Managing Across Cultures Business Management

Managing Across Cultures

Business management strategies are changing rapidly as the domestic and international business environment is converting into a big challenging of functioning beyond boundaries. In this regard, managers are playing vital roles in dual capacities. On the one hand they are business managers and developers who need to achieve their goals important for the growth of the bank. On the other hand they need to manage the operational processes effectively (Stringfellow, n.d). The recent global changes in the regulation and competitive structures are making positions even more complex. The ability of managers now cannot be judged on the basis of what are the quantitative results and achievements but what now is more important is to maintain high quality of work with a motivated and satisfied team. This is where managerial and leadership skills are best evaluated.

In the global competitive business environment it has become extremely important for managers to be effective leaders. They need to pursue their staff to a desired level, which should motivate them to work effectively and timely. To ensure that teams are well motivated is essentially a matter of using the right kind of leadership skills and appropriate management style. At the same time, an understanding of the motivation process will greatly enhance the chances of their success. Organizations have now become hybrid of different cultures and people from different backgrounds working together for the attainment of common objective. It's crucially important for managers to know what motivates them. And what leadership skills are required to direct them in the unified path?

In this paper theoretical perspective of leadership and motivation will be assessed. These theories will be discussed specially with regard to their cultural dimensions when applied to a real life organization's case study. In the case study potential problem of leadership and motivation to the various cultures are identified supported by logical recommendations.

managing cultures

Companies that appear to be quite similar can be faced with different corporate cultures. When companies merge together or undergo the process of acquisition or expand their business operations in diversified regions, they are faced with cultural issues and confronted with cultural conflict which if not managed properly can result in organization's cultural shock. Companies with smart leaders are well aware that cultural due diligence is as important as financial sustainability of the company. Organization's value system is rooted in its corporate strategies that reflect the company's growth prospects and future survival. If the value system of the organization is weak its foundation is shattered and the pillars of goals, objectives and strategies will no longer be able to hold the company for a longer period of time. Cultures are not easily changed, so if company is faced with divergent cultures due to any reason, it has to prepare itself to manage across cultures by creating a new culture for supporting the new organization policies and strategies.

Impact of culture on organization

Culture is the value system, norms, beliefs and attitudes that influence individual and group behavior within an organization. These norms, values and believes are initially structured in the organization through mission and vision by the founder of the business. It is then shaped and carried forwards along the business operations through senior executives, managers and other stake holders. Culture is the way of doing business. It involves strategies regarding the responsiveness to customers and suppliers. The span of control within the organization, level of authority and nature of delegation of authority, employee performance measurement mechanisms, development and growth prospects, risk tolerance and aversion procedures and quality assurance mechanisms all these are part of cultural norms and principals that shape the organization's strategies. In reality culture and strategies go hand in hand. Culture provides the insight of doing things and strategy show the road of getting to the destination. Organizations are able to achieve their objectives if they know how to prioritize value system and apply them best with the strategic implementation.

Organizational Cultural Assessment

Understanding the forces that drive employee performance is not an easy task. Its complexity even gets saturated when company are faced with the dilemma of managing across cultures. Organizational performance depends greatly on three factors: ability, environment and motivation. (Bovee, 2000) If employees have the necessary abilities to perform the task, organizational environment also supports their functions and the work groups are highly motivated, is the ideal situation where an organization is able to achieve its objectives. On contrary if any of the factor is missing then it is most likely to fail.

In light of the importance of cultural assessment in an organization, cultural due diligence involves organizational assessment and its future strategies by looking at the factors like:

a) How well the company adapt to the new processes and how it reacts to the cultural differences?

b) Analyzing the company style of management. Whether it's centralized or decentralized, entrepreneurial, authoritative or management by objective.

c) Evaluating competition structure and competitive strategies. Effectiveness of the company in serving the market and its penetration in the market.

d) Critical success factor for the company. Is it the management style, marketing strategies, industry growth, product life cycle or creativity and innovation?

e) The financial implication of the company. Its budgetary prospects, revenue structure and cash generation system.

f) Assess how far the company gives importance to the growth and development of the employees and enhancement of their creativity.

g) The communication system within the organization. It is very important assessment because it identifies the centers of policy formulations, its implementation and how these policies are communicated within the organization. It reveals the authoritative structure of an organization and how far organization is successful in managing its resources.

h) The risk evasiveness and risk taking behavior of the organization.

Discussion on the managing across culture is not limited to overcome the cultural conflicts through best management practices, rather its objective is to identify the cultural differences and how far these differences can be managed for the optimum results of the organization. Companies in today's time are more interested in taking advantage from the pluralism in an organization and making it an opportunity instead of threat. Collectiveness of thinking, collectiveness of understanding and collectiveness of responses always gives outcomes which are in best interest of the masses and representation of the whole body.

CASE AND THEORETICAL PERSPECTIVE

Case In Point-Ford Motor Company

Ford Motor Company is the fourth largest automaker in the world. It is an American company based in Dearborn, Michigan. The company was founded by Henry Ford incorporated on June 16, 1903. Ford Motor Company is the largest family-controlled company in the world, has been under family control for about 100 years. Alan Mulally is the current Ford CEO who has been appointed by William Clay Ford, Jr. For the restructure of the company. Ford Motor Company in current business environment is managed as a global business. Business functions like product development and vehicle design are all conducted on global basis instead of regional development centers. Manufacturing and purchasing functions are also controlled globally. The human resource management in this global business environment is also managed internationally by placing best people from anywhere of their current location to anywhere in the business center where their skills, abilities and experience is required (Charlene, 1998). Such management policy requires company like Ford or any other company with the same management philosophy required thorough understanding of different cultures, what motivates people from different norms and values and how that is reflected in the formulation of international projects. Consequently, company like Ford is faced with challenging task of understanding different cultures and societies when conducting their business across national boundaries. All the management strategies significantly the human resource management policies like recruitment, selection, training and compensation of employees are complicated through such cultural differences characterized by different countries around the world.

