Cross-Cultural Management: Strategies for Organizational Success

This report delves into the critical aspects of cross-cultural management in the era of globalization. It emphasizes the significance of cross-cultural competence, highlighting how a lack thereof can lead to organizational failure. The report examines cultural barriers, including linguistic differences, differing beliefs, and ethnocentrism, and their impact on employee motivation, communication, and overall productivity. It references research articles and news reports, such as the Mitsui O.S.K. Lines' 'One MOL Global Management College' program and discussions on multiculturalism in Luxembourg, to illustrate practical strategies for overcoming these challenges. The report underscores the importance of cultural training, cross-cultural intelligence, and the need to address ethnocentrism to foster effective cross-cultural interactions and achieve organizational success in a globalized environment. The report also emphasizes on the importance of training local staff to respect cultural differences.

Running head: CROSS CULTURAL MANAGEMENT
CROSS CULTURAL MANAGEMENT
Name of the student:
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In the era of globalization, cross-cultural communication deserves immediate critical
attention, as companies from different parts across the globe participate in global trade, and lack
of cultural awareness amongst the employees, both the natives and the expatriates, has been
identified as a chief reason behind organizational failure. The reviewed research articles clearly
established that although shared profitability or difference in time-zone often impede the smooth
cooperation amongst the nations in case of cross-cultural trade, inadequate cross-cultural
competence remain the topmost reason behind organizational failure. Cross-cultural competence
refers to the ability of an employee of one culture to develop an understanding about the
employees coming from a different culture, and his ability to engage actively in conversation
( both personal and professional) in a professional set-up1 (Rozkwitalska 2010). Research has
suggested that in a culturally diverse set-up, the employees often lack the ability to comprehend,
communicate with and effectively interact with the co-workers coming from different cultures.
The difference in beliefs, ideological perceptions and norms not only affect an employee’s
perception of its foreign worker, but can also influence his acceptability2 (Vertamo 2014). Often
the expatriate employees complain about lack of recruitment or promotional opportunity in a
foreign set-up, which clearly shows the biased attitude influenced by cultural differences, as
exhibited by the organization, as well as the cultural prejudices the expatriate employees are
subject to.
As far as cross-cultural interaction is concerned, linguistic differences amongst the native
officials and the foreign officials, can be a major obstacle in smooth and effective interpersonal
communication within the organization. Differences in cultural views and customs have been
1 Rozkwitalska, Małgorzata. "Barriers of cross-cultural interactions according to the research findings." Journal of
Intercultural Management 2, no. 2 (2010): 37-52.
2 Vertamo, Hannes. "Cross-Cultural Management." (2014).

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found to influence cross-cultural interaction in a negative way. Often, it has been observed, that
the employees belonging to the egalitarian and individualistic nations, such as the US tend to
voice their unfiltered opinions, attaching less importance to the organizational structure (
Vertamo, 2014). On the other hand, the employees belonging to the collectivist nations, such as
Japan tend to respect the organizational hierarchy, and get offended if a junior employee voices
opinions before the senior manager can opine. Cultural barriers can always impede effective
inter-cultural assimilation that in turn can certainly affect the motivation of the employees, and
influence employee productivity in a negative way. Research has clearly shown the direct
relation existing between effective cross-cultural interaction and employee motivation3 (Johnson
et al. 2006). Communication is a means by which employees express and exchange opinions,
and engage in the decision-making process. Linguistic difference or difference in communication
approach, caused by cultural differences, will always impede effective communication flow
within the organization and affect the productivity growth. Hence, it has been recommended that
companies in order to reduce the impact of cultural barriers on the communication style and
process, should train the employees, especially the expatriate employees, in the native languages
as well as soft skills. Proper cultural training needs to be imparted so that the employees do not
face cultural prejudice, or encounter difficulty in assimilating a new, foreign culture in a new
land. Similarly, the local staffs should also be trained so that they respect and appreciate the
cultural differences, and try to cooperate with the expatriate employees, instead of discouraging
effective communication.
While cultural awareness and sensitivity need to be inculcated amongst the employees, as
the same helps the employees become aware of cultural differences, and respect the same, cross-
3 Johnson, James P., Tomasz Lenartowicz, and Salvador Apud. "Cross-cultural competence in international
business: Toward a definition and a model." Journal of International Business Studies37, no. 4 (2006): 525-543.

