Cross-Cultural Communication

The Importance of Effective Cross-Cultural Communication in Business Today

Currently, globalization of business, international expansion of market and rising competitiveness has increased the interdependence of business. With the expansion of business into multiple countries, sensitivity towards the cultural differences has also augmented in the corporate environment. Global interdependence of economy has forced the business owners to provide ample opportunities of cross cultural communication to their managers. It would help in gaining skills and expertise in handling the problems of cultural differences in their organizations (Okoro, 2013). Moreover the international expansion strategies partnership arrangements like mergers, acquisitions and strategic alliances has augmented the importance of effective cross cultural communication in the business world. In highly competitive market and international scope of business, communication is considered to be the vital function in the success of business. Organizational profitability is evaluated by its communication strategies. Cultural barriers have played significant role in hindering the success process of communication in international businesses. Communication process between culturally different people has unleashed the issues of language, values, ways of thinking and religion. Mishandling of these issues would increase the chances of miscommunication (Guang & Trotter, 2012). The objective of this essay is to explain the reasons behind the importance of cross cultural communication which is followed by the explanation of problems and issues hampering the effective communication system. It would also provide the strategic approaches employed by companies to resolve the issues. In the end, organization successfully handling the cultural problems will be compared with the organization failed to cope with the problems of cross-cultural communication.

Various sources have consulted to explain the reasons that why cross cultural communication has become highly important in business today. Literature explained that high pace of globalization has made the cross cultural communication inevitable for businesses. Homogenization of markets has faded the distinctions of national markets. Along with the business development cultural differences between nations, regions and ethnic groups have become stronger. In this situation solution to overcome the cultural problems are presented to smooth the process of communication and interaction between business partners, companies, customers and coworkers (Tian & Borges, 2011). Advertising messages also hold the values, norms and cultural characteristics of different regions. Realizing the importance of cultural factors in advertising messages is very practically and financially very important for business communication As product sales are largely dependent on these advertising messages (Guang & Trotter, 2012).. Cultural values also affect the process of business negotiations and decision making process. In partnership agreements and business transactions business representatives from different countries different cultures has increased the importance of effective cross cultural communication in businesses (Peleckis, 2013) . Moreover, in multinational organizations culturally different workforce has increased the importance of effective communication for successful business operations. Management training programs are organized globally to deal with the issues of workforce diversity. These cross cultural differences have changed the organizational culture. Management styles, communication systems and motivational strategies in the organizations are modified and transformed to ensure the success of organizations (Arseculeratne & Yazdanifard, 2013).

Business students and businesses should be aware of the numerous issues regarding the importance of cross-cultural communication in business productivity and goal achievement. Three of the issues or problems are workforce diversity, cultural impact on advertising and business negotiations. Different management styles of culturally different managers and employees are one of the major issues hindering the productivity and business goals of businesses. It enhances the likelihood of miscommunication, misrepresentation and misunderstanding between the managers and employees. This miscommunication because of different national cultures and ethnic backgrounds affect the operations and productivity of the businesses. Increased emphasis on workforce diversity has made the communication system from culturally different people highly difficult (Okoro, 2013). Another issue rose by culture difference is marketing and advertising of business products and services. Culture differences affect the effectiveness of advertising messages in business environment. Different languages, different buying habits, and consumption styles of consumers from different cultures influence the marketing decisions and business decision of organizations. Moreover, market entering strategies of business are also affected by the purchase behaviors and consumptions styles of target market (Guang & Trotter, 2012). Cultural differences at organizational level affect the business negotiations, partnership agreements and strategic alliances in the global economy. In process of business negotiations, different cultures, different regions and different ethnic backgrounds largely influence the business transactions and partnership agreements. Mishandling of cultural issue and cultural insensitivity would lead to deadlock in negotiation process. In a negotiation process, representatives of high-context culture and low context culture would hamper the harmony of business transactions (Mengyu & Li, 2013).

Businesses can apply a range of strategies or approaches to overcome cross-cultural communication problems. Three strategies required by the organizations to handle these cultural problems in business environment are training sessions, cross cultural programs and enculturation strategies to equip management with the proper understanding of cultural differences. In order to resolve the problem of workforce diversity and develop mutually beneficial relationship between the employees, organizations and management organize training sessions. These training sessions would help in enhancing the managerial proficiency and operational effectiveness of organizations. Training would help in enhancing the cultural sensitivity of managers which ensure the effective intercultural communication (Okoro, 2013). Intercultural programs organized by the management would help to overcome the cultural differences of workforce. Successful implementation of these strategies would help to develop strong competitive advantage (Okoro, 2012).

Cross-Cultural Communication
Cross-Cultural Communication

Understanding of cultural differences and incorporating these cultural aspects in the advertising messages would help in smoothing the process of business communication between customer and the company. Representation of cultural values and cultural norms in the marketing messages would boost the products sales of the company. Moreover training provided to marketing representatives would help in realizing the importance of cultural factors in their marketing campaigns. These systematic strategies to smooth-line the communication system between company and customer help in increasing the profitability of businesses (Guang & Trotter, 2012). To enhance the effectiveness of international negotiations, managers and business representatives should be properly prepared to adapt according to cultural diversity. Enculturation strategies in the management and business representatives would help to ensure the success of international negotiations in partnership agreements. International managers should be properly educated and furnished with proper knowledge and skills to handle the culturally complex situations in business negotiations (Okoro, 2013).

Cross-Cultural Communication Problems

Many businesses have been successful in dealing with cross-cultural communication problems, while others have not shared this success. Successful organization is Volvo Construction Equipment with its acquisition Samsung Heavy Industry’s division while the company which has completely failed in integrating two diverse cultures is BenQ, a Taiwanese company which acquired Siemens. Reasons behind the successful integration of cultural strategies at post acquisition level in Volvo Construction Equipment helps in ensuring the success of acquisitions. New human resource management policy was implemented which completely changed and modified the formal and informal structures of the combined organization. It provided equal opportunity for both companies culturally different to equally participate in workforce and devise organizational structure. Variety of in house training programs and career development programs has equipped the Korean employees of Samsung Heavy Industry with necessary skills and competencies. It helped them to progress in combined organization at higher levels in the hierarchy. Increased stress on the team work facilitated in integrating strengths, concepts and skills of two different cultures (Lee et al., 2014). International education programs at education level enhanced the cultural sensitivity and positive results of these programs exhibited that it enhanced the quality, experience and adaptability towards different cultures (Brydon & Liddell, 2012). BenQ failed to integrate two culturally different organizations because of inefficient allocation of time and resources for integrating and assimilating the culturally diverse organizations. Ineffective communication system, absence of clearly defined objectives and performance expectations lead to the failure BenQ after acquiring Siemens (Cheng & Seeger, 2012).

In conclusion, homogenization of markets, globalization of businesses and increased workforce diversity has augmented the importance of effective cross cultural communication in business world. Increased cultural integration has emerged the issues of workforce diversity in employees and cultural effect on advertising and negotiation processes. Different cultural norms, values and different ethnic backgrounds have increased the problems of miscommunication, misrepresentation and misunderstandings. It affects the profitability, productivity and operational effectiveness of the businesses. These problems of cultural miscommunication could be handled by training programs, cross cultural education programs and introduction of enculturation strategies in the corporate environment. It would help in understanding and realizing the importance of cultural differences to ensure the success of advertising messages, business negotiations and business transactions. Volvo Construction Equipment successfully integrated the culturally different organizations by introducing new human resource management policies. While in comparison BenQ failed to integrate two culturally different organizations because of inefficient allocation of time and resources for integrating and assimilating the culturally diverse organizations. In my opinion, development in international business and global trade importance of cross cultural communication has increased. To fully capitalize on the benefits of international markets and diverse workforce, business organizations need to devise comprehensive strategies of cultural education. Cultural educations programs, in-house trainings would enhance the cultural adaptability of employees and ensure the integration of culturally different organizations in mergers and acquisitions.


Arseculeratne, D. & Yazdanifard, R., 2013. Barriers to Cross Cultural Communication and the steps needed to be taken for a MNC to Succeed in the Global Market.

Brydon, K. & Liddell, M., 2012. Supporting international students undertaking Australian university studies. Social Work Education , 31(8), pp.995-1011.

