Cross-Cultural Management Development - Essay Example

In a globalising world, management development has become international management development and sensible organisations are concerned to create a cadre of ‘cross-cultural’ managers”. Culture has become the essence of modern strategic management issues. Before delving into the notion of cross-culturalism it is important to gain an insight as to what culture is. The word culture is enrooted in the Latin word “cultura” meaning “maintaining” or “tending” (Luo, 2009). Experts have come up with several concepts of culture. Kroeber and Kluckhohn defined culture as a set of intrinsic and extrinsic patterns and symbols; including, but not limited to artifacts, that demonstrate distinctiveness among human groups (Luo, 2009). Culture operates at various levels namely, supra-culture, macro-culture, meso-culture and micro-culture (Srnka, 2004). Supra-culture is common across nations with similar economic background, religion and ethnicity (Srnka, 2004). Macro-culture is common within the nation, across people who share the same country of origin or residence (Srnka, 2004). Meso-culture is common amongst particular communities or professional groups within the broader macro-culture (Srnka, 2004). Finally, micro-culture is shared amongst family or clan members or by people across the same organization (Srnka, 2004). Culture has been defined differently in different areas, and, keeping in view its strategic importance, the concept of cultural ecology has sprung up where culture is assumed to be an outcome of the natural environment (Steward, 1955). The new wave of globalization is said to be bringing about what is known as cultural change. In this context, culture is not viewed as static but dynamic; that is, it is constantly evolving in an attempt to keep pace with the forces of globalization. This change has given birth to two distinct possibilities as far as cultural change is concerned; that of a clash of cultures and that of cultural learning (Soderberg & Holden, 2002). At the same time, it is anticipated that a new culture is taking shape known as the global culture of the world culture (Soderberg & Holden, 2002), which has its roots in the concept of global village. The ‘global village’ concept tends to propose the idea of a boundary-less world, with strong integration brought about the revolutions in information technology and telecommunications. Although, this bore little relevance to the traditional management practices that were limited to planning, organizing, staffing and controlling, the globalization and its associated cultural dynamics have immense importance for contemporary management which is dynamic and not static. This strong relationship between the two issues has given birth to the concept of globalization and the concept of cross-culturalism and organizations today are increasingly concerned with how best to align and adapt their management to various cultural styles. Research bears witness to the fact that differences in cultures across countries account for differences in management and leadership styles (Gerstner & Day, 1994). In today’s globalized world, it is imperative for firms to appreciate and adapt to diversity in cultures and mould their management styles accordingly in terms of cognitive information processing and emotional, behavioral and motivational mechanisms (Earley, 2006). Considering the fact that many developed (western) nations are setting up businesses (as MNCs) in the less-developed (Asian/ eastern) societies, it is increasingly important for managers to appreciate and understand the differences that exist between the eastern and western societies. Research by Hofstede (1980, 1991, 2001) identifies key dimensions that account for variation between the Eastern and Western cultures, including masculinity, power distance beliefs, uncertainty avoidance and long term orientation. On one end of the continuum are the Eastern societies that rank high in terms of high power distance beliefs, collectivism, long term orientation and conformity. On the other end lie the Western societies that are more work-oriented, have low power-distance beliefs and are inherently individualistic in nature. Furthermore, increased influence of multinational corporations has given rise to the need for interaction amongst employees and managers of different cultures (Adler, 1983). This has given birth to the concept of cross-culturalism which attempts to examine the attitudes, behavior and relationships across managers (and people in general) of different cultures (Adler, 1983). Cross-cultural management is defined as adaptation to foreign context, efficacy and ability to accomplish tasks in a foreign setting, successful intercultural communication (verbal and non verbal) and meta-cognition (Thomas, 2008). Two broad aspects of cultural change have stemmed from the globalization movement: cultural ecology and cultural learning (Bird & Fang, 2009). Both act as centripetal forces; cultural ecology attempts to preserve local culture, whereas, cultural learning attempts to broaden cultures by offering a vast deal of cultural exchanges. These movements have given rise to the need for management for focus on cross-culturalism while interacting and surviving