The benefits for organizations embracing cultural diversity are unlimited and range from innovative, creative solutions in business challenges to substantial growth and financial success. In order to capitalize on these benefits, synergy must be achieved. Synergy may seem like an abstract idea, but it has concrete meaning to a Multinational Enterprise (MNE) who adds cultural diversity as a building block for success. A comprehensive definition of synergy describes it as, “a cooperative or combined action, and occurs when diverse or disparate individuals or groups collaborate for a common cause. The objective is to increase effectiveness by sharing perceptions and experiences, insights, and knowledge (Moran, Abramson, & Moran, 2014, p.266). When you examine this definition, it reveals that the heart of synergy requires shared viewpoints, experiences and knowledge which are usually found in teams. Common sense would indicate to any leader whether that leader is an individual or corporation that synergy and cultural diversity go hand in hand.
“Cultural diversity is already an aspect of many
companies; the next step is to recognize it as a valuable
resource and put it to good use.” Festo AG & Co. KG
Retrieved from Cultural Diversity
Synergy By Diversity
Access the study by clicking this link: Bertelsmann-Stiftung
Bertelsmann Stiftung, a German non-profit foundation committed to social change released a study which chronicled the success of twelve different MNE’s whose operations span the globe and reach into multiple cultures. They advocate that, “The diversity of our workforce clearly offers untapped resources for success in the international marketplace” (Stiftung, 2008, p. 6). In each one of the companies profiled, their teams, projects and partnerships were made up a multicultural mix of personnel. The study revealed each company reported synergy effects through diversity in the following three areas:
– Conflict reduction and satisfaction
– Customer focus and market access
– Cooperation and international success
Team Conflict
“I believe the key is to create a team environment in
which the potential problems of diversity are minimized
while the potential benefits are unleashed.”
Dr. Taylor Cox Jr
There were myriad methods used by the MNE’s to overcome many of the problems associated with a diverse workforce. One of the primary concerns for a global corporation is assembling good teams and this is where the potential for conflict enters as each team member tends to view the world from their own point of view (PSU, 2015) or what is known as an ethnocentric perspective. One executive profiled in the study was Eva Kaiser-Nolden of Ford, who explained that to overcome conflict between team members there must be an agreement in how they perceive others and how they are viewed by the group (Stiftung, 2008). It is important that the team go through a process of identity negotiation to discover skills and values differences. In most instances, people possess different skills which leads to the generation of new ideas based on their particular expertise and can be described as a positive outcome of conflict (PSU, 2015). On the other hand, differing values often leads to emotional conflict which is detrimental to the team. A team will be successful if each person can identify with their team rather than their individual ethnic group (Stiftung, 2008). Moran et al., (2014) classified team participation as an intense learning experience and indicated synergy happens when team members listen to each other and think of others. It is up to organizations and their leaders to foster an environment where diversity can have a positive result in team success.
Customer Focus
Retrieved from Ay Yildiz
Another company highlighted in the study was the German telecommunications company, E-Plus Group which launched the cell phone brand Ay Yildiz in order to market cell phones to the 2.7 million Turks who had immigrated into Germany (Stiftung, 2008). The company did not employ anyone who spoke the language and they were unfamiliar with the culture. They responded by building a team comprised of local Turkish people from the community and redesigned their marketing campaign to target the specific population group. This allowed them to reach Turks not only in Germany, but other parts of the world as well. Ay Yildiz is a perfect example of Perlmutter’s (1969) theory that companies evolve from the ethnocentric, polycentric and geocentric mindset that allows them to achieve global success and local responsiveness simultaneously (as cited in Moran et al., 2014). Building a culturally diverse marketing team allowed them to achieve brand recognition and improve their image in the global marketplace.
Cooperation Builds Success
Deutsche Telekom is a global company who boasts substantial cultural diversity in its heterogeneous workforce of 80000 employees in 50 countries outside the home office in Germany (Stiftung, 2008). As a cultural diversity trendsetter, they recognize the differences within groups and the differences between groups. Their products take into consideration the various age, gender and socio-economic factors of each cultural group while also considering the variations between Turks, Slovakians and South African’s (Stiftung, 2008). Deutsche also accounts for the diversity of their employees and developed “ethnic handbooks” for their personnel which assist them with learning how to respect other cultures. Their strategy is customer oriented, but they have also forged strategic partnerships in each country which ensures their success.
