How Factors that Drive Globalization Influence Cultural Diversity in Organizat : – Effective Management Approaches in a Culturally-Diverse Workforce

With globalisation forces easing cross-border barriers, one of the outcomes has been the increased incidence of multicultural workforce within organisations. Such workforce diversity has resulted from aspects such as increased labour mobility across national borders, increased expansion of entities to capture advantages provided by expansion, and occurrence of virtual teams working from different geographical locations (Seymen, 2006). With such increased occurrence of workforce diversity, factors that have helped enhance the incidence of multinational enterprises could have various effects on cultural diversity in organizations. Such effects are highlighted here by considering the benefits and challenges the factors present to multicultural organization. Additionally, skills that better management approaches in culturally diverse workforce are considered.

One of the factors that affect cultural diversity in multinational enterprises (MNEs) is the adoption of technology. On the positive end, adoption of technology could serve to weaken cultural differences thus leading to a synchronized organization culture (Mead & Andrews 2009). This, for instance, occurs when technology leads to the implementation of virtual teams rather than face-to-face teams within the organization, thus reducing social interdependencies that are important in propagation of an individual’s culture (Mead & Andrews 2009). Accordingly, the new way of doing things could foster cultural learning and thus move the workers towards a common culture (Bird & Fang 2009). This is positive since it reduces the challenges that managers have to deal with in addressing cultural differences within their teams. On the contrary, such technology may present challenges of control for the manager. Additionally, by the suggestion that organic systems and interpersonal systems serve as determinants of how people interpret technology (Mead & Andrews 2009), adoption of technology that interferes with such relationship could negatively alter individual performance, thus affecting overall productivity.

Secondly, language adoption could also have various impacts on cultural diversity in MNEs. Since language is a critical component that determines communication (Mead & Andrews 2009), adoption of language helps effectuate communication within a multicultural team therefore foster better performance. Language adoption for instance helps in the processes of cultural learning which helps bring the workers towards a common, non-idiosyncratic culture (Bird & Fang 2009). Conversely, language adoption may impede expression and alternative ways of thinking; two critical components of innovation (Seymen 2006). According to the cultural ecology hypothesis, various aspects of culture may persist irrespective of the globalization forces (Bird & Fang 2009), hence an organization’s adoption of a particular language to be the official language at the work place may limit expression for workers who cannot effectively communicate in that language. This could restrict the extent to which such workers become motivated to engage in team activities.

Financial globalisation may also impact on cultural diversity in MNEs though in a more subtle way from the factors discussed. In times of contraction, sharing a common market for instance leads to enhanced cross-border transfer of such effects to the subsidiaries leading to the lay-off of individuals in these places. When this happens, it could elicit resentment of the foreign business ventures within the local employees’ unions (Mead & Andrews 2009). Conversely, when such a market has helped the locals get access to more opportunities, foreign ventures could be more positively appraised by the residents. In this way, financial globalisation effect is determined by either its enabling or disabling ability on economic factors that further influence social activities in different countries.

With such noted effects of forces of globalisation on workforce diversity, managers need to develop skills that would effectively manage cultural diversity in the dynamic global environment. In this respect, a manager needs to develop an organization culture that appreciates individual cultural differences (not imposing ones way of doing things as the only right way) (Seymen 2006), while providing for a shared frame of references that orient workers towards an organization culture that is in line with the goals of the entity (Chevrier 2009). For instance, when team members’ cultures are regarded with an equal importance, without viewing one to be more important than the others, individuals who would otherwise feel ignored due to their cultural background, become actively involved in the team processes (Seymen 2006).

For managers on international assignments, the understanding of host country political cultures is core to effective management in these places. Such national political cultures are representative of socially acceptable methods of control in the country (Chevrier 2009). Skills that managers would thus need to effectively manage in a multicultural team range from adept communication skills, through negotiation skills, to conflict resolution skills such as persuasion and compromise.


Bird, A & Fang, T 2009, ‘Editorial: Cross cultural management in the age of globalization’, International Journal of Cross Cultural Management, vol. 9, no. 2, pp. 139-143.

Chevrier, S 2009, ‘Is nation culture still relevant to management in a global in a global context? The case of Switzerland’, International Journal of Cultural Management, vol. 9, no. 2, pp. 169-184.

Mead, R & Andrews, TG 2009, International management, 4th edn, Chichester, England: John Wiley & Sons.

Seymen, OA 2006, ‘The cultural diversity phenomenon in organisations and different approaches for effective cultural diversity management: a literary review’, Cross Cultural Management: An International Journal, vol. 13, no. 4, pp. 296-315.

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