IMPACT OF CULTURAL DIVERSITY IN MULTINATIONAL CORPORATIONS 6.

IMPACT OF CULTURAL DIVERSITY IN MULTINATIONAL CORPORATIONS 1
Impacts of Cultural Diversity in Multinational Corporations
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IMPACT OF CULTURAL DIVERSITY IN MULTINATIONAL CORPORATIONS 2
Introduction
In a world influenced by globalization’s outcomes, the role of diversity has become increasingly
important. Organizations operate globally and, as a result, hire employees from all over the
world, resulting in diverse workforces. It is critical for an organization to be aware of differences
within its workforce and to actively manage diversity in order to reap the benefits of its positive
potential. Workplaces diversity refers to the diversity of organizational difference (Tamunomiebi
& Onah, 2019). Diversity not only includes how people identify, but also how other people
perceive them. Workplace diversity can be seen in, inter alia, race, sex, ethnic groups, age,
religion, sexual orientation, status as citizens, military service and physical and mental
conditions (Wanka et al, 2019).
In addition to ensuring efficient service delivery, integration and work with employees to
increase productivity, advanced world economies and increasing internationalization of
economic frontiers have strengthened cross-cultural networks within and outside of multinational
corporations (Wanka et al, 2019). A growing international migration to look for new
opportunities and better livelihoods in the developed countries, often seen as a primary source of
opportunity in other countries, also demonstrates the need to build an environment that is
accommodating and fair to multi-racial communities. While the implementation and
development of better strategies, risk management, better debates and effective results help large
companies to grow along the world's frontiers, cultural diversity is an important matter for
multinationals management, calling for institutions to adopt and develop strategies for
strengthening the relationship between individuals of varied socio-cultural backgrounds (Doz,
2020).
In this essay, I will examine the impact of diversity on multinational corporations, as well as the
strategies that various corporations have used to ensure that employees from diverse
backgrounds feel at ease in their roles within the overall organizational framework. In addition,
using examples drawn from established multinational corporations that have thrived over time, I
will outline the general implications and challenges encountered in the management of diverse
workplace environments.
Why is workplace diversity important?

IMPACT OF CULTURAL DIVERSITY IN MULTINATIONAL CORPORATIONS 3
The world is becoming more interconnected as a result of both increased internationalization and
globalization. The increasing global interdependence of global business has led to increased
business diversity and the need for quality cross-cultural management that seeks to explain the
behavior of individuals in multinational organizations and support managers in establishing
strong organization culture which can help to successfully manage cross-cultural challenges
including the ability to work with people from countries with distinct cultures (BAKO,
OGUNREMI & BAKO, 2019). Quality of cross-cultural management is important as it directly
impacts on the efficacy of any company be it local or international, many writers have argued
that “organizational culture contributes to the systematic balance and effectiveness of an
organization” and adds that “the cultural dimension is central in all aspects of organizational life”
thus a strong corporate culture can help to over bridge cross-cultural obstacles of different sorts
(Canestrino & Magliocca, 2018).
To bridge the gap between aspiration and reality for multinational corporations, managers have
recognized that having a diverse workforce gives them a distinct competitive advantage in terms
of differentiation, innovation, and employee branding, and that if successfully managed, it has a
direct impact on their overall performance and profitability (Jonsen et al, 2021). Cultural
diversity in the workplace refers to the fact that employees from different cultures typically think
differently and can thus analyze a situation from a variety of perspectives. When employees from
the same culture are asked to analyze the same issue, this is difficult to achieve. Employees from
various cultures have various experiences that can benefit the organization through a strong and
diverse knowledge base. It enables employees to develop talents and skills derived from a
diverse range of ideas and expertise in order to improve problem-solving abilities and increase
happiness and productivity (Salin et al, 2019). This spirit of innovation and encouragement to
contribute can drive business success in an environment where all voices are heard.
A diverse employee base also bridges the language barrier hiatus that is often created whilst
operating in the global market, multinationals continue to thrive in the international markets as a
result of the personalized service and communication facilities drawn from diverse multicultural
employee base meaning that they have the right person at hand to speak with a new customer,
and in their first language and this cannot be undervalued as it opens doors to new profitable
businesses and enabling the multinationals to delight in a wide customer reach.