ManAGING ACROSS CULTURES LESSON 1 - 10 Changing global context

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In this assignment, we will discuss Managing Across cultures creates chances, dangers, and difficulties. Firms acquire a competitive advantage by anticipating change and then seizing appropriate opportunities, frequently global ones. Operating in this dynamically changing global environment, however, also brings risks and obstacles. It specifically demands the ability in working with consumers, suppliers, and strategic partners from a variety of cultural backgrounds as well as managing people across cultural boundaries.

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MANAGING ACROSS CULTURES
LESSON 1 – 10
Changing global context
o The business environment in which an organisation operates is characterised by constant
change.
This presents opportunities, threats and challenges. Pre-empting change and then exploiting
suitable opportunities, often global opportunities, is the way firms gain competitive
advantage. However, operating in this changing global context also poses threats and
presents challenges. In particular, it calls for skills in managing people across different
cultures and working with customers, suppliers and strategic partners from diverse cultural
backgrounds.
Deresky (2016) explains how developments and trends within a dramatically changing global
stage present management with a range of challenges including the design and
implementation of global strategies, conducting effective cross-national interactions, and
managing operations in foreign subsidiaries. Deresky (2016) makes the important
observation that “Global companies are faced with varied and dynamic environments in
which they must accurately assess the political, legal, technological, competitive and cultural
factors that shape their strategies and operations. The fate of overseas operations depends
greatly on the international manager’s cultural skills and sensitivity, as well as the ability to
carry out the company’s strategy within the context of the host country’s business
practices.”
WHAT IS GLOBALISATION?
Globalization is the spread of products, technology, information, and jobs across national
borders and cultures. In economic terms, it describes an interdependence of nations
around the globe fostered through free trade.
On the upside, it can raise the standard of living in poor and less developed countries by
providing job opportunity, modernization, and improved access to goods and services. On
the downside, it can destroy job opportunities in more developed and high-wage countries
as the production of goods moves across borders.
Globalization motives are idealistic, as well as opportunistic, but the development of a
global free market has benefited large corporations based in the Western world. Its impact
remains mixed for workers, cultures, and small businesses around the globe, in both
developed and emerging nations.
Find pros and cons

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Emerging markets: Risks and opportunities
Opportunities: Access to cheaper labour markets, Access to raw materials, Access to
expanding consumer markets (e.g. China and India in particular), Increased demand for
luxury goods (huge demand in Asia), Tapping into new sources of talent, developing strategic
alliances with local companies, Undertaking joint ventures with innovative emerging MNCs.
Risks: Close relationship between government and business in a number of emerging
markets - challenges the principle of non-state interference in free-market capitalism,
Financial risks. For instance, the potential impact of national inflation levels, currency
stability, sector trends, levels of taxation, and the reporting required by governments, The
potential lack of infrastructure including essential commodities (e.g. water and power
supplies), The potential for war, terrorism or political instability (including piracy and
kidnapping), Censorship and restrictions on information, Getting the marketing wrong,
Cross-cultural management issues. Strategic alliances between Western companies and
firms in emerging markets have tended to be short-lived. Joint ventures in China have often
exposed mutual frustrations between Western and Chinese managers about management
practices, such as HRM.
WHAT IS A STAKEHOLDER?
A stakeholder is a party that has an interest in a company and can either affect or be
affected by the business. The primary stakeholders in a typical corporation are its investors,
employees, customers and suppliers. However, the modern theory of the idea goes beyond
this original notion to include additional stakeholders such as a community, government or
trade association.
Influence of culture on leadership and management
Leadership in an organisation is exhibited at all levels - from leadership of small teams to
leadership as a CEO. At the executive levels, in an increasingly global environment, the
emphasis is on global leadership. And at this level the boundaries between leadership and
management become blurred.
Leadership styles can vary from country to country. A transformational leadership style is
particularly popular in the West and linked with successful companies such as Apple. A
transformational leader is someone who: Creates a vision that inspires and motivates
followers to higher levels of performance and commitment to the organisation.
Demonstrates concern for their followers. Acts as a role model. Challenges the prevailing
culture.
This is in contrast to a transactional leadership style. A transactional leader is someone who
relies on explicit rewards or penalties to motivate people. This is a leadership style often
adopted by countries in East Asia.
