The contemporary business scenario reveals that an increasing number of firms have extended their business in the global markets. Cross-cultural communication issue has been extensively investigated by researchers for its importance in the global business operations. In the meantime, a large percentage of the workforce comes from different cultural backgrounds, however, researchers like Adair et al.’s (2001), as cited in Pekerti & Thomas (2015), argue that adaptation by negotiating parties did not prove to yield the high effective outcomes.
1.2 The research question
The research questions could be stated as follows:
- What is the current structure and the efficiency level of the supermarket industry in Australia?
- What are the major drivers of the structural changes that take place in the Australian supermarket industry?
- How globalization affected the way a business organization acts to effectively manage diversity in the workplace?
- How can organizations achieve success in the multicultural context through effective communication?
1.3 Brief explanation
Multinational organizations have to understand the complex nature of cultural differences and realize that managing them represents a significant skill that creates a competitive advantage to their success in the supermarket industry.
The supermarket industry plays a mediating role between the wholesalers or manufacturers and consumers that represents an essential characteristic of it. In Australia, the supermarket industry has considerably evolved with the aid of technology. It could flexibly respond to the consumer preferences and the economic and social conditions (Australian Government-Productivity Commission, 2011).
Effective communication with people from different cultures is still a challenging issue for many global organizations. The cultural factors act as invisible barriers to effective communication. This could take place through understanding that cultural diversity that represents the basis of effective cross-cultural communication. It significantly impacts the decision of standardization versus localization, brand effectiveness, managing the international business, business relationships and international negotiations. Barriers of cross-cultural communication could take different forms, like the stereotyping, uncertainty avoidance, ethnocentrism and anxiety (Jenifer & Raman, 2015).
Second: Importance of issue
The recent global developments changed the intercultural communication aspects due to the increasing number of organizations participating in global business transactions, strategic alliances and multinational joint ventures. The different cultural features of expectations, language and standards resulted in a complex environment.
The international business etiquette reflects the acceptable behavior in the international business situation. It shows the degree of communication effectiveness in the domestic and international situations. The global business relationships are functions of the organizational ability to learn other cultures and offer to its employees the proper training to help them adapt to other cultural differences. Nowadays, the marketplace is becoming increasingly global, contemporary business requires employees to work in foreign countries and effectively communicate with foreign people to create competitive advantage in new markets.
Businesses tend to operate with a global mindset by sourcing, producing and trading their products, the matter that increased the importance of the cross-cultural communication in the area of managing the international business. Accordingly, learning the international business etiquette is becoming more complex, the issue that makes etiquette on an international level a highly important factor for business success. The behavioral rules involve formal and informal rules; where the formal rules are obviously articulated and the informal rules are learned over the time. Over the international business lifetime, certain cultural differences are considered and respected and their communication style becomes highly adaptive while conducting business (Melvin, Ephraim, & Thomas, 2012).
Governments face increasing pressure to enact legislation that enables them to control and regulate the supermarket business activities. Mostly, the oversight authority empowers governments to use their authority and apply standards. The government regulatory role enables them to apply the governance mechanisms for overseeing the detailed activities at the workplace. The Australian government is highly involved in using their regulatory power to manage the supermarket industry through its regulatory framework. The importance of the cross-cultural communication in the supermarket industry stems from the conflict of interest between the supermarket business owners and the government, because of the regulatory framework that controls the power relationships along the agri-food supply chains (Burch, Lawrence, & Hattersley, 2013).
Third: Literature review
There are many barriers to communication at the workplace in the multicultural context. Although, misunderstanding represents the major barrier to communication in the multicultural environment. It is common among people from different cultural backgrounds with their varying values to misunderstand each other. Norms represent the rules that are culturally accepted to determine the acceptable behavior.
People behave in a certain manner and expect that others will act in the same way, but the fact is different because each culture has its own values and norms and their accepted behavior. People who work in the multicultural environment should be trained and taught how to deal with culturally different peopled at workplace before joining an international facility office. Unlike norms, beliefs and values vary from person to another. In the global context, the beliefs and values should be known to effectively communicate. In addition, cultural stereotyping could lead to an increased level of anxiety, because everyone enacts his stereotype of other people.