Cheng, S.S. & Seeger, M.W., 2012. Cultural Differences and Communication Issues in International Mergers and Acquisitions: A Case Study of BenQ Debacle. International Journal of Business & Social Science, 3(3), pp.116-27.

Guang, T. & Trotter, D., 2012. Key issues in cross-cultural business communication: Anthropological approaches to international business. African Journal of Business Management , 6(22), pp. 6456-6464.

Lee, S.-J., Kim, J. & Park, B.I., 2014. Culture clashes in cross-border mergers and acquisitions: A case study of Sweden’s Volvo and South Korea’s Samsung. International Business Review.

Mengyu, P. & Li, C., 2013. Research on the Effects of Culture Differences on Business Communication Between China and U.S.- ACase Study of Cross-cultural Management of Joint Venture Enterprise in China. Universal Journal of Management and Social Sciences, 3(9), pp.45-50.

Okoro, E., 2012. Cross-cultural etiquette and communication in global business: Toward a strategic framework for managing corporate expansion. International Journal of Business and Management , 7(16), pp.130-38.

Okoro, E., 2013. International Organizations and Operations: An Analysis of Cross-Cultural Communication Effectiveness and Management Orientation. Journal of Business & Management (COES&RJ-JBM), 1(1).

Peleckis, K., 2013. International Business Negotiations: Culture, Dimensions, Context. International Journal of Business, Humanities and Technology, Lituânia.

Tian, K. & Borges, L., 2011. Cross-cultural issues in marketing communications: An anthropological perspective of international business. International Journal of China Marketing, 2(1), pp.110-26.

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Multicultural Diversity

Effects of Multicultural Diversity Organizational Processes

Managing a multinational corporation requires one to understand different cultures that comprise the subordinate staff. This is because different cultural backgrounds promote different social communication skills that define personal relationship amongst members of a certain workgroup. Thus, Members in a heterogeneous group consisting of employees sourced from different cultural backgrounds have the ability to generate diverse ideas that can help streamline organizational strategies. This benefits the organization by improving and enhancing communication links within organizations. Information is thus shared freely amongst the subordinate staff of the organization. Predominantly male or female oriented workgroups suffer from intra-gender conflicts as competition for supremacy in the group disrupts communications within the entire organization. This because power and role struggles dominates relationships between employees as they seek favors from their senior managers hoping to be rewarded with promotions or pay rises. This presents barriers to effective communication hindering the flow of the necessary organization processes pivotal to the business as a separate entity.

According to Hofstede, a manager in charge of such an organization should strive to understand how the subordinates relate to each other culturally before grouping them together to perform a certain task. In addition, it is important for a manager to understand how cultural beliefs affect employee’s judgment towards organizational issues to align the organization goals focused on meeting their personal needs. Thus, the paper will focus on how multicultural diversity affects organizational processes in a Multinational Corporation such as Euro Disney Land.

Multicultural diversity is appreciating and accepting the existence of multiple cultures as related to the demographic make-up of a certain group of individuals. It affects relationships within a group depending on the level of acceptance of different cultures comprising the group. In an organization, it describes the demographic make-up at the organizational level aimed at harnessing benefits of different cultures both from major and minority identity groups. Proponents for embracing multicultural diversity in an organization suggest that increasing the number of minority groups improves cohesion within the organization’s management structure. For example, increasing the number of women in an organization to match the number of the male counterparts, improves contact between them. This in turn it reduces the overlap between sex roles and work roles that hinder proper information flow within the organization’s structure. The overall organizational effectiveness is enhanced by increasing the role of traditionally underrepresented groups within an organization. Multicultural diversity influences both positively and negatively the overall organizational effectiveness of a multinational corporation.

Effects of Group Composition

Demographic diversity increases the pool of human resources that can assist an organization to achieve its set organizational goals and objectives. These may include styles, perspectives, insights related to solving complex organizations needs or problems. For centuries, women and people of color have suffered immense discrimination both at social gatherings and at work places (House, Hanges, Ruiz-Quintanilla, Dorfman, & Javidan, 2010). The cultural perspectives and styles of these marginalized groups are valuable assets that managers of organizations can exploit to improve the overall organization effectiveness other than relying solely on the role played by the majority groups.

In essence, multicultural diversity in managerial ranks of an organization serves the needs of an organization better as compared to reliance on dominant cultures only. Proponents for multicultural diversity further argue that cultural values dominant among black people such as forthrightness, assertiveness, verbal inventiveness, and good will can be beneficial in stimulating organizational interactions among the subordinate (Moon, March 1997). This is a positive representation of how odd deficiencies in a race can contribute to the overall integration of organizational values along ethnic lines. It is important to remember how each race contributes positively towards organizational effectiveness to meet the needs of each employee successfully. It is important for a manager to understand how cultural beliefs affect employee’s judgment towards organizational issues to align the organization goals focused on meeting their personal needs.

Employees feel confident and secure in their jobs whenever they see efforts being made to allow cultural integration within the organization. For example, being a manager of an organization located in the Middle East requires one to embrace the Muslim culture such allowing women to wear veils in the office. This may seem odd in western countries but in culturally controlled civilization such as the Middle East, they demand respect for their culture. Therefore, the manager has no option but to be flexible enough to meet employee’s personal satisfaction in their work. Members in a heterogeneous group consisting of employees sourced from different cultural backgrounds have the ability to generate diverse ideas that can help streamline organizational strategies (Cox, 1994). This in turn provides an opportunity for the manager to improve on the quality of decisions made by incorporating ideas sourced from different employees. In a study carried out at on May 3, 2008, mixed-sex groups performed better in organization processes than single-sex groups. This was an indication of how useful multicultural diversity is towards mobilizing human resources to achieve set organizational goals.

Diversity and Workgroup Functioning

Even though increasing the number of traditionally underrepresented groups yield more success to the organization, it does require power relations balance between the dominant and subdominant groups in the company. On gender representation, empirical values favor men more than women skewing the trend towards male dominated leadership. Some cultures prohibit women from desiring to compete equally to men for leadership but should rather concentrate on family matters (Kundu, July – December 2001). This favors men over women increasing the gender disparity in Multinational Corporation to less than 30% of the total number of employees. Allowing employees to express their individual perspectives at the place of work may fetch in both rewards and disaster for the organization. First, benefits because the organization has a large pool of human resources committed to meet the set organizational goals and objectives. On the contrary, they may express their newfound freedom to indulge even in matters not concerning them.

Diversity Perspective

Integration and Learning

In a heterogeneous group, decision-making takes long as everyone’s opinion must be put into account complicating the organizational process that is simple when attempted by a homogeneous group. Thus, the manager should play the role of integrating cultural diversity in a workgroup to ensure all the functions of the organization are in harmony with the subordinate’s views (Cox, 1994). Training programs offer employees a chance to understand the role they play in an organization minimizing conflicts commonly associated with managing a heterogeneous group.

Access and Legitimacy

Unlocking the potential of a business or an organization requires communicating the organizational goals to all the members of the subordinate. Therefore, managing an international corporation requires giving every subordinate access to the information more so that relating to their field of operation (Cox, 1994). To control information shared within an organizational process; employees can be issued with different access codes limiting the information they retrieve.

Diversity Climate Factors

In a group, personal affiliations with people of different cultures affect the overall organizational behavior in a multinational corporation. Therefore, a manager in charge of such an organization should strive to understand how the subordinates relate to each other culturally before grouping them together to perform a certain task. This because employees define their values and principles based on their group affiliations. Most employees feel confident to work when coupled with subordinates they share a cultural background with since personal affiliations boost their self-esteem. Being a member of a certain tribe or race attracts several stereotypes that may irritate the subject of ridicule. For instance, a Black American would feel uncomfortable working with a white colleague because of the dark past between the two races (Kundu, July – December 2001). Muslims are falsely mistaken to be terrorists just because of their choice of religion. Other races seem to view them with suspicion thus weakening trust among subordinates. This eventually affects the overall performance of the group and may stall organizational processes due to differences in personal beliefs and affiliation.

Therefore, to rally such a group requires first understanding their personal relations in order maximize their output by utilizing their individual relationships. Personal affiliations are a key source of motivation that is cost-free to the organization. In this, the manager needs only to group the subordinates according to their personal affiliations to trigger personal motivation amongst the employees as they seek to impress their colleagues.

