BUS7049 Cross Cultural Management

Introduction:

Organizations operating in more than one country have to develop an effective organizational culture and management practice in order to fit themselves in the host country. The environment in each country varies due to variety of institutional regulations, market, bargaining power and cultural difference. This is a necessary part that needs to be dealt carefully in between different countries in order to attain efficiency in every country. Globalization has led to integration of economies in order to attain sustainable results(Harzing and Pinnington,2010).

Culture advantages and disadvantages of the MNC 

According to Hofstede the management is culturally dependent and efficiency can only be attained if a company adopts the culture of the country. The leaders do adopt foreign management ideas to grow although at certain time management has changed the overall culture. It is necessary to understand the importance of globalization in today’s scenario. It helps in adding cultural integration in the economy. Multi cultural environment assimilates the best talent from every part of the world.  Globalization provides benefit to all the countries participating in the business. Managing cultural difference in the organization working at different place is a difficult task but international business create ample of opportunities in terms of technology. It helps in utilizing the opportunities at different place and helps in high-scale production. In the given case study it is seen that intercultural difference in Germany, Finland and India has led to a different procedure to work. Cultural difference in every country creates a necessity to implement a work culture that helps in stimulating productivity (Brewster, Sparrow, Vernon and Houldsworth, 2007). The work culture in Germany is different from that of Finland and India. It is due to the cultural differences in the country. Globalization enlarges the scope to implement more progressive policies into work. This thereby ensures that the organization is working in a cohesive atmosphere. Globalization not only helps the organization to attain the best resources available in the host country but help in promoting the interest of the individual also (Harris, Brewster and Sparrow, 2003).

At certain times it is disadvantageous for the company to manage the work culture at different places. It is due to the reason that the work carried out at the different places is based on local environment. The difference in the work culture creates disruption in performance of duty. Sometimes it is difficult to manage the work from a centralized system. Centralization of the human resource function is difficult to be managed as it creates a burden on the center head. It is seen that globalization has gradually reduced the distance in between the countries (Dowling,2008). But at the same time it is a difficult task for the center head to operate the functions as the way of doing work in each country is different from the other. Different work cultures creates problem in designating responsibilities. It has become important for the organization to coordinate the function from one place. In such a multi cultural environment it is essential for an individual and the organization to implement the necessary changes in coordination with the organization. Therefore it becomes unmanageable for the people around to manage the goals (Noe, Hollenbeck, Gerhart and Wright,2006).

National culture and organization culture differences 

Difference in the national culture and organization culture has a significant impact on the local level subsidiary.  Every organization has a different culture than the country they are working in.  It is necessary for a business organization to adopt the cultural pattern of the country they are operating. Multinational companies can only sustain the change if they adopt the pattern according to the necessity. They need to focus on structuring the HRM pattern according to the local culture. In case if the company follows the similar pattern it makes difficult for them to implement the changes according. In order to succeed it is important for an organization to implement important changes as per the requirement. By establishing different HRM pattern it gives with an opportunity to grow in a distinguished atmosphere. People are ready to incorporate the changes according to their culture (Storey,2007). In the given case there is a necessity to implement the required changes according to the local culture of the country as this will give them with an opportunity to attain maximum productivity. Forcing employees to adopt the changes according to the multinational culture will decrease the overall productivity. This will put a wrong impact in the mind of the employees. It is necessary for a multinational organization to decentralize the human resource procedure according to the local needs. This will not only help in increasing the overall productivity but will create a long term positive impact in their mind. People tend to give high productivity in case if the work in a familiar culture (Briscoe and Schuler, 2004).

Hofstede’s cultural dimensions 

According to Hofstede a company tends to give high level of productivity if it adopts the culture of the local country. Companies which tend to adopt the local culture tend to achieve distinguish result. A company which does not adopt the local culture has a low productivity as compared to the other companies. A company which is operating in different country has to adopt the local HRM practice prevailing in the country. When the company does not adopt the local culture the productivity is affected (Nakata, 2009; Armstrong and Taylor, 2014).  