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Individualistic vs. collectivist cultures
Many of the newly emerging markets are collectivist societies. Here, family ties are
stronger than in Western societies, which place more emphasis on the individual. Loyalty
to work colleagues is an important characteristic of collectivist societies. For instance,
individuals will not blame each other for mistakes. This is in contrast to most Western
societies which tend to be individualistic, where the prioritisation is on the individual over
groups. In the individualistic culture the focus is more on self-achievement whereas in the
collectivist culture the focus is very much on group achievement.
National culture and organisational behaviour
We have already noted one area of difference in organisational behaviour stemming from
culture. In collectivist cultures, employee ties are very strong, and the apportioning of blame
is rare. There are many other behaviours influenced by national culture. In some countries,
in conflict or contentious situations, straight talking (or even blunt talking) is the norm,
whereas in other countries diplomatic talking is the acceptable form. In some countries,
team working is natural, and a consensus-based approach is expected, whereas in other
countries employees like to be told what they should do. Then there are differences in
meeting styles. In some countries, lengthy meetings are to be expected as everyone must
have a say, whereas in other countries strict adherence to the schedule is expected.
Attitudes to the role of women in the workplace are also highly influenced by national
culture, and so are attitudes towards diversity.
Definitions of culture
Culture is something we understand intuitively but often find difficult to define. It is often
explained as ‘how things are done around here’. It is something intangible, and in the
context of national culture, it sets a country apart from others. Each country has its own
unique culture. In the same way, each organisation has its own unique culture, and one of
the factors influencing organisational culture is national culture. Typically, in a multinational
or global corporation, the home country of the corporation has a strong influence on its
culture. But as we have examined in cross-cultural leadership and management, subsidiaries
operating overseas are also influenced by the local context and culture - indeed they should
be for effectiveness. This is often referred to as ‘glocalization’.
Diverse cultures, conflicts and impact on business
International managers must understand the distinguishing characteristics of cultures and
how national culture impacts business behaviour.
A culture is the product of many distinguishing features, such as:
Language; not always one. For example, in Canada, English and French are both spoken and
bi-lingualise is common.
Religion: again, as in language, not always one. For example, in Sri Lanka the main religion is
Buddhism. However, regions within the country are dominated by Hinduism, and there is
also a small Christian and Muslim presence.
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Ethnic and racial identity: again, as in the previous characteristics, there is often more than
one ethnic/racial grouping. For example, in Singapore, there are Malay, Chinese, Tamil and
European racial groupings. Within these, there are further sub-groupings of ethnicity.
Shared cultural history.
Cultural theories
International managers can underestimate the significance of cultural differences. Gaining a working
knowledge of the cultural variations that impact business and decision-making must be the top
priority of any international manager. Cultural theories can give insights into workplace variations.
We shall examine two theories that contribute to the systematic understanding of the differences.
Hofstede 1980’s:
Fons Trompenaars in 1994:

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Ethnocentric, polycentric and geocentric views in management
Cultural distance
We have looked at diverse workplace behaviour, such as individualism vs. collectivism or uncertainty
avoidance, resulting from cultural differences. Now diversity in workplace culture doesn't affect all
companies - simply because they do not actually have offices in overseas locations. However, most
companies today want to engage in international business even if they do not have offices in
overseas locations - they especially want to market their products as widely across the globe as
possible. To this end, consideration of cultural distance is important. Cultural distance is the extent
of the challenge a company faces when selling in overseas markets.
Corporate approaches to international business
At the heart of corporate approaches to international business is understanding on how value is
created through cross-border activities. This requires skills in analysing and critically evaluating the
company's strategy and its competitive environment. Sometimes international business does call for
operating in multiple overseas locations. The organisational issues and the complexity of managing
geographically distributed locations should not be underestimated. The best internationalisation
strategies can fail because the organisation hasn't understood how to internationalise, particularly
from a cultural perspective. An understanding of various organisational forms available to
multinational corporations is essential to find the right match.
Global company: In a global company operation are fully integrated across the different countries in
which it has bases. Working practices and processes will be the same although management styles
may vary for the local culture. A strong unifying corporate culture is usually present, and a strategy
of global marketing assumes all customers are nearly the same - so little or no local variation is
required e.g. Coca-Cola.