in a globalized world. The need to interact with people of different cultures and understand their behavior has become a critical aspect of international management. Let us take the example of a Hungarian employee’s encounter with an Austrian supervisor (Fink et al., 2007). The disgruntled employee complained of the “manner” in which his female Austrian supervisor delegated him work (Fink et al., 2007). According to the employee, there was absolutely no problem with the very work that was assigned; however, the supervisor failed to address her employee in an appropriate manner which offended him (Fink et al., 2007). Such, apparently trivial, instances of conflict between the manager and employee are a commonplace today. However, that does not make them insignificant. Paradoxically, such issues are not easy to understand; the cultural dimensions need to be accurately defined along a particular scale against which the behavior can be measured. In order to overcome these shortcomings, the “cultural standard method” was introduced by Leung et al., which identifies and examines the differences in perception, understanding, thinking and judging across a multitude of cultures (Fink & Meierewert, 2001). There are, in general, three approaches to understanding the notion of cross-culturalism: cultural dimensions, personality traits and the cultural standard method (Fink et al., 2007). However, the last one is limited to Central Europe, particularly Germany and Austria (Fink et al., 2007). All the three theories have been combined under the theory of action (1962) given by Parsons and Shils (Appendix 1) (Fink et al., 2007). This framework provides a coherent view of the incidents related to cross-cultural management by showing the linkage between three types of systems: the culture system, personality system and social system. Cross-cultural interaction, in the context of management, is attributed largely to the social system (Appendix 2) (Fink et al., 2007). The differentiation within the social system lies in the discrepancy between the “normal behavior” and that behavior which deviates from the normal behavior. Thus, the value orientations, norms of the society along with unique personality traits merge to form a holistic whole called culture. Managers come across various such situations in life where they the decision to be made by them comes into conflict with their value system. Consider this case. A young, female, manager walks towards her office in order to meet an employee. On her way, she encounters her close acquaintances who have to make the upcoming presentation to their boss and who seek the support of that manager in this regard (Fink et al., 2007). The question now arises as to what approach the manager should take. How should she react to the situation? Should she come to assist her friends and become late for her scheduled appointment with her employee? Or should she continue with her meeting at the cost of her friendship? (Fink et al., 2007). Such dilemmas, although common, are very difficult to deal with. The decision involves making a choice between discipline and friendship. The choice that the manager would make, however, would depend on a multitude of factors; the most important being culture. As mentioned earlier, culture itself is a complex product of cultural dimensions, personality traits and the cultural standard method. Thus, how the young female manager responds would be determined by factors such as in-group bias, whether she is a collectivist or an individualist, power-distance beliefs, personality traits as well as her cultural standards; that is, how does she “usually or normally” handle such situations (Fink et al., 2007). Reverting to the old example of the Austrian manager and the Hungarian employee, we may analyze the situation using the comprehensive framework “model of action” given by Parsons and Shils which has been modified in the context of management setting (Appendix 3) (Fink et al., 2007).Under this model, a manager from culture A will have his own set of actions based on his inherent cultural traits which might be different from the set of actions of, for instance, an employee from culture B. This is where the ‘clash of cultures’ takes place and managers’ actions collide with of employees (Fink et al., 2007).Taken in a positive light, however, this counterproductive behavior can be overcome by learning from previous such encounters or what is called cultural learning. If many people from the same culture change their behavior in response to such incidents, it results in a change in cultural standards. Thus, negative encounters between manager of different cultures or between managers and employees of different cultures need to be handled with care; the same experiences can be taken as lessons to learn from with the effect that the behavior of either party improves. From the managerial viewpoint, such instances of learning from past cross-cultural encounters can lead to improved relationships and better performance at a cross-cultural level. Considering that this is crucial in today’s globalized world, managers ought to reflect positively on their past cross-cultural experiences. With reference to the example of the Austrian manager and Hungarian employee, an