Ch. 6 – Organizational Cultures and

DiversityJeremy Bourne and Hannah Smith

Dedicated to Paul Taylor (What a Bro)

Define what is meant by organizational culture and discuss the interaction of national and MNC cultures.

Identify the four most common categories of organizational culture.

Review the nature and degree of multiculturalism and diversity in today’s MNCs.

Discuss common guidelines and principles used in building multicultural effectiveness at team and organizational levels.

Objectives

Organizational culture – the shared values and beliefs that enable members to understand their roles and the norms of the organization.

Characteristics: (not an all-inclusive list)◦ Observed behavioral regularities◦ Norms◦ Dominant values◦ MNC philosophy◦ Rules◦ Organizational climate

Organizational Culture

1. 2. 3. 4. 5. 6. 7.

What Characteristics do you look for in an organization?

National cultural values have a significant impact on organizational performance.

Cultural values employees bring to the workplace with them are not easily changed by the organization.

“Far from reducing national differences, organizational culture maintains and enhances them.” -

National and Organizational Cultures

Some researchers have found that when Germans work for a US MNC, they become even more German, and when Americans work for a German MNC, they become even more American. Why would this knowledge be important to these MNCs?

Discussion

Hofstede’s Dimensions of Corporate Culture

Differences in European Management Characteristics

It can be difficult to do business with two or more of these groups.

Ex: Pg. 163 – French and Spanish negotiators Differences in culture can reduce the ability

of units to work well together. An organization really needs to know national

and organizational cultures when breaking into foreign markets.

Cultural differences should be discussed, and activities carefully coordinated.

Family Culture

Eiffel Tower Culture

Guided Missile Culture

Incubator Culture

Four Types of Culture Based on Dimension of Equity and Task

Organizational Cultures According to Trompenaars

Family Culture•Strong emphasis on hierarchy and orientation to the person.

•Family types environment that is power-oriented and headed by leader who is regarded as a caring parent.

•Organization personnel respect the individuals who are in charge

•Foreign to most managers in the in the United States, who believe in

•valuing people based on their abilities and achievements, not on their age or position in the hierarchy.

Strong emphasis on hierarchy and orientation to the task

Jobs are well defined, employees know what they are supposed to do, and everything is coordinated from the top

Person at the top of hierarchy is not reared as all powerful

Most common in northwestern Europe (Denmark, Germany, and the Netherlands)

Eiffel Tower Culture

Characterized by strong emphasis on equality in the workplace and orientation to the task

Teams or project groups are prevalent

Formal hierarchy are given low priority and a great focus on individual expertise.

Motivation is more intrinsic than just concern for money and benefits.

Guided Missile Culture

Strong emphasis on equality and personal orientation

Organizations are secondary to the fulfillment of the individuals within them.

Creates environments where participants thrive on an intense, emotional commitment to the nature of the work

All participants are working toward the same objective

Incubator Culture

In which of the four types of organizational cultures (family, Eiffel Tower, guided missile, incubator) would most people in the US feel comfortable? In which would most Japanese feel comfortable? Based on your answer, what conclusions could you draw regarding the importance of understanding organizational culture for international management?

What kind of culture did you choose?

Discussion

Countries plotted on chart

Table 6-3

What Type of Culture is this?

Google Company Information

Southwest Company Website

What Culture is This?

SouthWest Company Culture

Click Southwest Logo to Watch a Video

Success in the international arena often is greatly determined by an MNC’s ability to manage multiculturalism and diversity.

Evolution of International Companies – Domestic, International, Multinational, Global

Multiculturalism and Diversity

Domestic – culturally distinct population within an organization within the same country. (New York, Miami, San Francisco, etc.)

Group – ◦ Homogeneous groups – members have similar

backgrounds and generally perceive, interpret, and evaluate events in similar ways.

◦ Token groups – all members but one have the same background.

◦ Bicultural groups – two or more members represent each of two distinct cultures.

◦ Multicultural groups – three or more different ethnic backgrounds within the group.

Types of Multiculturalism

Most MNCs need not enter foreign markets to face that challenge of dealing with multiculturalism. Do you agree or disagree with this statement? Explain your answer.

“Lack of diversity in corporate America.”

Discussion

What Do you Think Of Diversity?

Pros Cons

Attitudinal - mistrust of others Perceptual – preconceived stereotypes Inaccurate communications – different word

meanings, misinterpreted nonverbal communication, different perceptions of time

Potential Problems with Diversity

Enhance creativity Better ideas Better decisions – prevent groupthink

(social conformity and pressures on individual members of a group to conform and reach consensus)

More effective and productive performance – connect with customers from different cultures

Advantages of Diversity

Effectiveness of Diversity Displayed Diagrammatically

What are some potential problems that must be overcome when using multicultural, diverse teams in today’s organizations? What are some recognized advantages? Identify and discuss two of each.

Discussion

Questions:◦ What do you think some of the main

organizational culture differences between the two companies would be?

◦ Why might the cultural diversity in the Spanish firm not be as great as that in the US firm, and what potential problems could this create?

◦ What would you recommend be done to effectively merge the two cultures and ensure they cooperate harmoniously? Offer some specific recommendations.

Case Study, pg. 183:“A Good-Faith Effort Is Needed”