Multi-domestic company: Here subsidiaries in foreign countries have a fair level of independence in
product design and production e.g. Colgate in Brazil (special toothpaste). There is a high degree of
localisation with respect to management practices. Decision-making is decentralised and at the
national level because management must be able to respond on a local level.
Changing organisational forms
The organisational form adopted by a company will be influenced by its approach to international
business. If the extent of its international business is confined to just marketing without a local
presence (as in an office) then the approach will be different to a company that operates in a
number of locations with employees on the ground locally. One can also expect a different
organisational structure for a truly global company from that of a multi-domestic company.
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The ethnocentric view
Ethnocentrism is a view of the world through the benchmark of one’s own culture. According to
Deresky (2016) it is the belief held by some companies that their management practices are best,
irrespective of the country in which they are applied. It entirely ignores local or regional culture,
including its ethical and moral values.
In an ethnocentric approach, typically decision-making and control mechanisms are heavily
centralised (i.e. head office controlled) with local operations modelled on those in the home country.
Local staff tend to be at the lower end of the hierarchy with the top end dominated by managers
from the home country. In effect, the structure and culture of the company's home country are
imposed on the local context. When locals are given senior positions, perhaps because there is a skill
shortage and there aren't suitable candidates from the home country, they are expected to reflect
the culture of the company's home country. It should be noted that this approach is not restricted to
Western multinationals. For instance, if you take Wipro, the Indian IT company, the vast majority of
its senior managers in overseas locations are Indian.
The polycentric view
This approach makes a deliberate attempt to overcome one’s own cultural background and
limitations and tries to understand other cultures. It retains core cultural identity but displays
‘openness’ and seeks to adapt its identity to other cultures.
The approach is the opposite of ethnocentric. The assumption is that local people know what is best
and can inform organisational strategy. Structurally, the organisation is similar to a loose federation
of quasi-independent subsidiaries, and it can be hard to tell that the parent company is foreign.
Decision-making is decentralised and managers in the foreign subsidiaries will almost always be
locals. So local managers who are most knowledgeable about local conditions make decisions locally.
Local structures and business conventions are used.
The geocentric view
A geocentric approach is one in which there is a high degree of adaptation to foreign markets with
little discernible national bias. Haberberg and Rieple (2012) state that in a geocentric approach,
corporate headquarters make decisions on financial planning and control, but human resourcing
decisions are made by local managers - who make these decisions on the basis of the best person for
the job, irrespective of nationality. The local manager himself may be local, from the parent
company's country or from a third country.
A geocentric approach reflects a truly global culture in which subsidiaries work in collaboration with
the corporate head office. In this type of company, annual profits tend to be redistributed globally.
This is in contrast to ethnocentric approaches where profits are repatriated to the ‘home’ country,
or polycentric approaches where they are retained by the subsidiary.
For those companies beginning their journey of internationalisation, we have noted that venturing
first into countries with similar cultures isn't necessarily the best approach. We examined the
importance of understanding cultural distance, particularly in the context of marketing strategies.
For those companies, who do operate out of multiple overseas locations, we considered the
ethnocentric, polycentric and geocentric approaches to management. The next lesson looks at the
role of national culture, language and communication in managing internationally.
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The role of language in culture
Language is the fundamental means of communication between individuals. Not only does it
facilitate social interaction, but it facilitates business. Language is the most fundamental and
discernible difference between cultures.
Language, perception and preference
For anyone who has worked in international business, it is noticeable that the way people think is
similar within a culture - obviously not across all issues but there are distinct similarities in the broad
way of thinking within a culture. For example, moral judgements are often broadly the same from
people of a particular culture.
Language can influence the way an individual, group or community perceives the world, which in
turn influences the way a society interacts with the world. Unconsciously, our language appears to
shape the way we perceive things and the thoughts we express.
Language creates cultural identity and also establishes preferences for people who speak the same
language. Some psychologists suggest that we might be naturally programmed to recognise and
prefer people who share our language, and that this preference develops early in life and continues
for life.
Business language and changing patterns
In today’s globalised business environment, one of the principal challenges confronting all managers
is that the manager will encounter a number of languages. This is due to increasing diversity in the
workforce, even within one country. Deresky (2016) gives some examples to illustrate this point. An
automobile manufacturing plant in Cologne will have assembly-line workers who speak Turkish and
Spanish as well as German. Whilst in Malaysia, Indonesia and Thailand, many of the buyers and
traders are, in fact, Chinese. Furthermore, not all Arabs speak Arabic as their business language. In
Tunisia and Lebanon, French is the language of business.