adjustment is needed on both the sides in terms of understanding each other’s culture and allowing room for flexibility (Fink et al., 2007).. This would involve an assessment of the cultural dimensions, personality traits and cultural standards of both the parties (Fink et al., 2007). Several other researches have been undertaken with regard to cross-cultural management that cite examples of its significance in the contemporary workplace. According to one study conducted by Kirkman and Shapiro (2001) with respect to self directed work teams in Belgium, Finland, the Philippines and U.S.A, it was revealed that higher collectivism in teams translated into greater effectiveness, improved task performance, better results and higher levels of empowerment. Cross-cultural management has received increasing attention today due to the realization that management efforts will not always be successful under all business settings due to the cultural barrier. Managers need to consciously address the issue in order to overcome it; that is, they need to be aware of the significance of cross-cultural management, only then will they be able to tailor their behaviors according to the culture. Values may differ among various cultures. For example, a research conducted by Maaja Vadi, Krista Jaakson (2011) revealed that honesty is a highly valued attribute amongst Russians; however, its level of significance varies amongst Russians in different parts of the Soviet Union. The point to be made, therefore, is that even amongst people of the same culture, value systems may differ. Thus, it becomes critical for managers to understand these cultural differences and adapt to the respective behaviors. Modes of communication also tend to vary across cultures. This is the concept behind intercultural communication which emphasizes on different interpretations of verbal and non-verbal cues across cultures. A multitude of differences arise when dealing with cross-cultural communication, ranging from contextual, social, legal and ethical to nonverbal, age, gender, and religious differences (Bovee et al., 2008). High-context cultures must be separated from low-context cultures. The former refers to cultures such as those of South Korea and Taiwan where verbal communication takes a backseat and non-verbal communication conveys significant meaning (Bovee et al., 2008). The latter refers to the opposite and includes cultures such as those of U.S.A and Germany (Bovee et al., 2008). In low context cultures it becomes imperative for managers to be result and career-oriented whereas, in high context cultures emphasis is on building and maintaining relationships (Bovee et al., 2008). Thus, negotiations and trust-building are important exercises for managers as far as high-context cultures are concerned. Sometimes, social differences are also worth noting. For example, when Wal-Mart decided to expand its operations in Germany, the store personnel in Germany protested the company’s requirement of always putting up a smiling face to customers simply because it meant ‘flirting’ in their local context (Bovee et al., 2008). The way top management is addressed also differs. For example, in the U.S.A it is a common practice to address the top manager as Mr. X or Ms. Y. However, in China the same is addressed as ‘President’ or ‘Manager’ (Bovee et al., 2008). Furthermore, in the Arab states, it is considered as disrespect to exchange gifts with a man’s wife; similarly in India it is common to visit people without taking a time (Bovee et al., 2008). Non-verbal cues are also interpreted in surprisingly different ways. For example, managers in the U.S. may shake hands as a welcome gesture, whereas in Japan a slight bowing of the head is the norm (Bovee et al., 2008). Similarly, in the U.S, an eye-to-eye contact is considered to be a sign of confidence and respect, whereas, in South Korea it is considered disrespectful and hostile (Bovee et al., 2008). The ‘OK’ sign (made with an O with the thumb and index finger) demonstrates consent in the U.S; however, the same is considered as valueless in France and vulgar in Brazil and Germany (Bovee et al., 2008). The above clearly shows that out of Eric Garner’s seven barriers to effective communication, “cultural barriers” are of blooming importance to organizations today. Thus, managers of today ought to be aware of the cultural differences that exist across countries when dealing with people in the corporate world. Furthermore, it is important to realize the fact that what we say does not always translate to what we actually mean. This is best understood by contrasting the monochronic time period (that of Anglo Saxons) with the contemporary polychronic time period. Under the former, appointments, rigid schedules and task performance assumed high importance, whereas, in the latter, flexible working hours and relationship-building is the focus. This has important implications for managers. Consider the example of a manager who has a foreign (culturally different) team member. Such a manager has the crucial task to ‘fit’ that member into the group, in other words, to ensure that he is accepted by and adjusted into the team. When the team has a meeting, for instance, such a person must be made aware of the importance of