International Management and Cultural Diversity

Ausarbeitung, 2019

13 Seiten


Table of Contents

1. The impact of cultural diversity when managing in an international context

2. Different management styles in various international contexts

3. Cultural awareness and associated management skills that are relevant in international management

4. Comparative frameworks of cultural characteristics that can be considered when

assessing new international working environments


1. The impact of cultural diversity when managing in an international context

With the development and growth of transnational business activities, companies soon saw the need to discuss the necessary changes associated with global business activities. Due to the intensive research of the consequences of internationalization, companies realised that international business activity, along with other environmental influences such as geographic distance, legal framework, etc., is necessarily culturally bound (Rothlauf, 2006). The growing network of businesses worldwide imposes high requirements on managers who are engaging with people of different linguistic, ethnic and cultural backgrounds; a general management approach which is applicable for various cultures cannot be established and national variables alongside cultural backgrounds have to be evaluated in advance (Ott, 2006). Culture contains seven core elements: language and communication, education, religion, aesthetics, social institutions, behaviours, values and the type of business. All these elements have the same degree of influence on cultural diversity management, to which extent however, depends on the culture (Siedenbiedel, 1997). Considering these core elements and understanding the meaning within intercultural business activities is fundamental for internationally acting managers, who want to be successful in an international business environment (Acuff, 2008). This requires tools and working methods that allow mangers to develop sufficient competence in the cross-cultural context (Browaeys and Price, 2015). In order to perform successfully in a culturally diverse environment, companies have to invest in cross-cultural management skills trainings (Deresky, 2014).

2. Different management styles in various international contexts

What is suitable in Germany or even self-evident in the US can cause a disaster in Russia or disturb employees in China. Managers from various different cultural backgrounds act entirely different in certain situations. Management styles not only depend on the individual attitude of each manager, but also on the cultural background which has an impact on the working environment.

McGregor has studied behavioural patterns and developed two fundamental theories (Moores and Lorsch, 1970). Theory X assumes that employees generally do not want to work and want to be led. Employees are less ambitious and want to take as little responsibility as possible. As a result, managers are forced to control their employees and have to use threats of punishment (Luthans and Doh, 2014). On the contrary, Theory Y assumes that employees are motivated, want to work hard and are very willing to take on responsibility.

With Theory Z William Ouchi further developed Theory Y that combined Eastern and Western management styles (England, 1983). He examined cultural influences on leadership styles and presented Japanese management methods as a special form of cooperative leadership. Japanese management is strongly influenced by group work and decision-making processes. Theory Z stresses that employees are more likely to be motivated and find fulfilment in contributing to the company’s growth if they identify with the company's goals (Lee and Peterson, 2000). Given the importance of work and loyalty to the company in Japanese society, Ouchi urged for these methods to be transferred to Western companies (Seymen, 2006). However, most attempts to transfer management methods of foreign cultures to other countries have failed in the past. One reason for this was and is that the leadership style always results from the interaction of the leader. What is good for Japan does not have to be good for America and Europe either (Rothlauf, 2006).

The way a manager leads his employees depends not only on the management style; the key point is the degree of employee involvement in the decision-making processes (Figure 1).

Abbildung in dieser Leseprobe nicht enthalten

figure 1 Source: Adated from Brodbeck,2008

The less subjective feeling of freedom for the individual, the more authoritarian the leadership style and vice versa (Stahl, 2002). The authoritarian style of leadership is mostly used by managers, whose behaviour can be described by Theory X. Only by controlling employees and giving them little responsibility, the company goals will be achieved (Luthans and Doh, 2014).

Another type of leadership is the paternalistic style. It is not quite as strict as the authoritarian style and more employee-oriented. Managers expect a high work input and ambitious and hard-working employees. This type of leadership is mainly used in Japan and China (Rothlauf, 2006), whereas in Germany and Austria on the other hand, the task-oriented and hierarchy-consesus management style is preferred. Managing means to be tough and strict to the employees. The employee-manager relationship is based on fair and respectful conduct towards each other. People are also very direct and speak their mind (Brodbeck, 2008).

In countries such as Scandinavia, England and the USA the participative management style focuses on the interests of the employees. The management motivates and supports their employees. Moreover, two-way communication is very important as well as the personal and professional development of each employee (Luthans and Doh, 2009).

Which leadership style is suitable however, depends on the situation, the cultural background and the organisational culture.

3. Cultural awareness and associated management skills that are relevant in international management

Managers who want to be internationally successful need to adapt their management style to the local environment and culture. If cross-cultural contact shall be effective, certain conditions need to build the base (Bennett 2001). The potential for intercultural competence is associated with six developmental stages of sensitivity.

In order to explain, how people react when they are confronted with cultural differences, Milton J. Bennett (1993) developed the “Developmental Model of Intercultural Sensitivity” (DMIS) as a framework (Figure 2). Bennett observed that people deal with cultural differences in a similar and predictive ways. These six can be divided into two substages; the ethnocentric and ethnorelative stages. The ethnocentric stage defines the process of understanding intercultural communication and includes “Denial”, “Defense” and “Minimisation”. These three stages have to be overcome in order to develop cultural awareness. "Acceptance", "Adaption" and "Integration” within the ethnorelative stage help to approach different management challenges (Bennett, 1993; 2001).


Ende der Leseprobe aus 13 Seiten


International Management and Cultural Diversity
ISBN (eBook)
ISBN (Buch)
international, management, cultural, diversity
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Juliane Lutsch (Autor:in), 2019, International Management and Cultural Diversity, München, GRIN Verlag,


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