Deresky (2016) concludes that international managers need either to develop a good command of
the local language or engage competent interpreters.
High-context vs. low-context languages
Hall (1997) first differentiated high-context from low-context languages. We examine the differences
next.
High-context languages are characterised by: Implicit speech: ambiguity is common (e.g. ‘reading
between the lines’) and directness is avoided (may be considered rude)
Body language is important to interpret speech
Precise wording of speech will consider the relationship between participants, the context and the
knowledge of the recipient
Collective group orientation: the speaker will use collective ‘we’ more than an individualistic ‘I’.
Examples of high-context languages are Japanese, Arabic and Chinese.

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Low-context languages are characterised by:
Explicit speech: the aim is to be clearly understood whatever the context and whoever the recipient
Individual orientation: there will be more references to ‘I’ to indicate individualism and specific
responsibilities.
Examples of low-context languages are German, French, English and the Nordic languages.
Non-verbal communication
Communication is about more than the spoken and written word. A significant amount of our
communication is actually non-verbal. Every day, we respond to thousands of non-verbal cues and
behaviours. These include facial expressions, gestures, postures, eye gaze, and tone of voice.
Whenever me meet someone we process information about how they dress (smart, casual, scruffy
and so on), what they look like (e.g. hairstyle, facial features, height and build), and how they react
to us (e.g. handshake - is it firm?). Typically, as much as 60 per cent of communication is non-verbal.
PROXEMICS
An important aspect of body language, and something which the international manager needs to get
to grips with, is the concept of proxemics. Proxemics is the theory of using measurable distance and
space to make people feel comfortable and/or more relaxed while interacting with them. Proxemics
encompasses personal territory and physical territory.
Communication styles
According to Deresky (2016) cultural variety in communication styles is the result of a combination
of several factors, not just language and non-verbal communication. The factors are:
Attitudes: attitudes underpin the way people behave and the way they communication (both
sending and receiving messages). The international manager needs to avoid stereotyping and
instead learn how and why people behave differently.
Social organisation: reflects differences in group identity which may be tribal, regional or national.
Thought patterns: how people’s reason varies across cultures.
Role: different cultures have different views on the role of a manager.
Language: written and spoken languages can vary within as well as between countries.
Non-verbal communication: people communicate behaviour without having to speak.
Cross-cultural relationship development as well as collaboration and negotiation is strengthened
when the communication style of the particular culture is understood.
Defining ethical standards across the organisation
The approach adopted by the most ethical global organisations is to bring together the various
country managers regularly for open communication and collaboration in defining ethics and values.
These are then embodied in a business code of conduct for enforcement globally. There must be
representation across the diversity of cultures that makes up the organisation in these meetings.
Issues are debated and the organisation defines global ethical standards that address fundamental
issues of morality, integrity and fairness. The organisation must be able to identify those issues that
are not really fundamental ethical issues but issues concerning cultural norms - issues where local
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decisions are called for. Global fundamental norms must be distinguished from cultural-specific
norms. The reality is that foreign ethical models and frameworks will be opposed if they are imposed
without consideration to local situations and cultural variations.
Global growth strategies
The corporate and competitive strategies of multinationals tend to be focused on growing the
business. The biggest growth opportunities are often outside of their home countries, particularly in
emerging markets. However, companies that look to grow markets overseas should do so after a
rigorous market assessment and must continually appraise the market, because the environment
can change rapidly. Many companies have failed spectacularly in their overseas ventures.
Global growth through marketing in new geographies doesn't always require a physical presence -
especially for consumer goods. Today e-commerce gives unrivalled and global reach and it is far
cheaper to market products through a website (and efficient logistics) than locating overseas.
Global growth is also achieved in other ways, particularly when a company is looking to acquire new
capabilities. For example through:
Mergers and acquisitions
Strategic alliances and joint ventures
Innovation.
Global collaboration in innovation
Innovation is increasingly a source of competitive advantage particularly in some sectors such as the
technology and pharmaceutical sectors. It is also the case that innovation increasingly straddles
multiple disciplines. Therefore, no single company, however large, has the breadth of competencies
to undertake such complex innovations. Companies therefore look to form external linkages to
integrate their resources and collaborate in innovation. The creation of the strategic innovation
network in itself can be innovative and often gives competitive advantage over rivals.
