Cross Cultural Management - Edited

Cross-cultural management 1
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Cross-cultural management
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Contents
Executive summary......................................................................................................................3
General Motors..............................................................................................................................3
Macro and micro issues affecting India.....................................................................................4
Cross-cultural and HRM issues..................................................................................................6
Recommendations........................................................................................................................7
References.....................................................................................................................................8
Executive summary
Managing people from a different culture would bring in some challenges due to
the cultural differences. The major department that is affected is the human resource
management since they have to deal with people of a different culture which they do not
understand. Various issues will arise from this differences which include communication
misunderstanding, power distance, masculinity and femininity, individualistic and
collectivist behaviors, the motivation of the employees, the leadership styles in the
different countries and conflict management in the host country. These issues arise as a
result of alien management who are not aware of the host culture. The solution to this
problems would be employing managers from the host nation with the home country
education. This means that the organization should employ Indians who have an
American education. This would help balance the cultural differences in the
organization.
General Motors
The general motor is an American organization that specializes in car
manufacturing and design. The company is located in Detroit in the United States of
America and has spread over to all continents of the world. The organization has been
very successful globally competing as one of the biggest vehicle manufacturers in the
world. The organization could not, however, achieve the much that they have achieved
without moving into 0other countries and operating from there. This is as a result of
globalization which has brought the world together as it were a small village. Doing
business is has become easier than earlier and such organizations have taken such
quick advantage and entered the market into various regions of the world. This has
helped general motors increase their sales hence making more profit from globalization.
The company is operating in all the continents of the world with bases in most of the
countries in the world. The management of the organization has however not been easy
especially with cultural differences between the home and the host countries of the
organization.
Macro and micro issues affecting India

The host county that will be discussed in India. Just like any other nation, there
are macro and micro factors that affect businesses in this country. Both macro and
micro issues affect business in the country. One of the major factors is the cultural
environment. The cultural environment is a very important factor to consider before
doing business in any organization. This poses a challenge for multinational
organizations that are willing to venture into another country (Mead, 1998). This deals
with the culture of the people and what is acceptable to the people. It is easy to find that
a cultural perspective which is allowed in the home country may be a taboo in the host
nation. This brings issues when doing business in another country because of the
cultural differences. Organizations are advised to use as much local personnel
compared to outsiders for them to overcome the cultural barrier. This is because the
local people will work and behave according to the culture demands.
Another important factor that can affect business is the political environment of the host
country. The political environment will affect the way business is done in the
organization since they will be affected by political decisions made by the organization.
The stability of the politics will also determine the outcome of the business. This is a
very important factor to consider when before making decisions in an organization
which is in a host country. India's political environment is good for business, but it
cannot be compared to that of the home country of the organization which is the United
States of America. This will involve the laws set by the government and other factors
like taxation and all legal matters that are connected to the government.
Another important factor to consider which is affecting businesses in the host nation is
the technological factor. Technology has been hugely affecting business in the recent
years. All businesses for them to have a competitive advantage over the other must
improve their technology. This comes without question to the general motors company.
This however for them is an advantage since technological advancements in their home
country are far much better than that of the host country (Earley, and Singh, 2000). This
means that the organization will have a competitive advantage over other similar
companies in the region. This is one advantage that the general motors are enjoying.
However, technology remains a factor to consider for such an organization. Technology

is a major factor affecting businesses in India just as it is in the rest of the world.
Another important factor that affects businesses in India is the economic environment
of the host country. The economic factors will involve all matters regarding business
from the consumer spending index to the rate of income generation among customers
and other business-oriented factors. Compared to the host country, general motors
home country's far much better as far as the economic environment is considered. This
means that the decision making of the organization has to be informed and enough
research should be done to ensure that they make economic decisions well. This
decision will involve the pricing of their products, advertising of their goods and even the
selling of their product (Sparrow, and Budhwar, 1997). The organization must seek to
understand their customers economically. This will come as a challenge to the
organization since they cannot rely on the information of their home country which has
much higher statistics compared to the host country. Decision making will aim to look at
the affordability of their goods and how to make their goods more appealing to the
public in the host country. This will help them grow as an organization in the host nation.
The other common factor that affects businesses is the legal factors. This will
deal with all the laws and regulations that have been set by the law. This will involve the
taxation, the rules of doing business, the rate of payment of workers. And all other
factors that are concerned. Legal factors may encourage or discourage doing business
and will also change the way of doing business. For example in the host nation, people
should work from 8 am in the morning to 4 p.m. (Brewster et al., 2012). This will be
different from other countries where it is 9am to 5 p.m. This rules will matter to the
business and will affect the way of doing business. Other factors include the natural
factors which will involve the nature of the place and natural factors that may affect
business. For example, the Indian weather is different from that in the United States
which will affect the wheel designs in the different countries. Some will have bigger
treads than others due to the weather. These factors affect business, and the
organization must be ready to deal with them before they destroy the business
foundations that the organization has set.
Cross-cultural and HRM issues

