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Essay: Multicultural organisations

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  • Published: 11 September 2015*
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In today’s unstable, global business environment, companies should become more multicultural especially in their business practices and in selecting leaders only then they could survive and succeed. An organization work force should not only be comprised of people from similar cultural and gender backgrounds, but should include minorities along with different people across all levels of the company, including top level positions. A multicultural organization also shows a lack of bias and injustice, were skills and talent are the key criterion for moving up the business hierarchy. Studies have been conducted on various aspects to analyse the effectiveness of cultural difference in the organisation whether they contributes towards the organisational success, the effects of diversity on team performance under different circumstances, how the management of diversity in practice are interpreted and analysed by operational managers, different approach to the diversity management.
There are many advantages for a multicultural organization; It comprise of a superior level of improvement, improved success in marketing to minorities and export markets, and better sharing of chances. These benefits generally compensate the depressing factors such as a higher rate of cultural clash and the possibility for hatred among some employees, which could lead to higher employee turnover rates. The existence in a community or organisation of people from diverse backgrounds, of race or nation of varied genders, with diverse beliefs and values, with diverse attitude and at different stages of life are referred to as cultural diversity.
Studies have been conducted and the effects of diversity on team performance under different circumstances have been examined. The studies are conducted among board of directors and executives from samples of the largest MNC’s based in USA, Europe and Asia. The results show that European MNCs have a more proportion of internationally qualified personnel among their boards of directors and within the executive ranks than companies of the USA.
In both the cases of USA and European samples, executives have more international qualifications than directors, while data from the Asian sample shows that directors are more likely to have international qualifications.
As the globalisation has become a worldwide phenomenon, many companies have taken several measures to make their company globalise.
There is increased globalisation in the case of business in the last decade. In many countries the national workforce has got diversified to a large extent. Because of this, companies dealing with people of different backgrounds have to put into practice new policies and processes. The ultimate and main goal for the internationalisation is to secure and capture new technologies that has developed, increase market share, and to gain a competitive advantage.
The study was conducted to find out how international are companies board of directors and executives of MNC’s in USA, Europe and East Asia.
The study which is been conducted is on the basis of 2 theories, such as agency theory and dependence theory. Under agency theory the board’s role is to monitor the performance of the companies and under dependence theory, the role of board is concerned with providing necessary resources. Under the agency theory the board continues monitoring the performance which includes legal compliance and under dependence theory the board analysis the contribution made by the board members and the resources that they can provide.
If board members are bringing their orientation and personal expertise, it is then expected that the national composition would play a great role in the company’s performance and would lead to the synergy of different views.
Under this study the composition of boards of directors and executives belonging to USA, European, and Asian firms were examined. The compositions of boards of directors concerning 36 companies in 18 industries in the US were examined. Companies from each of the 8 industry to get a composition of 31 companies were examined from the European sample. Under Asian sample companies were divided into 8 industries and one company was selected from each.
The result showed that in both the USA and European, executives are more likely to have global experience than directors. Only eight of the 36 companies in the USA sample have a higher amount of directors than executives with international qualifications. Also the result showed that the Asian sample only gave small and partial data for executives for 12 of the 32 companies in the sample therefore it was difficult to obtain conclusion from it.
Higher levels of global qualifications regarding to the directors and executives are helpful of the dependence theory, as the levels of global expertise should enhance the effectiveness of policy setting and organisational decision making, particularly in the global field. The international skill of directors and executives came mainly from within Europe. Larger European countries such as Germany, France, and the UK were less global than smaller ones.
Based on the study, European boards and executives bring greater international expertise than their American counterparts, and Asian boards generally bring the lowest amount. Overall, executives are more international than board members.
The success of multiculturalism to connected with cultural differences depends upon the level of support for it by majority members. It has been stated that support for multiculturalism in the Netherlands has changed with reaction to various national and international events, such as the terrorist attacks on New York etc.
Today most of the world’s societies are ethnically diverse. Society’s has got an important task as how to manage the possible tension between the need for consistency to function as a society and the need for variety to accommodate the needs of both majority and minority groups.