Stereotypes represent the major reason for different opinions about the other culture and results in miscommunication. Moreover, ethnocentrism increases the anxiety level at the workplace, because it makes us believe that our culture is distinctive. It is important for organizations to understand that their competence of cross-cultural communication enables them to achieve their goals. The development of successful cross-cultural competence are factors of cross-cultural sensitivity, awareness and ability. These competencies could be enhanced through cross-cultural training and language training to eliminate the employee's ability to communicate with foreigners (Jenifer & Raman, 2015).
There are different cultural dimensions that represent cross-cultural models of communication; the Lewis model of cross-cultural communication involves three groups of behavior that are the linear-active, multi-active and reactive. The linear-active represent task-oriented people who are highly organized, the multi-active is the multitasking people that cannot follow a specific task agenda, while the reactive people are good listeners. This model is advantaged for its easily understandable dimensions, but it could be limited to deliver business optimization insights in relation to the effectiveness of the organizational behavior (Latt & Thi, 2017).
Trompenaars and Hampden-Turner (1997), as cited in Balan & Vreja (2013), developed the seven dimensions of the cultural theory model to enable understanding and managing the cultural differences. They believe that each culture can provide a solution to a certain problem that solves a cultural dilemma. The researchers argue that there are three categories of dilemmas; the relationship with people, attitude to the environment and attitude to time. Then, they divided these three categories into 7 dimensions that enable in differentiating between cultures.
They are represented in universalism versus particularism, specific versus diffuse, individualism versus communitarianism, achievement versus ascription, neutral versus emotional, sequential time versus synchronous time and internal direction versus outer direction. Although this model could be used as a useful tool that measures culture variations, it is criticized for their correlation with the Hofstede cultural dimensions, mainly in the definition of Individualism (Pekerti & Thomas, 2015).
According to Hofstede (2011), there are major five cultural dimensions that represent the paradigms of national culture that were expanded to six dimensions later power distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance, long-term orientation and indulgence. Power distance represents the way in which power is distributed within the members of the society and how the less powerful people in the society accept and expect. Individualism is compared to collectivism to measure the peoples' attitude of whether to prefer themselves and close families or they prefer social welfare.
Masculinity is compared to femininity to measure the social orientation towards gender differences, where masculinity describes the assertiveness of the society. Uncertainty avoidance refers to the degree of fear from uncertain future conditions. The long-term orientation reflects the links between the present and the past compared to the challenge of the present and the future. Finally, indulgence refers to the degree of assertiveness and the society freedom of pleasure. The Hofstede's model was criticized for arguments that considered it was built on the work of other researchers (Latt & Thi, 2017; Merkin, Taras, & Steel, 2014).
The Australian history reveals that its retail industry was exposed to international influences. Although the Australian market is physically distant from other markets that represented a natural barrier. This condition created a highly concentrated retail industry, mainly in supermarkets and grocery. In recent years, a high number of global retailers entered the retail market that contributed to economic development. The new "Fair work system" commenced that took full effect since January 2010, provides a high safety net for the employees compared to the former "Work choice system". The new system declared the pay conditions in retail by setting the minimum wages and penalty rates the matter that increases the employees' trust in their employment system.
Accordingly, the workers in the supermarket industry receive wages determined by the industrial award and less likely to be devoted to the collective arrangements. Also, they are amongst the most affected workers by the decision of minimum wages. In addition, the supermarket industry enjoys a high level of work flexibility that yields potential benefits for the employees, the industry and the economy as a whole. A highly flexible system is likely to increase productivity and reduce the cost of employer unit labor.
The retail industry contributes to 10.8% of the Australian workforce in 2010. They are concentrated in the supermarket and grocery retail stores with 25.1%. During 1996 and 2011, they grew by 36.7%. In general, the workforce of the retail industry has different characteristics compared to the rest of the workforce; the majority of them are under 45 years old representing 72.8% and 35.8% of the employed workers are aged between 15 and 24 years.
In addition, about 23% of retail industry workers worked 29 hours per week and 29.8% worked for 45 hours per week that represents shorter working hours compared to other industries. The increasing share of part-time workers lowered the average working hours to 28.7 hours per week in 2011. Moreover, the workers in the supermarket industry are not skilled labor, they received the lowest average educational level compared to workers in other industries. In 2009, about 58.7% of them did not receive the post-school qualification (Australian Government-Productivity Commission, 2011).
