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Globalization and Multiculturalism

Question:

Discuss about the Cross Cultural and Strategic Management.

This report discusses the difference of management style in different countries in the world. Due to globalization, the organizations have got the scope for operating in various countries, manufacture their products in one country and exporting them in another market. Sometimes the companies operate from their headquarters located in different country but regulate their market located in different region (Knight et al. 2015). In doing this, they face various issues regarding the methods of management. Multiculturalism is the reason why the management needs to have a prodigious knowledge about the cross cultural management strategies so that the they can understand the expectation of the employees with different set of values and responses and act accordingly to utilize their manpower in a best possible manner.

The news article namely ‘Business Mentor: How Cultural Differences Affect Doing Business’ published in July 2017, reveals the fact that different culture of different country can affect the business and regulate the organizational culture in that place (News.abs-cbn.com 2018). As the reporter of this article Armando Bartolome has discussed that globalisation and technological advancement have greatly changed the connectivity and communication among the organisations operating in different countries. This articles originally describes the global acceptability of various factors which distinguish one organisational culture from another. The organisations which functions in a multicultural environment need to know some most important factors for effectively motivate the employees as well as business associates.

This article discloses the fact that business management style varies from country to country. One management style that is effective in the European countries may not be effective in the Asian organization. Management styles varies across countries due to the factors like political influence, economic ups and downs, level of mobility, technological progress and market globalization. Including all these, the corporate culture of that country, educational background and the technological availability (Kuratko 2016). With the progress of time, the conventional management style has changed. The management styles that were once used to be very effective to manage the local employees became outdated as the organizations started to function in the multicultural markets. In this aspect, the theory of cultural dimension by Hofstede can be discussed. According to this dimension, the organizational culture varies from country to country. It describes the effects of cross-cultural communication where the society’s culture influences the values of its members. This values ultimately relate to their behaviors and this dimension uses a structure derived from factor analysis (Coviello 2015).

Business Mentor: How Cultural Differences Affect Doing Business

The article reveals that the communication mode is different in different cultures. In some culture, the people are blunt hence loud whereas in other culture, the people are soft-spoken and use more indirect language to communicate with others. In some cultures, the employees directly take the first name of their bosses or other employees but in some culture the last names of the employees are the only way to address (Stahl et al. 2017). The most senior business partner sometimes is the person to take decision at a meeting hence the employees need to acknowledge their status as a sign of respect and leave a good impression.

Different people in different culture have different views and values of time. Some culture follows times as a guideline to complete their tasks whereas others see time to be very important factor to follow. In business, most of the organizations value time as they need to deal with other business partners hence coming late for the meetings may leave negative impression to the business making others to feel that the authorities are least interested with the deal (Moore 2015). This article then gives some recommendation that the business in cross-cultural environment should follow to sustain in different market. They should identify how their business partners value time then begin the trade relationship. Here the author has described the importance of punctuality in the business dealings with the American companies which often cannot be followed by the Indian or Filipinos.  

As described by Hofstede, there are six factors that regulate the attitudes and thought sit h employees in the organization which affect the regulations of the company to sustain in that environment. These are power distance index, individualism, uncertainty avoidance, masculinity, long term orientation and indulgence. The style of management in China and other south-east Asian countries is different because the society here is more collectivist. The people accepts the power dimension of the managers.  The people are accustomed with the hierarchical structure where the power is executed strictly without any reason (Mackenzie, Golembiewski and Rahim 2018). The lower degree of this index discloses the fact that the power hierarchy is not clearly established in the organization hence the employees can question their higher authorities easily. The European and north American countries have lower power index where the cross-cultural leaders need to apply different method of management.

In the collectivist country like India, China, brazil and some African countries, enjoy tightly integrated relationships with their extended fails as well as other groups. Hence the management needs to work for the wellbeing of whole community rather than for any individual. The European countries are highly individualistic where individuals work only for their own achievements or their immediate family. In the uncertainty avoidance index this dimension captures the situation where the employees are ready to embrace any kind of unexpected situation and tolerate ambiguity than any other societies (Jiang, Gollan and Brooks 2015). The societies score higher in this index opt for more stiff guidelines, laws and rely on absolute truth. In such cases, the market entry mode such as joint ventures (JVs) or as a wholly owned subsidiaries (WOS) becomes difficult for the organizations. In the societies scoring ow in this index have fewer relations and the market environment remains more free flowing. The westernized organizations are more masculine where the people are more achievement oriented and believe in assertiveness and rewards for success. In this kind of culture, the women are also very competitive but less emphatic than men as this are seen to be taboo in masculine culture societies. On the other hand, the feminist societies tend to care for others in the organization where the members believe in cooperation and modesty of life. For the multinational companies, it is more profitable when the employees are less indulgent in the luxurious life. This is the reason why the big MNCs like Walmart, Amazon and Nike have been shifting their manufacturing department to the south Asian countries more specifically to China where the society is more rigid and restrained hence the employees are more controlled in their lives and carry on their tasks very seriously.