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cultural intelligence nevertheless plays an equally important role in ensuring success of cross-
cultural trade. The cross-cultural intelligence is defined as the ability of an employee to relate to
culturally diverse situations, and work effectively, in a collaborative way with the individuals
belonging to distinct cultural backgrounds. The importance of cultural intelligence lies in the fact
that it allows the employees to gain a better understanding of cultures which in turn enables
them to work in a positive and compassionate way with people belonging to different cultures.
Thus, it is clearly evident that the intercultural intelligence is important as it creates in employees
a more advanced knowledge of traditions, nationalities as well as the distinct corporate cultures
and disciplines which are likely to have an impact on the business operation of a company4 (
Thomas et al. 2017). In absence of cultural intelligence, the employees often lose job satisfaction
and motivation, ultimately leading to organizational issues such as low retention rate, higher
absenteeism and low productivity level.
However, one of the most interesting and persuasive arguments forwarded in the articles,
is the problem of ethnocentrism in cross-cultural trade. Often when the expatriate employees face
problems in a new cultural set-up, the employees of the host country fail to analyse the problem
objectively, and end up exhibiting a biased attitude. This lack of objective and transparent way of
analysing the problem can easily affect the morale and motivation of the expatriate employee.
Hence, the local staffs should be trained to eliminate the possibility of such culturally influenced
decisions, while handling organizational issues involving expatriate employees.
4 Thomas, David C., and Mark F. Peterson. Cross-cultural management: Essential concepts. Sage Publications,
2017.

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A news has been published in Marinelink on 25 Monday in the month of September in the year
2017. It has been written by Aiswarya Lakshmi (He will not be inserted as the name of the
reporter as the name of the reporter was Aiswarya not Aishwarya) on September 8 of the same
year. This new article is mainly depicting the news of the huge transport company of Japan
called the Mitsui O.S.K lines or MOL establishing 2017 session of a project called 'One MOL
Global Management College'. It was developed in the year 2014 with the sole aim of
improvement of the different types of management skills in a cross cultural management. They
also had a vision to develop the next generation of executives who will lead the MOL Groups
global management with proper cross cultural skills and knowledge5 (Laxmi, 2017). They had
invited 14 participants form 7 countries giving them an opportunity to meet and learn over the
next four months. An interesting factor that was present in the project which aligned with the
articles provided was that it paid importance to energetic hand on sessions which focused on the
themes of personal empowerment. This aligns with Johnson’s article where he had stated that
one of the most important model for cross cultural development would be the development of
personal attributes like development of personal attributes, personal skills as well as
development of cultural knowledge which would help in realizing one’s own cultural features
and at the same time provide respect, importance and interest in others culture being sensitive to
the other culture. This would lead to personal empowerment as is influenced by MOL. This
would help the individual to expand his horizon in cultural ideas and embrace all cultures with
5 Lakshmi, Aiswarya. 2017. "MOL Launches 2017 Session Of 'One MOL Global Management
College'". Marinelink. https://www.marinelink.com/news/management-launches429220

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same importance as its own6 (Stahl et al. 2015). This program had also helped in the
establishment of different features for organizational management as well as strategic leadership.
They also have stated that company besides promoting cultural confluence in workplace had also
introduced MOL chart values which focus on company’s values as well. The article by
Rozwitalska aligns with it where the author had provided many organizational factors which
culminated as cultural barriers. Mol has rightly taken the steps. They have also considered the
organizational factors and have introduced strategies to handle the organizational initiatives to
eliminate cultural barriers7 (Pawloski and Bick 2015). Johnston’s article has also shown how
taking appropriate steps in managing institutional ethnocentrism so that it cannot impair an
employee’s ability to work effectively with other national groups. Johnston has also mentioned
about how proper leadership styles with ambition, courage, curiosity, decisiveness, enthusiasm,
fortitude, integrity, judgment, loyalty, perseverance, self-efficacy, tolerance for ambiguity can
also help in managing not only personal attributes but also multicultural teams successfully. Mol
has also allowed the participants to come with their own innovations to develop the company
which aligns with their both the articles recommendations about reducing the cultural distance
providing them the scope to feel respects and integrated in the organization. They have also
6 Stahl, Günter K., and Rosalie L. Tung. "Towards a more balanced treatment of culture in
international business studies: The need for positive cross-cultural scholarship." Journal of
International Business Studies 46, no. 4 (2015): 391-414.
7 Pawlowski, J.M. and Bick, M., 2015. The global knowledge management framework: Towards
a theory for knowledge management in globally distributed settings. Lead. Issues Knowl. Manag.
Vol. Two, 2, p.134.