Combining and integrating knowledge and capabilities from diverse organisations to innovate is now
a strategy adopted by high-performing global companies. They companies are pursuing exploration
strategies by looking for ideas from outside, through strategic networks. Innovation partners would
include start-ups, suppliers, distributors, academia and even governments. It is a management
strategy adopted in many industry sectors by leading innovators.
The power of team working
Even in large global organisations, empowered teams in flat organisational structures are seen as a
means of overcoming the heavy bag and baggage of rules and bureaucracy which are so counter-
productive to creativity. The free-flowing nature of teams and its informality is ideal for creativity,
experimentation and learning - all of which are precursors for success in today's competitive global
environment. Teams outperform even the smartest of individuals acting alone. There is energy,
excitement, dynamism, creativity and collective learning in well-functioning teams - people
collaborate, building on the diverse contributions of others and come up with innovative ways of
doing things. However, the biggest benefits of teams arise when diverse, empowered teams are put
together. Diversity appears to trigger creativity, outstanding ideas and, often, ground-breaking
solutions. Empowerment is able to deliver creativity, speed and agility in fast changing markets
because teams operate largely autonomously.
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Characteristics of individuals in cross-cultural teams
Respect and leverage team differences
The value of cross-cultural and, in general, diverse teams is the multiple perspectives it brings
together. As a manager or team leader, respect these differing cultural perspectives. Indeed,
encourage team conversations that offer radical new insights or cultural perspectives. Leverage
team differences. Diversity and empowerment lead to creativity, speed and agility.
Managing conflict for creativity
The key to turning conflict into creativity appears to be getting away from a win-lose mentality.
Explain what this means, particularly in a cross-cultural team working context?
The author identifies five areas of conflict:
Different interpretations of facts or information
Lack of clear goals
Unclear processes or procedures
Low trust or broken relationships
Diverging values.
Team identity and bonding
Managers and team leaders must set the right environment to achieve team identity, bonding and
cohesion by: Facilitating people coming on board the team,facilitating people getting on with tasks,
organising for action and Facilitating evaluation and reflection.

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Differing motivating factors
Ritchie and Martin (1999) identify 12 motivational drivers that are more pertinent to the
contemporary environment:
Interest
Achievement
Recognition
Self-development
Variety and change
Creativity
Power and Influence
Social contact
Money and tangible rewards
Structure
Relationships
Physical conditions.
Virtual and geographically distributed teams
Today with global and cross-cultural teams being commonplace, team members can be distributed
across a number of time zones (San Francisco to Paris to Bangalore to Beijing to Perth) under the
management of one leader. The leader may not see his/her team members frequently. Team
members themselves may not get to meet face-to-face. In these situations, team identity and
bonding are particularly important.
Technology is the cornerstone of communication across team members who are dispersed across
distributed locations. Teams, where communication and collaboration is enabled principally by
technology, are referred to as virtual teams.
Members of the virtual team may be drawn from the same organisation or from several different
collaborating organisations. They adopt project management practices for discipline and rigour in
working.
Global Human Resource Management (HRM)
Given the global nature of more and more companies today, the term international HRM (IHRM) is
often used to describe HRM strategies, policies and practices. The use of this term is an
acknowledgement of the complexities of operating in different countries. Not only must differences
in employment law be considered but also differences in custom and practice (i.e. local culture). The
latter is crucial because much of the knowledge about HRM comes from the US and it is often
assumed that this knowledge is widely applicable to other countries and regions.
Brewster and Mayrhofer (2013) stress that multinational corporations that wish to manage HRM
effectively across different countries need to understand the different national cultures they are
dealing with and their HRM policies need to be informed accordingly by this knowledge.
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Global changes and existing organisational structures are making the work of the global HRM
function more complicated. In HRM, organisations must develop organisational structures that find
the right global-local balance so that they are effective in attracting the right people to meet
country-specific business objectives, such as identifying local acquisition opportunities or building
brands in the country, whilst aligning with global strategy.
The strategic focus of HRM
HRM has a strategic focus and there must tight alignment between HRM practices and corporate
strategy. HRM must support the corporate strategy in areas such as talent management or
development of core competencies.
The importance of strategic alignment is now widely accepted in Western multinationals although
the situation is less clear cut in a number of emerging markets where HRM principles are still in their
infancy.
