cultural impact if multinational work force in

ISSN NO: 0745-6999 JOURNAL OF RESOURCE

MANAGEMENT AND TECHNOLOGY

CULTURAL IMPACT IF MULTINATIONAL WORK FORCE IN

CONSTRUCTION MANAGEMENT 1V. SAI SRI SHASHANK,

2Mr. P. NAVEEN KUMAR

1M.Tech Student,

2Assistant Professor

DEPT OF CIVIL ENGINEERING

SHRI SHIRDI SAI INSTITUTE OF SCIENCE AND ENGINEERING

Abstract: Multinational organizations have

workforces that involve people from different

countries, defined by linguistic, religious, and

political backgrounds, in other words, people of

different cultural backgrounds. Generally,

differences related to culture are more evident and

prominent than similarities and homogeneity. For

multinational companies, it is a must to take

cultural differences into account in their managerial

practices the interactions between the project

manager and team members may be affected by

several variables, such as culture, leadership style

of the project manager, and the complexity of the

developed tasks. Focused in this context, the

objective of this paper is to investigate and describe

how the culture issue can affect the management of

global project teams. It is a qualitative, descriptive

study conducted in a large multinational company

in the automotive sector. The results of this

research show that cultural issues can influence

both positively and negatively the management of

project global teams and the managers of these

projects have to deal with several management

challenges that require the adoption of certain ways

of dealing with culture impacts in managing their

teams to minimize potential problems in this

context.

I.INTRODUCTION

Cultural factors play an important role as

invisible barriers. With the continuous

globalization the firms should focus on eliminating

the invisible cross cultural communication barriers

Solving these barriers is important in order to foster

the organizational climate This will also create

opportunities for expansion of the organization and

widen their geographical outlook. Many serious

problems may arise when people from different

countries, races values, corners of world come

together. Working in multicultural team involves

many challenges, disagreements and conflicts.

These challenges and conflicts affect the

performance of the individuals and the entire firm

to a certain degree. In a multicultural internal

environment, the firms need to find out a solution

to bring a clarity in communication. Cross cultural

communication where people belonging to diverse

cultures being in communication with each other

needs to be effective in order to avoid

disagreements and conflicts and in turn achieve the

business objectives. In order to make cross cultural

communication effective, a firm has to understand

the barriers involved in cross cultural

communication process & identifying means of

overcoming such barriers in order to make cross

cultural communication effective.

The increasing trend of globalization has become a

major concern of many businesses that led to the

growing demand of human resource outsourcing

and filling the gap of shortage in human capital.

Consequently, as many companies operate

globally, it requires the hiring of foreign workers

from different countries with different origins and

cultural background thereby prompting the

managers to address the issues on cultural

differences as well as the concerns on how

managers effectively communicate their decisions

that equitably benefits the workers and the

organization. As businesses expand from local to

international operations, managers will be able to

gain understanding on the importance of cultural

diversity in the workforce especially in the human

resource management that largely deal with the

employees. Moran, stated that, modern managers

have undergone unending challenges in managing

employees of different cultural orientations and

nationalities considering that people‟s reaction to

situations are determined by culture Common

example to this is the language barrier where by,

different perceptions and interpretation of

information related to business operations due to

the varying culture. In other words, the culture of

time for instance may suggest different

implications country to country.

1.1 MULTINATIONAL ORGANIZATIONS

AND CULTURE:

Multinational organizations are the result

of economic structures that adapt the global

economy; these companies prefer to produce goods

or services in foreign countries for many reasons,

one of them being the financial one, as most of the

time it is cheaper this way. Also, the labor force is

cheaper and the resulting services and goods

exceed expectations. Multinationals are structures

that are multicultural, which on the other hand

requires a different management concept because

of the challenges that can and often arise from

cultural differences Having this in mind, being

multicultural is about being positive and open to

the effects that are positive, and the interaction with

other cultures, which develops significant methods

of interaction the most important aspect of being

multicultural is to have a positive perception of the



cultural variety that can bring positive income to

the organization. Multinational companies are

present in almost every sector of activity and they

require management and employees from different

cultural backgrounds. The assignment of managers,

experts, and workers to countries with different

legal, cultural and political structures on one hand,

and also their relations with the workers from the

host country, on the other hand, make the

management of cultural differences something that

cannot be avoided in these organizations. These

organizations require not only management of

production in a traditional sense, but because of the

employment of people that are from different

cultures and beliefs, also to actually manage these

differences. However, investment deals with

different countries allow multinationals to act both

alone and in partnership in foreign countries, which

in return makes the cultural differences to

inevitably show up. The activities of multinationals

differ from those of the local ones because of the

variety of nationalities of managers and employees,

of different cultural backgrounds.