According to a research carried out by Ijzendoorn, a Dutch researcher in 2005 revealed that some persons affiliated to certain cultural groups suffer discrimination and prejudice for simply being members of the minority group. Authoritarian personalities present in dominant races seem less tolerant towards subordinates who are members of underrepresented minority groups (Guidroz, Kotrba, & Denison, 2009). This causes tension between how the two groups relate towards the chain of authority in an organization. For instance, the three major sources of prejudice namely communication proficiency, physical attractiveness, and legal issues such immigration affect relations among individuals in a multicultural group created to achieve a certain objective.

Irrespective of an employee’s educational status and academic achievements, physical attractiveness rooted in their DNA plays a major role when a manager is choosing the subordinates to work with. In addition, their communication attitude attributed to their upbringing and cultural backgrounds determines how an employee responds to others working in the same unit or group (Rao, 2006). In the current business world, English language is a prerequisite for every employee seeking to work for a multinational corporation. Thus, if someone is not proficient enough in the language they are viewed as not intelligent enough.


In an organization, the root cause of power struggles is because of stereotyping among the subordinates. For example, hiring a woman as the senior manager in organization causes a status of rebellion among male compatriots. This role-playing struggle affects the flow of information throughout the organization’s management structure. Those against the proposed power-sharing status in the organization present hurdles aimed at discouraging all her managerial efforts and strategies.

Stereotypes that exist within a working organization may affect the establishment of productive relationships across the subordinate staff as people relate to different cultural identities differently. If the divide is too wide between the two groups involved in the power struggle, the manager should intervene to arrest the situation before it evolves into a managerial crisis that may halt vital organizational process (Appelbaum, 2002). Personal relationships among employees working for an international corporation determine the level of trust bonding them together to achieve the set goals and objectives efficiently.

Informal Integration

In an organization, informal groups define themselves along factors such as common language, ethnocentrism, and social similarities among the subordinates. These social networks play a very vital role in enabling efficient communications within an international corporation. Differences in races and cultural backgrounds determine the dominant social networking skills possessed by different employees (Ely & Thomas, June, 2001). Therefore, the senior manager of a Multinational Corporation should be accommodative enough to understand how well to communicate to each group of employees formed along certain social networking skills. People prefer to associate themselves more with those who share a common cultural background, as they feel closer to them due the common features they share culturally.

Multicultural Diversity and Management

The basic attitudes and values shared by individuals of a certain cultural group affect their response to managerial attitudes and ideologies. Moreover, since culture affects how people think and act, it can affect positively or negatively government-business relations (Lott, 2010). In some cultures or societies, a few top managers are charged with the responsibility of making important decisions related to the organizations they lead in complete disregard of the opinions expressed by the subordinate.

In a country such as Japan, employees relate more close to an organization’s management as compared to their American counterparts who do not care about the welfare of the organization they are working as long as they get their pay. This shows that if one has to manage an organization that is based in these two countries, they must be ready to vary their managerial strategies to suit the two situations (Lott, 2010). In communist and socialist economies, cooperation is encouraged among people while in Capitalist economies competition is seen as the only way to achieve success. Therefore, the type of eco-cultural ideologies embraced by a society determines the type of organizational strategies used to implement the company’s missions on a foreign territory.

Diversity Management

According to Hofstede, being the senior major of a multinational corporation requires understanding the different cultural divides that exist in a common work group. This is because an international corporation does business in different countries sourcing their human resource from the native population. This brings in the factor of cultural disparities as people relate differently to foreign authority. In some case, an international corporation doing business in a foreign territory may be seen as an extension of neo-colonialism especially in communist and nationalist societies. This presents barriers to effective communication hindering the flow of the necessary organization processes pivotal to the business as a separate entity (Bhattacharyya, 2010). A variety of opinions generated by cultural differences assist to improve the quality of decisions made as well as the emergence of unique behavioral styles of leadership. For decades, gender disparity affects the communication behaviors exhibited by individuals within a workgroup as they relate uniquely to each other based on their different cultural affiliation. Thus, it is crucial for a manager to create and develop workgroups that reflect gender balance based on cultural motivation to self-motivate the subordinates to remain loyal to their duties and responsibilities.

Multicultural Diversity
Multicultural Diversity

Predominantly male or female oriented workgroups suffer from intra-gender conflicts as competition for supremacy in the group disrupts communications within the entire organization. In male dominated, money and power are the main causes of conflict as each member of the group wants to be regarded as the most influential due to the great power and respect they command in the entire organization. Chauvinistic male senior managers tend to prey on women for sexual favors in exchange for work-related appointments that promise money and power to women victims (Kochan, Bezrukova, Ely, & Jackson, November, 2002). This stems from the way culture has conditioned men that a woman is barely a sexual object that can be bought at a cost. Due to the harsh economic conditions being experienced worldwide, women tend to give in to these temptations to gain financially even though they have to compromise their morals upheld by their cultures.

Influence on Group process and Group Outcomes

Positive communications links bonding the members of a workgroup together help to reduce conflicts as well as improve cooperation among the group members. Efficient problem-solving strategies coupled with concise communications links improve the overall performance of the workgroup. For a group of subordinates to achieve success in completing a task delegated to them by the senior manager, they must be willing to communicate ideas, collaborate as well as compromise their views and opinions to increase the overall performance of the group (Guidroz, Kotrba, & Denison, 2009). Therefore, the senior manager should give the group the freedom to be creative by allowing them to utilize their cultural affiliations to improve their daily outcome delivery frequency. Thus, effective communication skills sourced from employees sharing different cultural backgrounds reduce the degree of organization conflicts as well as establish positive influence on the overall workgroup outcomes.

Cultural and Gender Diversity and Group Outcomes

Multicultural diversity increases a groups critical thinking base as personal relations amongst the members of the group generate alternative viewpoints to an issue requiring consultations before a decision is made about the overall group process. This redefines the clarity of decisions of individual workgroups in an organization improving the overall organizational outcomes. If cultural diversities within an organization promote negative effects such as racism, tribalism, gender disparity and discrimination, then the ripple effect will cause a negative process outcome affecting other group processes such as communication (Bhattacharyya, 2010). Thus, the manager of such an organization should try to attain equitable balance between the effects of culture and gender diversity in order to focus the energy and resources of the entire workgroup towards achieving set goals and objectives. It is hard but with proper training and experience one can absorb cultural differences prominent in a group and promote unity and accountability within the organization.

Even though gender equity promotes balance and cohesion within a workgroup, empirical figures fail to support this phenomenon in a normal working place as men usually outweigh the number of female colleagues by far. This is because most cultures do not allow women to pursue their careers reducing their chances of entering the corporate level of business management (Ely & Thomas, October 2000). For instance, in countries such as Germany, France, UK, U.S, and Eastern European countries, good governance and leadership is viewed as the central keys pillars that support democracy and fairness within an organization. In an organization, the founders tend to determine the behavior of their subordinate leaders by ensuring they use management selection criterions that favor members of a certain culture as their preferred employees. Furthermore, the societal and cultural norms endorsed by the founders of an organization induce global leadership practices desired by the owners. In turn, the subordinate managers have the responsibility to enforce the norms throughout the organization.

Once the founders of the organization establish the initial organizational culture, subsequent leaders and their subordinates have a responsibility of upholding the practices irrespective of their cultural backgrounds. However, as the leadership of the organization is handed down to different generational leaders, dominant organizational cultures are usually altered to favor the dominant races or genders within the organization. This is usually unfair to the minority-underrepresented groups, as they have to tone down their cultural beliefs to accommodate the overall organizational cultural norms dominant in each workgroup they join (Moon, March 1997). Organizational contingencies force managers of international organization to adopt new leadership attributes aimed at fostering the desired communication behavior within the organization.

A Case Study on How Multicultural Diversity Affects International Corporations

Euro Disney Cultural Problems in France

According to Hofstede’s cultural dimension on power distance index, Euro Disney Park under the management of Ron miller failed to understand the acceptance levels of power and authority among the French population that they expected to be their customers. Since France has a high Power Distance Index of 69 out of 100 on Hofstede’s cultural dimensions, it therefore means that the French population is more assertive to infringement on their individual privacy by the government or any powerful institution such as Euro Disney S.C.A (Keegan & Green, 2002). It was a failure by the management of Euro Disney to start requiring French citizens working for them and those visiting the park to speak in English at all meetings inside the park.

