Cross Cultural Management Research Paper 2022

Running head: CROSS CULTURAL MANAGEMENT
Cross Cultural Management
Name of the Student:
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With the ever increasing globalisation of businesses and enterprises all around the
world, companies are increasingly expanding across different boarders and also, the global
marketplace is becoming more accessible for both the large and small scale businesses alike.
This further is bringing in more number of opportunities for working in international borders.
However, it is to mention that the concept of “multinational” and “cross-cultural” teams are
likewise becoming more common and the contemporary businesses are benefitting from a
growing diverse base of knowledge and the different new approaches for solving the business
problems (Ocloo, Akaba and Worwui-Brown 2014). By gaining success with the
globalisation of the business markets, more and more number of organisations are changing
into multinational companies for gaining a competitive edge, improving technologies,
increasing their market share and gaining labours and skills. As MNCs (Multi National
Corporation) are active in different nations, they need to be highly sensitive towards the
accepted rules and norms for the culture and behaviour in diverse nations. These differences
exist in terms of the race, social status, age, gender and other backgrounds.
This paper shall elaborate on critically analysing how the ethnic diversity and cross
cultural differences could be used effectively in working environment of a MNC (Multi
National Corporation). The chosen MNC for this purpose is IBM International. Different
types of communication across different cultures shall be assessed in this paper. It shall also
provide a framework for handling some potential conflicts that might arise as a result of
ethnic differences. The paper shall further elaborate on reflecting about the role of religion in
the whole process while referring to a particular case study while providing some
comprehensive examples.
Ethnic diversity and cross-cultural differences

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Ethnic diversity is one of the many forms of social complexity that are found in
majority of the modern societies. According to Williams, Priest and Anderson (2015), it is the
legacy of the conquests, which have led different people come together under the rule and
dominance of some dominant groups of rulers who in their own interests have imported
people for the labour skills and other business and technical skills of industrialisation that
have deepen the former pattern of migration for different economic reasons and of the
religious and political persecutions, which drove the individuals from their native lands
(Meissner 2015). Until the late twentieth century, ethnic diversity and cross-cultural
differences have posed no significant issues for the empires. Its key historic significant has
been its relationship to the nation state, whose key aim is political unity and this tends to be
regarded as social unity. The political function of ethnicity is much more important in
modern world than ever before and this is due to the spread of doctrines of democracy, self-
determination and freedom all around the world. Cultural diversity or cross-cultural
differences on the other hand, comprise of respect and acceptance (Iwai 2017). This means
understanding that each and every person is unique and realising the individual differences.
These differences can be related to the dimensions of gender, sexual orientation, ethnicity,
race and the different ways of life living along each other. There are certain basic standards in
each and every culture for the social relations like that of personal space, eye contact, public
negotiation and body languages. For example, in Germany people often express their views
and opinions directly but in countries like China, it is bit difficult to find out the opinions of
people there as they did not express the same and this often results in confusion. Also, for the
germens, connections are highly important but not as important as for the Chinese. As the
corporations are expanding and their business activities are increasing, their focus is not just
limited to the local geographic region, but also, to the whole world. Having cross cultural

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teams could help in providing a different experience and some advances thinking in the
development and establishment of the competitive position among different companies.
However, due to such enormous diversity, one of the main success factors for the
MNCs is selection and recruitment of the labour who offer them value individuality. These
individuals form the beliefs and values of the organisation. One of the important challenges
under diversity in MNCs is language barriers. It is to note that communication is very
important for the management of multinational organisations. This communication depends
upon a shared language, which is a requirement that does not prevail in all many of the
international business situations and this is when the issues start emerging.
Types of Communication across different cultures
Communicating across cultures is a very challenging task as each and every culture
has their own set of rules, which their members take for granted. The type of communication
that is done across different culture is known as cross-cultural communication (Mahmoodi et
al. 2015). It is to note that cross-cultural communication has become highly important for the
MNCs because of the growth and development of technology, internet and business.
Challenge for the global communication has never been greater than it is today. The
worldwide businesses have found that the intercultural communication is a subject of great
significance. This is not only due to the increased level of globalisation but also due to the
fact that their domestic workforce is becoming highly diverse, both culturally and ethnically
(Ocloo, Akaba and Worwui-Brown 2014).
Gaining a deep understanding of the cross-cultural communication is highly
significant for any business, which has a different workforce or plans for conducting the
global business. This type of communication comprises of an understanding of how the
people from diverse culture communicate, speak and perceive the whole world around them.