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influenced the participants to develop a sense of ownership and using the values if Mol charts to
participate in decision making. Thus Mol group had tightly taken initiatives to manage cross
cultural management for increasing productivity and reputation of their company.
News had been published in Luxembourg Wort on Sunday 24th September on the year
2017 about the multiculturism where business leaders, industry experts and minister of family
affairs Integration and the Greater Region Corinne Cahen had come together for a meet. The
matter was placed under the highlight of the American Chamber of Commerce in
Luxembourg (Amcham) and The Network. They have provided importance to the Diversity
Charter Lëtzebuerg, a private-public initiative, launched in 2012 in their discussion inviting
companies being members from different industries8 (Multiculturalism: Making Diversity Work
In Business And Society, 2017). Kary Bheemaiah, consultant at Uchange and author of “The
Blockchain Alternative” book in the discussion had stated that interdisciplinary pesreoctive is
very important resfarsding about an idniviudual look at things and how different individuals
assume it. The discussion had put importance of Hofstedes’ theory where they have stated that
“cross-cultural communication and looks at how individuals' values and understandings of
culture impact their behaviour” this feeling of the panel members are very much in lieu with the
Johnsons article which states that ‘person aspect’s both at intra-individual as well as inter-
individual or universal traits become important in assessing a person’s outlook towards other
culture. Rozkwitalska had also provided several individual rooted aspects which may act as
8 "Multiculturalism: Making Diversity Work In Business And Society". 2017. Wort.Lu.
https://www.wort.lu/en/luxembourg/multiculturalism-making-diversity-work-in-business-and-
society-59c538e556202b51b13c3b25.

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cultural barriers and thereby may alter an individual’s behaviour towards other cultures. The
author had stated that making assumptions in cross cultural assumptions, possible Pygmalion
effect, weak communication, ethnocentrism and others all lead to behaviour changes that may
become insensitive to a culturally different people9 (Mor, Morris and Joe 2013). The meeting had
finalized that several training sessions hosted by Hofstede Centre-certified intercultural experts
will be conducted in next six months staring form October 14 which will bring out initiatives to
overcome such biasness of individuals and help organizational to overcome their cultural
barriers. Johnston in his article had noted the comment of another writer that “Cross-cultural
training enables the individual to learn both content and skills that will facilitate effective cross-
cultural interaction by reducing misunderstandings and inappropriate behaviors.” Although
Johnston’s planned model is not followed in the initiatives but components of her model were
introduced like proper formation and modification of Personal attributes and Institutional
ethnocentrism.
Reference List:
9 Mor, S., Morris, M.W. and Joh, J., 2013. Identifying and training adaptive cross-cultural
management skills: The crucial role of cultural metacognition. Academy of Management
Learning & Education, 12(3), pp.453-475.

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"Multiculturalism: Making Diversity Work In Business And Society". 2017. Wort.Lu.
https://www.wort.lu/en/luxembourg/multiculturalism-making-diversity-work-in-business-and-
society-59c538e556202b51b13c3b25.
Johnson, James P., Tomasz Lenartowicz, and Salvador Apud. "Cross-cultural competence in
international business: Toward a definition and a model." Journal of International Business
Studies37, no. 4 (2006): 525-543.
Kersiene, Kristina, and Asta Savaneviciene. "The Formation and Management of Organizational
Competence Based on CrossCultural Perspective." Engineering Economics 65, no. 5 (2015).
Lakshmi, Aiswarya. 2017. "MOL Launches 2017 Session Of 'One MOL Global Management
College'". Marinelink. https://www.marinelink.com/news/management-launches429220
Mor, S., Morris, M.W. and Joh, J., 2013. Identifying and training adaptive cross-cultural
management skills: The crucial role of cultural metacognition. Academy of Management
Learning & Education, 12(3), pp.453-475.
Pawlowski, J.M. and Bick, M., 2015. The global knowledge management framework: Towards a
theory for knowledge management in globally distributed settings. Lead. Issues Knowl. Manag.
Vol. Two, 2, p.134.
Rozkwitalska, Małgorzata. "Barriers of cross-cultural interactions according to the research
findings." Journal of Intercultural Management 2, no. 2 (2010): 37-52.

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Stahl, Günter K., and Rosalie L. Tung. "Towards a more balanced treatment of culture in
international business studies: The need for positive cross-cultural scholarship." Journal of
International Business Studies 46, no. 4 (2015): 391-414.
Thomas, David C., and Mark F. Peterson. Cross-cultural management: Essential concepts. Sage
Publications, 2017.
Vertamo, Hannes. "Cross-Cultural Management." (2014).