Both cultural diversity and international business management skills are closely related in the sense that both of them are crucial towards the success of any form of globalised international business. In addition, it is worth noting that international tourism management largely relies on how well both cultural diversity and overall business management have been integrated.
This paper offers a succinct discussion of cultural diversity in international trade and skills or competences required to manage international businesses. In addition, the paper relates the two topics of discussion and how they are significant to tourism industry.
Topic I. Cultural diversity in international trade
Managing cultural diversity in international trade has become one of the most fundamental requirements when managing modern multicultural and multinational enterprises.
When this form of diversity is managed well, it aids in enhancing workplace relationships bearing in mind that individual employees will be in a position to appreciate cultural values of members drawn from diverse cultural backgrounds by interpreting their behaviors and actions.
Besides, organizational performance of a multinational enterprise is greatly influenced by cultural differences experienced in the course of complex interaction between the immediate business environment and individuals.
It is against this backdrop that Torres-baumgarten and Yucetepe (2009) point out that the latter may easily affect the degree of satisfaction, motivation, performance as well as l diversitbehavioral patterns of individuals especially at their places of work.
On the same note, cultural diversity has been used as a major in tourism industry. While this form of diversity may act as a draw back in international trade, it is highly likely that the multicultural aspect of a region may be used as a major strength in building tourism industry.
Cultural diversity as well as equality in international trade in a foreign country remain as some of the most important factors that define the ability of an international organization to promote greater creativity, strengthening its brand alongside improving production and profitability.
Moreover, management of cultural diversity and equality in a multinational enterprise is gaining popularity rapidly and is being used to facilitate faster attainment of organizational objectives.
However, in spite of key legislations which have been in existence for long to encourage diversity and reduce inequality, managing cultural differences still remains a major challenge. The tourism industry is also bound to suffer great losses in regions where international trade has been thwarted by the aspect of culture.
Hofstede argues in his cultural model argue that cultures of diverse multicultural enterprises in a foreign nation are based on different independent dimensions that include short-term or long-term orientation, uncertainty avoidance, masculinity or femininity, individualism or collectivism and power distance (Hofstede, 1993).
While the tourism industry has benefitted a lot from the multicultural domain of most destinations, it is imperative to note that the proposed model can indeed assist a manager of a multinational enterprise in predicting the values and practices of societies or nations that host them.
It is imperative to note that the culture of a given society is the sum of its assumptions, beliefs and values. The man-made part of that culture is influenced by the perceptions individuals have of their social environment. In addition, a prescribed behavior of a particular society and enterprise is shaped by those shared perceptions.
An international manager intending to manage cultural diversity among a workforce may not be able to directly observe culture, but can easily infer it from verbal exchanges and daily societal or organizational activities.
It is also worth noting that tourism industry relies heavily on operations across borders. Hence, the aspect of cultural representation of employees in tourism agencies is of great importance. Managing cultural diversity in a multinational enterprise is therefore important for the following reasons:
To enhance organizational networking
Schwartz argues in his cultural value theory that effective understanding of different cultures may assist a manager to develop social networking behaviors with a multicultural workforce or businesses.
His theory strongly indicates that a manager in an organization or a multicultural enterprise who intends to be effective and succeed in management operations must possess or develop positive patterns of behavior necessary for social networking.
As an international industry, the growth of tourism is indeed dependent on organizational and social networking. Nearly all multinational enterprises today including tourism are operated with an aim of growth and maximization of profits.
Developing a positive networking behavior in this industry will not only aid such an enterprise to build good relationship with other businesses, but also assist it to acquire scarce resources for business growth.
Additionally, effective understanding of masculinity and femininity cultures as Hofstede indicates has been a positive networking and management behavior that has enhanced many multicultural enterprise relationships with different cultures.
As such, this has aided it in obtaining external resources necessary to drive up the business and establishing an effective workforce.
To promote diversity and equity in the workplace at all levels of management
Managing diversity in a multicultural enterprise should start from the lowest level of an organization management and be reflected up to the top. Furthermore, leaders should constitute teams that reflect strong gender sensitivity and representation. Most societies from Hofstede’s perspective of masculinity versus femininity offer male gender better positions than the female.