Variation of Management Style Across Countries

As discussed by Edward Hall, the human receptions of space are actually formed as well as patterned by their culture. In his theory of proxemics, the theorist has suggested that differing cultural framework for organizing space, which are internalized in people at an unconscious level, may lead to the serious failure of communications well as understanding in the cross-cultural setting (Gelfand et al. 2017). This theory basically revolves round four dimension- context, time, space and information. In the article, author has pointed out that there are different communication methods which makes the organization or culture soft spoken or loud. Hall has identified two levels of context cultures. In the high context culture the organizational messages are implicit but bears metaphors but in low context culture, the messages are simple and clear to understand. The people in high context culture, accept failure whereas in the low context culture people blame each other for failure. In high context culture, the amount of nonverbal communication is high, people bear inward reactions, strong bond among themselves and prefer to maintain a long-term orientation (Dalkir 2013). In low context culture, the focus is high and filed with verbal communication. The reaction of people is visible and prefer to maintain an open grouping pattern according to the need of situation.

According to Hall, the factor of valuing time also has two differ aspect. In the monochronic action, the people do one thing at a time, concentrate on the immediate job and emphasis promptness of action. On the other hand, in polychronic action, the members of the organization can do many things at a time. These people are easily distracted and prefer to lend things. Unlike monochronic action, which thinks about the time to finish a job, polychronic action emphasizes in the quality of the task. Here, relationship is more important than time.  

The factors of space and information are also vital for the cross-cultural societies to follow. The low-territoriality allows for the sense of low ownership of space. For taking the organization to a summit of success the maintenance of information flow is one of the most necessary things (Bird and Mendenhall 2016). The slow information flow allows the mangers to plan carefully structured strategies but fast flow needs to have a quickly made strategy.

Conclusion:

Therefore, it can be concluded that the article by Armando Bartolome, provides general idea about the functionality of the managers, operating in the cross-cultural market. The cross cultural issues emerge when they need to maintain different employees from different cultural background hence different code of behavior and expectation. The report here analyses these issues discussed in the article from theoretical perspectives and provided insights to these issues to manage.

References:

Bird, A. and Mendenhall, M.E., 2016. From cross-cultural management to global leadership: Evolution and adaptation. Journal of World Business, 51(1), pp.115-126.

Brewster, C., Houldsworth, E., Sparrow, P. and Vernon, G., 2016. International human resource management. Kogan Page Publishers.

Coviello, N., 2015. Re-thinking research on born globals. Journal of International Business Studies, 46(1), pp.17-26.

Dalkir, K., 2013. Knowledge management in theory and practice. Routledge.

Gelfand, M.J., Aycan, Z., Erez, M. and Leung, K., 2017. Cross-cultural industrial organizational psychology and organizational behavior: A hundred-year journey. Journal of Applied Psychology, 102(3), p.514.

Jiang, Z., Gollan, P.J. and Brooks, G., 2015. Moderation of doing and mastery orientations in relationships among justice, commitment, and trust: A cross-cultural perspective. Cross Cultural Management, 22(1), pp.42-67.

Knight, G., Liesch, P., Zhou, L. and Reuber, R. eds., 2015. Creation and Capture of Entrepreneurial Opportunities Across National Borders. Journal of International Business Studies.

Kuratko, D.F., 2016. Entrepreneurship: Theory, process, and practice. Cengage Learning.

Mackenzie, K.D., Golembiewski, R.T. and Rahim, M.A., 2018. Introduction. In Current Topics in Management (pp. 9-24). Routledge.

Moore, F., 2015. Towards a complex view of culture: cross-cultural management,‘native categories’, and their impact on concepts of management and organisation. In The Routledge Companion to Cross-Cultural Management (pp. 69-77). Routledge.

News.abs-cbn.com, A. (2018). Business Mentor: How Cultural Differences Affect Doing Business. [online] ABS-CBN News. Available at: https://news.abs-cbn.com/business/06/30/17/business-mentor-how-cultural-differences-affect-doing-business [Accessed 1 Apr. 2018].

Stahl, G.K., Miska, C., Lee, H.J. and De Luque, M.S., 2017. The upside of cultural differences: Towards a more balanced treatment of culture in cross-cultural management research. Cross Cultural & Strategic Management, 24(1), pp.2-12.

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