Trompenaars’ Research on Organizational Culture

According to Hofstede’s cultural dimension on Uncertainty Avoidance Index, France has a high score of 86/100. This means that the French population was not tolerant to trends of uncertainty and ambiguity that Euro Disney management were trying to introduce to the rigid French culture.  Euro Disney management disregard for the French culture was the beginning of the company’s problems in its operations in France. In addition, they required all the employees working for them to maintain a strict Disney’s appearance code for members of staff. This appearance code for members of staff required every one working at Euro Disney to use no make-up, facial hair, tattoos nor any type of jewelry while working for the company.

Trompenaars’ research on organizational culture helps to explain the cultural differences between the United States and France by highlighting how the management of Euro Disney developed a pattern of assumptions that eventually led to its slow growth in Paris France. The Managers at Euro Disney made so many assumptions about how they expected the French population to accept their American culture. What they failed to understand is that the French citizens loved their personal space and individual rights protected by the French law and any attempt to infringe on was met with numerous lawsuits that destabilized the operations of the company (Keegan & Green, 2002). The most appropriate way that the company would have to gain popularity between the French population, would have been to embrace the French language and culture as proposed to them by the French government. This would have attracted even those natives of France who did not speak English fluently as they would be allowed to converse in French whist in the park.

Mistakes That the Company Made In Managing Euro Disneyland

The three major mistakes that the company made in managing Euro Disneyland are as follows. The first major mistake that the company made when they set ground in France was requiring English to be spoken at all meetings inside the park. Many throughout France criticized this ignorant stand on language (Goodman, 1999). One very vocal journalist wrote in a French paper Le Figaro that he wished with all his heart that the rebels would set Euro Disneyland on fire for the lack of respect for the indigenous French culture. Many protesters viewed this restriction on language use in the park as new age colonialism. It was not fair for the managing director of Euro Disneyland to restrict speaking in French in the park since it is the national language of France and his target market is the French population (Ely & Thomas, June, 2001). Some people refused to visit the park not because they were not interested but it was because they considered language restrictions in the park as a form of cultural imperialism that the Americans were trying to introduce to France.

Therefore, the company failed to attract the population it was targeting to capitalize on leading to the company making huge losses within its first year in operation. The second mistake that the company made was imposing dressing code regulations to all its employees. This regulation required all the employees of the company to limit their use of make-up, facial hair, tattoos and jewelry. The company did not take a proper dress code survey before they imposed this regulation (Keegan & Green, 2002). This is because if they did they would have learnt of the rich fashion culture that blooms in France and by imposing this regulation; they were insulting the fashion culture in France as a national heritage. The third major mistake that the company made in its operations in France was that they created small pathways like those in their main branch in California.


In summary, multicultural diversity affects the overall organizational culture that is dominant within workgroups comprising the organizational process. In addition, gender equity a key component of cultural relativity at work reduces conflicts within an organization improving the effectiveness of each organization process. In addition, personal affiliations with people of different cultures affect both positively and negatively the overall organizational behavior in a multinational corporation. Therefore, a manager in charge of such an organization should strive to understand how the subordinates relate to each other culturally before grouping them together to perform a certain task. Lastly, members in a heterogeneous group consisting of employees sourced from different cultural backgrounds have the ability to generate diverse ideas that can help streamline organizational strategies. This in turn provides an opportunity for the manager to improve on the quality of decisions made by incorporating ideas sourced from different employees.


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International Intercultural

International Intercultural Management

The intercultural dinner is an interesting concept which helps gain insights into the various aspects of a culture. It is important to understand food and life style as well as personality aspects in order to form a better understanding of the culture of a nation (Hamel, 2007). I met all of the group members for dinner and all of us brought a dish belonging to different cultures. I brought Hummus which is a popular dip made from smashed chickpeas and tahini with other seasonings. China and Saudi Arabia were other two predominant cultures which were presented at the dinner. The learning and outcomes of this dinner was that culture is an extremely important aspect which impact management as well. As we discussed cultures, we were able to understand how history, lifestyle and exposure to globalization impacts them.

Culture of Iraq

Iraq is located in the Middle East Asia. Iraq is predominantly an Islamic country (A Country Study: Iraq, 2010). This makes it important to understand the laws of Islam and the preaching’s of Quran or Prophet Mohammad (Abdul-Jabar, 2002). Prophet Mohammed has been a very popular Prophet not only among the Muslims or the followers of Islam but also among several religion researchers, philosophers, diplomats and other people. Their culture and thought on food is that food is a blessing given by God. They believe in rich food which is enriched with nutrients and contains fruits, nuts and even meat. The teachings of Prophet led to his popularity growing from time to time and there are nations like Arabia, Pakistan and India where Islam is popularly preached and forms one of the main religions (Abdul-Jabar, 2002). Prophet Mohammed is as popular as Jesus Christ in America and United Kingdom. Similarly the food and cuisine of Iraq is also popular all around India, Pakistan, Arabia and other Eastern countries. Though the economy of Iraq is not very stable, it has a very rich culture (A Country Study: Iraq, 2010).

The revelations of God, received by Prophet Mohammad included the will of God and the principle of submission to God’s will (Musharraf, 2012). Prophet Mohammad narrated these principles to the people. The revelations of God include the Apostle of Peace which propagates love and brotherhood (Abdul-Jabar, 2002). So the people of Iraq believe in being good hosts and serving food generously to people that visit them. This is also an important part of celebrations of festivals like Id and Bakrid. Considerations of prestige and family strength are important values of the culture of Iraq (A Country Study: Iraq, 2010).

In Medina there were eight different tribes which had several conflicts among themselves. These led to them inviting Prophet Mohammed as a neutral negotiator and resolve these conflicts (Musharraf, 2012). So the  food habits and lifestyle varies significantly among different sub groups in Iraq itself (A Country Study: Iraq, 2010).

Iraq does not have political stability and such elements like instable political situation, poor economic conditions and war has led to deterioration of life and business, but their culture still remains extremely rich (A Country Study: Iraq, 2010). The texts of the “Quran” play an important role in formation of the texts of several other religions including Judaism (Abdul-Jabar, 2002). It has also greatly influenced middle-eastern ethics and common beliefs as it is one of the oldest religions practiced (Abdul-Jabar, 2002).

Comparison of culture of Iraq with China and Saudi Arabia

Culture refers to the values and lifestyle adapted by a society. The post-globalization era has been a time of merging of cultures and this leads to one culture impacting another and understanding these influences is extremely important in the present times as they impact the management of human resources in multi-national corporations (Dauber, 2012). Culture refers to the several lifestyle elements like food, dressing, sports, entertainment and several such factors along with the values like uncertainty tolerance or emotional involvement and independence, openness and several other faiths (Greenfeld, 2013). Culture is shaped through the interaction of people and their ideas as well as ideologies (Schein, 2004).

The comparison of cultures of these countries has been based on two models – one being Hofstede’s cultural framework and another being Hall’s cross cultural framework. These models help understand the similarities and differences between the cultures of Iraq, China and Saudi Arabia.

Hofstede’s cultural framework

The culture of Iraq does have several similarities with that of Saudi Arabia but is very distinct from that of China. Hofstede’s cultural framework helps evaluate cultures based on five cultural and behavioural parameters as explained below.

International Intercultural Management
International Intercultural Management

Fig 1: Comparison of culture of Iraq with the cultures of China and Saudi Arabia, based on Hofstede’s cultural framework

Power Distance

This refers to the extent of importance and influence of hierarchical relations in a culture. It reflects the degree of unequal allocation of power and psychological detachment that is accepted in a country. Power distance in China is high (National culture – Iraq, n.d.). Subordinate-superior relationship tends to be polarized and hierarchical ranks are followed strictly. Power distance is extremely high in Saudi Arabia and Iraq (National culture – Iraq, n.d.). Inherent inequalities, centralization of decision making and bureaucratic hierarchy marks the culture of Saudi Arabia and Iraq.

