Group 3 Sanjay Krishna Surya Srinivasan Anjali Daisy Gunaseelan Hannah

Overview of the article

Impact of cultural diversity on international

organizational behavior East-West cultural differences Differences among cognitive processes of people of different cultures Need for cultural diversity to be recognized, understood and appropriately used in organizations Benefits of comparative studies for cross cultural management

Introduction
Firms operating on a world wide basis has advantages

over the companies operating in domestic markets

To remain competitive businesses are becoming global Rise of MNCs because of internationalization MNCs Challenges and opportunities

 MNC to Global Corporation Change in perspective Cross Cultural Management - Organization theory

literature to be integrated with comparative

management literature

Some major debates

Does organizational behavior vary across cultures?
How much of the observed differences can be attributed to cultural determinants? Is the variance increasing, decreasing or remaining the same?
How organizations best manage within cultures?

How organizations use cultural diversity as a resource?

Culture
Shared values and norms by all or almost all members
Not the characteristic of an individual but that of a

group
Something that older members of the group pass on to

the younger members

Shapes ones perception of the world

Cognitive Maps
Mental representation of layout of ones environment
Varies across cultures and has varying effects on

managerial action
Recognizing unique set of cognitive maps is extremely

important

Cultures Influence
Culture is certainly not identical to societal structures

but it strongly influences their form and function

Westerners vs. Easterners

Confronting a Problem

Sense of Self

Weekend Activities

How to Express Anger

Queue when Waiting

Status of Leader

Relationships

Punctuality

Convergence vs. Divergence

Convergence- The tendency of companies to adopt

similar successful management practices suggests that companies are becoming more alike
Divergence- Think globally but act locally

(Convergence and Divergence Issues in Strategic Management An

Asian Perspective on the Balanced Scorecard in HR management)

Hofstedes study
Study of 1,60,000 employees of 40 countries identified

four dimensions
Power distance Uncertainty avoidance Individualism or Collectivism Masculinity/ Femininity

Intercultural Interaction
International managers should not only compare but

also interact
People behave differently with members of their own

culture than they do with members of foreign cultures

Differences in interaction:

Non-business context- Salient

Business context- Exaggeration

Synergy from cultural diversity

Managers see only the disadvantages of cultural diversity in

organizations in spite of the several advantages present

Maruyamas four metatypes of casualty:
Non reciprocal causal model Independent event model Homeostatic causal-loop model Morphogenetic causal-loop model

Non reciprocal causal model

Homogeneity is natural, desirable and good
Heterogeneity- an abnormality or error Cultural diversity is viewed as a source of conflict,

inconvenience and inefficiency

Culture of the top management dominates the whole

organization

Independent event model

Multi domestic firms regard each national unit as

independent and autonomous

No attempt to create mutually beneficial combinations Recognize cultural diversity

Homeostatic causal-loop model

Analogy is multi national firm
Diversity basic, indispensable and desirable

Homogeneity- source of competition and conflict

Cultural interaction and heterogeneity- beneficial External forces cause organizational change

Morphogenetic causal-loop model

Analogy is global firm
Internally generate a need for change

Constantly create new, improved, mutually beneficial

systems of interaction
New patterns are generated through international

interactions

From the Atlantic to the Pacific

Transformation from the Atlantic century to the

Pacific century
Shift in the research area Solid theoretical base for comparative studies on

culture

Single-Culture Management Studies

Studies on managers from various Asian companies
Japanese- Respect for the interest of individuals,

cooperativeness
South Korean- Loyalty, obedience to authority, shared

management
Chinese- Material security, hard work,

competitiveness

Comparative Management Studies

Majority focus on comparisons between Japan and the

West
Basis of difference Reasoning
Cognitive process

Japan

Western

Analytical
Whole to its parts

Comprehensive
Divided into parts

Sociological Studies
Traditions, values, ideologies and norms are bound to

be different between societies

Each side is unable to step outside its own world view

Developmental Psychology studies

Individuals cognitive style dimension varies from low

field articulation to high field articulation

Causes of misinterpreting data across culture

Culture can be viewed from two sides: Refining it till it falls under a regular condition (Or) Believing it is pushed to be in that particular state.
According to the westerners, they focus more on productivity, morale and leadership more than the eastern people by asking questions and tend to have answers with solid proof.

 Effects of Cultural heterogeneity

Management principles and methods must be adapted

within the office and the local culture

Significant differences with each culture

Local culture excellent if judged by the criteria of

foreigners but very low among compatriots

Those who appreciate local and foreign culture are a

valuable asset

Implications for the practice of management

As the process of analyzing the colleagues,

competitors, go on a phase of difficulty to predict the future, we often blame the language or other factors as a barricade. This will lead in misunderstandings and lack of motivation if not solved soon will also lead to tiny conflicts that have no strong reason. The only measure to overcome this is to accept the actual problem and fix it through a cognitive dimension which will then lead to a great co-operation