The document discusses organizational culture and diversity in multinational corporations. It describes the nature of organizational culture as shared values, behaviors, norms and dominant values. It also discusses the interaction between national and organizational cultures, and how cultural values employees bring can impact performance. When mergers or acquisitions occur in multinational companies, four steps of integration are outlined. Additionally, four types of organizational cultures - Family, Eiffel Tower, Guided Missile, Incubator - are defined based on emphasis on tasks vs people and equity vs hierarchy. The evolution of international corporations from domestic to global is shown through four phases. Potential problems and advantages of diversity in organizations are also noted.

1. Organizational culture & Diversity

2. The Nature of Organizational Culture
 Shared values and beliefs that enable members to understand their
roles and the norms of the organization, including
 Observed behavioral regularities, as typified by common language,
terminology, and rituals.
 Norms, as reflected by things such as the amount of work to be done
and the degree of cooperation between management and employees.
 Dominant values that the organization advocates and expects
participants to share, such as high product and service quality, low
absenteeism, and high efficiency.

3. Interaction Between National and
Organizational Cultures
 National cultural values of employees may have a significant impact on their
organizational performance
 Cultural values employees bring to the workplace with them are not easily
changed by the organization

4. Organizational Cultures in MNCs
 There are four steps in the integration of organizational cultures in
international expansions that result from mergers or acquisition
1. The two groups have to establish the purpose, goal, and focus of their merger
2. They have to develop mechanisms to identify the most important organizational
structures and management roles
3. They have to determine who has authority over the resources needed for getting
things done
4. They have to identify the expectations of all involved parties and facilitate
communication between both departments and individuals in the structure

5. Organizational Cultures in MNCs
 Three aspects of organizational functioning that are important in
determining MNC organizational culture
1. The general relationship between the employees and their organization
2. The hierarchical system of authority that defines the roles of managers
and subordinates
3. The general views that employees hold about the MNC’s purpose,
destiny, goals, and their places in them.

6. Organizational Cultures in MNCs
Person
Emphasis
Task
Emphasis
Equity
Hierarchy
Fullfillment-oriented
culture
INCUBATOR
Project-oriented
culture
GUIDED MISSILE
EIFFEL TOWER
Role-oriented culture
FAMILY
Power-oriented
culture

7. Organizational Cultures in MNCs
 Family culture
 Strong emphasis on hierarchy and orientation to the
person
 Family-type environment that is power oriented and
headed by a leader who is regarded as a caring parent
FAMILY
Power-oriented
culture
 Management looks after employees, and tries to ensure that they are
treated well and have continued employment
 May catalyze and multiply the energies of the personnel or end up
supporting a leader who is ineffective and drains their energies and
loyalties

8. Organizational Cultures in MNCs
 Eiffel Tower
 Strong emphasis on hierarchy and orientation to the task
 Jobs are well defined, and everything is coordinated from the
top
 This culture is narrow at the top, and broad at the base
 Relationships are specific, and status remains with the job.
 Managers seldom create off-the-job relationships with their people, because they
believe this could affect their rational judgment
 This culture operates very much like a formal hierarchy—impersonal and efficient
and loyalties
EIFFEL TOWER
Role-oriented
culture

9. Organizational Cultures in MNCs
 Guided missile
 Strong emphasis on equality in the workplace and
orientation to the task
 This culture is oriented to work
 Work typically is undertaken by teams or project groups
 In projects, formal hierarchical considerations are given low priority, and
individual expertise is of greatest importance
 All team members are equal (or at least potentially equal
 All teams treat each other with respect, because they may need the other for
assistance
 Egalitarian and task-driven organizational culture
Project-oriented
culture
GUIDED MISSILE

10. Organizational Cultures in MNCs
 Incubator
 Strong emphasis on equality and personaI orientation
 Based on the premise that organizations serve as incubators
for the self-expression and self-fulfillment of their members
 Little formal structure
 Participants in an incubator culture are there primarily to perform roles such as
confirming, criticizing, developing, finding resources for, or helping to complete
the development of an innovative product or service
Fullfillment-oriented
culture
INCUBATOR

