Intercultural Competence in Business

This report discusses the importance of intercultural competence in the global workplace and explores a case study on the challenges faced by a manager in an overseas assignment. It also provides advice and theories to understand and manage cross-cultural problems.

Intercultural competence
in Business

Table of Contents
INTRODUCTION...........................................................................................................................3
CASE STUDY 2..............................................................................................................................3
Where did Stefan go wrong?.......................................................................................................3
How could you help Stefan to understand cross-culture problem..............................................4
Use intercultural theories to explain and support discussion......................................................6
Advice to Stefan..........................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................8
Hofstede's Cultural Dimensions .2019. [Online]. Available
Through:<https://www.mindtools.com/pages/article/newLDR_66.htm>.......................................9

INTRODUCTION
Intercultural competence is a crucial skill that is required in the global workplace where
employees from different cultures, beliefs, values and assumptions work together. It helps in
analysing the expectations of people belonging to different cultures so that they can be motivated
to perform their tasks efficiently which will help in increasing their productivity. This will help
in increasing the profitability of the company and also better coordination and integration among
all the workers so that a friendly work environment can be created (Beugelsdijk, Maseland and
Van Hoorn, 2015). In this report case study 2 is discussed regarding the issues faced by Stefan
Philips in an overseas assignment in Saudi Arab due to intercultural differences. Also
intercultural theories and frameworks will be discussed to understand different interpersonal
interactions in different situations.
CASE STUDY 2
Where did Stefan go wrong?
Different national cultures comprises of different cultural value systems, beliefs and
assumptions which affects the behaviour of persons in the organisations. Variety of cultures in an
organisation can increase the potential of conflicts due to differences in their thought process and
the ability to perceive things differently by people belonging to different cultures. Stefan Philips
was a manager in a large U.S. Airline and lacked cross-cultural competence which led to his
getting frustrated by the end of first week when he was transferred to Saudi Arab for an oversea
assignment. He was unable to understand the perception levels, value and beliefs of Arab people
who are generally God fearing and are superstitious about everything. It is a belief that prevails
in Arab that if something does not happen in the planned manner or the results are not achieved
as desired then it is because God did not want that thing to happen. They say 'Inshallah' which
means 'If God wills it' for anything that went wrong or did not go the way it was planned. Stefan
on the other hand belonged to a culture where people put their efforts so that desired results are

achieved. This created frustration in Stefan as the local employees did not will to work harder if
certain results were not obtained (Danso, 2018).
Stefan lacked cross-cultural competence which led to his frustration. He must have
properly studied about the culture and beliefs of the Arab people so that he could efficiently
manage and monitor their task. This would have enabled him to understand what affected the
employees and how can they be effectively motivated to complete their tasks. Stefan could also
have been able to encourage the people to work harder so that the results if not achieved were not
thought as God's will. He also very easily gave up on the assignment and came back home in just
one week. This shows that he lacked patience and also was unable to manage adverse business
situations. He could have engaged with the workers so that their level of beliefs and values can
be studied from the core and appropriate approaches could be applied so as to make the
workforce more work-oriented rather than being passive about their work and blaming God if
something went wrong (De Sousa, 2016).
Stefan also lacked good communication and leadership skills which are important to
motivate the employees to work harder and with efficiency. With leadership skills Stefan could
have given directions to the employees for the way in which work was to be done and the results
that were to be achieved. He could have also trained the employees so that they took work
seriously and enhanced their performance to achieve the results in an efficient manner.
How could you help Stefan to understand cross-culture problem
Understanding the cross-cultural problem is important so that the organisations that work
at the global levels and have employees belonging to different cultures can work efficiently and
survive in the competitive market. Cross-cultural organisations have to face conflicts among the
members due to differences in their values, beliefs and assumptions related to work and the way
in which tasks are to be performed to achieve desired results. Stefan can use various intercultural
theories so as to study the behaviours and beliefs of Arabian people so that they can work
efficiently to achieve the organisational goals and do not apply a passive approach to their work.
Stefan can understand the cross-cultural problems by applying the following steps : Keeping an open mind : It is important to keep an open mind while dealing with people
belonging to different cultures so that their problems can be understood and solutions can

