This document discusses the impact of language diversity in multinational corporations. It notes that globalization, viewing language as independent from culture, and shifting analysis to the organizational level have increased the importance of this issue. Language differences can create barriers to cooperation through lack of grammar knowledge, different contextualization cues, and linguistic distance from the corporate language. This can lead to isolation, less substantive interactions, and uneven power dynamics. The document reviews strategies for managing language diversity, such as translation, code switching, recruitment standards, and language training.

1. Giulio Valagussa
University of Tübingen
Department of International Business

2. Three factors that increased its importance:
- Globalization (deregulation of capital and
workforce movement);
- Researchers’ consideration of language as an
independent factor from culture in general
(starting from the late 90’s);
- The shift of level of analysis from that of the
individual to that of the organization.
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University of Tübingen,
Department of International
Business

3.  Grammatical and lexicon knowledge;
 Contextualization cues (such as tone of voice,
pauses, gestures and so on…) that vary from
culture to culture and can lead to different
interpretations of the same word or phrase;
 Linguistic distance between foreign worker’s
mother tongue and the official corporate
language;
 Education received during scholastic years.
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University of Tübingen,
Department of International
Business

4.  Consequence of the use of a corporate
language, such as English, as lingua franca;
 Members who are less fluent in that language
feel isolated and excluded from the rest of
the group;
 Team meetings and interactions are
impoverished in their contents by the inability
of those members to express their thoughts
as they would like.
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University of Tübingen,
Department of International
Business

5.  SanAntonio (1987) case: a team split in two
locations (USA and Japan), with Japanese
members behaving differently according to
the language spoken;
 Piekkari, Oxelheim and Randoy’s (2014)
experiment on nine firm’s heterogeneous
corporate boards.
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University of Tübingen,
Department of International
Business

6. Area under observation: from individual’s characteristics
to interactions within the team as a whole.
Language is a barrier that can limit cooperation between
team members.
Two forms a faultline can take (Jehn & Bezrukova,
2010):
 “Dormant faultlines” are lines that, by nature,
separate people according to their demographic
characteristics, or personality traits;
 “Activated faultlines” are material divisions that occur
when those differences are perceived by the people.
The latter can generate subgrouping.
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University of Tübingen,
Department of International
Business

7. Experiment of Hinds, Neeley and Cramton
(2013):
 Realized through interviews and observations
on a MNC’s six teams split in two different
countries (among which, USA, Germany and
India);
 Open-ended questions about tasks and
interactions required;
 Concurrent observations of team activities
(e.g., meetings, e-mails);
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University of Tübingen,
Department of International
Business

8. Emotion-regulation strategies:
 Situation selection: one’s decision not to
undertake an action because of the perception of
the bad effects it will generate;
 Situation modification: one undertakes the action
trying to modify the conditions that originally
would bring him/her an unwanted emotion;
 Code switching: switching from one language to
another during the same dialogue;
 Reappraisal: one tries to act proactively, in order
to reduce the gap with its colleagues.
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University of Tübingen,
Department of International
Business

9. The authors found out that in order for a
faultline to produce its effects, a source should
activate it.
This source was identified with power contests
and perceived shifts of power between some of
the teams analysed.
The more the information is symmetrically
distributed, the stronger those two phenomena.
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University of Tübingen,
Department of International
Business

10. Linguistic Ostracism (LO) is the condition suffered by an
individual who cannot understand what other people say.
Research of Dotan-Eliaz, Sommer & Rubin (2009) is based on the
Collective Effort Model, created by Karau and Williams (1993):
 It assumes that one’s commitment in processing a task,
individually or in a group, is related to the perception of how
its effort will be worthwhile in terms of pay offs (e.g., pay,
perspective of future promotions);
 Transposed in the LO context, an affiliation hypothesis is
verified if the ostracised person perceive a positive
correspondence, and so it will work hard to reduce its gaps
with the colleagues;
 Otherwise a disengagement hypothesis arises if there is not
that perception of effort fulfilment.
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University of Tübingen,
Department of International
Business

11. Two more indicators were integrated in the
experiment:
 Social Self-Efficacy (SSE): the self-rated ability
of an individual to relate with other people;
 Rejection Sensitivity (RS): the tendency to
overreact to rejection, such as the one caused
by LO.
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University of Tübingen,
Department of International
Business

12.  High SSE was related with low negative affect
and anger. The opposite is valid for high RS;
 Affiliation hypothesis is verified for people
high in SSE and low in RS;
 Disengagement hypothesis is valid for
people low in SSE and high in RS;
 Negative correlation between LO exposure
and indicators such as team potency, co-
worker attraction and creative performance.
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University of Tübingen,
Department of International
Business

13. Language can act as a way for more fluent
workers to gain power and improve their status
in the MNC.
The research that better underline this bond is
the one by Marschan-Piekkari, Welch and Welch
(1999), a case study on a Finnish MNC.
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University of Tübingen,
Department of International
Business

14. 1) They point out the role of the expatriate, a
figure able to speak both the corporate
language (English) both the parent language
(Finnish):
◦ It is able to act as an intermediary for its co-
workers in their relations with the superiors;
◦ It can get earlier and more easily access to
important information. One interviewee even talked
about that as a “Finnish mafia”, according to which
Finns form an elite that restricts to itself the
information sharing within the organization.
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University of Tübingen,
Department of International
Business

