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Chapter 3-Organizational Cultures

and Diversity
Chapter 3(1): Organisational Culture, Diversity
&Multiculturalism
Chapter 3(2): Organisational Culture
Chapter 3(3): Diversity
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Chapter 3(1):
Organisational Culture, Diversity &
Multiculturalism
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Acknowledging Culture
Cultural diversity can exist on a national and
cross-national level
Often, managers assume that culture does not
play an important role in shaping practices =>
Universalistic approach: if it works here, it will
work there
Such approach contributed to high failure rates in
expatriate missions and international mergers
In order to manage cross-cultural differences,
managers need to acknowledge and understand
them
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Diversity-Related Problems
Increased ambiguity
Increased complexity and confusion
Difficulty to converge meanings and
Miscommunication
Lower cohesiveness
Harder to reach agreement
Harder to make decisions and agree on
specific actions
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Diversity-Related Advantages
Expanding meanings and
Broader cognitive frame & resources
Multiple perspectives
Multiple interpretations
Richer alternatives & more ideas
Increased creativity and problem solving skills
Increased flexibility
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Diversity and Types of
Organizations
Organizational culture affects the acceptance and
impact of diversity in organizations
Parochial: Our is the only way
Ethnocentric: Our way is best
Pluralistic (synergetic): The best is combining
our ways and their ways
In large companies, different divisions may have
different sub-cultures
The more complex, unpredictable and global is the
business environment of a company, the more
competitive advantages cultural diversity has.
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Nature of Organizational Culture
Organizational culture
Pattern of basic assumptions that are
developed by a group as it learns to cope
with problems of external adaptation and
internal integration and that are taught to
new members as the correct way to
perceive, think, and feel in relation to these
problems
An MNCs organizational culture in one
countrys facility may differ sharply from
those in other countries
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Nature of Organizational Culture
Interaction Between National and Organizational
Cultures
National cultural values of employees have
a significant impact on organizational
performance
Cultural values that employees bring to the
workplace are not easily changed by the
organization
Substantial differences may be observed
among subsidiaries that cause coordination
problems
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Organizational Cultures in MNCs
Integration of organizational cultures is crucial
following mergers and acquisitions
Integration process consists of:
Establishing a common purpose, goal, and focus
Identifying important organizational structures
and roles
Determining who has authority over resources
Identifying the expectations of all involved parties
and facilitating communication between the
parties
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Organizational Cultures in MNCs
(cont.)
Family culture
Strong emphasis on hierarchy and person
orientation
Power-oriented with paternalistic leader
Leader looked to for guidance
Can catalyze and multiply employees energy
Reliance on intuition rather than rational
knowledge

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Organizational Cultures in MNCs
(cont.)
Eiffel tower culture
Strong emphasis on hierarchy and task
orientation
Employees know what to do
Coordination from the top
Methodic approach to motivating and
rewarding people and resolving conflict
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Organizational Cultures in MNCs
(cont.)
Guided missile culture
Strong emphasis on equality in the
workplace and orientation to the task
Work typically undertaken by teams or project
groups
Low priority attached to hierarchical concerns
Employs a cybernetic structure
Culture may change quickly
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Organizational Cultures in MNCs
(cont.)
Incubator culture
Strong emphasis on equality & personal
orientation
Organizations are secondary to the fulfillment
of individuals
Organization is an incubator for self-
expression and self-fulfillment
Participants have intense emotional
commitment to their work
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Organizational Cultures
EIFFEL TOWER
Rule-oriented
culture
Fulfillment-oriented
culture
INCUBATOR
FAMILY
Power-oriented
culture
Project-oriented
culture
GUIDED MISSILE
Equity
Hierarchy
Task
Emphasis
Person
Emphasis
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Processes & Implications
Attraction-Selection-Attrition framework
Where do you advertise for jobs?
Who interviews and selects candidates?
What type of people is the company
(implicitly and explicitly) looking for?
Who gets promoted?
Mentoring
Networking
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Examples
Knowledge workers
Medical doctors & nurses
University academics
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Chapter 3(2) ORGANIZATIONAL CULTURE
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CULTURE REVIEWED
Organizations also have a learned, shared,
interrelated set of symbols and patterns of basic
assumptions
The culture help the organizations cope with
problems it faces
external adaptation
internal integration

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CULTURE HELPS ORGANIZATIONS INTEGRATE
INTERNALLY (PPS) AND ADAPT/SHAPE EXTERNALITIES
(6 GLOBAL ENVIRONMENTS) TO SURVIVE.
Culture permeates the organization
Through knowledge acquisition
Organizational symbols
Organizational stories
Organizational rites
CULTURE REVIEWED
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ORGANIZATIONAL KNOWLEDGE
Explicitformalized and widely distributed
Implicitnorms or how we do things around
here
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EXAMINE ORGANIZATIONAL
SYMBOLS
What language is in use and where?
Who is pictured on annual reports, web pages,
or brochures?
What colors represent the company; where are
they used?
What logos are in use?

