The Impact of Cultural Diversity upon Organizational Outcomes and Group Productivity

The Global Leadership and Organizational Behavior Effectiveness (GLOBE) project analyzed and explored previous studies on cultural patterns before developing a single program measuring the extent of global cultural differences.  The mixed methods study utilized 170 researchers and agents to collect data from 17,000 middle managers from 951 organizations within 62 different countries (House, et al., 2004).  The sampling procedure ensured adequate representation of all major regions of the world.

Despite the reliable sampling procedure, Hofstede (2006) criticized the GLOBE study for using such a large number of researchers, which adversely influences the consistency of approach.  He also found the GLOBE study United States-centric.  Lastly, Hofstede felt the GLOBE study was an ethnocentric study in nature while his earlier research (1980) was a decentered study.

Results from the GLOBE study validated Hofstede’s (1980) cultural dimensions while adding two additional dimensions: performance orientation and humane orientation.  These dimensions were included based on the belief that a performance-oriented society values and rewards performance, emphasizes results rather than people, and are concerned with individual achievement and excellence.  In a highly humane society, individuals are rewarded for being fair, altruistic, caring, kind and benevolent.  Addition of these two dimensions also addressed the concern with Hofstede’s research, which did not include long-term as well as ethical dimensions (Fang, 2003).  Compared to Hofstede’s research, the GLOBE study utilized the dimension “Gender Egalitarianism” rather than Masculinity compared to Femininity. 

The GLOBE program developed nine dimensions, which formed the independent variables for the study.  The nine cultural dimensions included: Uncertainty Avoidance, Power Distance, Gender Egalitarianism, Assertiveness, Future Orientation, Institutional Collectivism, In-Group Collectivism, Performance Orientation, and Humane Orientation (House, et al., 2004).  Results of the GLOBE project demonstrate the indirect influence of national culture upon leadership behaviors as reflected by societal expectancies. 

GLOBE results suggest an effective leader consistently utilizes leadership approaches best aligned to his or her followers’ cultural expectations.  Therefore, leaders acting in accord with societal expectations are most effective.  GLOBE results identify charismatic and value-based leadership as universally effective leadership approaches.  By contrast, GLOBE results identify participative leadership approaches as culturally sensitive.  By identifying superior compared to inferior organizational leaders in relation to the extent that their behaviors either exceeds or fails to meet their societal expectations, the GLOBE project increases understanding of the relationships between organizational behavior, cultural expectations, and successful leadership. 

As reported by Collins and Powell (2004), seminal work by Collins (2001), distinguished leaders by analyzing a paradoxical blend of genuine personal humility and intense professional will.  For example, Collins differentiated a leader exhibiting modesty and unwavering resolve from the leader that is shy and courteous yet fearless.  Based on a five-year study, Collins identified Level Five Leaders that transformed their good companies to great companies, achieving extraordinary results, and building great organizations without overt publicity.  As exhibited by the results of cultural assessment tools (Hofstede, 1980; House et al, 2004), societal cultural diversity can directly influence whether a transformational or transactional leadership approach would be most effective. 

With Level Five as the hierarchy, Collins developed a model predicated on transformational and transactional leadership behaviors.  Leaders whose style corresponds to Levels One–Four could be successful but they fail to elevate an organization to excellence.  A Level One leader relates to being a capable individual.  A Level Two leader is oriented toward teams and achieving group objectives.  The Level Three leader exhibits a transactional leadership approach (Vera, et al., 2004).  The Level Four leader exhibits transformational approaches.  Transactional leaders seek to guide followers toward established goals by clarifying objectives and task requirements.  Transformational leaders inspire followers to pursue an explicated, motivating vision, are concerned about followers’ well-being, and encourages innovation and creativity (Bass & Avolio, 1990, 1994, 1995, 2000). 

A Level Five leader is a clock builder rather than a time teller (Collins & Powell, 2004).  Their ability to identify great successors exhibits the difference.  Therefore, a Level Five leader exhibits unwavering resolve to build their companies for future success rather than being mainly concerned about the present.  When meeting or exceeding organizational objectives, the Level Five leader credits followers for successes while accepting personal responsibility for poor results.

Hogan and Hogan (2001) suggest this behavior is partly attributable to the Level Five leader’s personality.  In relation to their communication style, Level Five leaders and his or her followers are considered egalitarian rather than superior (Collins, 2001).  The Level Five leader surrounds himself or herself with followers who are confident but not self-centered (Collins, 2005).  Such humility is conceptualized as three-dimensional: self-awareness, openness, and acceptance of something greater than self (Morris et al., 2005).  

Given the globalization effort at hand, the need for better understanding cultural influences on leadership and organizational practices becomes essential for sustained team success.  As House et al (1998) reminds us, "Situations that leaders and prospective-leaders must face are highly complex, constantly changing, and difficult to interpret.  More than ever before, managers of international firms face fierce and rapidly changing international competition” (p.5).   Time zone diversity is an obvious managerial reality; the sun will never set on this new global organization. 

More than logistics, a thoughtful analysis will need to review the team managers’ diverse societal cultures.  Analysis of results from the Globe program data indicates variance in the new global team’s Uncertainty Avoidance (UA) dimension requires immediate attention.  It must be noted that the UA dimension exhibits much greater variance in the 5-D model results (Hofstede, 1980).  The Uncertainty Avoidance (UA) dimension is the extent to which members of a specific culture feel threatened by ambiguous or unknown situations and as a result created beliefs and institutions designed to avoid risks, threats, ambiguity, or uncertainty.  The GLOBE data identifies UA ratings by managers from Singapore as 5.31 and ratings by managers from Germany as 5.22.  This contrasts sharply with the 3.39 UA ratings by Greek managers and 3.67 UA ratings by Iranian managers.  The 4.15 UA ratings by United States’ managers indicate American society is uncertainty accepting, exhibiting willingness to accept new ideas, innovation, and openness to trying something new.  As uncertainty avoidant societies, Iranian and Greek societies strongly prefer deductive rather than inductive approaches and strongly relying on expertise.  Societies exhibiting high uncertainty avoidance maintain rigid codes of belief and behavior and are intolerant of unorthodox ideas, often exhibiting an emotional need for rules (Hofstede, 2006).  By contrast, while German and Singapore societies may be rated as uncertainty accepting, contradictions with ratings compared to Hofstede 5-D results (1980) indicate the German and Singapore UA results may be related to those societal Power Distance ratings, which identify the extent that less powerful members within a society expect and accept that power is unequally distributed.  Based on exhibited variance noted with GLOBE data results and low correlation to the Hafstede (1980) 5-D data, the Uncertainty Avoidance and Power Distance dimensions ratings for this specific team needs to be further assessed to mitigate potential problems to the global team and adverse influence upon the greater organizational culture. 

Therefore, an effective leader creates a defined culture by optimizing structured organizational learning through the utilization of strategies exhibiting high levels of effectiveness.  The first pursuit in this endeavor is to mitigate learning overload.  Learning overload prevents leaders from helping followers realize progress and achieve stated goals (Reason, 2010).  Citing Kennedy (2006) and Franklin (2005), Reason (2010) further notes, “We can’t alter the brain to hold more information, but we can change our approach to learning in ways that reduce overwhelm and prepare us to deal with institutional challenges more effectively” (p. 99).  Cultural awareness and proactive planning accordingly will mitigate the potential for learning overload and thereby optimize this global team’s success.  

To Cite:

Anderson, C.J. (December 31, 2018) The impact of cultural diversity upon

organizational outcomes and group productivity [Web log post]

Retrieved from http://www.ucan-cja.blogspot.com/

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