Uncertainty avoidance

Uncertainty avoidance refers to the risk appetite of the culture of a country. Hofstede refers this as “what is different, is dangerous” (Khastaret,, 2011). China is low on uncertainty avoidance (National culture – Iraq, n.d.). Adherence to laws and rules in China are flexible and adapted on situational basis (Country Profile: China, 2008). Iraq and Saudi Arabia are very high on uncertainty avoidance (National culture – Iraq, n.d.). The rules play an important role in all aspects of life. People of Iraq and Saudi Arabia are bound to abide by the stringent codes of belief based on Islamic preaching. They are intolerant of modernisation and influence of western cultures.

Individualism vs collectivism

This dimension reflects the relative importance that a company places on interests of an individual or a group (Ryh-Song and Lawrence, 1995). China, Iraq and Saudi Arabia are collectivistic society (National culture – Iraq, n.d.). Individualism is found to be very low because the cultures are relationship driven. In China relationship needs to develop before doing business (Hatch, 1993). The traditional root of Chinese culture is Confucianism. Confucianism focuses on long term orientation, thrift and perseverance (Ryh-Song and Lawrence, 1995).

Masculinity vs femininity

This dimension reflects the importance of the level of dominance of masculine values for achievement of the organizational goals. Chinese, Iraq and Saudi Arabia cultures have more of Masculinity aspects than femininity (National culture – Iraq, n.d.). Chinese often prioritise work over family and leisure (Country Profile: China 2008). In Iraq and Saudi Arabia, the leaders in the organisation are decisive and assertive. Conflicts are often resolved by confrontation.

Long term orientation

The Chinese culture has a high long term orientation and Iraq and Saudi has a short term orientation (National culture – Iraq, n.d.). The Chinese are comparatively more employer oriented and the employee retention rate in China is higher in comparison to other countries (Bu and Xu, 2000). Cultures of Iraq and Saudi Arabia immensely respect and follow traditions. Propensity to save is low as Shariah law and Islamic banking does not encourage savings (Aggarwal and Tarik, 2000).

Hall’s Cross Cultural Model

Hall presents a popular cross cultural framework and when we apply that to these 3 cultures, they have been found to be extremely compatible. The Hall’s model is based on cultural awareness, cultural adaptation and effective management of the elements of personal, social and cultural aspects in present times of multiculturalism (Schneider and Barsoux, 2003).

Cultural Awareness

Awareness is high in Iraq and Saudi Arabia when compared to China. But in present times technology enables people everywhere to find information easily.

Cultural Adaptation

The model explains that multiculturalism is an important element of present times and seamless communication and technology promote it and the same can be observed in various cultural texts as well and in present times of globalization (Schneider and Barsoux, 2003). The adaptation of these elements is based on cultural adaptation, which is high in China as compared to Iraq and Saudi Arabia.

Management of Cross Cultures

This can help create effectiveness and better competency (Schneider and Barsoux, 2003). It can help bring teams together and also create an environment that is suitable for work and helps create several competencies. It also helps ensure that there be effective balance between operational and strategic level planning and organizing.

Comparison of leadership styles in these countries

Leadership behaviour in organizations is demonstrated through taking initiatives, considering broader roles and helping the organization achieve better progress through focus on improving the overall organizational performance (Pillai,, 1999). This is evident in China when compared to that of Iraq and Saudi Arabia.

Leadership in Iraq and Saudi Arabia

In case of Iraq and Saudi Arabia, senior levels of management focus on overall performance of the organization and its competitive position. In order to create effective business development, leaders focus on operational efficiency as a whole and deal with managers who actually communicate with the team members. Leaders at the senior management levels set goals and targets which help in ensuring that the organization is able to form the common vision (Hofstede,, 2002).

Authoritative style of leadership is focused on the creation of authority. The leader is mostly expressing the authority and passing the judgment during using such style leadership. The management communication follows a top down approach (Zaharna, 1995). This is evident in the day to day organizational activities in several of the local organizations. This is evident in Iraq and Saudi Arabia where in the rules and regulations are extremely strict and stringent. It is important that the authoritative style of leadership be based on mutual understanding and acceptance in order to avoid conflicts and retaliation (Smith,, 2007).

In case of Iraq and Saudi Arabia, religion and political systems have a great impact on the leadership style used in these countries (Smith,, 2007). It forms an essential impact on the styles in which the government and the public sector is managed. It also impacts the various business ideologies and set of ethics followed in these organizations (Smith,, 2007).

The culture of Saudi Arabia and Iraq is based on  the preaching of Prophet Mohammed. In discussing the leadership style of Saudi Arabia, it would be relevant to evaluate the leadership style of Prophet Muhammad. Prophet Muhammad can be considered as a transformational leader (Musharraf, 2012). His teachings and public speeches have inspired thousands of people to do things for greater good of mankind (Musharraf, 2012).

Intellectual Stimulation: Prophet Muhammad not only inspired them for good deed and good thought, he also made is followers aware of following the right path. He increases awareness about what is right and good.

Individualized Consideration: the followers of Prophet Muhammad were trained by Prophet himself (Musharraf, 2012). He guided them to become leaders in their own ways.

Inspirational Motivation: He motivated his followers to spread Islam fearlessly.

Charisma or idealized influence: Prophet Muhammad can be considered an ethical charismatic leader. He had a unique vision for his followers and a long run perspective. His high ethical and moral values, forgiving nature and optimism for future showed direction to the followers (Musharraf, 2012).

Leadership in China

A futuristic measure is ensured in case of leadership in China. It assists the organization to take futuristic decisions and helps in implementation of the firms’ long term plans or strategies (Management in the People’s Republic of China in comparison with the West: Convergence, divergence or crossvergence?, 1997). Mostly, all organizations follow some core values according to their business strategies to serve the customers with better products and services  (Hirst & Thompson, 1996). The mission and vision creates an alignment with the strategic planning of the organization. These values impact the leadership as the leaders of the organization or the top management form these and ensure that they are effectively passed on to the subordinates (Management in the People’s Republic of China in comparison with the West: Convergence, divergence or crossvergence?, 1997). But this is not the case in present day multinational organizations as they belong to globalized environments. In this way the leadership styles used in organizations in China are compatible with the trends in leadership in several of the globalized countries and this helps them take benefit or advantage of globalization to propagate economic development. Leadership in China has been considered as effective and has been used to benchmark leadership strategies in several of the multinational firms all around the world (Management in the People’s Republic of China in comparison with the West: Convergence, divergence or convergence? 1997).

Future Trends

Transformational leaders are those who influence others based on the usage of participation with all of the other members of the team. In this way they are able to accept the leader as a part of the team (Wade, 2013). This form of leadership is coming up rapidly in all of the countries including Iraq, Saudi Arabia and China. In case of democratic leadership, it is crucial that there be consideration of opinions of everybody. A leader requires ensuring that things are understood by the people who are to actually implement them. He should be very careful about the client requirements as well as the need of the project (Wade, 2013). This is not consistent with the cultures of all the three countries and may not be adopted in the near future.


To conclude, culture forms an extremely important part of all nations and the global culture as well   (Albala, Ken, 2011). Culture is an extremely important factor that affects the business environment of an international business. It is important for present day organizations, especially multinational organizations to reform their policies in order to suit the present day need of these organizations. It is important that the business environment is well researched and cultural change adaptation strategies are formed for the purpose of creating better synchronization with the cultural changes. It is extremely important that there be effective balance among the culture and the dynamic environment around the world in the present times of globalization. It is also important that the focus on the required changes in organizational environments be made slow and steady in order to ensure smooth transitions.


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Organizational Structure

Organizational Structure and Behavior

The fundamental intention of the study is to focus on the behavior of individuals and groups and how it affects the organizations. This study helps one to survey the links and relationship between the culture and constitution of organizations and how both the factors manipulate the behavior of workforce within the organizations. The impact of culture and structure can be measure with the ways and regularities being applied in organizations. These values basically conclude the functional prototype of behavior of organizations personnel. The structure and culture which are being applied within the organization structure are important aspects which stimulate the workforce at all echelon of the organization.