It is important to note that due to the current male dominance in most organizations and middle level management, human resources management should facilitate the change of trend by ensuring equity in teams. Use of teams in societal working as Schwartz postulates in his cultural value model gives all members of a workforce a chance to learn and perfect their skills in line with their company’s objectives.
Teams would further allow all workers irrespective of their race, gender, religion or origin to assert their skills and prove their critiques wrong. With acting as latter source of leaders and managers, Shwartz conclusion that they create the best basis for anchoring diversity and equity is therefore correct.
Schwartz dimension above is almost congruent with Hofstede’s homonymous dimension. In his power distance dimension, Hofstede points out that the degree of equality in a society should be stressed since it allows upward mobility for citizens. Managing a multicultural enterprise requires balancing power distances between the management and workers to minimize inequalities.
For instance, at Dell Company, emphasis on equity and diversity is reflected at all levels including the top management. The management of the company should be reflected from the top. The top management should be a role model and reflect diversity in itself.
Hence, there is need to include disabled people, both genders, and different races in the top decision making teams to create the sense of equity to lower levels of the company. Both to lower level management and the community, a diverse top leadership team would be easy to emulate and ultimately make similar applications easier.
Use of rewards and incentives on the basis creativity
Trompanaar points out that there is need.for a society to appreciate cultural diversity in his achievement versus ascription dimension. He points out that in cultures that are highly ascription oriented, rewards for personal attributes such as experiences should be given regardless of race.
The notion that diversity and equity application is largely dependent on organizations’ management calls for more innovative ways to change their operations. Trompanaar’s dimensions fits well with Hofstede’s achievement versus quality of life dimension that calls for use of rewards and incentives in managing cultural organizations that articulate diversity and.
Both models almost unanimously agree that employees in a multicultural business regardless of their cultural background would respond positively to rewards like promotions and bonuses as they add meaning to their work life.
Employees’ development and capacity building
Schwartz argues in his cultural value model that the biggest step that organizations can make in fostering diversity and equity in organizations is facilitating employees understanding on their rights.
In their publication, Bellin and Pham (2007) argues that though managements remain the greatest determinants of equity and diversity in their organizations, employees must not be passive. They should constantly equip themselves with laws requirements on equity and diversity.
Their argument echoes Hofstede’s position on masculinity and femininity where gender differentiation is considered a major issue in societies where power structure is male dominated.
Individuals in such societies, especially the discriminated ones, must defend their rights. In a multicultural enterprise, effective management of cultural diversity calls for low masculinity where both male and female genders are treated equally (Schlein & Garii 2011).
Topic II. International business management
The emerging competitive business environment calls for effective and competent international management skills. The foundation of successful management functions in international markets is dependent on intercultural skills of multinational managers as already discussed.
Similarly, international markets are affected by variety of internal and external factors that are likely to hinder business operations in the foreign country. Proper application of the four management activities is what guarantees success in achieving international and national business goals and objectives.
On the same note, the growth and development of tourism industry demands effective management of international tourist platforms and destinations (Bhatia, 2001).
Organizations today both in international and home markets are directing most of their efforts towards achieving two important goals; increase profitability and securing their competitiveness for the future.
To achieve the above goals effectively, businesses appointed managers who are entrusted to carry out various managerial activities to steer the business towards its goals and objectives are needed. Scholars in management have identified four management concepts that assist international organizations to achieve their set goals and objectives if effectively executed.
The most basic operation of international tourism management is planning. It acts as a foundation upon which all the other functions of management are built upon. The process of planning involves a critical assessment of the organization in terms of its present positioning in the market, and the future threats and opportunities it is likely to encounter.
The results of the above evaluation are what determine the course of action that a company will adopt to achieve the set goals and objectives. Additionally, international managers should note that planning activity is a continuous process that should be modified as an organization faces sudden challenges and identifies new opportunities in the course of attaining objectives and goals.
Sometimes, external factors that affect a business negatively may compel a multinational enterprise to redesign new action plans to accomplish certain goals especially when operating in unfamiliar regions.
For example, a new brand of soap in the market might force the companies dealing with similar products to rethink of new marketing strategies to maximize their positioning in the market. Research has shown that business environments are evolving continuously, therefore, it had become extremely difficult to predict what changes might be present in the future.
