Management and cultural diversit

Management and cultural diversity. Speaking on this topic, I feel like first I should say a few words about multinational companies, because, in my opinion, they are the main mechanisms that help us to understand all differences in management, organizing the performance of people and process of motivating in different parts of the world according to the cultural and national particularities of every one. So, if we are talking about multinationals,

I believe that most people would certainly say that it is a company doing business in more than one country. But I am sure that many experts, however, would not be satisfied with this definition. They believe that it does not indicate the size and scale of the multinational's activities. To be a 'true' multinational, they say, a company should combine 3 aspects: - it should operate in at least six countries; - have no less than 20% of its sales or assets in those countries; - it should

“think internationally” – the management should have the global perspective, I mean to say, it should see the world as inter-related and inter-dependent. Let me tell you that the size and international organization of some multinationals is really impressive. The larger enterprises, like IBM, British Petroleum and Mobil Oil, have subsidiaries in sixty to eighty countries, some, like

Heinz, Singer and Exxon, get more than half their profits from overseas business. As far as multinationals make their businesses overseas, they have to play the game according to the rules of the country they are working in. But it’s a matter of common knowledge, that because of their global approach, multinationals very often make decisions which are against the interests of their host countries. And of course that is the time when they have to face some constrains – restrictions on managerial

actions. The examples are numerous: a multinational can decide to close down its plants in country “A” because it wants to concentrate production in country “B” – it leads to unemployment for all the personal in country “A”, and as a result the government of this country will put some pressure on the multinational to change its mind. Difficulties often arise when a multinational wishes to transfer its earnings back to Head Office. The host country may feel that the transfer will have a bad effect on the exchange rate

of its currency. So, we can sum it up as the interests of multinationals and foreign governments frequently clash. And I feel free to say that this conflict – the conflict of foreign governments and multinationals is the conflict between localization and globalizations has led to the invention of the new world glocalization. Managing a truly global multinational company would obviously be much simpler if it required only one set of corporate objectives, goals, policies, practices, products and services.

But local differences often make this impossible. A fairly obvious cultural divide that has been much studied is the one between, on the one hand, the countries of North America and north-west Europe, where management is largely based on analysis, rationality, logic and systems, and, on the other, the Latin cultures of southern Europe and South America, where personal relations, intuition, emotion and sensitivity are of much greater

importance. The largely Protestant cultures on both sides of the North Atlantic (Canada, the USA, Britain, the Netherlands, Germany, Scandinavia) are essentially individualists in such cultures, status has to be achieved. You don't automatically respect people just because they've been in a company for 30 years. A young, dynamic, aggressive manager with an MBA (a

Master in Business Administration degree) can quickly rise in the hierarchy. In most Latin and Asian cultures, on the contrary, status is automatically accorded to the boss, who is more likely to be in his fifties or sixties than in his thirties. This is particularly true in Japan, where companies traditionally have a policy of promotion by seniority. A 50-year-old Japanese manager, or a Greek or Italian or

Chilean one, would quite simply be offended by having to negotiate with an aggressive, well-educated, but inexperienced American or German 20 years his junior. A Japanese would also want to take the time to get to know the person with whom he was negotiating, and would not appreciate an assertive American who wanted to sign a deal immediately and take the next plane home. In northern cultures, the principle of pay-for-performance often successfully motivates

sales people. The more you sell - the more you get paid. But the principle might well be resisted in more collectivist cultures, and in countries where rewards and promotion are expected to come with age and experience. Moreover, Singaporean and Indonesian managers objected that pay-for-performance caused salesmen to pressure customers into buying products they didn't really need, which was not only bad for long-term

business relations, but also quite simply unfair and ethically wrong. Another example of an American idea that doesn't work well in Latin countries is matrix management. The task-oriented logic of matrix management conflicts with the principle of loyalty to the all-important line superior, the functional boss. You can't have two bosses any more than you can have two fathers.

Andre Laurent, a French researcher, has said that in his experience, French managers would rather see an organization die than tolerate a system in which a few subordinates have to report to two bosses. In discussing people's relationships with their boss and their colleagues and friends, I am convinced we can also distinguishes between, universalists and particularists. The first believe that rules are extremely important; the second believe that personal relationships

and friendships should take precedence. Consequently, each group thinks that the other is corrupt. Universalists say that particularists cannot be trusted because they will always help their friends, while the second group says of the first 'you cannot trust them; they would not even help a friend In this context I would like to add that norms, or standards of behavior, vary not only from North to South, but from country to country as well.

1. The prestige of work and of particular occupations within the soci¬ety. Some societies hold the pursuit of leisure in much higher esteem than do other societies. Also, certain types of occupations have higher prestige in some countries than in others. Since business and management are held in fairly high esteem in the United States many highly qualified people seek business careers, whereas in, say in

Argentina many quali¬fied people shirk business in favor of other professions. 2. How managers react on the Job. Studies comparing managers from different countries have revealed significant differences in willing¬ness to take personal responsibility for solving problems, in setting achievement goals, in taking calculated risks, and in requesting con¬crete feedback about performance. 3. The preference for individual versus group oriented compensation.

In societies where individual achievement is emphasized more than group achievement, the work force tends to be mobile in terms of changing employers and locations. The workers also tend to prefer monetary compensation as a direct form of feedback on their per¬ceived worth. In other societies, such as Japan and parts of Latin America fringe benefits may substantially exceed the amount of di¬rect compensation given to employees.

These benefits often include transportation to and from work, lunches at work, bonuses at Christ¬mas. 4. The identification of individuals with certain groups. The group affiliations are based on such things as sex, family, age, caste, religion and so on. Membership in the various groups often re¬flects the degree of access to economic resources, prestige, social relations, and power. If a company does not understand the' subtle or overt meanings of these

group affiliations, it may hire people who will be unacceptable to their peers and subordinates. 5. Social mobility. The more open or mobile the society is, the more likely it is that a person can obtain a job strictly on the basis of his or her qualifications. Of course, even in the extremely mobile society of the United States, certain occupations have opened to certain groups only in the last few years.

Nurses, elementary school teachers, and secretaries are almost always women; airline pilots, religious minis¬ters, and trash collectors are almost always men. Certainly no innate male or female ability makes one person more qualified than another for these occupations. It is simply tradition or custom of a particular country. Its all clear and at the end of my story Id like to say a few words about people who have to work overseas

and day after day face all these situations. These people are living and working in a strange environment, they have to deal with people who have a different language, customs, religions and business practice. To be a successful manager abroad, one needs various skills. It’s a great advantage if he knows the language of the country he is working in, but it’s not the most important one. I would certainly say that human relations skills, the understanding of the other culture

and the ability to adapt are the first in the list of most valuable. Human relations skills are vital because, to be effective, the manager must persuade local stuff to coordinate with him. Otherwise he is sure to fail. What is more, a professional manager mustn’t have the attitude of intellectual and cultural superiority or seem to be “know-it-alls”. But have to be more willing to learn from their fellow workers, and to

treat them as ‘partners’. If he follows these rules, I bet, he is sure to become a great manager.