Global Mindset
“Globalization challenges us to question our attitudes.
That’s why it’s so exciting!” Prof. Eckard Minx
The common thread with all these companies is they cultivated a global mindset in their approach to success by embracing cultural diversity. Moran et al., (2014) suggested attitudes and ethnocentric views are learned, and it is apparent these companies evolved in both arenas. Global leaders can follow suit by choosing to evolve and broaden their depth by: assembling multi-culturally diverse teams, targeting new ethnic groups in their business strategies and capitalizing on the opportunities created by cultural synergy.
Koppel, P., Sandner, D. (2008). Synergy by diversity: Real life examples of cultural diversity in corporations. Germany: Bertelsmann Stiftung.
Moran, R.T., Abramson, N.R., Moran, S.V. (2014). Managing cultural differences. (9th ed.) New York, NY: Routledge.
Pennsylvania State University (2015a). Lesson 6: Cultural synergy. Retrieved from https://courses.worldcampus.psu.edu/fa15/olead410/001/content/06_lesson/03_page.html
Pennsylvania State University (2015b). Lesson 6: Cultural synergy. Retrieved from https://courses.worldcampus.psu.edu/fa15/olead410/001/content/06_lesson/03_page.html
Jamie Arnold says
If you read my comment to the other reply you will notice I mention a questionnaire that Eva Nolden uses and is included in the study. However, to address your question specifically I can recommend an exercise that I have been a participant in. It consists of a guided discussion or role playing environment where a team will receive a scenario that is designed to invoke strong responses and differing opinions. This allows the team to learn how others would view the situation and resolve it. Differences of opinion and cultural influences are certainly going to be driving forces behind some of the ideas. In a controlled environment, people can learn how to receive and respond to others who may not agree with their point of view.
As far as tracking them goes and determining their usefulness, that is challenging. The obvious answer in terms of effectiveness comes when you have an actual conflict and will be based on how the conflict is resolved. If it is constructive and the team remains intact then it is a success, if not, then I would say the measure is not effective.
Another method could be to have a neutral team composed of several members who fill the role of arbitrator when a group conflict occurs. The team assignment could be on a rolling basis to ensure all members participate. This would allow the neutral team to employ conflict resolution skills, perhaps the Thomas-Kilmann model which proposes five options for conflict resolution: competing, accommodating, avoiding, compromising and collaborating. The idea is to educate team members on how to properly handle conflict. Here is link to a website which has more detailed information on the model.
http://www.managetrainlearn.com/page/conflict-resolution-model
Jamie
jam7249 says
Very good post. You did a good job tying together various course ideas such as moving away from ethnocentric perspective toward a geocentric ideology highlighted by real life examples of E-Plus Group and Deutsche Telekom. Seeing how they harnessed the power of diversity to build products that benefited everyone involved was interesting. I like that we see real world examples and not just theory. They were able to harness cultural and group synergy by ensuring conflict was healthy and that people respected each other [i.e. the cultural handbook] to turn a profit and have a happier workforce and client.
Some points I really liked were noting that a team will be successful if they identify as a team first rather than with their ethnic group. Also, I think your point is important that organizations and their leaders must create space where diversity flourish and lead to a positive result.
One question I have is what are a few methods leaders can use to foster healthy conflict using diversity without leading to any ethnocentric lines being drawn and people receding to their own groups instead of saying with the team? Also, how do we as leaders ensure these situations we create are productive and tracked to ensure progress?
Jamie Arnold says
Thank you for responding. To answer your question regarding team conflict I was implying that that there needs to be an understanding by each team member on how they perceive others. We understand this to be an awareness of their ethnocentric views.
In the study I referenced on pp. 44-45, you will find Eva Nolden’s comments regarding the team process and how conflict can be avoided along with a questionnaire that she uses to help her team members identify how they perceive the others. This is shared to foster that understanding which raises the awareness and cuts down on the amount of conflict experienced in multicultural teams.
alv5142 says
Wow, incredible post. Very thought out and meaningful. I like how you tied the idea of geocentricism into the idea of synergy since they do seem to go hand in hand. One area where you kind of lost me once under the solving team conflict area, where you said that members must agree on how they perceive each other. Does this mean that at some point all the group members should give feedback to each other about things that they do and things they don’t like about everyone else? I’m not sure how you would agree on something like that. Its definitely an interesting thought and something I was going to bring up about the volatile nature of synergy, just need a little clarification upon it.