Culture is a behavior or an attitude that is transferred from one generation to
another and becomes the way of life of the community. The organization has faced very
many challenges in the human resource department in their operations in India due to
the various cultural differences. The following are the issues that have been faced in the
human resource
Communication Misunderstanding: this is one major issue that has been affecting the
human resource in the host country of India. Most of the employees cannot speak
English while the Americans don’t understand the Indian language. This has become a
barrier and an issue in the management of the human resource. Sometimes there will
be miscommunications between the management and the employees (De Cieri, and
Dowling, 1995). This issue has resulted in a management problem in the host country
since there is a communication barrier. Other cases an employee is given instruction,
but they end up doing a different thing since they did not understand the original
message.
Leadership style: Indian leadership style is very much hierarchical which is unlike the
American leadership style which is general and collective. This has brought a major
issue in running the general motors in India since the employees wait for directions from
the management directly. Seeing it is a new market, the leadership needs to involve the
employees in decision making wh4reeas the employees keep quiet since they are used
to hierarchical management.
Motivation: the motivation for working in both countries differs a lot. This is because in
America the employees are motivated by the task they are doing while in India most of
the employees are motivated by money and titles. This changes the way of doing
things, and the management is forced to find new ways of motivating the employees
(Joynt, and Warner, 2002).
Conflict: conflict will arise very easily since most of the Indians are very tempered
compared to the Americans which cases conflict many times in the organization. This
has brought a challenge to the organization's management since they do not know how
to control such conflicts that occur in the organization. This is caused by the cultural
differences that arise am9ong the various cultures.
Power distance: this is how people in a community are willing to interact with the
powerful people in the organization. In America, most of the employees are very relaxed
and can easily communicate with their superiors compared to India. This is because
Indian cultures create a separation between the superiors and the inferiors. This has
affected the business in that the management does not get enough feedback from the
employees.
Masculinity and femininity: this is the extent in to which cultures will have gender
roles which are different. The Indian culture has separate tasks for women and different
ones for males. This is unlike in the home country of the United States where any task
can be done by any person regardless of the gender. This is an issue that has been
faced by the human resource management has to cope with this difference (Scullion,
and Collings, 2011).
Uncertainty avoidance: this is the willingness of a person to undertake a task they are
uncertain about. Since general motors deal with inventions and new ideas, most of their
employees in India are reluctant to undertake new task and venture into uncertain areas
unlike in their home country where people love challenges.
Individualistic and collectivism: most of the people in India are much collectivist
compared to Americans. This makes them do work in groups, and this makes it difficult
for the management to assign individual tasks since most of them will lead to failure.
Recommendations
One major recommendation to the organization is that they should focus more on host-
based management compared to bringing their managers who do not understand the
public in the host country. This makes them more understandable to the employees.
The best choice of managers would be locals who have studied in America. This would
bring in a blend of the two cultures and hence both of the cultures would be taken care
of. This means that the top management would well communicate with the Indian
management since they are aware of the American culture and values which would
them manage their employees in an Indian manner which would bring affectivity to the
organization.
References
Brewster, C., Mayrhofer, W. and Farndale, E. eds., 2012. Handbook of research on
comparative human resource management. Edward Elgar Publishing.
De Cieri, H. and Dowling, P.J., 1995. Cross-cultural issues in organizational
behavior. Journal of Organizational Behavior (1986-1998), p.127.
Earley, P.C. and Singh, H., 2000. Innovations in international and cross-cultural
management. Sage.
Joynt, P. and Warner, M. eds., 2002. Managing across cultures: Issues and
perspectives. Cengage Learning EMEA.
Mead, R., 1998. International management. Blackwell.
Scullion, H. and Collings, D., 2011. Global talent management. Routledge.
Sparrow, P.R. and Budhwar, P.S., 1997. Competition and change: Mapping the Indian
HRM recipe against world-wide patterns. Journal of world business, 32(3),
pp.224-242.
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Cross-cultural management 1

Macro and micro issues affecting India

However, technology remains a factor to consider for such an organization. Technology

Cross-cultural and HRM issues

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