International Organizational Behavior: A Cross-Cultural Perspective

Posted on Aug 17, 2024 in Social sciences

Globalization

Globalization is a social process in which the constraints of geography on social and cultural arrangements recede and in which people become increasingly aware that they are receding. But globalization is not a new phenomenon. Since 1795, globalization and the integration of the world-system have increased as the result of three waves of cross-cultural business contact. International Organizational Behavior is the study of behavior in organizations around the world.

Differences from Organizational Behavior in the United States

  1. The study of organizational behavior in the U.S. is not sensitive to variations in national cultures.
  2. The focus of studies conducted in the U.S. is usually individual roles and the functioning of groups.
  3. Much U.S. organizational behavior research emulates natural science methods that emphasize narrow research questions, hypothesis testing, and quantifiable data. An alternative approach to studying culture is using qualitative ethnographic techniques. Because of these limitations, the approach to international management and organizational behavior presented here extends the American model by using national culture as the organizational context and explanation. Another recent development is the systematic comparative study of work across cultures from a sociological perspective.

Competitive Advantage to Succeed in the New Economy

  1. Understanding the nature of competition in the global marketplace. Learn about the technologies, management practices, strategies, and product development of firms around the globe as well as domestic rivals. Increased emphasis on international product quality, global finance, and the ability to purchase products from companies located anywhere.
  2. Explore and evaluate prospects for collaboration with other companies. Strategic alliances are common between competitors.
  3. Facilitate borrowing ideas from other cultures to improve organization performance. Since the late 1970s, Great Britain & the U.S. have borrowed Japanese management techniques including total quality control and just-in-time manufacturing.
  4. Multiculturalism in the workforce is increasing. The management of people with diverse cultural backgrounds improves when managers understand and apply organizational theories based on cultural explanations.

Organizational Analysis

The second reason to study IOB is that formal organizations are a major social structure in modern societies. The influence of organizations on daily life is pervasive, and their leaders have significant power.

Analysis of Culture

The third reason to study IOB is intellectual curiosity about cultures other than one’s own. In addition, knowledge of other cultures generates insights into one’s own culture and behavior. This is because most of us believe that our culture is preferable – possibly superior – to other cultures.

Explaining IOB

Mechanical models of individual and organizational behavior ignored the influence of outside forces on behavior in organizations. As the external environments of organizations became more turbulent, research focused more on the relationship between organizations and their environments but usually excluded culture as a causal variable. No single or best approach applies to all management situations; there are still competing theories and debates over complex issues.

  • Industrialization is a powerful economic force unaffected by culture. Industrialization creates organizational structures and cultures that are fundamentally the same regardless of national culture.
  • Cultural Explanations: Culture has been accepted as an explanation of OB due to the increase in competitiveness of nations. Second, business executives encounter different cultures in their contacts with people from other nations. It is increasingly important to understand how members of other cultures behave.
  • Multiple Cultures: Nations and organizations have multiple cultures. National cultures have roots in ethnic identity, religion, social class, or some combination of these. Subcultures form on the basis of these variables and shape attitudes and values that affect behavior in organizations such as motivation, obedience to authority, and interpersonal relations. Subcultures develop from job specialization, departmentalization, friendship, and other factors.
  • External Culture: This includes multiple national and local cultures, as influencing internal organizational culture. Social class is an external basis for distinctive cultures.
  • Internal Organizational Culture: This is composed of artifacts, values, and basic assumptions.

Limitations of Cultural Explanations

  1. Numerous definitions of culture
  2. Culture, even when there is agreement on a definition, is a multifaceted concept that is difficult to measure
  3. It is possible to use culture as too comprehensive an explanation of organizational behavior. Cultural Determinism, the position that all behavior is the product of culture, ignores economic, political, technological, and biological factors as plausible explanations.

Theory and IOB

Despite Kurt Lewin’s aphorism, “Nothing is as practical as a good theory.”

  • Real World Theory: 73 organizational behavior theories – the vast majority developed in the U.S. and attempts to locate theories from other countries produced very few – and surveyed management research experts who endorsed many of the theories as scientifically valid and useful for understanding and improving OB.
  • Normative theories formulate the way organizations ought to function. A properly designed and managed organization does not experience internal conflict.
  • Descriptive theories attempt to portray organizations realistically.
  • Value Judgments are culturally biased assessments of behavior.
  • Ethnocentrism is the belief that one’s own group is the center of everything, and all others are scaled and rated with reference to it.
  • Culture Shock, an adverse or confused reaction to behavior in other cultures, challenges understandings between ourselves and others.

Global Processes

  • Saskia Sassen’s The Global City illustrates the discovery of similarities – convergence – across cultures produced by global economic activity.
  • Management Pluralism by Mauro Guillen demonstrates that these industrial societies adopted different paradigms of management philosophies and practices at different times: scientific management, the human relations school, and structural analysis. Guillen concludes that cultural factors influence the selection of management models, not only their scientific credibility or economic and technological factors. In addition to the political and social factors that influenced managerial ideology and practice, Guillen found that religion – an important cultural element – also was significant in the adoption of a management model.

Guillen Research: Two Important Issues

  1. Institutional arrangements, not only the type of economy, technology, or a particular definition of industrial efficiency, create ideologies that become guidelines for the way people manage organizations.
  2. Comparative analysis is a more productive way of understanding management and organizational behavior than single-culture studies.

Cultural Values in the 21st Century

Cultural values impact the types of organizations that emerge, the behavior that takes place in them, how and in what directions they change, and the techniques to manage them. Cultural zones have distinctive value systems that persist after controlling for the effects of economic development. Economic development tends to push societies in a common direction, but rather than converging, they seem to move on parallel trajectories shaped by their cultural heritage.

Organizations Enter the 21st Century

  • Unprecedented career insecurity
  • Renewal of economic rivalry and collaboration throughout the world’s economies

Convergence or Divergence?

If cultures are converging – that is, becoming more alike – there is little reason to study specific management practices and organizing principles. If organizations throughout the world are similar, the same management techniques apply. If cultures remain distinctive and basic values persist or are actually becoming more dissimilar – that is the process of divergence. This viewpoint suggests that it is urgent to become familiar with diverse cultures and develop culturally sensitive ways to manage organizations.

Forces for Convergence

Sassen’s study suggests that globalization, which affects the economy and culture of cities, is a force for convergence.

Forces for Divergence

Guillen’s study concludes that distinctive cultural elements influence the management of organizations. Unless globalization produces a uniform religion or other value system, there will continue to be differences in management philosophies and practices.