organizational. Organizational culture signifies the manner in which individuals think, act, make decisions and contribute towards organizational goals and objectives. It defines the organizational practices, as well as the methods implemented to ensure proper execution of organizational duties by individuals concerned, i.e., employees and managers. The manners in which such individuals react or adapt to the changes within the organization suggest their eagerness to contribute towards planning and executing such changes. Schein defines organizational culture as: "A set of core values, behavioral norms, artifacts and behavioral patterns, which govern the way people in an organization interact with each other and invest energy in their jobs and in the organization at large”9. Figure: The Balance of Values versus Practices at the National, Occupational and Organizational Levels10 The above diagram proposes that at the national level the cultural differences are concentrated largely in terms of values rather than in practices. At the organizational level, cultural differences are found largely in practices as opposed to that in values while at occupational level, the cultural differences are half placed between nation and organization, which suggests that making a foray into an occupational field suggests the acquisition of both values as well as practices. The author further claims that national and organizational cultures are phenomena of a different order which ultimately signifies that values within organizations were found to be different within these contexts i.e., organizational, occupational and national rather than in terms of other key factors such as age, nationality, educational qualifications etc. Hofstede’s model of national culture is by far one of the most efficient models that describe organizational culture. The core dimensions of national culture include: preventing uncertainty, power distance, individualism - collectivism, masculinity - feminity, and long versus short term patterns of thought. The model claims that organizations tend to react in accordance with the dominant cultures existing within their respective geographical locations11. Organizational culture has evolved significantly over the years, irrespective of the level of culture i.e., national, occupational or organizational; the understanding of various aspects related to organizational culture is inevitable for ensuring sustainability within the industry. Leaders and entrepreneurs thus, must be prepared and well versed with the various nuances inherent in organizations and develop and implement policies to combat the unforeseen situations that may arise on account of changes driven by emerging trends12. References: Kakabadse, A., (1999). Essence of Leadership, Cengage Learning, Pp.77 Jablin, F. M., Putnam, L. L., (2001). The New Handbook of Organizational Communication: Advances in Theory, Research, and Methods, SAGE publication, Pp. 343 Organizational Culture, viewed: April 18, 2009 from: Luftman, J. N., (1996). Competing in the Information Age: Strategic Alignment in Practice, Oxford University Press, Pp. 122 Schein, E., (1983). The Role of the Founder in Creating Organizational Culture, organizational Dynamics, 12 (1), Pp. 13 - 28 Karwowski, W., (2006).International Encyclopedia of Ergonomics and Human Factors, CRC Press, Pp. 2204 Hofstede, G., (2001). Cultures Consequences: Comparing Values, Behaviors, Institutions, and Organizations across Nations, SAGE Publications, Pp. 394 Schein, E., (1985). Organizational Culture and Leadership, Jossey – Bass, Pp.2 Redding, G., Stening, B. W., (2003). Cross-Cultural Management, Edward Elgar, Pp. 305 Tosi, H. L., Mero, N. P., (2003). The Fundamentals of Organizational Behavior: What Managers Need to Know, Wiley Blackwell Publishers, Pp. 115 Schein, E. H., (2004). Organizational Culture and Leadership, John Wiley and Sons, Pp. 3 Read More