time management. On the other hand, if there is a foreign manager for a domestic team then it is the manager who has to fit in with the rest of the team. For instance, an Indian manager in Germany must learn to adapt to the latter’s low-context culture. On the other hand, an Indian team member in a German team must learn to be punctual. Manager of such a team must allot time frames rather than one particular time and also inculcate the realization of the importance of time management skills in the member. This task is never an easy one as it requires an understanding of the motivations, behaviors, attitudes and intentions of the person which are highly influenced by one variable that is culture. Thus, a foreign manager in a domestic team will be required to adapt, whereas, a domestic manager heading a foreign team must coach. Finally, there may be situations where a manager from U.S is required to interact with, say, a team comprising of members from Italy, Germany, India, South Korea and Japan. This is, in essence, a multi-cultural team. Both flexibility and unity must be aimed at in this case. Perhaps, members of low-context cultures may develop an in group bias against members from high-context cultures. In such cases, the manager will have to negotiate and explain to, for example, a Japanese member why the German member is more innovative or justify why ‘his’ idea was taken up rather than the Japanese member’s (Bhattacharyya, 2010). Conflict management skills will play an important role here. It is also important to succumb to the behavior of one country; cross-cultural management requires co operation, integration and unity of thought and direction, which are sometimes very difficult tasks to achieve. Only when the thoughts of all members are aligned will the team move in a uniform direction. Consider another example of an American and a Chinese. The former is highly individualistic, prefers openness of thought, is task-oriented and short-sighted (short-term focus) (Bhattacharyya, 2010). The latter is collectivistic, relies more on non-verbal cues, is relationship-oriented and far sighted (long term focus) (Bhattacharyya, 2010). To bring a team (comprising of both cultures’ members) at par with each other, one culture’s members need to adapt to the values and norms of another culture’s members. This is, perhaps, the most important task for any cross-cultural manager. To conclude, it is imperative for organizations to provide cross-cultural training to management and for management to acquire the same. Not only does this allow managers to interact confidently with people of all cultures but it also acts as a trust-building measure and throttles all barriers in the path to effective communication and business. When differences (cross-cultural) are acknowledged, the problem is half-solved and a lot of misunderstandings and conflicts are averted. Cross-cultural management, thus, makes it possible for organizations to have a diverse workforce and enables the development of a coherent, integrated and uniform direction to steer the organization towards its goals. References: Adler, N.J., 1983. Cross-Cultural Management Research:The Ostrich and the Trend. Academy of Management Review, 8(2), pp.226-32. Bhattacharyya, 2010. Cross-Cultural Management: Text And Cases. Eastern Economy Edition ed. New Delhi: PHI Learning Pvt. Limited. Bird, A. & Fang, T., 2009. Cross Cultural Management in the Age of Globalization. International Journal of Cross Cultural Management, 9(2), p.139–143. Bovee, C.L., Thill, J.V. & Chaturvedi, M., 2008. Business Communication Today. 9th ed. New Delhi: Dorley Kindersley Pvt. Limited. Earley, P.C., 2006. Leading cultural research in the future: a matter of paradigms and taste. Journal of International Business Studies, 37(6), p.922–31. Fink, G. & Meierewert, S., 2001. Interkulturelles Management–Österreichische Perspektiven (Intercultural Management-Austrian Perspectives). Vienna: Springer Verlag. Fink, G., Neyer, A.-K. & Kolling, M., 2007. Understanding Cross-Cultural Management Interaction. International Studies of Management and Organization, 36(4), pp.38-60. Gerstner, C.R. & Day, D.V., 1994. Cross-cultural comparison. Leadership Quarterly, 5(2), p.121–34. Luo, Y., 2009. Analysis of Culture and Buyer Behavior in Chinese Market. Asian Culture and History, 1(1), pp.25-30. Soderberg, A.M. & Holden, N., 2002. Rethinking Cross Cultural Management in a Globalizing Business World. International Journal of Cross Cultural Management, 2(1), p.103–121. Srnka, K., 2004. Culture’s Role in Marketer’s Ethical Decision Making. Academy of Marketing Science Review 1. Steward, J.H., 1955. Theory of Culture Change: The Methodology of Multilinear Evolution. Illinois: University of Illinois Press. Thomas, D.C.e.a., 2008. Cultural intelligence : domain and assessment. International Journal of Cross Cultural Management, 8(2), p.123–143. Appendix 1 Source: Gerhard Fink, Anne-Katrin Neyer, Marcus Kolling, 2007. The Parsons and Shils (1962) model of action. Appendix 2 Source: Gerhard Fink, Anne-Katrin Neyer, Marcus Kolling, 2007. Cross-cultural interaction model based on Parsons and Shils (1962). Appendix 3 Source: Gerhard Fink, Anne-Katrin Neyer, Marcus Kolling, 2007. Cross-cultural performance model. Read More