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It is to mention that cross-cultural communication in a company is all about understanding
the different business communication strategies, beliefs and customers (Pikhart 2014). The
non-verbal differences, language differences, power distance, high versus low context
cultures are the key factors that have the potential of affecting the cross-cultural
communication. Lack of cultural understanding could led to a challenge for the business
success by means of examining how managers handle their day to day processes in the
organisation.
a) High versus low-context culture
The notion of high versus low context culture is related to how the feelings, thoughts,
upbringing and opinions of the employees influence the way they act within a particular
culture. It is to note that all the international communication is affected by the cultural and
ethnic differences (Mazaheri et al. 2014). Even the option of the medium of communication
have cultural overtones. In this case, the determining factor might not be the level of
industrialisation but instead, whether the country falls in low-context culture or high context
culture. The high-context culture societies (Central European, African, Arabian, American-
Indian etc.) leave much of their messages unspecified and to be understood through non-
verbal cues, contexts and the between-the-lines interpretation of what is actually said (Havold
and Oltedal 2018). On the other hand, people in the low-cultural context culture societies
(Western Europe, North America, and Germany) expect messages to be specific and explicit
in nature.
b) Sequential versus Synchronic
There are certain cultures that think of time sequentially, as a linear commodity for
spending, saving and wasting. The other cultures view time in synchronically manner, as a
continuous flow that is to be experienced in the moment and also, as a force, which cannot be

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controlled or contained (Martins et al. 2015). In the sequential cultures (Dutch, German,
North American, Swedish and English), the business people give complete attention to a
single agenda item after another. On the other hand, in the synchronic cultures (Southern
Europe, Asia, South America), the flow of time is considered as a sort of circle, with the
present, past and future, all being interrelated. Such a point of view influences how the
companies in those cultures approach strategic thinking, deadlines, investments and the
concept of “long-term” planning.
c) Affective versus Neutral
In the multinational business practices, the emotions and reasons, both play a vital role.
The members of the neutral cultures do not telegraph their feelings, but they keep them
controlled and subdued in careful manner. In the cultures that are highly affective, people
demonstrate their emotions and feelings plainly by means of grimacing, laughing, scowling,
crying and smiling (Moore et al., 2015). However, it is to mention that this does not mean
that people in the neutral cultures are cold. In the normal business activities, the people or
business men from the neutral cultures are very much careful to monitor the amount of
emotion that they display. The emotional reactions were found to be very least acceptable in
UK, Indonesia, Netherlands, Norway and Japan and they are most acceptable in Singapore,
France, America and Italy. It is very easy for the people belonging from the neutral cultures
to sympathise with the Dutch manager as well as his frustration over trying to reason with
“that excitable Italian” (Johnson et al. 2015).
Potential conflicts that might arise as a result of ethnic differences
There are several potential conflicts that might take place as a result of the ethnic
differences in workplaces and they are that of prejudice, ethnocentrism, stereotypes, blaming
the victim, harassment, description and backlashing.

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a) Prejudice- It is an unreasonable and unfair feeling or opinion, particularly when
formed without much thought of knowledge and an unjustified negative attitude
towards an individual on the basis of his or her membership in a specific group.
b) Ethnocentrism- it refers to the tendency of regarding one’s own group, nation or
culture as superior to the others.
c) Stereotypes- it refers to the fixed idea regarding what a specific type of person is like,
particularly an idea that is wrong, a set of certain beliefs regarding a group, which is
universally applied to all the members of that group or team (Lamont, Swift and
Abrams 2015).
d) Blaming the victim- It is all about making incorrect casual attributes linking the
aggressions with the perceived characteristics of the groups.
e) Harassment- Harassment is when an individual consciously shun verbally or
physically abuse other individual due to his membership or involvement in a
particular group (Carter et al. 2017).
f) Discrimination- It is all about barring people from the membership in a company or
from a job due to his or her membership of a particular team or group.
g) Backlashing- It refers to the negative reaction to the members of the previously
underrepresented groups that are gaining influence and power gradually.
These challenges are often faced by several people in the multinational corporations and
could be effectively handled by means of reducing prejudices and usage of stereotypes within
the office premises, recognising that diversity do exists and learning to respect and values the
key differences. With the same, people should also minimise the level of miscommunication
with the diverse people by means of educating oneself regarding the differences through
reading, listening and broadening his or her experience base about the diverse group of

