How to Deal with Cultural Diversity in your Company

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Identify the 5 dimensions of cultural segmentation. CQ is identified as a way to ensure cultural diversity and mangerial excellence

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How to Deal with Cultural Diversity in your Company

  1. 1. Case study on International Joint Ventures
  2. 2. <ul><li>The extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. </li></ul><ul><li>Does not in any way imply the existence of a society that is less or more humane than another, it simply denotes the social structure </li></ul>
  3. 3. <ul><li>Power Distance Index </li></ul><ul><li>UK: 35 </li></ul><ul><li>Japan: 54 </li></ul>
  4. 4. <ul><li>Problems in relation to Japan/UK: </li></ul><ul><li>Relationship between the superior and the subordinate, mainly when British is subordinate of Japanese </li></ul><ul><ul><li>In UK: Validation and defending of a superior’s role is expected </li></ul></ul><ul><ul><li>But if British subordinate challenges superior’s role, would be accused of being offensive </li></ul></ul>
  5. 5. <ul><li>Problems in relation to Japan/UK: </li></ul><ul><li>Interaction between subordinate and superior </li></ul><ul><ul><li>In Japan: Initiatives taken by the middle management </li></ul></ul><ul><ul><li>Superior plays a very vague role when it comes to making a decision in order to protect him from losing face </li></ul></ul>
  6. 6. <ul><li>Problems in relation to Japan/UK: </li></ul><ul><li>Interaction between subordinate and superior </li></ul><ul><ul><li>In UK: Superior makes decision based on subordinates opinions </li></ul></ul><ul><ul><li>Takes full responsibility for decision </li></ul></ul><ul><ul><li>If wrong choice made, no less respect from subordinates </li></ul></ul>
  7. 7. <ul><li>Problems in relation to Japan/UK: </li></ul><ul><li>Interaction between Japanese and UK </li></ul><ul><ul><li>Japanese say things ambiguously, need to listen to underlying tones </li></ul></ul><ul><ul><li>British direct and frank </li></ul></ul>
  8. 8. <ul><li>Individualism: loyalty to oneself </li></ul><ul><li>Collectivism: loyalty to family or group </li></ul><ul><li>However, </li></ul><ul><li>Citizens of an individualist culture are more likely than not to be part of volunteer organizations or join the military voluntarily </li></ul><ul><li>Hence, a very unclear definition given. </li></ul>
  9. 9. <ul><li>In Hofstede’s surveys: </li></ul><ul><li>Individualism indicated in questions relating to the availability of personal time, the amount of freedom given to an employee in solving a problem and the presence of challenging work to accomplish. </li></ul>
  10. 10. <ul><li>In Hofstede’s surveys: </li></ul><ul><li>Collectivism was indicated by the training opportunities given, the physical conditions of the work environment and the use of ones skills on the job. </li></ul>
  11. 11. <ul><li>Individualism Index Value (IDV) </li></ul><ul><li>UK : 89 </li></ul><ul><li>Japan: 46 </li></ul>
  12. 12. <ul><li>Japan: Organisation orientation </li></ul><ul><li>Factors in the external market are of less importance with regards to employment in the company </li></ul><ul><li>UK: Market orientation </li></ul><ul><li>Job aspects (eg. Pay) dependent on market value </li></ul>
  13. 13. <ul><li>Japan: </li></ul><ul><li>Inclined to run machinery unattended </li></ul><ul><li>Strive to attain multi-machines operation </li></ul><ul><li>UK: </li></ul><ul><li>Would rather run them with operators who have had previous experience </li></ul><ul><li>Contented with the distribution of one operator for each machine </li></ul>
  14. 14. <ul><li>Minimizing uncertainty in the form of rules and structures </li></ul><ul><li>Japan:92, UK:35 </li></ul><ul><li>Trust </li></ul><ul><li>Reputation </li></ul><ul><li>Hierarchy structure </li></ul>
  15. 15. <ul><li>Attention to the future versus the past and present </li></ul><ul><li>Japan:80, UK:25 </li></ul><ul><li>Affects the way decisions are made </li></ul><ul><li>All business relations are long term </li></ul>
  16. 16. <ul><li>Ability to engage in a set of behaviors that uses skills (e.g. language or interpersonal skills) and qualities (e.g. tolerance for ambiguity, flexibility) </li></ul><ul><li>Tuned to the culture-based values and attitudes of the people with whom one interacts </li></ul>Definition
  17. 17. <ul><li>Consists of a multiple intelligence and emotional </li></ul><ul><li>intelligence as mentioned by Howard Gardner </li></ul><ul><li>and Daniel Goleman </li></ul><ul><li>There are four aspects mainly </li></ul><ul><li>Linguistic </li></ul><ul><li>Spatial </li></ul><ul><li>Intrapersonal </li></ul><ul><li>Interpersonal </li></ul>
  18. 18. <ul><li>Successful interaction with people from other cultures whose native language is different from their own </li></ul><ul><li>In our case study, interaction between the British and Japanese counterparts would require genuine interest to bridge the language barrier </li></ul><ul><li>Constructive efforts to learn as much of the other language as possible </li></ul><ul><li>For e.g. assuming a British colleague learns some key words or lingo of is/her Japanese counterpart, this would definitely foster a more cohesive work environment </li></ul>