1.2 CULTURAL ORIENTATIONS

A society‟s cultural orientations mirror the

intricate pattern of interactions of the values,

behaviours and attitudes by its members.

Individuals articulate culture as well as its

normative characteristics by way of values which

they hold regarding life as also the world

surrounding them. Such values impact their

attitudes regarding the behaviour type hold to be

attest and most defective in a particular situation.

Steadily stirring patterns of group and individual

behaviours ultimately the culture of the society, and

the cycle starts again. A discussion involving the

issue of cross vengeance usually results in a

discussion on multiculturism. Multiculturism

signifies the process of managing sub-cultures in a

particular nation. It implies an analytical level,

which Hofstede Trompenaars and some others have

completely lost sight of in their work Nonetheless

cross-cultural perspectives regarding nations get

strengthened by making reference to various sub-

cultures in the context of those nations It has been

demonstrated that in Africa numerous cultural

groups care able to have divergent views regarding

the desirability of applying specific practices of

management. A particular system of management

may be adopted but it hardly indicates preference in

cultural terms of a vast majority Contrary to that it

is likely to have been opted for done to the

immense political power of a specific sub -culture

which may assert itself in order that its different

members get hold of the organisations upper

echelons. So, a major sub-culture may involve

itself in order that its different member get hold of

the organisations upper echelon .so major sub-

culture may involve itself in a type of cultural

imperialism which is touched upon by cross-

cultural exporter only form the standpoint of one

nation that is dominating another nation culturally

and not a particular sub-culture taking precedence

over another sub-culture.

Figure1: Impacts of cultural diversity

on individuals

1.3 CULTURAL DIFFERENCE

MANAGEMENT STRATEGIES

The subject of culture has rightly come to

the fore in construction research. So far, the work

has focused on industrialised countries. It is

necessary to reconsider the arrangements and

procedures of the construction industries of

developing countries, especially since the countries

from which they are borrowed have already taken

measures to review or replace them. Effort is

required to reflect the cultural attributes and values

of individual developing countries in their

construction practices and procedures. The existing

ones are not only currently obsolete, but they are

also inappropriate.

1.4 LIMITATIONS AND FUTURE

RESEARCH:

This study suffers from several

limitations. First, the size of the sample was

relatively small, which may affect the significance

level of the moderating effect. Increasing the

sample size may yield new revelations. Second,

there was a lack of diversity among the



respondents, who were overwhelmingly contractors

(85%). This lack of stakeholder diversity may limit

the perspective(s) offered by this particular study.

Advantages and Disadvantages of Different

Cultures:

The research findings also suggest that the

cultural structure is the determiner in taking

responsibilities but that the managers think

otherwise in relation to agreeing with the decisions,

taking responsibilities, and organizational identity.

It is clear that different cultural backgrounds may

make reaching agreement more difficult.

Heterogeneous cultural settings may give rise to

different attitudes or misunderstandings, which in

turn could lower performance and raise conflicts.

What is taboo for some may be a joke for others,

which could jeopardize organizational

communication and diminish employees‟

satisfaction. While different cultures may enrich an

organizational culture, they can also weaken

communication and emotional commitment. The

participating managers complained about having to

explain things at length to members of other

cultures. It is further suggested by the research

findings that cultural differences may make

communication difficult but at the same time make

the work more interesting, with many points that

often go unnoticed being questioned. The

disadvantages of cultural differences are lack of

communication, misunderstandings, conflict, and,

consequently, poor performance. According to the

participating managers, the advantages are a wide

range of opinions, flexibility, increased creativity,

and more tolerance. Multicultural management of

multinationals is of significance for the following

key factors: while informing employees of

organizational activities, information must be given

in more detail and in more time, communication

breakdown in certain processes and activities, too

much difference in opinions and perspectives, and

respecting other cultures. On the other hand,

managers from different cultural backgrounds have

different views on multicultural management. They

might sometimes prefer employees from their own

culture. This raises the importance of forming a

common language (concept) in the work

environment. For this reason, in management of

different cultures, focusing on meritocracy and

performance, rather than culture alone, is more

important.