Understand the relationship between organizational structure and culture

The organizations are basically developed up on the base of communication and culture of any organization is a communicatively accomplished part of the organization which saturates it. According to Anne Maydan Nicotera (2003, p.1) the “organizing is a communication process” and an organization is an entity which is basically embedded in cultures. The relationship between culture and organizational structure is a vast and comprehensive dilemma to discuss because the organizational members create and recreate the organization cultures and organizational structure entities are embedded in this cultural environment. In other words it can be said that members of an organization is a culture part of the organization and this organization is a cultural part of society.

Culture is basically the combination of disciplines, norms, values, customs, beliefs, attitudes, practices, and several other aspects. These factors are not culture itself but culture underlies them in it (Marcia J, 2003, p.2). Culture is a conferred set of communal emblematic systems those direct individuals’ behaviors and incline them to play a role as an assemblage (Chen and Starosta, 1998).

Compare and contrast different organizational structures and culture

Organizational structures

The “organizational structure identifies the responsibilities for each position and relationship among these positions”. A firm basically establishes a structure which determines the job and responsibilities of each individual within the organization under the supervision of someone above all of them who monitors and guides them to perform their job efficiently. In some organizations where the jobs and responsibilities are not supervised by some other position the workforces are not contributed to the production of organization due to not getting proper guidance about their responsibilities towards their organization. In other cases, where the positions are supervised by more than one person the chances of conflicts are much higher (Jeff Madura, 2007, pg. 277 to 278).

Types of organization and associated structures

Different organizations use different organizational structures. The organizational structure is particularly based on the nature and specification of business. Basically the following types of tools are used to build up the organizational structure.


Rob Dransfield (2004, p.74) stated that the organizations based on the functional structure basically apply the grouping of workers in order to bring the different individuals and groups of workers altogether so they can help and support each other’s in specific projects and jobs. In this structure the individuals and groups mutually share their expertise and ideas with each other so they can produce something innovative and progressive.


The product based organizational structure is completely the customer oriented structure. This structure is being organized in product line and each line reports to the CEO or an organization. And these product lines lend themselves in centralized and decentralized decision making process (Sandra M. Reed and Anne M. Bogardus, 2012, pg.77).

Geographically based

Geographically based organizational structure is basically the country based structure in which an organization widens its scope of business at international levels. The organization establishes its business in different countries or merged with other multinational organization globally. It often gets complicated if an organization has a large number or competitors. In other cases, the geographical based structure works successful where all the organizations are organized along product lines (Sharan Jagpal and Shireen Jagpal, 2008, pg. 552).   

Multi-functional and multi-divisional structures

Rob Dransfield (2004, pg. 76) demonstrated that some organizations basically use the formal organizational structure while in large firms the multidivisional and multifunctional organizational structures are being applied. To combine the different areas and expertise of organizations such types of structures are used.  

Span of control

Management is responsible for the organizational structure span of control. In span of control some individuals are being supervised by any individual manager. In large firms one manager supervise several employees while in small scale organizations, the numbers of employees are less. These spans are also called as narrow span of control and wide span of control (Jeff Madura, 2007, pg. 278).

Hierarchal levels

The organizational division is also an important factor of organizational structure. The organizations which apply the wide span of control use the flat organizational structure because it doesn’t have several layers to determine the workforce and its responsibilities while the other organizations which use narrow span of control have to adopt the tall organizational structures and cultures consisted of many layers (Mason Carpenter, Talya Bauer and Berrin Erdogan, v. 1.0).

Organizational charts

Sakthivel Murugan (2007) defines, “The organizational charts are the useful mean of providing the information about the organizational relationship”. Theses charts are also used as the tools of management controls. They graphically represent the managerial positions and interpretation between them. The charts are the blue print of organizational structure of an organization. There are several kinds of organizational charts, the vertical charts, horizontal chats, circular charts,

Matrix organization

Jeff Madura (2007, pg. 293) stated that organizations are often tackled with some specific conditions which demand some inputs from employees. In matrix organization structure, several parts of the organization interact on specific projects. These projects normally based on the short span of time so these individuals can perform their normal routine work under the supervision of same boss. The matrix organization is combination of product based and traditional functional structure (Carpenter et al, 2012).

Centralization and de-centralization

The centralization is an organizational structure which refers to the organization which is held under the authority of high leveled managers. The middle managers and supervisors monitor and control the day to day task of the organization and then reporting to the top managers. In this type of organizational structure, the middle managers are not liable and allowed to take decisions (Jeff Madura, 2007, pg. 288).

While in decentralization structure, the organizational structure functions are ruled under the supervision of several managerial and supervisions divisions. The self-government organization is the basic illustration of decentralization structure in which the managers and supervisors are responsible to make decisions where necessary (Dave Needham, 1999, pg. 232).

Internal and external network structures

The internal network structure consists of the information which is organized, processed, analyzed and reported to all levels of managerial position within an enterprise. Whilst the external organizational structure encompasses at international level as well as with the parent departments of an organization (F. L. Harrison and Dennis Lock, 2004, pg. 70).     

Flexible working

The flexible working organizational structure allows workforce and managerial positions to work in flexible and relaxant working environment within the organization. It helps to adopt and deal with the modern economical and financial business pressures. Every firm basically needs the functional, financial and numerical flexibility working structure (Rob Dransfield, 2004, p.85).

Organizational Structure
Organizational Structure

Organizational cultures

Culture is the way of life for individuals or particular group of society. It is consisted of norms, beliefs, customs and values for those specific social groups. People learn values from the environment where they live or work and this culture determines the way of life for these people. The behaviors and responses are being adopted by the environment. In an organization the culture is a personality of an organization. The way of working, rules, norms and values upon which the organization based and workforce is pressurized to act upon is the culture of an organization (Rob Dransfield, 2004, p.87). 

Classification of organizational culture

The organizational culture is further divided into different classes according to the culture and social styles. Following are the four main classifications of organizational culture.

Power culture

Power cultures can be illustrated as the spider web, which has a main central power point from which it influences and controls the workforce in outward direction from its center of power.

Role culture

Role culture is most identical culture class, which easily can be determined by the specific role or job rather than the performance of specific individuals or groups.

Task culture

In task culture, the management is basically responsible for all the problems and the solutions of an organization. The main concern is the job or project, not the individual because it is team working culture.

Personal culture

It is purely based on the individual’s performance and job. The talent, education, expertise and skills of an individual for his organization matter here.

Explain how the relationship between an organization’s structure and culture can impact on the performance of the business

Cultural norms and symbols

The cultural norms, beliefs and values are the ways and standards the organizational management or HRM settled up for all the levels of workforce. These values and norms basically motivate the workforce to perform best for their organization in order to make it well developed and progressed. The cultural norms are structured in decision making process according to internal, external behaviors and situations the organization has to deal with.

Development of organizational culture diagnosing behavioral problems

Psychology is the study of human behaviors and organizations take deep interest in studying the psychology because it helps them in seeking about the behaviors of their workforce and managerial positions. The main two concern often make organization complex in knowing ne is why people behave as they do and how can organization tend their workforce to behave as they want them to. The psychology basically helps organizations in behavioral problems and provides deep insight into different strategies such as absenteeism, group interaction, intelligence, stress management, resistance to change and levels of motivations.

Concepts, Principles, Perspectives and Methodology

Cognitive, behaviorist and psychoanalytical are three main approaches of psychology. These approaches assume different methods of researches according to the area of study for an organization. The qualitative, quantitative and action researches, survey and experimental design, psychological assessment, diaries, of an organization are some essential strategies of these concepts and approaches.


Perception is most identical organizational behavior because it is based on the judgments or decision making according to the given or immediate situations of an organization. The decisions are taken on these perceptions and misperception often leads towards the wrong and inappropriate decision making. Three main elements of a perception process are the perceived, the perceiver and the circumstances or situations. The understanding of individual’s perception of an organization is an essential part for the management. It helps in understanding that the perceptions of individuals are differ from each other so overcoming procedure must be vary from a person to person or specific groups.


Organizational structure conflicts cause several internal and external issues for organizations and also for individuals of that organization. Wrong assumptions, perceptions, negative attitudes, opinions, rumors, and several other reasons cause conflicts in an organization. The conflicts are not always negative; they might of productive or destructive nature. They often rise on introducing new working protocols and environments, repositioning of goals, and developing new organizational structure and strategies.