  19. 19. <ul><li>Understanding the proper behaviours that would facilitate a proper introduction without any embarrassment </li></ul><ul><li>For e.g. Asians and particularly Japanese people show courtesy by bowing slightly or even opening doors for others </li></ul><ul><li>However this is considered ridiculous in the Western culture </li></ul><ul><li>Thus ability or failure to adapt different spatial behaviours could make our international counterparts comfortable or ill at ease </li></ul><ul><li>This in turn leads to various levels or success or failure in face-to-face cultural interactions </li></ul>
  20. 20. <ul><li>Understand one’s own unique cultural style </li></ul><ul><ul><li>Allows easier comparison with others and thus the appropriate adjustment to behaviour to be compatible to cross-cultural settings </li></ul></ul><ul><li>Intrapersonal intelligence could be improved only if one strive’s to learn one’s own cultural style better </li></ul>
  21. 21. <ul><li>An important aspect of cultural intelligence </li></ul><ul><li>Successful interaction with people from other cultures is the heart of cultural intelligence </li></ul><ul><li>According to Gardner, interpersonal intelligence goes beyond just the language aspects and is described as the ability to “read the intentions and desires of others, even when they have been hidden” </li></ul><ul><li>For professionals to be successful in international interactions such ability to “read” people and anticipate their motivations and desires is crucial </li></ul>
  22. 22. IMPROVING CULTURAL INTELLIGENCE <ul><li>Developed through three means: </li></ul><ul><ul><li>Head / Cognitive (learning about beliefs, customs, and taboos of your own and other cultures) </li></ul></ul><ul><ul><li>Body / physical (using your senses and adapting your movements and body language to blend in to your foreign hosts, guests, or colleagues simply by showing you understand their culture) </li></ul></ul><ul><ul><li>Heart / Emotional / motivational (Adapting to a new culture by overcoming obstacles and setbacks. People can do that by gaining rewards and strength from acceptance and success). </li></ul></ul>
  23. 23. <ul><li>Examine the motivation for learning about other cultures </li></ul><ul><li>Develop the mindset that there is more than just one set of thinking as opposed to refusing to accept other viewpoints </li></ul><ul><li>This could be cultivated through learning, evolving and thus gaining perspective. </li></ul><ul><li>Merely memorizing a list of dos and don’ts is difficult as it differs within countries </li></ul><ul><li>Way of behavior in other cultures is critical </li></ul>
  24. 24. <ul><li>For instance, Americans and Japanese have differing styles when presenting their name cards </li></ul><ul><li>When presenting a business card to a Japanese colleague, one should mention “Hajima mashite”, meaning “Pleased to meet you” in a slight bow and using both hands to give the card shows a sense of respect towards the receiver and the business card </li></ul><ul><li>However from the Westerners context, like the British, a business card is for practicality. Thus very little consciousness to show to towards the presentation of the business card </li></ul>
  25. 25. <ul><li>Vulnerable to failure due to cultural misunderstandings. </li></ul><ul><li>Paterson and Shimada (1978): cultural differences led to failure on the part of parent company managers to “understand” one another. </li></ul><ul><li>Resultant communication breakdown - Collapse of the venture. </li></ul>
  26. 26. <ul><li>Faulkner, in his research, found that the following attitudes were outstandingly associated with joint venture success: </li></ul><ul><li>Commitment by top management </li></ul><ul><li>Mutual Trust </li></ul><ul><li>Sensitivity to company culture </li></ul><ul><li>Commitment at lower levels </li></ul><ul><li>Sensitivity to national culture </li></ul><ul><li>Information widely disseminated </li></ul><ul><li>Good dispute resolution mechanisms </li></ul><ul><li>Reviewed Learning </li></ul>
  27. 27. <ul><li>Individual & organizational levels </li></ul><ul><li>Cultural Intelligence as the fundamental basis </li></ul><ul><li>Cultural mix of people not as a problem BUT as an ASSET (Cognitive) </li></ul>
  28. 28. <ul><li>Training of managers and other employees </li></ul><ul><ul><li>trained and prepared for the difficulties of building cross-cultural working relationships. </li></ul></ul><ul><li>Sending employees of partner cultures together on these courses might be useful </li></ul><ul><ul><li>encourage the building of informal inter-cultural contacts. </li></ul></ul><ul><li>Such would strengthen and develop the physical and emotional aspects of cultural intelligence. </li></ul>
  29. 29. <ul><li>Having and developing cross-cultural empathy (emotional aspect of cultural intelligence) would also prepare staff for cross-cultural understanding and lead to joint venture success. </li></ul>
  30. 30. <ul><li>Multicultural work teams could be built prior to as well as after the establishment of the joint venture. </li></ul><ul><li>Clear communication channels and mechanisms could be put in place to avoid misunderstandings. </li></ul><ul><li>Adequate efforts in educating joint ventures assignees about the strategic intent underlying partnership. </li></ul><ul><li>Ensure sufficient economic and career incentives for sustained learning within and across strategic business units. </li></ul>
  31. 31. Summary & Conclusion Application: Joint Venture Hofstede’s 5 Dimensions Improving Cultural Intelligence Cultural Intelligence Cultural Diversity

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