As exemplified above, the main concern businesses is how to secure a competitive edge in the future market. For this reason, managers today are adopting a new preparation strategy known as strategic management as part of planning activity.
Therefore, strategic management is a situation where an organization’s management critically analyses internal and external factors that are likely to hinder achievement of its goals and objectives.
As stated above planning is the foundation of all management activities. Therefore, after successful planning the second function is getting organized. The responsibility of international management at this stage is to organize the necessary resources (both manpower and material) needed to implement the course of action identified in the planning stage.
Boddewyn, Toyne and Martínez (2004) expound that organization is a managerial activity that seeks to create relationships by assigning a specific responsibility for each team member and identify the authority to head each team. It is also worthy to note that international tourism is part and parcel of globalization since there are no barriers to free flow of people and goods.
Therefore, an international manager has to take care of staffing issues with the global aspect in mind, since it the most important asset in the attainment of goals and objectives. Staffing as a subsidiary organizational activity is concerned with the entire process of equipping an organization with the necessary manpower or human resource.
This includes issues to do with recruitment, selection, training, placement, compensation, demotion if any and employee’s retirement issues. The main aim of assessing the staffing needs of an organization is to ensure that it gets the right men for the right job. The capacity and ability of an organizations hired personnel is what determines the future success or failure of the organizations goals.
The third and equally important management activity is direction and leadership. The main concern of process of management is getting the work done to achieve the desired goals. To get the work done, the human assets require continuous motivation and encouragement to work effectively.
It is the role of management to direct the team towards the delivery of action plans. It achieves the above function by giving instructions and constant communication about orders, rules and decisions. In addition, the management provides guidance and leadership, supervises the work delivery process and employee behavior towards the same, and inspires the employees towards improved performance.
Research has shown that employee satisfaction translates to positive and improved performance (Schneider & Jean-Louis, 1997). Therefore, most managers today are focused on improving employee satisfaction, and this should be activity for every organization that wishes to survive the cut-throat competition (Boddewyn, 2004).
For example, the management can carry out employee satisfaction surveys to find out the level of satisfaction. Depending on the results, the management can improve on the areas identified to be creating a dissatisfied workforce.
This process of defining the desired direction and leadership of a company can be achieved with ease, however, pro-activation the right direction requires an insightful and experienced management.
The last of the four functions of international managers is control. The main aim of this function is to establish performance standards that are biased towards achieving organization’s goals. It also involves carrying out performance evaluation on how the actual job is progressing.
In the case of tourism industry, control is crucial in identifying and maintaining the attractiveness of a destination. For instance, the management is supposed to communicate the expected performance standards of employees, and sheds light in case any of the organization’s department is experiencing a challenge in achieving the required standards.
Similarly to the management functions identified above, control activity is a continuous process. The management constantly evaluates the performance standards and identified the challenges that hinder improved performance standards.
The continuous control evaluation process is important because if any future problems are identified, preventive measures can be put in place immediately. In brief, the managerial control activity is a kind of a follow up process that examines performance and compares it against the identified actions plans, and takes corrective measures if needed.
As such, impressive growth in revenue in tourism industry can only be initiated and sustained in an environment where an international manager is exercising utmost control though with due caution.
References
Bellin, O.B. & Pham, C.T. (2007). Global expansion: balancing a uniform performance culture with local conditions. Strategy & Leadership, 35(6) 44-50.
Bhatia, A.K. (2001). International Tourism Management. New Delhi: Sterling Publishers Private Limited.
Boddewyn, J., Toyne, B. & Martínez, Z. (2004). The Meanings of International Management. Management International Review, 44(2):195-212.
Hofstede, G. (1993). Cultural constraints in management theories. Academy of Management Executive, 7(1)81-93.
Schlein, C. & Garii, B. (2011). Cross-cultural interpretations of curricular contextual crossings. Issues in Teacher Education, 20(2) 81-94.
Schneider, S. & Jean-Louis B. (1997). Managing Across Cultures. New York: Prentice Hall.
Torres-baumgarten, G. & Yucetepe, V. (2009). Multinational Firms’ Leadership Role in Corporate Social Responsibility in Latin America. Journal of Business Ethics: Supplement. 85, 217-224.