Currently, this globe is experiencing globalization, because people may get in touch with each other more easily and have the information they need from the largest source of knowledge – the internet. Commercial entities and individuals of different nationalities can operate a number of activities here collectively. Therefore, a Multinational Company (MNC) is a perfect example for this matter; nevertheless, there are several challenges as relates to its organizational culture. A MNC is an enterprise that normally has its headquarters in one nation, that is, the home nation, and runs its offices or factories that it uses for operation in other nations, which are known as host nations (Van den Born, Floor & Peltokorpi, Vesa 2010, p. 97). The idea of a transnational company has been around for centuries, and the basis of the idea is thought to be Dutch East India Company of the 17th century. In the 19th and 20th centuries, the transnational company turned out to be more and more common, and in the 21st century, this company model has been exceedingly growing as well.
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The host nations may extract various advantages from the existence of transnational companies. Many companies have declared that local workers should be working with them and also diminished the level of unemployment in third-world nations. Additionally, transnational companies bring in positive effects on the expansion of economy within the host nations. For example, transnational companies attract investments from various nations and create competition for local commodities and goods from international companies. When the competition takes place, domestic workers will obtain more alternative to select from (Marginson 2010, p. 151).
The challenge of transnational companies is to blend various workers that have diverse nationalities and different cultures. It is not just a single country in a transnational company but there are many participants globally; therefore, norms, cultures, nationalities, and beliefs of every worker are a huge problem of a transnational company. This is because if individuals have variation in cultures, norms, and behaviors they may have different ideas and views on affairs, especially in the transnational company that has a huge deal of persons from different parts of the world (Chatman & Jehn 1994, p. 522). Therefore, it is possible for workers with different nationalities to get into conflict on the matters of personnel. The solution concerning this issue is: the employer should study the culture, norms, values, and beliefs in every nationality. She should also encourage the worker to express observations, share achievements and experiences.
Additionally, the workers should be very keen on the individuals who are racially or otherwise biased and discuss the problems revealed. Furthermore, workers have an influence over anyone within the organization with a similar aim. If both workers and the employer manifest a common desire to accomplish same purposes, the company will grow. In the long run, it will raise huge profits, directly influencing everybody in the company.
It has been perceived that in numerous foreign based companies, business-oriented standards are derived deliberately and instinctively from their organizational culture (Asma 1996, p. 1). Correspondingly, Harrison (1994) contended that organizational cultures may differ depending on the functions, authority structure, and ability to run the place of work (p. 10). For example, American cultural standards have permeated IBM, DuPont, and Exxon Mobil, whereas Japanese cultural standards dominate in Sony, Hitachi, Nissan, and Mitsui. These businesses bring in their cultural baggage in various ways, that is, structures, processes, and systems comparable to their home nation anywhere they operate the business. For example, Japanese culture is mainly concerned with communism, the life-long devotion to their businesses, and the Samurai spirit used in their place of work. Conversely, American businesses emphasize more on the person-based recompense systems rather than grouping reward systems (Asma 1996, p. 1).
2.6.1: Culture’s Influence on Persons as Employees
A worker’s ability to work effectively and successfully will depend on the organizational culture. As a result, the culture may either negatively or positively affect the workers of the company (Mowbray 2010, p. 7). Worker behavior is also known as organizational behavior, or the outcomes of facets that influence the ways workforce reacts to their task, management, and clientele. Making out the interior and exterior facets that have an effect on their behavior may assist the company in comprehending why its workers are devoted and motivated. The examples of interior factors include organizational structure, management and corporate cultures, while exterior factors are family life and other company relationships.
Management- this plays a main role in setting the tone of an organization. According to Mowbray (2010), the one quality that influences worker actions in an optimistic way is the confidence in management (p. 8). When workers see management as truthful and respectable, they are motivated to be more fruitful and the rest of the business will follow suit.
Organizational structure- Lamer University defined organizational structure as the formal structure of duty and reporting relations that organizes, directs, and inspires workforce in order to accomplish corporate goals. This includes the organization’s strategies, processes, and expectations. A well-built organizational structure enables the workforce to be more resourceful, whereas an unwholesome structure may keep the workforce from attaining their potential goals (Nicole 2012, p. 1).
Corporate Culture-The organization’s elusive norms constitute its organizational culture. For instance, the business culture of Starbucks consists of sociable service, convivial ambience, and flexibility of working schedules. This kind of culture differs from that of a domestic police unit, which concentrates more on defending the public the way it is supposed to be done.
Family Life- Workers’ family life may have direct impacts on their behavior. If the worker has conflicts in the family, it may influence his behavior at the work place. The worker may react unconstructively to criticism in communication with the management. Thus, the contentment with the home life may lead to job motivation and a happier worker (Schein 1993 p.5).
Company Relationships- The relationships with other companies have impact on worker behavior. For instance, if a business has partnerships with other businesses, and these other businesses have higher expectations, the workforce may react by enhancing the performance in response to the higher expectations.
220.127.116.11: Understanding and Influencing the Culture of an Organization
According to CBI/Pfizer study (2010, p.1), concentrating on the work culture had a similar level of influence on absence as sickness absence management. It also argued that the wellbeing strategies have positive impacts on absence ranks, efficiency, and integrity. According to the World Economic Forum and Consultancy Right Management (2010, p.1), the wellbeing is shaped by workers’ psychosomatic and physical health and that the organization involved in supporting wellbeing is probable to have a solid development in worker involvement, production, inventiveness, and minimize talent drain. Therefore, wellbeing influences involvement in diverse ways. People’s unconstructive attitude to the job satisfaction and involvement, devotion to the organization, lessened motivation, feelings of betrayal, as well as the organizational loss of trust, weakening interactions, fear, resistance to change, raised inflexibility and worsened quality, production, and clientele relations. These effects may be experienced by the senior managers who ignore the needs of the workforce at the bottom of the company (Hallier & Lyon 1996 p. 107).
The performance within the company and its culture reveal that businesses which are aware of developing their cultures in a successful way most likely embrace the benefit of improvement in production and the superiority of work life amongst the workforce. Certainly, workers have to absorb the company’s culture to the maximum and the top leadership must offer accurate guidelines to inspire the workforce in accomplishing the company’s goals.