1.5 NEED FOR RESEARCH

There has been no such research

performed to analyze the organizational culture

between two unique districts, in such a socially

enhanced nation like India; been done before. Past

discoveries of the study performed so far was done

regardless various geographical cultures prevailing

in India, and classifying Hyderabad to follow a

particular organizational culture as a whole, leaving

behind the organizational culture of various regions

in Hyderabad. So, an exploration is being done to

break down whether diverse districts in India have

distinctive Organizational Culture.

II.LITERATURE REVIEW

Al-Jenaibi, B [1] Another positive effect

of cultural diversity in the workplace is the

increased tendency of organizational personnel to

overcome culture shock as the business expands in

other countries and becomes international. This is a

very important benefit derived from cultural

diversity of the employees because many modern

companies have global expansion on their

corporate agendas. With expansion into other

countries comes a range of obstacles including, but

not limited to, gathering information about local

customs and laws in the foreign country, assessing

risk, and designing strategies to overcome those

risks. When an organization has a culturally diverse

workforce, it can use the information and

knowledge of the individual workers to achieve

these objectives and overcome the aforementioned

obstacles. For example, an American company

trying to expand its business in India can draw

information about the Indian federal and provincial

laws that apply to the business, insurances required,

and applicable tax regulations.

Moore, T. W. [2] Difference is just any

other quality that a person uses to uncover personal

differences are people‟s variations in terms of

„race, culture, gender, age, and physical adequacies.

Some definitions of difference also include

variables such as ethnic origin, national origin,

class, religion, ways of learning and

communication, place of birth, and profession.

Cultural difference is a structure that arises from

the mixture of people with different group

identities within the same social system

Management of cultural differences is to create an

environment that allows employees from different

cultures to use their potentials to the full, and to

direct and manage these differences in line with the

organizational goals. In other words, it is the

activity of directing and managing the attitudes and

behaviours of employees from different cultures in

line with the organizational goals. It is the process

of turning cultural differences into a competitive

edge by supporting them with managerial and

organizational strategies rather than melting them

away in organizational settings. This includes all

the organizational and managerial activities relating

to a sense of multinational leadership, formation of

multicultural teams, and creation of a multicultural

structure representative of all these teams.

III.METHODOLOGY

Culture as such has been given many

definitions over the years. It does not have the same

meaning to all people or even researchers in the

fields of anthropology, sociology, psychology and

management Individuals behave differently in



groups than when alone. We human beings are

“social animals” and define ourselves in relation to

different groups to which we belong or want to

belong. On one hand, all humans have the same

needs to eat and sleep, but on the other hand, we

are individuals with our own personalities, in which

nobody else is equal. Belonging to a group creates

a feeling of safety and comfort for an individual

This way, a culture creates possibilities to respond

to the challenges that come from outside; to break

the comfort zones and create new solutions to

problems. According to the widely used definition

of culture by Hofstede a culture is a group‟s

response to its environment. The members of the

group share a set of beliefs and values. This

description is based on the idea that culture is

something that all the members of the group have,

instead of being a social construct, which exists

only in human interaction This means that the

people within a specific culture do not necessarily

share the same meaning or act similarly Levels of

culture have been used in literature in ambiguous

ways, for example in describing the visibility of

culture to the observer (artefacts, values/beliefs,

basic assumptions) or the different spheres of

culture (e.g. national, organisational, professional

etc.) Without analysing and understanding the basic

underlying assumptions of a specific culture, the

interpretation of artefacts and values will be limited

Various spheres of culture interact with each other;

however, it seems that national culture is very

strongly bound to basic assumptions in different

spheres has questioned the whole existence of

national culture, especially if it is linked directly to

the nation state. On the other hand, institutions in a

nation state define the national culture in that

country

Figure2: flow chart

In a global environment with an increasing number

of organizations where more and more people from

different cultural backgrounds work together, the

way in which cultural differences are perceived and

managed gains significance. The present study is

expected to make a contribution to the literature

both with its findings and the academic critiques

that it will attract. This study mainly aims to reveal

how managers at multinationals perceive cultural

differences and what their cultural difference

management strategies are. Studies along these

lines are significant both for management literature

and for managers who have to work with people

from different cultures.