The dominant acculturation model developed by Berry explains four types of acculturation orientations that minorities can take on namely integration, assimilation, separation, and marginalisation. These orientations are defined by two dimensions: maintenaning the culture and identity of the group were one belong to, and maintenaning a positive relationships with other groups that exists in the society. Research stated that the integration orientation (i.e. maintaining the cultural quality of ones own group and of positive relations with other society groups) is preferred by most immigrants and leads overall to the most positive acculturation outcomes, both in a psychological sense and in a socio cultural sense.
This article finds out how the management of diversity in practice are interpreted and analysed by operational managers. It is concerned with the different ways in which diversity management is understood and its application in large established British retailing company. The
Findings shows that while the benefits of the business that contributes to the diversity management are appealing to employers, and then it is a concept which lacks clarity for line managers both in terms of what it is to be implemented and how it should be implemented within the anti-discrimination legal framework.
Changes in the working population of UK and patterns of employment have resulted in greater diversity in the economically active workforce compared with 20 years ago researchers have stated that these changes along with shortages of labour and the increased purchasing power of minority consumer markets has led to the emergence of arguments for greater workforce diversity.
The suggestion made is that the employers who promote organisation’s image as an inclusive place to work by inviting employees from different diversity is seen themselves as employers by choice.
In-depth interviews were conducted with managers, HR specialists and employees across the three different business units of a long-established UK major high-street retailer of stationary and books as a part of research
The result thus obtained was a sample that was seventy per cent female and thirty per cent male, with an age ranging from mid-twenties to late fifties, although the majority of them were in their thirties or earlier forties. There was only one non-white manager in the UK sample. Interviews were conducted on these employees. At the time of the interviews each individuals were asked to comment on a couple of Scenarios describing employment situations where people could be treated either the same or differently. At the time of interviews respondents were asked to identify not only how they would act in a particular circumstances but also to describe critical incidents that Illustrated their own way of approaches to manage diversity or their own experience as employees from the point of view of their own working context
Line managers in the UK high street business were directly responsible for operational matters on daily basis
supported by a central specialist HR function and written company policies and procedures which were provided to them to implement and to achieve.
As a conclusion managing diversity concept open to different interpretations even though there is formal diversity management in the documents of the company
The role of organisational culture that exists in the system of workplace and practices has been identified by the research program. The contemporary approach to the diversity management is new.
‘ Diversity and Australia
Due to the increasing population and their descendents multiculturalism is at an increasing rate in the Australian society. This shows that the market share, international competitiveness, efficiency, level of innovation and efficiency of the organisation will greatly depend upon the ability of the organisation in managing a diverse work force both within the organisational and across organisational boundaries
‘ Diversity Research Program
The degree of receptivity to perceived dissimilarity is referred to as diversity. In an organisation an individual or work group that is open to diversity is unprejudiced and they are willing to take into consideration the arguments and new ideas that is approachable to ideas external their usual way of thinking. Diversity openness is a broad attitude to variation, where the level of openness and the type of apparent difference varies as a function of the person. It refers to embracing difference. Steps are to be taken to decrease likely negative affective and behavioural reactions to difference in order to realise the full potential diversity offers to organisations. Individuals and groups must be able to conquer stereotypes or prejudices and identify that actual different others have exclusive and valuable information that can clutch up group processes and routine. Another name for diversity openness is tolerance of difference.
‘ A Climate of Diversity Openness
In an employee’s level of diversity openness an important role is played by Organisational culture as it helps in shaping the meanings and actions of the members. With respect to culture Organisations differ in the case of viewing dissimilarity. Diverse people were likely to incorporate to the existing culture. As a result assimilation to the dominant, existing culture, expected by the organisation are not open to diversity.
As a conclusion diversity openness and dissimilarity openness concepts describes how individuals, groups or organisations contract with dissimilarity.
‘ The Perceived Dissimilarity-Openness Moderator Model
The influence of diversity on workgroup processes and outcomes through perceptions of dissimilarity is the basic reason for resulting Perceived Dissimilarity-Openness Moderator. This Model has made a primary contribution that there is a negative effect in the work interaction when 2 conditions are met. In terms of explanation of the processes leading to positive or negative affective cognitive and behavioural reactions to diversity The Perceived Dissimilarity-Openness Moderator Model, is different from other things that give explanation of effects of diversity in organisation
Under this study it was stated that HRM policies and practices gives shape to the employee attitudes and their behaviour and strengthen a diversity open organisational culture. 50 structured interviews which were conducted by phone and face to face contacts with those people who represent diverse stakeholders were obtained.