be formed based on their level of perceptions. This will help Stefan in keeping an open
mind in accepting the way in which people work (Johnson and Cullen, 2017). Gain knowledge of people's cultural backgrounds : This will help Stefan in preparing
himself to deal with the differences in the beliefs, values and styles of working of the
people. Basic knowledge must be gained about the people's culture so that approaches
that can best suite their styles of working can be applied which will help in effectively
motivating them to work in the way Stefan wants.
 Practice acceptance : This will help Stefan in accepting the cultural differences that exist
in the organisation so that he devices such strategies which will help in making the
employees more productive.
Cross-cultural problems can be understood by keeping patience while dealing with
people belonging to different cultures. This can be understood by the differences in their
communication styles and languages which creates a gap between the perception level of people
belonging to different cultures. Differences in attitudes towards conflicts also tells about the level
of cooperation and positive thinking among the workers. This will determine the level to which
they need to be motivated so that conflicts can be solved efficiently. Different approaches to
completing task also determine the way in which people move forward with their work and the
point of success they want to reach. Difference in decision-making styles are also affected by the
differences in their cultures which are influenced by their beliefs and value system. Difference in
their attitude towards disclosure also determines the openness and frank nature of the people
belonging to different cultures (Khlif, 2016).
Stefan can thus understand the cross-cultural differences by determining the level of
differences in the attributes as mentioned above which will help him in formulating such
strategies and policies that can help him in dealing with the local employees so that they can be
motivated to complete their tasks.
Use intercultural theories to explain and support discussion
Cultural problems occur in organisations if people belonging to different cultures work
together and have to coordinate with each other so that their work can be integrated to generate
desired results. Also difference in language of all the people working in an organisation along
with difference in their ethnic backgrounds, racial backgrounds, religious beliefs, gender, class,

educational backgrounds etc. leads to conflicts among the people working in the organisation.
Two types of frameworks can be used to help Stefan to understand cross-culture in organisation :
Hofstede's Six Dimensions of Culture
This framework was given by Greet Hofstede to understand cultural differences and
identified six dimensions that could help in distinguishing one culture from the other which are
listed below : Power distance index(PDI) : This is the extent to which inequality in power distribution
exists and is accepted by the people of a society. A high PDI indicates that a society
accepts an unequal, hierarchical distribution of power and that the people understand
their position in the system and do not create objection. Individualism vs Collectivism (IDV) : It refers to the extent to which people connect with
each other in the society. A high IDV indicates that there is weak interpersonal
connection among the members of the society and individualism exists (Mazanec and et.
al., 2015). Masculinity Versus Femininity (MAS) : It refers to the distribution of roles between men
and women in the society. In masculine society, men have a higher position to the women
and they are expected to behave assertively and have to be strong, fast and successful. In
feminine society great importance is placed to making good relations with all the people
in the society. Uncertainty Avoidance Index (UAI) : It demonstrates how well people can cope with
anxiety. A high score on UAI means that the people of the society attempt to make their
lives more predictable and controllable and if they fail to do so then they blame God for
this. Long- Versus Short-Term Orientation : It is also known as pragmatic Vs normative and
refers to the time horizon of the people. The short-term oriented people tend to put more
emphasis on principles, consistency and truth and are religious and nationalistic.