The labor productivity represents an integral part of productivity, where it represents a low level in the supermarket industry compared to other industries. Although, the nature of the industry controls the labor productivity. The supermarket industry is labor intensive and it does not contribute to the overall efficiency of the industry. It actually represents the shift of work done by the retail employees to the customers. The productivity growth fluctuates in the Australian supermarket industry that is determined at the market sector level rather than the retail industry level (Australian Government-Productivity Commission, 2011).
In the Australian supermarket industry, the suppliers are treated in a way that differentiates between suppliers. They perceive delayed payments, price retrospective reduction, they contribute to marketing costs and conditions of lump-sum payments to the producers as a condition of supply. These conditions led to market concentration and monopolistic activities of the two leading retailers represented in Coles and Woolworths. The Australian Industry Code of Conduct Committee was primarily established to develop the fruit and vegetable sector that contributes with the largest share in the complaints of the supermarket industry (Burch, Lawrence, & Hattersley, 2013).
Labor migration to Australia has become more circular and temporary. It involves
low-skilled contract workers with new modes for the management of migration. The temporary nature of immigrants created new conditions of denied access to government-sponsored social welfare, including healthcare, insurance and education. The recent years witnessed an economic failure to deliver benefits for all the people in the society that resulted in inequality and the growing concentration of income. The Australian unions helped in maintaining the workers minimum wage increase and introduced assistance to improve the employment conditions (Robertson, 2014).
Fifth: Concluding recommendations
Achieving a high flexibility in the Australian supermarket industry is vital for growth. The employees, employers and unions are interested in achieving long-term prosperity for the industry growth. The stakeholders should act cooperatively to achieve the required improvements in their productivity. The adoption of innovative measures and high productivity will assist in enhancing the pay scale and the job satisfaction level.
Governance is essential to maintain stable conditions at the workplace to workers from different cultural backgrounds. They are capable of solving problems of diversity at the workplace, including the temporary immigrants' conditions who lack the access of any governmental service facilities, the situation that negatively affects the working conditions and the productivity level in the supermarket industry that has the largest share in the retail industry. According to David (2015), there are many claims that the labor union resources are tied up due to the surveillance of the Royal Commission on Union Corruption. The claims argue that the commission is acting in bias against the union due to corruption. Accordingly, there should be trust in the union by practicing democratic activities that build the workplace union power.
Also. the socioeconomic policy in Australia needs to be restructured. It needs to improve the workers' conditions by creating an alternative policy that challenges the current working conditions. The unions can act towards improving the working conditions and managing diversity. They are capable of reducing the absenteeism rate, lowering the quit level, enhance the employees' loyalty, solve the problems related to quality and hinder the possible sabotage. Moreover, unions can stress on business owners to maintain flexibility in the workplace, downward work pressure on job security and wages under the globalization proceeds.
The workplace power for unions requires activism that emerges from the effective delegation. The effective delegation is built on trust and harmony among the workers from different cultural backgrounds. The matter that requires effective cross-cultural communication between the workers to be able to achieve common goals for their organizations and for enhancing workplace conditions (David, 2015).
The global business relationships are functions of the organizational ability to learn other cultures and offer to its employees the proper training to help them adapt to other cultural differences. That is why workers from multicultural environment in the supermarket industry in Australia should be trained and taught how to deal with culturally different peopled at workplace before joining an international facility office.
In conclusion, the marketplace is becoming increasingly global, contemporary business requires employees to work in foreign countries and effectively communicate with foreign people to create competitive advantage in new markets. Learning the international business etiquette is becoming more complex, the issue that makes etiquette on an international level a highly important factor for business success.
The Australian government is highly involved in using their regulatory power to manage the supermarket industry through its regulatory framework. The new "Fair work system" commenced that took full effect since January 2010, provides a high safety net for the employees compared to the former "Work choice system".
The new system declared the pay conditions in retail by setting the minimum wages and penalty rates the matter that increases the employees' trust in their employment system. Accordingly, the workers in the supermarket industry receive wages determined by the industrial award and less likely to be devoted to the collective arrangements. The supermarket industry enjoys a high level of work flexibility that yields potential benefits for the employees, the industry and the economy as a whole. A highly flexible system is likely to increase productivity and reduce the cost of employer unit labor.
Australian Government-Productivity Commission. (2011). Economic structure and performance of the Australian retail industry -Productivity Commission inquiry report. Australia: Australian Government-Productivity Commission.
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