3.1 METHOD AND RESEARCH

TECHNIQUES:

This study is characterized by a

qualitative and descriptive research to examine how

the cultural issue can influence the management of

teams of global projects in multinational

companies. The unit of analysis of this research are

two global projects of a multinational company of a

large automobile industry. For data collection,

proposals were initially drawn up based on the

theoretical referential of this study and, based on

these propositions, it was developed both a

structured interview with semi open questions, as a

questionnaire for the lifting of the level of

agreement of respondents with the statements

presented. The interviews were conducted

personally with each of the managers, and the

issues of the interview guidelines were used, in

order to verify how the cultural issue can influence

the management teams of global projects. At the

end of the interview, it was delivered to the

respondents the questionnaire to indicate the degree

of agreement with the statements presented, with

the aim of ascertaining whether the reports of the

professionals interviewed were in accordance with

the propositions outlined in the study. In addition to

the interviews and questionnaires, information was

collected on each project. For the study of these

different data sources, the method used was content

analysis of the interviews, the responses to the

questionnaire were subsequently evaluated

comparing them between themselves and also with

the propositions laid down, and in parallel, it was

done the analysis of the information provided by

the managers on each project.

3.2 CULTURE AND PERFORMANCE – A

CONCEPTUAL FRAMEWORK

The preceding chapter that there are

grounds for hypothesising that culture does have an

impact on performance, and that this relationship

can be captured empirically. In order to investigate

systematically this empirical relationship between

culture and performance, it is necessary to have a

conceptual framework that brings together in a

logical manner all the essential aspects to be

investigated, and provides appropriate parameters

and points of reference for investigating culture

within a construction project context. This chapter

focuses on the development of such a conceptual

framework and on the development of empirical



referents to aid the development of appropriate

hypotheses, data collection and hypotheses testing.

This chapter thus addresses the third objective of

this research which was to develop a conceptual

framework of the relationship between

organisational culture and performance.

Although models of organisational culture have

been criticised for oversimplifying a complex

phenomenon, it is also recognised that such models

serve an important role in guiding empirical

research and theory generation

Figure3: A conceptual model of the impact of

culture on performance and satisfaction

IV.RESULTS AND DISCUSSIONS

The cultural differences were discovered

through a comparison between national cultures in

Hyderabad and Vijayawada the study was

conducted with a descriptive and explanatory

design. The empirical findings have been retrieved

from a qualitative case study with one Hyderabad

and one Vijayawada manager working within the

case company. The empirical data was collected

through semi-structured interviews that focused on

cultural diversity and how it is managed together

with a concentration on the four cross-cultural

aspects chosen; time, relationships, hierarchy and

gender equality.

Data analysis

In the process of analysing the cultural

differences between India and Sweden an

identification of both cultures had to be done. The

cultural dimension and Trompenaars time

orientation an interpretation of four cross-cultural

aspect causing issues for Swedish companies to

efficiently manage the cultural diversity when

operating in India was made. These aspects are

time, relationship, hierarchy, and gender equality.

The theories have been used as a base to increase

the understanding of cultural diversity and the

effect it has on global organizations. When the data

needed had been collected the procedure continued

with testing the different cultural aspects. This was

done through interviews with a Swedish

organization operating in Hyderabad. The process

of collecting data from the case study was to

develop a real and deep understanding of how the

cultural differences could be managed in an

efficient way. The data collected has been carefully

reviewed in order for the conclusion to be as

reliable as possible and for the analysis to be

legitimate. The authors have throughout this study

continuously evaluated and revaluated the inclusion

of the data to only include the data of relevance for

this research. Furthermore, data has been removed

and added since it is essential for the process of

selecting, abstracting and simplifying data to

enable the analysis to be consistent the

interviewees did go off the topic sometimes during

the interviews, therefore everything that was stated

and discussed was not included in the empirical

data. Only the parts of relevance for the study were

included which was decided after listening to the

interviews more than once to make sure that

nothing valuable was discarded

Comparison of organizational culture between

Hyderabad and Vijayawada region of India

Figure4: Difference of cultural profiles between

Hyderabad and Vijayawada regions

It was concluded from this examination that

"market" type of organizational culture dominates

in the small-scale development companies located

in both the selected study area,

Figure5: Organizational Chart



Hyderabad and Vijayawada the characteristic

features of “market” culture following companies

are that their focus lingers around getting the work

done by any means, with a high competition to

reach the end goal. This prominence on winning

keeps these organizations together. This finding is

disputing that Indian culture has both socialistic

and unorthodox or individualistic attributes because

of their inclination for a bigger social system.

