Question 1: Cultural differences between the companies
Organizational culture refers to shared norms and values within members of a given organization. These are the dominant values, beliefs and attitudes held by the organization’s employees. It can also be defined as the set of knowledge forms and basic assumptions commons amongst organizational members. Organizational culture is largely influenced by the society in which it exists. A merger between Excelsior Manufacturing and Quality Instrumentation creates a diverse and global team. Such teams are a source of competitive advantage and production efficiency. Mergers create concerns into international management. In determining the core elements in which the two organizations culture may be different, Geert Hostfede’s dimensions will be used as the main reference (Luthans and Doh176).
- Power distance: this refers to the extent to which members of the lower management level within the organization feel that power is unequally distributed. The high power distance culture is characterized by submissiveness to orders from lawmakers. This society is observed as one where there is strict obedience of orders. However, the low power distance society is one where its individuals tend to question the rational of orders. Organizations within the low-power-distance societies tend to be decentralized in decision making. Such an organization is characterized by fewer supervisory personnel and members of the lower management levels are highly qualified when compared to individuals in a similar level, in a high power distance society. Centralized decision making and bureaucracy is a feature of the high power distance societies. There is a large supervisory portion while members of the lower managerial position have lower educational and professional qualifications. This tends to create inequality.
- Uncertainty avoidance: this refers to the level in which members of an organization feel threatened by unknown occurrences and have consequently come up with structures to avert the ambiguous situations. Societies that tend to have a high regard for the knowledge of experts and are in constant need of security are defined as high uncertainty avoidance societies. Spaniards are a high uncertainty avoidance society. However a low uncertainty society such as the American tends to be risk takers therefore, willing to engage in risky business ventures. There are fewer written laws, highly ambitious employees and high labor turnover. Managers encourage creativity and responsibility amongst the employees. A high uncertainty avoidance culture has organizational structures, less ambitious employees and a large manual of written laws.
The effectiveness of the merger is pegged on effective international management. These requires that the organizations purpose and goal of the merger so as to focus solely on the merger. Secondly, mechanisms and techniques need to be established so as to identify management roles and organizational structures. Thirdly, authority over key resources needs to be established and a consensus reached as to the sharing of such resources and profitability. Lastly, effective communication between individuals and departments within the organizational structure needs to be emphasized. This is achieved by first identifying the expectations of all members of the agreement 9 (168-191).
Question 2: Comparing the cultural diversity between the two organizations and the advantages of cultural diversity.
Cultural diversity refers to the appreciation of different cultures within the organization. The Spanish firm is not culturally diverse because of its centralized decision making, risk-averseness, individualism and formal procedures. Cultural diversity brings about diversity of ideas in formulating new business opportunities and in conflict resolution. Cultural diversity is an incentive of acquiring a large customer base originating from the diverse cultural experiences, understanding and greater appreciation of other languages. Cultural diversity influences managerial ideologies, attitudes and technological transfer. A culturally diverse organization is accepting of different opinions. The small Spanish company is likely to have a small number of same thinking minds conducting hiring/ personnel expansion activities. The result of this is that only same thinking minds are hired into the company. This limits business activities and problem solving skills.
Question 3: Recommendations of effective merger of the two organizations
The merging companies need to first understand the cultural dynamics and consequently plan their strategy in locating production facilities, the design of culturally acceptable products, international supplies and cross cultural interaction of members of the organization and its clients. An appreciation of cultural diversity between the two firms is imperative for the survival of the merger. The management needs to look into building an effective multicultural team. The management needs to look into leading a multicultural team effectively. This can successfully be done by following the outlined procedures:
- The management needs to understand the conditions of an effective team. Team development is crucial in the development, of an effective diverse team. The first stage is the entry stage which focuses on the development of trust and cohesion among the team members by merely getting to know each other, as opposed to focusing on getting the task done. It also entails establishing professional similarities and respect by getting to know members’ professional and status similarities.
The second work stage deals with getting to understand the task. It is easier for a multicultural team to analyze the task as it can draw ideas and innovativeness from its members. The action stage focuses on decision making and implementation. It requires consensus among the members. It is at this stage that problem solving skills such as Nominal Group Technique are introduced. This technique entails individual contributions, group interaction and finally, reaching a consensus.
The success in the multicultural organizations teams need to be established based on individual ability to contribute to the task and not merely on ethnic composition. However, when the task is routine homogenous membership is preferred and if innovative multicultural membership is emphasized. Team leaders must recognize the existence of differences and know how best to deal with the differences. The team leaders must also be able to recognize their need to define the overall objective, fair contribution, mutual respect amongst members and positive feedback to the team that encourages cohesion.
The New United Motor Manufacturing (GM and Toyota Joint Venture) can be used as an example of how effectively led and constituted diverse teams can be used to transform local organizations to state of the art multinational companies. The success of this joint venture was founded on the following concepts:
- Recognition that a mutual vision between the management and employees was critical due to the interdependency of their successes.
- The employees of the venture were assured of fair treatment. This is an enabling factor to being voluntary contributors.
- A healthy working environment was created by having the production system in the plant interdependent.
- Finally, the management system was managed into one of trust and respect so as to deal with cases of conflict and stress (Luthans and Doh181).
Works Cited
Luthans, Fred and Jonathan P. Doh.International management: Culture, Strategy and
Behaivour. New York: McGraw-Hill, 2012, 168-191. Print.