 Indulgence Versus Restraint (IVR) : Countries high on IVR encourage free gratification
of people's own drives and emotions so that they can follow their passion (Rockstuhl and
Ng, 2015).
This theory can be used by Stefan so that he can understand the values and beliefs of
people of Arab. This theory will help Stefan in developing an insight as to how the people in
Arab work and perform their task. Stefan will be able to deal with the people belonging to
different culture so that they can be motivated to coordinate and work in harmony in the
company. The frustration level of Stefan can also be dealt with efficiently by applying this theory
as such strategies can be formulated by Stefan so that the employees are motivated to finish their
task and achieve the desired results and not say 'Inshallah' every time something went wrong.
Advice to Stefan
While working in global businesses it is important to develop such skills which will help
in dealing with the cultural differences which causes conflicts among the workers due to
difference in their values, beliefs and assumptions. Stefan can deal with the cross-cultural
problems by applying the following steps : Learn the other side's culture : This will help in gaining the trust of people who belong
to other side of the culture. Also right strategies can be formulated to motivate the
employees by keeping in mind their cultural values. This can help in efficiently dealing
with their problems and coming up with solutions that are accepted by all without any
resistance (Shokef and Erez, 2015). Find ways to bridge culture gaps : This needs to be done so that the disagreements
among the local employees and Stefan can be reduced and monitored. This can be done
by finding common attributes in their cultures so that the employees can be motivated
and made familiar with the culture of both the countries. This will increase the sense of
belongingness and familiarity between Stefan and other workers so that they can
collaborate with each other and work towards achieving the organisational goals and
objectives.
 Employ different negotiating styles : Attitude, beliefs, customs, laws, values and
traditions that are affected by differences in cultures of the people and also affects the
negotiation, building better understanding, collaborating and communication styles.

Different kind of negotiating styles can be used by Stefan so that the employees can be
motivated and encouraged to take their work seriously and can work hard to achieve the
goals of the organisation (Thomas and Peterson, 2016).

CONCLUSION
From this report it can be concluded that cross-cultural competence is important so that
working in an organisation where people belonging to different cultures work together. This is
important so that conflicts can be managed and strategies can be formed which will help in
motivating the employees to work in a coordinated manner. This helps the international
businesses in gaining a competitive advantage in the market by managing the workforce of the
company. Various theories can be applied appropriately so that effective culture can be formed
and all the employees can work together and in harmony so that the goals and objectives of the
organisation can be achieved within budget and within the time-frame.

REFERENCES
Books and Journals
Beugelsdijk, S., Maseland, R. and Van Hoorn, A., 2015. Are Scores on H ofstede's Dimensions
of National Culture Stable over Time? A Cohort Analysis. Global Strategy
Journal .5(3). pp.223-240.
Danso, R., 2018. Cultural competence and cultural humility: A critical reflection on key cultural
diversity concepts. Journal of Social Work .18(4). pp.410-430.
De Sousa, G.U., 2016. Shakespeare's cross-cultural encounters. Springer.
Johnson, J.L. and Cullen, J.B., 2017. Trust in cross‐cultural relationships. The Blackwell
Handbook of Cross‐Cultural Management, pp.335-360.
Khlif, H., 2016. Hofstede’s cultural dimensions in accounting research: a review. Meditari
Accountancy Research .24(4). pp.545-573.
Mazanec, J.A., Crotts, J.C., Gursoy, D. and Lu, L., 2015. Homogeneity versus heterogeneity of
cultural values: An item-response theoretical approach applying Hofstede's cultural
dimensions in a single nation. Tourism Management .48. pp.299-304.
Rockstuhl, T. and Ng, K.Y., 2015. The effects of cultural intelligence on interpersonal trust in
multicultural teams. In Handbook of cultural intelligence (pp. 224-238). Routledge.
Shokef, E. and Erez, M., 2015. Cultural intelligence and global identity in multicultural teams.
In Handbook of cultural intelligence (pp. 195-209). Routledge.
Thomas, D.C. and Peterson, M.F., 2016. Cross-cultural management: Essential concepts. Sage
Publications.
Thomas, D.C., 2015. Cultural intelligence. Wiley Encyclopedia of Management, pp.1-3.
Online
Hofstede's Cultural Dimensions .2019. [Online]. Available
Through:<https://www.mindtools.com/pages/article/newLDR_66.htm>