Table1: Mean Scores of Elements of

Organizational Culture

Finding no statistical difference between the

Hyderabad and Vijayawada region of Indian

construction companies, it can be reasoned that

there is no huge distinction of the organizational

cultures honed in these two regions of India. The

mean score of the “market” culture in both the

regions are comparatively higher than the other

types of organizational culture, concluding that

both the regions follow dominantly “market” type

of organizational culture. It can also be stated that

India, being a developing a nation, follows

“market” culture. With a specific end goal to look

at the organizational culture of the interviewees‟

construction companies more thoroughly, the

scores of each of the individual attributes of

organizational culture were plotted the differences

of dominant characteristics graph are given in

organizational leadership management of

employees in organizational glue in strategic

emphasis and criteria for success in in between the

Hyderabad and Vijayawada regions. The plots for

each of the individual attributes of organizational

culture demonstrate the degree to which attributes

reflect the controlling culture between the regions;

and the overall cultural profile gives the idea about

the type of organizational culture practiced in the

selected study areas.

Figure6: The difference of the dominant

characteristic feature of the organizational culture

Figure7: The difference of the organizational

leadership feature of the organizational culture

Figure8: The difference of the employee

management feature of the organizational culture



Figure9: The difference of the organizational glue

feature of the organizational culture

Figure10: The difference of the strategic emphasis

characteristics of the organizational culture

Figure11: The difference of the criteria of success

feature of the organizational culture

Connection between the culture of organizations

in the construction organizations and its impacts

on development

As indicated by the outcome‟s organizations of

Hyderabad and Vijayawada regions of Indian have

the similar dominant organizational culture. This

might be the reason why all the reviewed

development companies encounter relatively same

level of delay in their projects. It is worth

investigating the connection between

organizational culture and postponement in

construction. The discoveries displayed in Table

demonstrate that the construction organizations of

both the locales encounter 10-15% postponement

for finishing their

endeavours in time, with 5-10% cost overrun, as in

Table This finding shows that Indian construction

companies are outperformed and less efficient in

completing projects on scheduled budget and time

TABLE2: Percentage of Delay

Table3: Percentage of Cost Overrun

V.CONCLUSION

The impacts of cultural diversity in the

workplace can be both favorable and unfavourable.

Some negative effects include dysfunctional

conflicts, lost productivity, and difficulty to achieve

harmony in group settings. Positive effects include

a strong knowledge base created by a variety of

cultural experiences, an in-house resource of

cultural trainers and informers, and a greater

tendency to expand the business in foreign cultures.

For the most part, the effects of cultural diversity in

the workplace depend upon how well they are

being managed by the organizational leaders. With

proper strategic planning, top management can

enhance the positive effects and reduce the

negative effects of cultural diversity in the

workplace. With an aim to explore the

interconnection between the culture followed by

the organizations and its impacts in Indian

construction companies, the case study from the

selected study area, i.e. companies in Hyderabad

and Vijayawada regions reveals that a connection

exists between organizational culture followed by

the construction organizations and the impacts due

to it, mostly in terms of postponement and cost

overrun, in their development endeavours. By the

information gathered by questionnaire survey from

the respondents of the enterprises of the selected



study area (40% response rate from Vijayawada

regions and 41.2% response rate from Hyderabad),

and analysing the values by “T-test”, it was

revealed that statistically the sample mean scores

do not differ much in between the two selected

regions. The survey results also propose that the

type of culture followed by an organizational is

related with the postponement and cost overrun of

the construction companies. The results indicate

that there is a 10-15% of postponement of the

ventures with 5-10% cost overrun in both the

selected study area regions.

5.1 FUTURE SCOPE

This study has focused on one

organization that operates in Hyderabad and

Vijayawada and the findings are therefore not

generalizable for all organizations and cultures. It

would be interesting to conduct a study to further

do a research on cultural diversity within

organizations and compare more than one

organization, preferably from different industries.

Since there are different states in India and the

national culture differs in different regions, the

authors of this thesis propose a study where

organizations from different regions of Hyderabad

was investigated to get a more generalizable result.

Culture is difficult to generalize, therefore it would

be interesting to conduct a research considering

different subcultures in Hyderabad and Vijayawada

This research has primarily used Hofstede's cultural

dimension and Trompenaars‟ time orientation to

understand cultural differences between India and

Sweden and it is suggested to use even other

cultural theories to analysed the cultural

differences.

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cultural impact if multinational work force in

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