11. Table 6–3
Summary Characteristics of the Four Corporate Culture
Relationships
between
employees
Adapted from Table 6–3: Summary Characteristics of the Four Corporate Culture
Four Corporate Cultures
Diffuse relation-
ships to organic
whole to which
one is bonded
Specific role in
mechanical
system of
required
interaction
Specific tasks in
cybernetic system
targeted on shared
objectives
Diffuse,
spontaneous
relationships
growing out of
shared creative
process
Attitude toward
authority
Status is ascribed
to parent figures
who are close and
powerful
Status is ascribed
to superior roles
that are distant yet
powerful
Status is achieved
by project group
members who
contribute to
targeted goal
Status is achieved
by Individuals
Exemplifying
creativity and
growth
Corporate Culture
Characteristic Family Eiffel Tower Guided Missile Incubator
Ways of thinking
and learning
Intuitive, holistic,
lateral and error
correcting
Logical, analytical,
vertical, and
rationally efficient
Problem centered,
professional,
practical, cross
disciplinary
Process oriented,
creative, ad hoc,
inspirational

12. Table 6–3
Summary Characteristics of the Four Corporate Culture
Attitudes toward
people
Adapted from Table 6–3: Summary Characteristics of the Four Corporate Culture
Four Corporate Cultures
Family members Human resources Specialists and
experts
Co-creators
Ways of changing “Father” changes
Course
Change rules and
procedures
Shift aim as target
moves
Improvise and
attune
Corporate Culture
Characteristic Family Eiffel Tower Guided Missile Incubator
Ways of
motivating and
rewarding
Intrinsic
satisfaction in
being loved and
respected
Promotion to
greater position,
larger role
Pay or credit for
performance and
problems solved
Participation in the
process of
creating new
realities
Management by
subjectives
Management by
job description
Management by
objectives
Management by
enthusiasm

13. Table 6–3
Summary Characteristics of the Four Corporate Culture
Adapted from Table 6–3: Summary Characteristics of the Four Corporate Culture
Four Corporate Cultures
Corporate Culture
Characteristic Family Eiffel Tower Guided Missile Incubator
Criticism and
conflict resolution
Turn other cheek,
save other’s face,
do not lose power
game
Criticism is
accusation of
irrationalism
unless there are
procedures to
arbitrate conflicts
Constructive task
related only, then
admit error and
correct fast
Improve creative
idea, not negate it
Source: Adapted from Fons Trompenaars and Charles Hampden-Turner, Riding the Waves of Culture: Understanding
Diversity in Global Business, 2nd ed. (Burr Ridge, IL: Irwin, 1998), p. 183.

14. International Culture Diversity Focus
Phase1
Domestic
firms
Phase2
International
firms
Phase3
Multinational
firms
Phase4
Global
firms
Source: Nancy J. Adler, International Dimensions of Organizational Behavior, 2nd ed. (Boston: PWS-Kent Publishing,
1991), p. 123.

15. Table 6–4
The Evolution of International Corporations
Primary Product/service Market Price Strategy
orientation
Competitive Domestic Multidomestic Multinational Global
strategy
Importance of Marginal Important Extremely Dominant
world business important
Product/service New, unique More Completely Mass-customized
standardized standardized
(commodity)
Product Process Engineering not Product and
engineering engineering emphasized process emphasized
emphasized engineering
Phases of Multicultural Development
Characteristics/
Activities
Phase I
(Domestic
Corporations)
Phase II
(International
Corporations)
Phase III
(Multinational
Corporations)
Phase IV
(Global
Corporations)
Adapted from Table 6–4: The Evolution of International Corporations

16. Table 6–4
The Evolution of International Corporations
Technology Proprietary Shared Widely shared Instantly and
extensively
shared
R&D/sales High Decreasing Very low Very high
Profit margin High Decreasing Very low High, yet
immediately
decreasing
Competitors None Few Many Significant (few
or many)
Market Small, domestic Large, Larger, Largest, global
multidomestic multinational
Production Domestic Domestic and Multinational, Imports and
location primary markets least cost exports
Adapted from Table 6–4: The Evolution of International Corporations
Phases of Multicultural Development
Characteristics/
Activities
Phase I
(Domestic
Corporations)
Phase II
(International
Corporations)
Phase III
(Multinational
Corporations)
Phase IV
(Global
Corporations)