Discuss the factors which influence individual behavior at work

Individual behavior at work

Personality of a worker of an organization is the main factor of determining the individual behavior at work. A worker have two types of personality aspects, one is stable characteristic, while other is distinctive characteristic. The stable characteristic of an individuals’ personality always remains same all time while the distinctive characteristics make him identical among crowds. The traits and types of the worker’s personality depend on the current situations and circumstances in an organization. An individual’s behavior at work is purely based on his traits and types of personality.

Intelligence Significance and nature of individual differences

The intelligence is an entity which is still not defined in any universal term because of its unique diversity. Few groups suppose it as an intellectual power while others takes it as the sense of understanding the environment. However, intelligence plays a vital role in understanding and responding towards the society, people and work. While the personality of an individual worker predicts the success of that person and how he will be working with other workers in an organization. It is a combination of behaviors and mental characteristics of a person which depict the person’s altitude and aptitude. It also has an important impact on how people behave at work.


Attitudes are the likes and dislikes of an individual, we all have some specific attitudes towards our environment and society. Attitudes are basically developed according to the personal experiences and environmental or social effects. When a person get anything positive and good in an organizational environment, it seems he must have a positive attitude towards is work or organization while the person who always make issues and stay annoyed have a negative attitude towards his work and place.

Aptitude or ability

The aptitude or ability is the individual capability of a person to learn something positive from his surroundings. In an organization the employers take much interest in the aptitude or ability of worker rather than his attitude.

Understand different approaches to management and leadership

Different approaches to management and leadership

Michael Armstrong and Tina Stephens (2005, pg. 4) stated that the main purpose of the management and the leadership in an organization is to provide direction, arrange changes and attain results through the accurate, proper and responsible use of resources. The management process is divided into the different methods which are used in achieving the organizational structure objectives. The main processes of the management and leadership approaches are planning, motivating, organizing and controlling.

Mangers are always leaders, while leaders are not always managers” (Michael Armstrong and Tina Stephens, 2005, pg. 5). But there is a clear distinction between the management and leadership processes. Management basically concerned about the achievement of organizational objectives by using all the available resources, while leadership focus on one an ultimate resource which is the “people”. It is essential for the managers to be a good leader as well.

Compare the effectiveness of different leadership styles in different organizations

Talha Iqbal (2011) stated in his book “The impact of leadership styles on organizational effectiveness” that leadership is an important part of any organization, but often leaders get confused on initial stages about how to do leadership. However, leadership is itself a quite comprehensive approach which has divertive aspects according to all field of life. The leadership styles basically portray the impact and application of leadership process and its effects on an organizational structure. The main three styles of leadership are autocratic, participative, and free rein. In autocratic style of leadership, all the decisions are taken only by leaders while in participative style the leader makes decisions with team involvement. The free rein leadership style is completely different because in this style leader leave all the decision making processes on the team.

Explain how organizational structure theory underpins the practice of management

Development of management thought

Rob Dransfield (2004, pg. 174) stated that the main concern of the managers is to secure maximum profitability and prosperity of the organization and providing the job satisfaction to the employees. The empowerment of employees by giving them responsibility to manage them is being developed to lower down the organizational and managerial responsibility. This hierarchal top down management trend was used in twentieth century for scientific managers.

The scientific management and the classical administration are the hierarchal structure of an organization. Managerial positions are responsible in this organizational structure for specific group of employees while the bureaucracy is a hierarchical authority and goal oriented system of an organization.

Evaluate the different approaches to management used by different organizations

Human relations, systems and contingency approach

The human relation approach is however necessary to get positive and expected outcomes form workforces of an organization rather than just pressurizing them to produce. It is necessary to respect the human forces of an organization by giving them incentive to motivate them for their organizational progress. The system approach refers to the organizational structure systems which are specifically introduced for the wellness and betterment of workforce so they can return the positive production.

Andrew J. DuBrin (2011, pg. 27) demonstrated that the contingency approach basically attained when not any other approach or structure is being applied. In an organization, sometimes such situation occurs when HRM have to decide something on immediate basis according to the current circumstances, so the contingency approach thus applies.

Understand ways of using motivational theories in organizations

Motivation is basically related with the most important question, why people do what they do. Motivation is a key to understand the various types of organizational behaviors. What factors and strategies motivate the employees are some basic considerations an organization supposes first. The organizations with clear motivational protocols always generate the positive outcomes (Steve M. Jex, 2002, pg. 209).

Discuss the impact that different leadership styles may have on motivation in organizations in periods of change

John Darling and Anita Leffel (2010) stated that different leadership styles influences the organizational structure functions in various ways. The team leader affects the other team members through this decisions and practices to motivate and facilitate the competence in organization. The leadership styles adopted by the team members are based on the behaviors, thoughts, communication, and interaction of team members. Organizations get benefited from the well-established leadership styled system among team members and the leader. It inspires the collective and entrepreneurial spirit to the organizational team.

Compare the application of different motivational theories within the workplace

Motivation is a process to stimulate a person to perform his action or role in achieving the goal. Motivation has several kinds, thus the motivational theories are also diverse in numbers. The motivation is becoming more important in present era of competition at work place. The organizational management implies several motivation theories to stimulate themselves as well as to its employees. The scientific management was fir introduced by Fredrick W Taylor and known as the most important motivational theory for organizational structure development. He also introduced the Piece Rate motivational theory through which the employee gets salary according to the production average. This theory better stimulate the workforce to struggle more to increase the organizational productivity so they can get more salary (Friederike Hertel, 2003, pg. 3).

Evaluate the usefulness of a motivation theory for managers

(Dave Needham, 1999, pg. 263) As it is mentioned before that the managers are only concerned about the productivity and profitability of the organization by applying all the resources available, while leaders are responsible for the people of his team members not about the resources. The leadership is an important motivational theory for the managers to make them able to stimulate themselves for their organization. For progressed organization, the manager must be a good leader also. The scientific management is ne mot highlighted motivational theory which better stimulate the managers to boost up themselves and their personnel to struggle more for the profitability of an organization.

Understand mechanisms for developing effective teamwork in organizations

The system of developing the effective teamwork in an organization develops the respect, trust, and support to the leadership environment and thus improves the individually as well as collectively performance and attitudes for the organizational structure achievements by motivating the team members to perform at high levels.


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Business Strategy BT

Development Strategy for Business Resilience and Sustainability through an Incremental Strategy – A Study of British Telecom

This report discusses the comparative analysis of three strategies namely incremental, renovate and inventive within the context of the internal as well as the external environment of a company such as BT (British Telecommunications Limited) which is a multinational telecommunications services company headquartered in London. It also evaluates a change management programme that can bring about strategic change within this organisation. BT has a global services as well as a retail division. Its operations span 170 countries throughout the world.

Company’s Internal and External Environment and Its Strategy Type

In the current business scenario, intense competition, integration across global markets, changes in technology and the advancement of the telecommunications sector are some of the external factors that influence the change management program of BT. the Company’s managerial talent and the level of the motivation of its workforce are some of the internal factors influencing strategic management. In order to improve the effectiveness of the organisation, strategy is the key because it leverages the capabilities of the individuals and the institution in a cohesive manner. The ideal development strategy for a company like BT that seeks business resilience and sustainability throughout its line of operations is an incremental approach.

Strategic Capabilities

Incremental strategies are effective within the current dynamic environment. Regulatory convergence is a key factor in the selection of incremental strategy for handling change and sustaining profits. The challenges of global competition have to be seen within the broader regulatory framework for effective strategic management. The incremental approach to strategic management is in response to the complex and ever changing corporate environment. Consequently, the strategic process moved in an incremental manner adapting to changes in the internal and external environment of the company. Decisions will then be driven by multiple goals. BT has low levels of business resources with respect to its telecommunications services though it is steadily expanding in the field of broadband communications. BT has reported a fall in sales though it experienced a healthy profit in 2013. Moderate or high business resources imply greater strategic capabilities which enable the company to excel using innovation or denotative strategic management. Annual pre-tax profits of BT were up by more than 40% but sales fell by 4%.