Fromm the research, several implications and recommendations for organisation and diversity were selected by the researcher. Firstly Organisations are expected to encourage and to have a continuous monitoring on the ability of their cultural and climate to make possible positive stereotypes towards difference. Secondly in the case of selection capacity of recruit should be given consideration in order to provide services which are positive to the persons from different backgrounds. Thirdly the service of employees should be compared by the performance monitoring, their feedback and evaluation in the organisation to similar and dissimilar internal and external customer.
The study states that the management is provided with tasks of human resources management with a better kind of working systems and the attitude of the employees for the provisions about reasonable working conditions and the service of the customers by the research. The diversity management will persist to captivate management scholars as it undertakes progress in the case of knowledge, and innovations that lead to the boost in productivity and profits, trades which are done globally and increases the trustworthiness of employees and client and uses employee skills and abilities.
The existence in a community or organisation of people from diverse backgrounds, of race or civilization of varied genders, with different beliefs and values, with different outlook and at different stages of life are referred to as cultural diversity. The patterns of life style and beliefs etc are encompassed by the difference. Companies, societies etc are undertaking cross culturalism as a result of increase in the globalisation. Such differences affect the smooth functioning of the communities
The diversity management gives focuses on HR development of the people. The main reason for equality in opportunity is that discrimination prevents complete usage of abilities of the people. As result of globalisation certain problems faced by the companies such as the increased labour turnover in the organisation need to be given more attention. Cross cultural face of corporate workforces is changed as a result of globalisation. Certain uses of diversity of cultures in the organisation are the following
‘ Acquisition of resources which will help in increasing the efficiency in recruiting employees from different back grounds of cultures.
‘ Helps in reducing the turnover of managers belonging to different cultures.
‘ Helps in improving decision making more effective as information can be obtained from people from different cultures
‘ Helps in increasing creativity
‘ Helps in increasing the flexibility of the organisation in order to get adapted to the changes in the environment.
Cross cultural environment in the organisation provides more opportunities for unnoticed groups and a supportive environment. The organisation that is concerned with diversity management uses strategies to achieve harmony among the organisation and citizens. In organisation diversity is concerned with changing the attitude from them to us. Management of diversity comprises of introducing an maintaining a climate were people from different cultures are able to perform their work efficiently. This is considered to be internal and the external way is to make the organisation ready to accept changes happening in the environment and to make it more flexible. In order to mange diversity in an organisation it has to adapt to the changes in the society and culture. Firstly the threats and opportunity should be identified and secondly awareness should be created through open discussions etc and finally a mindset should be created on a global basis which is concerned with identifying differences and commonality among them. This includes appreciating the positives in differences and influencing the factors which lead to the change in beliefs and values. There are situations were people believe that different cultures in the organisation is dangerous as it might create conflicts. Providing equality in the work area depends upon the ability of the management to bring up and execute new policies to manage people belonging to different cultures. Movements in population and migration of labour are as a result of globalisation. Communities across different organisations are becoming multicultural.
The election of US president gives a lesson of power of Hispanic American and other voters to change its outcome the culture of America has changed. This change affects every business from IT to health care. Here are 3 factors that need attention; they are barriers to culture-i.e. factors that affect the messages to reach the respective audience, cues of the cultural which shows the relevancy of the information, cultural windows
1. Opportunities should be defined- the commendable of investing is based on the characteristics associated with services or products
2. Finding the right kind of investment- so that return can be calculated easily
3. The journey of the person should be known to the firm- identifying the target market, religion, community role should also be known.
4. The opportunity of education
On the basis of outcome, conflicts can be a positive or negative experience in the cae of an organisation. The rapid change in the demographics and cultural, which makes culture conflict education to be a vital tool for maintaining strong relation in organisations and society in broad. Change management can be considered as an important portion for modern business especially in MNC’s. From the study it is identified that more number of organisations are benefitted from multiculturalism. . An organization work force should not only be comprised of people from similar cultural and gender backgrounds, but should include minorities along with different people across all levels of the company, including top level positions

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