How do motivation and leadership affect the
corporate culture of multi-national firms?

von: Anke Mayer

Every business has its own character which is unique and called corporate identity. It has one major part, corporate culture, often described as the “personality of an organization”. (www.quintcareers.com). As well as the unique character, the personality is also inimitable because all aspects of the enterprise environment influence it. Therefore, corporate culture varies from enterprise to enterprise and from country to country. Two major affecting elements are motivation and leadership which both are constituents of human resources management.
To answer the relevant question it is essential to understand what the corporate culture is especially its meanings to a multinational firm. This essay will examine it by explaining the cultural dimensions of G. Hofstede in general and in respect of global business. Furthermore a closer look will be given at the two aspects, motivation and leadership and examples will show to what extent each of these two facets can influence the corporate culture of multinational firms.

The corporate culture is also called organizational culture. It includes the mission statement, which makes clear the purposes, values and direction of the organization, as well as the beliefs and expectations. Very often heroes (mostly very successful managers) and legends complete this picture. (Griffin, 1999, p. 186) All these values are shared by every organization’s member and are transferred from one generation of employees to the next generation.
Furthermore the corporate culture defines acceptable behaviour of employees by setting norms (e.g. rules of conduct). Included in a corporate culture can be symbols, traditions, the daily working hours, the work environment (hostile or friendly environment), the general behaviour of the employees, the degree of competition, the dress code and other perks.

One of the major missions of the multinational firm Microsoft from June 25, 2003 is
“to enable people and businesses throughout the world to realize their full potential.” In respect to leadership, Microsoft stands for an innovative and responsible role. “Expanding platform innovation, benefits, and opportunities for customers and partners; openness in discussing our future directions; getting feedback; and working with others to ensure that their products and our platforms work well together.” (www.microsoft.com)
All big enterprises have the norms of a corporate culture written down and normally they will be handled out to every new employee to make aware of them. Nevertheless smaller firms may not have a typed version and therefore many salaried personnel might not be conscious of it. In fact, some small firms may not be aware of its actual or theoretical existence. It appears in the daily behaviour of the staff, as well as in the leadership of the CEO or in the way of motivating the employees.

The corporate culture is notably more important to multinational firms than for domestic companies. The national culture of the country can be seen to influence the subsidiary corporate one, and their employees and leaders recognisably influences their organizational culture as well. This is the reason why a multinational firm can not copy the Corporate Culture very easily. Sony is a very good example for this performance/comportment. The American company unit has it’s own corporate culture, as well as the Japanese one. But both units belong to Sony with an overall culture called “Sony’s Way” (Griffin, 1999, p. 521)

The corporate culture of multinational firms is shaped by numerous factors. One of the determinant factors is the national culture of the leader and the employees of this enterprise or subsidiary. Culture differs from country to country and from continent to continent. Regarding the topic in question this also means that motivation and leadership have different affects to the organizational culture in different countries of the world. The reason for this is that a Japanese worker will be motivated by other circumstances than an American one and that the cultural leadership behaviour in Great Britain differs from the cultural leadership in Russia. To understand the varieties in different cultures, Geerd H. Hofstede, a Dutch psychologist, collected and analyzed data from over 100,000 IBM Corporation employees and managers in over 64 different countries from 1967 to 1973. He developed 4 cultural dimensions. A fifth one was added years later. The following 5 dimension will show the differences between cultures, this survey also shows the different values and behaviour of employees from one multinational firm in their subsidiaries worldwide.

According to Hofstede (1991) the five dimensions are:

1. Power Distance
2. Individualism vs. collectivism
3. Masculinity vs. femininity
4. Uncertainty avoidance
5. Short-Term vs. Long-Term Orientation

The first dimension is called power distance and it depicts the acceptance of inequality and degrees of power within an organization. If there is a high power distance, employees generally agree to power and authority. Workers in lower order respect and are obedient to their boss or to officials. Furthermore it is believed that everyone has a specific place in the hierarchy. In low power distance cultures there is minimal social and class structure, respect for individuality and no existing hierarchy. In addition, employees emphasise the need for challenging decisions, they also expect autonomy and independence.

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