Elsewhere there are certain cases in which a company tends to change the local culture. It is seen that in certain cases it is that the country adopts the culture as implemented by the company. This however helps in overall growth of the organization. In certain cases when the company is the first mover in the country, it enforces their own culture in order to adopt the changes. Managing the difference in culture is a difficult task to be managed as it affects the people and their sentiments. Cultural understanding plays an important role for a company working in a different country. It provides with an opportunity to grow in a diversified business atmosphere. However it is recommended that the company should adopt the local culture in order to grow. This will provide with an opportunity to grow effectively. Difference in cultural understanding in between the host country and the multinational company makes it difficult to manage the organization(Hendry,2012).

Increase intercultural communication within multicultural teams at the local level 

The multicultural functions need to be managed effectively. The HiTree needs to improve the intercultural communication within its branch in order to attain effective result. HiTree has employed approximately 20,000 employees in abroad. Company has many subsidiaries working in different country. In the recent times company has been witnessing a fall in the sales due to disruption in between the cultural understanding in between the head office and the subsidiary. This is the reason that the company has been facing a lack of employee performance due to difference in culture. It is highly recommended that the company needs to transfer the US based function to the subsidiaries. This will on other hand help in attaining distinguished results. There is a necessity to increase the dependency on the subsidiary regarding managing human resource management. This will however help in decreasing the efforts of the company. Rapid development and technology up-gradation is important for a company in case when it is working at different places. The primary necessity in an organization is to remove the conflicts occurring in the organization. Rapid growth and effective communication procedure has however helped in creating an effective business environment. Due to rapid expansion of the business the companies are looking for the most appropriate opportunity in order to derive effective result. Workforce is becoming more diverse and it has become important to find out the most appropriate technique to manage the effective result. It has become important to manage the multicultural organization in an effective manner so that the maximum capacity can be attained. The managerial communication plays a significant role in communicating the idea among each other. In a diverse business environment HiTree need to find out the most appropriate way to delegate the authority to make decisions regarding the HRM in an effective manner. Effective communication is necessary in case when the company is operating in a multidimensional atmosphere(French, 2010). Organizational growth is only possible in different region is only possible if the company form an effective cross-cultural communication with each other. It is most importantly necessary in the current scenario is decentralization of the Human resource function to different place will enhance the productivity. It will make them self-reliant in term f decision making. They will no longer be depending upon the head office for the decision making regarding the human resource decision making. In a diversified business environment managing everything from a center is difficult not only for the organization but for the subsidiary to manage the task in every possible manner. They need a proper response from the organizational team as well. In case if they don’t receive a proper response they fail to take quick decisions. HiTree is managing more than 20,000 employees in different countries. It is difficult for them to manage all the functions effectively without any hindrance. It is moreover necessary for the business organization to effectively manage the work within the perquisite environment (Van Marrewijk and Yanow, 2010).

Big multinational organizations are efficiently working in the current business environment to manage the human resource function by effectively responding towards the human resource requirement. As the human resource practice in each country is different from the other. They can only manage the function in the case if every subsidiary is given rights to take their own decision. This will however increase the overall productivity of the organization. In all the organization need to opt for the most effective way in managing the environment so that the human resource can be managed. It has become important in the multinational culture that the business needs to find out the most possible way to manage resources. In such a business scenario it has become important to manage the business function in an effective manner by managing tee cross-cultural communication. This will enhance the coordination among the different organization. In a business organization like HiTree it is necessary t manage effective communication to achieve sustainable objectives. It is the necessity to manage the overall work room the center head in case if the subsidiaries are not working effectively (Chanlat and Dupuis, 2013). This is majorly because the company has to manage its functions through proper coordination with the employees. In case of standardization of HRM practice it is seen that it is eventually not possible for the business organization to manage the organization. For example in India the human resource system is followed through a hierarchy system which is divided into top, middle and lower level management. They have little inter-cultural communication among the teams that need to be managed in order to attain high level productivity. In case of Finland the intercultural communication is in term of local language and culture. The local culture is well exhibited in the way of doing business. The business culture is formal ad involve people to exhibit an extraordinary quality of managing business (Taras, Kirkman and Steel,2010).

Germany has a strong organizational culture and the workforce is highly gender diverse and poses local cultural values. They are amicable in nature and work effectively by enhancing competencies through team participation. Though, the business environment in Germany is different from that of Finland and India.  

Conclusion:

Hence it is evident that the intercultural communication is an important key to manage the business function across the organization through development of relationship with the subsidiary. The US head office need to synchronize the efforts of the team located at the different places to develop most comprehensive relationship with the team in order to give effective results.

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