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ORGANIZATIONAL STORIES
TELL US
what the employee is supposed to do when in
doubt
what to do when a high-status person breaks the
rules
how the little person advances within the
organization
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ORGANIZATIONAL RITES
REINFORM NORMS
Rites of degradation dissolve a persons
organizational identity
Rites of enhancement recognize
accomplishments or enhance power
Rites of renewal lubricate social relations
Rites of conflict reduction reduces conflict by
partitioning it
Rites of integration revive common feeling
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NATIONS TRADITIONALLY
SHAPE ORGANIZATIONS
HOW DOES CULTURE
AFFECT FIRMS?
Traditionally: national culture shapes business
INDIVIDUALS INDIVIDUALS
FAMILIES FAMILIES
NATIONAL CULTURE NATIONAL CULTURE
BUSINESS BUSINESS ACTIVITIES ACTIVITIES
Business culture
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BUT INFLUENCES COME FROM
MULTIPLE SOURCES
Professional training/groups
Family
Subgroups, e.g., R&D or accounting
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INCREASINGLY WE ALSO SEE
business influences come not only from
domestic influences but also from international
and global business activities, e.g.,
subsidiaries
joint ventures and other strategic alliances
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OFTEN CREATING CULTURE
CLASH
between parent and subsidiary
among managers
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THUS IN A GLOBAL WORLD, BUSINESSES BECOME
CULTURAL CONDUITS
See page 207 of I ntroduction to Globalization
and Business by Barbara Parker
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BUSINESS INFLUENCES
CULTURE THROUGH
Global entertainment and electronic media
Global travel
Global language
Global demographic groups
Global elite
Global teens
Business behaviors

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GLOBAL INFLUENCES OF
BUSINESS ON CULTURE
Make global businesses more central to
Cultural change
Cultural concerns
And cause them to interact more with social
actors such as NGOs and governments



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Chapter 3(3) DIVERSITY
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Diversity Defined
Human diversity
Visible
Less or invisible
Diverse structural configurations
Diverse processes
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Global Organizations Emphasize
Inclusive Networks When They
a) reexamine their norms or traditional ways of
doing things
b) seek and value similarities as well as
differences as sources of competitive advantage,
and
c) train people for skills that enhance a sense of
inclusion

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Communications Education and Training Employee Involvement
CEO speeches Diversity briefings for
managers
Task forces on diversity
Written diversity policy;
diversity brochures
Awareness training for
everyone
Interest groups for members of
diverse populations
Second language publications Diversity skills training Company time provided for
diversity planning
Reports to the public or to
shareholders
Multicultural team training Networking groups
Press releases Sexual harassment training
Career Development Performance and
Accountability
Mentoring Define behaviors that enhance
inclusion
Succession planning for
diversity
Monitor and report on diversity
progress
Individual development plans Link rewards to achieving
diversity objectives
Assign people to diverse jobs
over a career
Develop diversity measures
that are both qualitative and
quantitative
Networking directories
Diversity Initiatives
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Approaches to Managing Human
Diversity
Discrimination and fairness
Access and legitimacy
Learning

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Strategic Responses for Managing
Diversity and their Implementation



Episodic Freestanding Systemic

1
Deny an assignment to an employee
because a client might object to the
employees nationality, race, gender,
age, etc.
2
Choose to risk fines or other costs,
rather than engage in equal
employment opportunity practices
3
Choose geographic locations for the
business which avoid diversity / where
the local workforce does not contain
protected classes
4
In response to a governmental
employment audit, provide a
workshop for protected groups on
how to succeed by adapting to fit
into the organization
5
Regular sexual harassment training
which focuses on how to avoid legal
liability
6
Performance appraisal standards for
managers include specific targets /
quotas for hiring of protected groups
7
To increase diversity awareness for
managers, bring in a speaker to tell
them how to value the diversity of
their employees
8
Sponsor an annual event that
celebrates a protected group, e.g.,
Special Olympics
9
To ensure equal pay, program the HR
computerized management system to
annually review and adjust pay
differentials between non-protected and
protected groups
10
Pilot an employee network
conference that engages employees
and their managers in reciprocal
learning activities
11
Regularly include vendors, suppliers,
and customers in the organizations
diversity training offerings to increase
their involvement in and contribution to
diversity efforts
12
Different business units continually
share information about their diversity
successes and failures, then adapt and
integrate them into their businesses
Marginal Strategic
Executive priorities for managing diversity
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Diverse Structures
Hierarchical
Export office to functional to divisional to
hybrids
Internal horizontal
Networks, shamrocks, matrix, virtual
Interorganizational
Joint ventures
Strategic alliances
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Diverse Processes
ITintegration depends on infrastructures that
vary
HRselection, development, and compensation
in different nations and regions
Labor practices and conditions
Social responsibility and ethics initiatives