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people (Choi and Rainey 2014). Formation of a positive relationship with the diverse others
is very important.
Cross cultural and ethnic diversity in MNCs
Case study of IBM International: How IBM manage diversity for success
IBM is a multinational company that operates in more than 170 different nations with
a workforce of more than 398,000 employees while understanding and managing the
diversity effectively in the place. It is to note that being a multinational organisation, IBM
considers the management of cultural and ethnic diversity as its key business priority (Lozano
and Escrich 2017). It is the company that employs people and sells a huge range of products
and services all around the world and this is why, it is very important for IBM for
understanding the different groups of people that are making up this world. Since its
foundation in United States, IBM has always been a pioneer in giving importance and
appreciating its workforce diversity. In the year 1935, that is about 30 years prior to the
“Equal Pay Act” that guaranteed equality of pay in between both the sexes, the president of
IBM, Sir Thomas Watson was the one to promise women equal pay for equal work. Again, in
the year 1943, IBM had its first ever female vice president. Also, as per Johnson et al. (2015),
about 30years before the introduction of Family and Medical Leave Act (FMLA) that granted
unpaid leave to women for delivery of their child, it was IBM that offered the same benefit to
its female workers, extending it to 1 year during the 1970s and later, to 3 years in 1988. IBM
is ranked one among the top 100 companies on the Working Mother Magazine’s “100 Best
Companies” list. In the year 2009, IBM was also awarded for being number one for the
multicultural working women again by the Working Mother Magazine.
It is to mention that IBM has always proved itself to be the leader in diversity
management. However, the main way in which diversity was managed was primarily for

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ignoring the differences and providing equal employment benefits. This concept was changed
in the year 1993, when Louis Gestner became the CEO of the company. Gerstner was highly
surprised to see the low level of diversity among the seniors of the company. For all the
efforts that are being made for promoting diversity within the organisation, the firm still has
what he perceived a masculine culture. In the year 1995, Louis creates a 8 diversity task
forces around the different demographic groups like men and women and the African
Americans, Asians, the LGBT (Lesbian, bisexual, transgender and gay) individuals. It is to
note that the task forces that comprised of the senior-level, the well-respected executives as
well as the higher-level members and managers were charged with acquiring a deep
understanding of the ways of making each constituency feel much more welcome at home as
well as at IBM (Lightfoote et al. 2014). Each and every task force conducted a wide range of
meetings and also several surveys were conducted for thousands of employees for arriving at
the important factors in terms of each specific group. For instance, the presence of male-
dominated culture, the shortage of networking opportunities as well as the challenges in terms
of work-life management that topped the list of the concerns for women.
Furthermore, it was also seen that the Asian employees were highly concerned about
the stereotyping, shortage of networking opportunities and the limited plans of employment
development. On the other hand, the employees who were African American were concerned
about retention, very limited training and development opportunities and lack of networking.
While being armed with the huge range of priorities, IBM launched several key initiatives
and programs for addressing the highlighted issues (Johnson et al. 2015). For instance, the
employees who were looking for a mentor could now make use of the company’s website for
locating one willing for providing advice and guidance. The most unique thing about this
approach was that, IBM acted on each and every concern, whether it was based on perception
or on reality. They eventually realised that there are some women who were more concerned

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about the fact that they would have need to give up leading a balanced life if they wanted to
get promoted to the higher management. On the other hand, there about 70 percent of the
women in the higher levels who had children and this indicated that the perceptual barriers
could also act as a significant barrier for employing aspirations. The management of IBM
chose to deal with this specific issue by means of communicating in better manner with the
employees and through improving their networking program.
It is to mention that IBM is widely regarded as a company that excels in the
recruitment efforts for increasing the diversity of its wide number of candidates (Lightfoote et
al. 2014). However, one of the significant hurdles that the company is facing in terms
diversity is the limited minority representation in the areas like engineering and computer
sciences. For instance, only 4 percent of the students who were graduating with a degree were
Hispanic. For overcoming with this issue, IBM get into partnership with different colleges for
increasing the recruitment level of Hispanics for these programs. In a program called EXITE
(Exploring Interest in Technology and Engineering), they bring the middle school female
students together for a weekly program where they can learn the subjects of science and
maths in a fun atmosphere from the female engineers of IBM (Walton et al. 2015). Till today,
there are about 3000 girl students that have gone through this program. The end result of
these programs conducted by IBM was that, it tracked the results through the global surveys
all around the world and have identifies which programs have been successful and which
programs are facing issues and these things were no longer considered as problems. The total
number of LGBT executives have increased sevenfold and also, the executives with
disabilities gold tripled. With increasing emerging markets and minorities and women
representing about 1.3 trillion dollars of market, the culture of IBM (that of appreciating and
respecting diversity) is possibly to be a significant source of competitive advantage of IBM.
Role of religion in handling conflicts