Business Strategy BT Competitive Analysis

The major feature of the incremental strategy is that it is decentralised and it responds to dynamic environmental challenges. BT is facing a changing socioeconomic milieu wherein the incremental approach accounts for this variable. An incremental strategy enables the organisation to fulfil its mission by closing the divide between long as well as short term goals within a changing environment. Organisational design followed a contingency approach since landmark research was conducted by Emery and Trist (1965) as well as Lawrence and Lorsch (1967). When a company faces a challenging environment, incremental strategy is far better than inventive or renovate strategies on account of the challenging environment faced by the company. As a British MNC which has to face global competition, BT should opt for an incremental strategy to boost its prospects and sales.  The degree to which the environment of a company is globalised also influences its development strategy. Porter has proposed the five force model for analyses of competition presented below:

Porters 5 Force Model
Porters 5 Force Model

Figure 1: Porter’s 5 Force Model from Michael Porter, “Competitive Strategies”

Porter’s model elucidates how competition from different sources can create industry rivalry. Competitive analyses in the context of an incremental strategy is suitable for organisations such as BT which want to cope with competition from different sources, as discussed in Porter’s model.

Business Strategy BT Competitive Advantage

BT needs to consider the complete gamut of competitors through an incremental approach to change management. Porter (1980) has argued that organisations should consider the behaviour of firms that are producing same/similar products as well as the action of suppliers, competitors producing substitute products and the customers themselves. An incremental strategy enables companies such as BT to develop a holistic view of the market to promote business resilience and boost profits. Competitive advantage has been discussed through a model proposed by Porter discussed below:

Porters Generic Strategies Model
Porters Generic Strategies Model

Figure 2: Porter’s Generic Strategies Model (Porter, 1980)

Ansoff (1985) has discussed how companies should also develop the strategy keeping in mind the flow of critical resources for production. They should also consider how they will impact non-market actors. Nonmarket actors or strategic interest groups also have an important role to play in influencing the development strategy of a firm. BT should follow a cost leadership strategy for low cost rather than aiming for product uniqueness as there are many rivals offering advanced services in this sector.


The culture of an organisation also plays a key role in influencing the strategy it adopts. The company’s abilities revolve around the resource, skills and procedures as well as its competencies. Attitudes and other cognitive factors reflect an organisation’s culture. The work culture at BT is unique. It focuses on completion of projects and garnering of crucial contracts. The organisational culture of a company influences its success in current times. BT needs to follow an incremental strategy whereby it adapts to changing global and domestic environment so that it can keep up with its competitors. The choice of a strategic management approach is based on several critical considerations such as an organisation’s strategic capabilities, competitive analyses, competitive advantage and culture.

An organisation must have a strategy that can meet the challenges of its internal or external environment (Ashby, 1961). Therefore, an incremental strategy would be ideal for enhancing the sustainability of business practices and the resilience of British Telecom. Consider the personnel, structure, systems and financial resources to be important factors in any strategy for change management. An incremental strategy follows a contingency approach which is ideal for British Telecom.

The organisation’s culture as reflected by collective values, experiences and beliefs of its members also has a critical role to play in its success. An incremental strategy for development and change management incorporates this effectively, making it the viable and effective choice for BT which has skilled employees. An incremental strategy is ideal for bringing about small but important changes in the organisational functioning compared to inventive or renovate strategies which focus on large scale change.

In order to possess business resilience and sustainability in its operations, BT needs to follow an incremental strategy to bolster its current organisational culture. Companies need to be proactive to cope with changes such as economic slowdowns, increased global competition and massive amount of technological advancement. BT would do well to adopt an incremental, contingency oriented approach to strategic management to cope with this.

Critical Evaluation of the Incremental Strategy

Incremental strategy is ideal for British Telecom.  An incremental strategy enables the company to have flexibility in coping with uncertainties in the field of policy regulation and governance.


There is a need to bargain with stakeholders and integrate human and organisational capabilities to catapult the company to the path of success. Renovate and innovative strategies can only be effective in environments where there are less regulation uncertainties (Lindblom, 1979). Each of the different resources within a company plays a critical role in its success. Through an incremental approach, British Telecom can impact its employees in a positive way. By instilling coping skills and out of the box thinking to manage dynamic and changing situations, BT can boost its profits.

Employees also differ in terms of their personal knowledge, perception, limitations, and it is due to this inherent complexity that incremental strategy can be the perfect tool for change. Diversity is one of the chief features of the workforce at BT. Therefore; development strategies followed here should take advantage of this versatility. Incremental approaches to strategic management can accomplish this.  Top managers within the same company can approach the same problem with different solutions (Bower & Doz, 1979).


Operations system provides guidance regarding how work procedures must be carried on and provides the framework for performing the work People are the key resources of any company. They are the prime assets which spur the growth and development of the organisation. Operations are a key area where rapid changes have to be kept pace with. The internal as well as external stakeholders also play a central role in the company’s success (Lindblom, 1959; Mintzberg, 1919). Balancing the goals and interests of stakeholders is the key to organisational success (Ansoff, 1985). BT should adopt an incremental strategy to improve operations.


Financial resources are necessary to accomplish goals and provide rewards. Money is one of the primary motivators for obtaining optimal performance from employees in the work setting. Annual pre-tax profits were up 42% to £2.4bn, last year for BT while sales were down 4%. An incremental strategy is ideal for a company such as BT which has ample financial resources.


Technology sets the stage for the company to maximise its capabilities if it keeps pace with it. Effective utilisation of resources is a must if a company has to progress and make healthy profits. An organisation’s culture is maintained and transmitted by its workers. Leaders of internal stakeholder groups are the key assets to instil positive change within an organisation. For companies such as BT that are facing moderate to heavy environmental turbulence, an incremental strategy for strategic management is needed (Mintzberg, 1973).

Several comprehensive reviews have been conducted by leading researchers in the field of strategic management (Hofer, 1976; Vancil, 1976; Armstrong, 1982). Research has found that degree of formality centralisation, hierarchical structure and comprehensiveness of any company is influenced by its environment, and complexity (Armstong, 1982, Hofer, 1976). In current scenario, an incremental strategy is optimal for BT.

Change Management Programme

A change management programme for British Telecom must incorporate an incremental approach. This is because its external and internal environment is more suited to an approach that makes allowances for sudden and rapid changes. Whether it is people, financial aspects, technological advancements or  organisational culture, all aspects of an organisation’s functioning need to be taken into account for effective change management. A conventional approach towards change management will not be successful. In 1995, John Kotter published his landmark paper “Leading Change: Why Transformation Efforts Fail”. This paper cited how only 30% of change programs are successful.

The biggest advantages of a change management programme for British Telecom through an incremental strategy is that it will make allowances for the rapid changes in technology and competition that are taking place in the Indian telecommunications sector. Colin Price and Emily Lawson (2003) suggested that the conditions which must be met for employees within an organisation to embrace change include their agreement to the change, effective role modelling for inculcation of change oriented behaviours, and reinforcement systems that encourage the behaviour and the skills required for change. The structures, systems, processes and incentives within a change management program should be conducive towards a positive transformation of the company into a reliable and sustainable business.

An incremental approach to strategic management can bring about this transformation for British Telecom. But change management processes should have an appeal for employees. Businesses that want to do more than survive have to remodel themselves to match up to competitors. Change management programmes have incorporated various methods such as total quality management, rightsizing, restructuring, cultural change and turnarounds in a bid to improve their profit margins. British Telecom needs to follow a change programme that pursues innovation in a way that is flexible and keeps in line with the incremental strategy of adapting to changes. Too many companies fail to progress beyond a certain point when it comes to garnering market share because they do not anticipate change due to factors such as advances in technology and industrial competition. Even a change management programme based on the incremental approach can have a few pitfalls though. Anticipating change is not easy. Many times, market analysts may be predicting a trend which is short-lived. Kotter’s 10 year study of more than 100 companies found unsuccessful change management programmes failed to generate the urgency or formulate a vision that could be communicated well to bring about a complete transition.

Companies need to be practical and realistic in their aspirations. Only then can change management programmes succeed in a complete sense. Obstacles to the change management programme suggested in this paper include rapid changes in the regulatory framework, unforeseen innovations and advancements in the field of technology and lack of market foresight. Genuine transformations require game changing ideas which can bring about creative solutions to problems. A change management programme based on an incremental strategy can only succeed if company personnel have the objectivity to view successes and failures in accurate ways.


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