Under such circumstances leaders are challenged with the task of motivating employees towards the achievement of common goal around the world where business operations are conducted and directing them to the right path of business policies and strategies while managing their cultural differences. Following text will discuss how company like Ford is best able to meet its objective while managing across culture through profound leadership and motivation.

Managing through Motivation

One of the most difficult and challenging task of managers is to motivate employees to perform at the highest possible level in order to achieve organizational goals. A true leader role is to determine the factors that stimulate employee motivation and to channel that motivation in ways that serve organizational objectives (Dessler, 2000). Theories of motivation are amalgamated around three basic ideas: the nature of human needs and desires, the thought process that people adopt to satisfy those needs and the reason that people repeat or change their behavior. The three areas of motivation theories are:

a) Need Theories: These theories identify human action to overcome certain deficiencies. The four major need theories are Maslow's Hierarchy of needs, Alderfer's ERG theory, Herzberg's two factor theory, and McClelland's acquired-needs theory. Need theories discover the kinds of needs that motivate people but it lacks to explain how people decide to behave in a certain manner for the satisfaction of their needs (Campbell, 1983).

b) Process Theories: These theories explain the thought processes. These thought processes guide certain behaviors through decisions and action to be applied in response to satisfy certain need. Two significant approaches are Vroom's expectancy theory and Adam's equity theory. These theories are helpful in understanding human action that responds to their needs. However it fails to understand continuous people behavior in a certain way.

c) Reinforcement theories: These theories identify the rationale behind people's behavior and examine the influence of consequences on behavior and suggest that people behavior is directly related to the consequences of their action. In the reinforcement theories the law of effect states that behaviors with pleasant consequences are more likely to be repeated then the behaviors with unpleasant consequences.

Rewards systems are designed in organizations to encourage employees to work for the attainment of short- and long-term goals. Reward system can take the form of salary increase; gain sharing, profit sharing and employee stock ownership. In many organizations employees have given liberty to choose the reward system for them. Brief perspective of these theories is discussed below with their necessary implication on the case (Baumeister, 2004).

McClelland's Acquired-Needs Theory

McClelland's acquired need theory was developed by psychologist David C. McClelland. It states that needs are acquired or learned through life and some people are more oriented to certain needs than to other needs. McClelland had identified three types of need in particular:

i. need for achievement

ii. need for affiliation iii. need for power

Implication

In the diversified cultural environment managers need to understand what needs employee pursue to fulfill from their job. If their specific need is fulfilled then they function best for the development of the organization. People who exhibit high level of need for achievement should be involved in the creative team and new product development team. Managers can stimulate motivation in employees with strong need for affiliation by creating the work environment that emphasize social teaming and foster team work. There are two type of power influenced on individual need. One is the personal power and other is the institutional power. People showing need for personal power will work for their own sake however people with institutional power have the concern for organization and will work hard and even make compromises to solve organizational problems. Therefore, managers need to identify people with institutional power and place them on managerial positions because they will be more effective then people with need for achievement (McClelland, 2008).

Adam's Equity Theory

Equity theory specifies that employees in an organization are primarily concerned with being fairly treated in relation to others. This theory was first given by J. Stacey Adams. The equity theory in brief postulates that people compare their ratio of their input like the number of hours work, their experience or training and their outcomes like promotion, salary and leaves with the ratio of inputs and outputs of people functioning in similar capacity (Carver, 2001).

Implication

Company like Ford when operating in global market place where teams are components of people with different cultural backgrounds having different set of needs and values, managers in order to motivate employees towards team efforts and productivity should encourage employees and make them assured that their efforts will lead to performance, that performance will lead to rewards and that these rewards are attractive for the employees. If employees are satisfied on this notion that others are being rewarded according to their input in the organization then they are more likely to be motivated and enthusiastic in achieving their objectives (Mintzberg, 1990).

Conclusion and Recommendation

Charismatic Leadership for managing across cultures

Modern researchers and management gurus are conducting studies that widen the horizon of leadership from the trait, behavioral and contingency theories to more transactional and transformational leadership. Some of the roles performed by a leader in an organization in his/her capacity of being manager are:

i. Interpersonal Role: Managers must take initiates in performing formal interpersonal duties towards their employees. Greeting them formally, being responsible for the duties of their work groups, influence their actions through motivation and leading direction and lastly making a collaborative effort in building strong relation with the employees that drives their actions towards the achievement of organizational objectives (Robert, 1990).

ii. Communication and information passing role: Managers are concerned to be the brain center of the organizational unit. From this center all the information disseminates in various functional units therefore it has to be very much active, well informed and unbiased in its distribution function. Monitoring the outcomes, evaluating the performance and keeping in close intact with the teams are core to this role of manager.

iii. Decision Taking Role: information without its formulation into some policy action is of no use. Therefore managers are required to process this information into meaning decisions that are in benefit of organizational strategies and is functioning according to the needs, motives and goals of the work groups (Bovee, 2000).

Global companies like Ford when understands the motivating factors of the work groups from diversified cultures are then able to design the organizational culture which functions in the best interest of all and is always directed towards the achievement of organization corporate goals and objectives. No matter where the business operations are conducted organizational culture remains unified in all.

SC Johnson Culture: Another example of organizational values and culture