17. Table 6–4
The Evolution of International Corporations
Cultural Marginally Very Somewhat Critically sensitivity
important important important important
With whom No one Clients Employees Employees and
clients
Level No one Workers and Managers Executives
clients
Strategic “One way”/ “Many good “One least-cost “Many good
assumption one best way” ways” Way” Ways”
equifinality simultaneously
Adapted from Table 6–4: The Evolution of International Corporations
Phases of Multicultural Development
Characteristics/
Activities
Phase I
(Domestic
Corporations)
Phase II
(International
Corporations)
Phase III
(Multinational
Corporations)
Phase IV
(Global
Corporations)
Source: Nancy J. Adler, International Dimensions of Organizational Behavior, 2nd
ed. (Boston: PWS-Kent Publishing,
1991), pp. 7–8.

18. Potential Problems Associated
with Diversity
 Attitudinal problems
 May cause a lack of cohesion that results in the unit’s inability to take
concerted action or to be productive
 Perceptual problems
 When culturally diverse groups come together, they often bring
preconceived, erroneous stereotypes with them
 Inaccurate biases.
 Inaccurate communication

19. Advantages of Diversity
 Can enhance creativity, lead to better decisions, and result in more effective and
productive performance
 Can prevent groupthink
 Social conformity and pressures on individual members of a group to conform and
reach consensus
 Can be very effective team under right conditions
 Tasks requiring innovativeness
 Activities must be determined by the stage of team development

20. Multicultural Teams
“Multinational teams do not happen naturally –
on the contrary, the human inclination is to stick
to its own kind.”
P. Barnevik

21. Why Multicultural Teams?
 Teams with different profiles are more effective than teams of “stars”
 Once settled, multicultural teams work better at:
 identifying problem perspectives
 generating alternatives
 The problem: how to “get settled”

22. Team Strategies
 Task Strategies
 Creating a sense of purpose
 Structuring the task
 Assigning roles and responsibilities
 Reaching decisions
 Process Strategies
 Team building
 Method of communication
 Eliciting participation
 Resolving conflict
 Evaluating performance

23. Task Strategies
 Creating a sense of purpose
 What is the team’s mission?
 What are the objectives?
 Can they be measured?
 Who should be a member?
 What are the priorities?
 Schedule?
 Budget?
 Quality?

24. Task Strategies
 Structuring the Task
 How structured should the agenda be?
 How detailed should the rules be?
 What needs to be accomplished? By whom?
 How important are deadlines?
 How will work be divided?
 What can be done together? Apart?

25. Task Strategies
 Assigning Roles
 Who does what?
 Should a leader be assigned? By whom? On what criteria?
 What is the leader’s role?
 Who needs to attend meetings and when?

26. Task Strategies
 Reaching Decisions
 How should decisions be made?
 By vote, consensus, compromise?
 Who should make the decision?
 Leader vs team

27. Process Strategies
 Team Building
 How is trust developed?
 How much time for social activities?

28. Process Strategies
 Method of Communication
 What is the working language? Who decides?
 How are fluency imbalances handled?
 What technology can be used?
 What is an effective presentation?

29. Process Strategies
 Eliciting Participation
 How to ensure participation by all?
 Are some members more credible?
 Is input from some members ignored?
 Who listens to whom?
 Who interrupts whom?

30. Process Strategies
 Resolving Conflict
 How is conflict managed?
 Avoided? Confronted?
 Who accommodates whom?
 Is negotiation win/lose, lose/win, or win/win?

31. Process Strategies
 Evaluating Performance
 How and when to evaluate?
 Is it a two-way process?
 How direct can feedback be?

32. Guidelines for Effectively Managing
Culturally Diverse Groups
1. Select team members for their task-related abilities
2. Team members must recognize and be prepared to deal with their
differences
3. Team leader must help the group to identify and define its overall goal
4. Members must have equal power so that everyone can participate in the
process
5. All members must have mutual respect for each other.
6. Managers must give teams positive feedback on their process and output