So, what does strategic alignment refer to? It comprises two elements:
Vertical strategic alignment: Vertical strategic alignment is the process by which HR strategy, policies
and plans are aligned with an organisation’s strategic goals and objectives - in direct support of
corporate strategy.
Horizontal strategic alignment. Horizontal strategic alignment is the process by which functional
strategies, policies, plans and practices are aligned (or integrated) with each other. So, as an
example, what happens in recruitment and selection must be compatible with what happens in
learning and development - to develop targeted core competencies, for instance.
Global staffing and talent management
Global staffing is one of the principal concerns of the global HRM function. Staffing embraces all
aspects of HRM:
Roles are required (i.e. HR planning)
Hiring the right people to fill roles (i.e. recruitment and selection)
Induction, training and development of people (i.e. learning and development)
Performance management
Retention of talent and reward management.
Talent management and manager limitations
Although senior managers may appreciate the competitive value of talented employees, they are
often limited in their know-how on how best to acquire, utilise and develop talent. With the
pressures of running a business and delivering business results often in tough environments,
managers can easily become insular with narrow focus. Too many do not keep up to date with
developments in HR practices. To respond to an increasingly competitive global environment,
managers must continuously evaluate and embrace best practices in talent acquisition and talent
development. They need to adopt a mindset that understands that the new reality is that to gain
competitive advantage an organisation has to tap into a global talent pool. However, altering
managerial frames is difficult as it involves challenging some of the basic assumptions driving
management behaviour.
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An international manager’s exposure to different cultures provides opportunities to acquire the
necessary know-how even in global HR management. This is because having to adapt to different
cultural values and norms means the international manager develops a much higher level of
adaptability not just to culture but also other global developments in HR practices.
Developing managerial talent
Developing managerial talent, including international managers, typically comes under the HRM
discipline of leadership and management development. Multinational companies tend to require
that managers develop one or two management competencies such as consulting, project
management, sales and international management. These underpin most management
development programmes. Management development clearly must be aligned with the company’s
corporate strategy. International managers in most global companies regularly meet at conferences
and workshops to share ideas and experience. They are encouraged to critically assess the pros and
cons of local development, mergers and acquisition, and innovation opportunities and consider fit
against corporate strategy. Lateral thinking is encouraged.
International career development
According to Truss et al (2012) the challenge for the organisation is to provide interventions that are
aligned and beneficial in the organisational context. Some popular career development initiatives for
international managers include:
Secondments
International assignments
Opportunities to manage international projects
Development centres
Mentoring
Career counselling.
Managing diversity
In today’s globalised markets, one of the biggest challenges facing international managers is finding
effective ways of managing an increasingly diverse workforce. In this context, we have emphasised
the importance of cross-cultural leadership and management, national culture, language and
communication, and managing cross-cultural teams for high performance amongst other things. The
incentive for organisations is that diversity adds value to a business and contributes to its bottom
line. Diversity is also a recognised source of innovation and creativity for competitive advantage.
Structuring a global HRM function
The ways in which the global HRM function is structured varies across multinationals and is
influenced by a range of factors, including: Corporate strategy, Organisational structure,
Stakeholders, Organisational culture, Technology and communications infrastructure. In larger
organisations, which have more complex designs, there are a range of options available for the
structure of the global HRM function such as: Centralised, Decentralised, Outsourced.

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Reasons why multinationals use expatriates
Reasons for using expatriates and benefits: Dowling and Welch (2009) suggest that multinational
companies use expatriate managers for a number of reasons. Check these out and consider the
benefits.
The expatriate as an agent of direct control: Here the primary role of the expatriate manager is to
ensure that local staff comply with corporate policies and regulations. This reflects an ethnocentric
perspective on the role of the international manager.
The expatriate as an agent of socialisation: Here the expatriate manager helps to transfer corporate
values and beliefs to local companies in an informal as well as formal manner. However, there is no
real evidence that this actually works. Although knowledge sharing does take place this doesn’t
necessarily reinforce or instil values and beliefs in local workers who may simply perceive the
international manager as an agent of direct control.
The expatriate as a network builder: Here international assignments offer the opportunity to build
and foster interpersonal relationships - to build social networks. Obviously, the length of the
international assignment, as well as the personality of the individual international manager, will have
a bearing on how extensive and valuable these networks are.