15. 2) Also foreigners can obtain advantages from
that condition:
◦ The experience of a Spanish employee who,
because of his excellent English fluency was sent to
meetings and training courses although he didn’t
have the status to attend them.
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University of Tübingen,
Department of International
Business

16.  Brannen, Moore and Mughan (2013) stated
that performance is related to more tangible
aspects such as the tenure in the firm;
 Watson, Kumar and Michaelsen (1993)
demonstrated that language issues can be
overcome by a prolonged team work
experience.
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University of Tübingen,
Department of International
Business

17. To overcome language differences  resorting
to routines to standardise some processes.
One of these can be the adoption of a lingua
franca; but take care of the fact that a
standardised communication “can only be
achieved by doing violence to very important
cultural practices within other groups”
(Henderson, 2005, p. 75).
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University of Tübingen,
Department of International
Business

18. To avoid the presence in the team of weak
corporate language speakers  in the recruiting
process require the applicants to submit
certifications that ensure their fluent knowledge
of the corporate language, (Marshan-Piekkari,
Welch, & Welch, 1999, b), paying attention not
to leave the impaired person alone in the team;
Or temporally transfer expatriates to the
problematic team in order to facilitate
communication in the first steps of its life
(ibid.).
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University of Tübingen,
Department of International
Business

19. The MNC should organise language training
programs for the employees (teaching not only
the basic of the corporate language, but also
the MNC’s organizational culture);
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University of Tübingen,
Department of International
Business

20.  Lack of generalization: It’s hard to classify the
effect of such an abstract characteristic as
language through standardised methods 
most of the studies are qualitative analysis of
few companies, or even case studies;
 Difficulty in establishing causality between
the two variables (language asymmetry and
performance);
 Solution: Quantitative researches on a wider
range of companies.
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University of Tübingen,
Department of International
Business

21.  Performance is always described only by
measuring the internal processes and
interactions of a language diverse team;
 Solution: Take into consideration the
outcomes of their tasks, and compare them
with homogeneous teams ones.
 Language as a faultline is often analysed
independently from other features;
 Solution: Combine language with other
demographic characteristics to show how
they influence each other.
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University of Tübingen,
Department of International
Business

22. Successfully mastering the issue of language allow
a MNC to obtain some important results:
 Information is able to flow within a team without
any constraint;
 Less individual social exclusion;
 More involved participation in the
communications;
 No clashes and subgroups between team
members;
 Equally distributed power inside the team;
 Improvement of corporate climate and better
performance.
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University of Tübingen,
Department of International
Business

24.  Brannen, M. Y., Moore, F., & Mughan, T. (2013). Strategic ethnography and
reinvigorating Tesco Plc: Leveraging inside/out bicultural bridging in multicultural
teams. In EPIC 2013 London. Proceedings of the Ethnographic Praxis in Industry
Conference; 15–18 September, London, 255–272. Arlington, VA: American
anthropological Association.
 Dotan-Eliaz, O., Sommer, K. L., & Rubin Y. S. (2009). Multilingual groups: Effects
of linguistic ostracism on felt rejection and anger, coworker attraction, perceived
team potency, and creative performance. Basic and Applied Social Psychology, 31
(4), 363-375.
 Henderson, J. K. (2005). Language diversity in international management teams.
International Studies of Management & Organization, 35 (1), 66-82.
 Hinds, P. J., Neeley, T., & Cramton, C. D. (2013). Language as a lightning rod:
Power contests, emotion regulation, and subgroup dynamics in global teams.
Journal of International Business Studies (2014), 45 (5), 536-561.
 Jehn, K. A., & Bezrukova, K. (2010). The faultline activation process and the effects
of activated faultlines on coalition formation, conflict, and group outcomes.
Organizational Behavior and Human Decision Processes, 112, 24-42.
 Karau, S. J., & Williams, K. D. (1993). Social loafing: A meta-analytic review and
theoretical integration. Journal of Personality and Social Psychology, 65, 681-706.
University of Tubingen,
Department of International
Business 24

25.  Marschan-Piekkari, R., Welch D., & Welch, L. (1999). In the shadow: the
impact of language on structure, power and communication in the
multinational. International Business Review, 8 (4), 421-440.
 Marschan-Piekkari, R., Welch D., & Welch, L. (1999). Adopting a common
corporate language: IHRM implications. The International Journal of
Human Resource Management, 10, 377-390.
 Piekkari, R., Oxelheim, L., & Randoy, T. (2014). The silent board: How
language diversity may influence the work processes of corporate
boards. Corporate Governance: An International Review (2015), 23(1),
25–41.
 SanAntonio, P. M., (1987). Social mobility and language use in an
American company in Japan. Journal of Language and Social Psychology,
6 (3-4), 191-200.
 Watson W. E., Kumar K., & Michaelsen L. K. (1993). Cultural diversity's
impact on interaction process and performance: Comparing
homogeneous and diverse task groups. The Academy of Management
Journal, 36 (3), 590-602.
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Department of International
Business 25