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One of the most vital findings of the different researches on the cross-cultural conflict
resolution is that religion is a perennial and one of the most inevitable factor in conflicts and
conflict resolution (Oyeshile 2017). The term “religion” can be defined as a path of
transformation that is comprised of the different interconnected systems of guidelines and
symbols. All these shape the group and individual subconscious from which the social
interactions and practices are all given a deep meaning. In the process of promulgating the
values and ideals that held in highest esteem by individuals and groups, religion influences
the behaviour of goal-seeking in the conflict situation, by means of establishing the frames
and criteria of reference for the determination of what is right and what is wrong. It is to note
that religion is a very strong and powerful constituent of the different cultural values and
norms (Inglehart 2018). With the same, it is religion that addresses the most profound
existential problems of human life like that of fear and faith, right and wrong, security and
insecurity etc. This is why, religion is deeply implicated in the social and individual
conceptions of peace.
It is very important to recognise that the experience of the conflict evokes deep seated
requirement for affirmation of the identity and restoring the meaning. The conflict resolution
does more than just addressing the material clashes of the interest, it speaks to the social
reintegration, redemption and restoration, personal transcendence, existential security and
transformation (Lightfoote et al. 2014). All these concepts are long drawn from the backdrop
of sacred that might be defines as a process that explicitly connects the people to the larger
possible context for which we belong.
Harmonisation of cross-cultural differences
As the corporations are expanding and their business activities are increasing, their
focus is not just limited to the local geographic region, but also, to the whole world. This has

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resulted in the emergence of the multinational corporations, often known as transnational
corporation or global firms (Ocloo, Akaba and Worwui-Brown 2014). Along with the advent
of the new political ideologies, the multinational companies have found that their firm are
footing in the whole world. Having cross cultural teams could help in providing a different
experience and some advances thinking in the development and establishment of the
competitive position among different companies (Dragoni et al. 2014). Although, there could
be significant interference in the completion of the projects because of this diversity but the
manager should always try to be better equipped for facing the challenge for avoiding and
preventing cultural misunderstandings. The organisational managers need to be well aware of
the different cross cultural differences in the working environment for facilitating some
mutual adjustment in the cross cultural gaps prevailing. There are several companies who
dispatch their employees to international borders for implementing global corporate strategies
and managing their subsidiaries and it was found that the managers from a parent culture find
it difficult to try to fit into their host culture. On the other hand, the local staffs also find it
difficult to adapt to their managers, who belong from a different cultural background. This
could further led to issues with the performance and this further can affect the profits of the
company directly. MNCs require special understanding, knowledge, considerable time and a
strong commitment of resources in order to reach the success in their foreign operations
(Mudambi and Navarra 2015). Being large organisations, the MNCs are not restricted by
their limited human or financial resources. For example, in case of IBM, the company has
been successful in creating a competitive advantage for outperforming its competitors in both
the local and international levels, by means of managing effectively its huge human resources
across the cultural and national boundaries.
It is to mention that while dealing with the foreign managers, the workers and
managers need to be more flexible and more open about their concerns and feelings and at the

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same time, should be more direct and more accountable and rational. For gaining
trustworthiness and acceptability from the expatriate managers, they must demonstrate their
intellectual capacity, high level of responsibility and self-motivation and the same, also while
dealing with the “tough” expatriates who lays much emphasis on the task performance
(Johnson et al. 2015). It should be ensured that the expatriates need to discard the belief that
their own cultural values and norms are superior to the ones that are practised in the host
nation. Furthermore, it is also to state that the mangers must seek to develop some initial
awareness of the prevailing intercultural differences by means of demonstrating the positive
attitudes and the willingness for understanding and adjusting to the culture of the host
country, the openness to the presentation of the diverse opinions, showing respect and
valuing the local employees and by being a role model for them (Lightfoote et al. 2014).
They should demonstrate their positive personal attributes like being hard-working, open-
minded, patient and friendly. Furthermore, managers must also take some actions for
minimising the level of miscommunication with the diverse people by means of educating
oneself regarding the differences through reading, listening and broadening his or her
experience base about the diverse group of people (Choi and Rainey 2014). Formation of a
positive relationship with the diverse others is very important.
Conclusion
Hence, from the above analysis it is to conclude that ethnic diversity and cross-
cultural diversity could be used very effectively while working in the international
environment or MNCs, if the organisational managers become more open, more rational,
more direct and more accountable in their operations in the foreign borders. They must
demonstrate their intellectual capacity, high level of responsibility and self-motivation and
the same, also while dealing with the “tough” expatriates who lays much emphasis on the
task performance. Challenge for the multinational communication has never been greater.

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The worldwide business organisations have discovered that the intercultural communication
is a subject of great importance. This is not only due to the increased level of globalisation
but also due to the fact that their domestic workforce is becoming highly diverse, both
culturally and ethnically. The case study of IBM, one of the largest MNCs in the world, have
demonstrated that the company celebrates diversity in its place and that diversity is a major
competitive advantage for the company. As the global corporations are expanding and their
business activities are increasing, their focus is not just limited to the local geographic region,
but also, to the whole world. Having cross cultural teams could help in providing a different
experience and some advances thinking in the development and establishment of the
competitive position among different companies. Although, there could be significant
interference in the completion of the projects because of this diversity but the manager should
always try to be better equipped for facing the challenge for avoiding and preventing cultural
misunderstandings.

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