The expatriate as a boundary spanner: Boundary spanning involves activities such as gathering data
and information that spans organisational boundaries. Dowling and Welch (2009) comment that
expatriate managers can act as boundary spanners by collecting host-country information, acting as
representatives of their firms in the host country and influencing agents. Social functions are ideal
opportunities (often hosted by a foreign embassy) for networking, gathering market intelligence and
promoting the firm at the very highest levels in a foreign country.
The expatriate as a language node: This is when an international manager gains fluency in another
language while working on an international assignment and is able to capitalise on this language skill
when he/she returns home at the end of the assignment.
Preparing expatriates for international assignments
International assignments still tend to be associated with ‘highflyers. Thus, international assignments
act as a form of development tool although it is a very expensive way of developing managers.
Selecting international managers can be a challenging process and one which is often
underestimated by multinational companies. Those with the highest potential may be hard to attract
for international assignments.
Assignments in emerging markets
Short-term assignments to emerging markets are predicted to accelerate at a phenomenal pace.
Companies must move expertise and talent to where it's needed most, depending on such factors as
cost competitiveness, open business environments and availability of skill sets. The increased focus
on the world's "growth" markets can be a challenge for many companies. Global mobility is a source
of competitive advantage. Most companies experience reluctance by managers to take on
international assignments, particularly in emerging countries. This can be for a variety of reasons
including concerns that the company doesn't have the right mechanisms in place to manage the
payroll, tax and security issues of sending someone to an emerging market. Compliance issues such
as tax reporting and immigration paperwork also put pressure on company resources.
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There are also concerns about adjustments to local culture, not just for themselves but also for their
families. Healthcare can also be a serious concern in some parts of the world.
Supporting adjustments
Deresky (2016) observes there are many training methods and techniques which can be used,
individually or in combination, to help international managers to adjust to working and living in a
new country. These include workshops on specific topics such as cultural variations, differing
business practices, managing diverse teams and so on. These training programmes and workshops
generally take place in the expatriate's own home country.
Deresky (2016) suggests that the benefits of training can be far greater if conducted in the host
country rather than in the home country. In this way important practical skills can be acquired.
Crucial skills, such as overcoming cultural differences in intercultural relationships, can actually be
experienced during in-country training rather than simply discussed.
Many multinational companies are recognising the importance of in-country training and prioritising
this, sometimes by engaging local providers of such training. High-performance companies
appreciate that early stage adjustments are critical and early experiences can sway the decisions
managers make with regard to long-term careers in international management.
Expatriate competencies
Technical knowledge is an essential competency for any international manager and excitement
about travel and working abroad is highly desirable - but these qualities in themselves are not
enough for international management roles. Similarly, whilst fluency in a foreign language is
important it does not guarantee an individual’s ability to understand and emotionally connect with a
foreign culture.
International managers must be capable of working across cultures. Cultural awareness and
communication competence is critical - particularly intercultural communication and listening.
Personal qualities such as flexibility, openness and tolerance of ambiguity are particularly important.
The latter recognises that there is more than one way of doing things right. This is especially
important when working in diverse cultures where business practices might be quite different to
what individuals might be accustomed to in their home country.
An individual's approach to learning is perhaps the most important competency for an international
manager. Learning from experience is a necessary quality as this leads to tacit knowledge. Tacit
knowledge cannot be discovered, articulated and disseminated in a hurry. It is different from explicit
knowledge. Explicit knowledge is relatively easy to acquire (e.g. attending courses, doing an MBA,
reading books, reports, case studies etc). However, tacit knowledge is not easily articulated to others
e.g. a green fingered gardener cannot explain to a novice precisely why his plants always thrive. Tacit
learning comes only from experiential learning - it is the type of learning that requires human
interaction leading to modified behaviours.
The ability to integrate tacit knowledge into work settings requires competencies such as intuitive
and innovative thinking, emotional intelligence and empathy. There is no doubt that managerial tacit
knowledge improves performance in real-world, cross-cultural settings. Its value is in the modified
behaviours and the "doing" that follows. It is this that contributes towards the success of the
international manager and leads to competitive advantage for the organisation.
Document Page
Osland (2013) defines it as the ability to:
communicate effectively
manage psychological stress
adjust to different cultures
deal with different society systems
understand others
establish interpersonal relationships.
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