The increasing globalization of modern businesses has posed a problem of integrating the headquarters of enterprises with their subsidiaries.
At the point, there are many approaches and models helping us understand the nature of cross-cultural management as well as those strategies which business administrators should adopt in order to make the company more productive. This paper will discuss the theories of convergence, divergence, and crossvergence that show how different cultures interact with one another.
Overall, the theories of convergence postulates that the key driver of value formation in any international organization is technology and economic development, which means that a less industrialized society tends to adopt the values of a more technologically or economically advanced country.
For example, if a U.S.-based company has a subsidiary in India, China, or Taiwan, the value system of the subsidiary will resemble that one of the headquarters (Ralston, n. d. p 5). One should also mention the so-called divergence theory which opposes the idea of convergence. According to it, socio-cultural differences between the headquarters and the subsidiary can hardly be minimized (Ralston, n. d. p 5).
Furthermore, they should be managed according to the principles that are habitual for the employees of a certain country or culture. Finally, one has to speak about the idea of crossvergeance.
According to it, values of organization as well managerial strategies have to be based on a certain business ideology and socio-cultural innfluences (Ralston, n. d. p 6). The advocates of this approach assume that that the management of an international company depends on the demographic trends in a certain region, the age of employees, their religion, the product of a company, and certainly their culture.
Overall, the knowledge of this theoretical framework allows the manager to better coordinate the effort between the headquarters and the subsidiary. On the basis of this research, one would be able to pinpoint a certain idea which would unite members of the personnel, irrespective of their cultural or ethnic origin.
The theories of convergence are similar to other approaches to cross-cultural management. For instance, one can mention Hofstede’s cultural dimensions. Hoftededy argues that culture shapes work-related values such attitude to hierarchy, relations between the employees, assessment of one’s performance and so forth (Hofstede as cited in Johann, 2008, p 5).
Nonetheless, the theories that we have discussed, are more oriented toward practical needs of international companies, in other words, they are aimed at answering the question how people of different cultures can work together.
If I had been faced with a task of integrating headquarters with subsidiaries, I would have applied the theory of crossvergence as a guide. In my view, this model is the most beneficial one because it urges the managers not to overlook the importance of employee’s age, gender, religion, political system in the country, and so forth.
Furthermore, this framework differentiates between the work values of an individual and the team and this aspect is frequently overlooked by other theorists.
A manager who is trying to integrate the headquarters with subsidiaries would have to come up with a certain value that would appeal to each employee, for example, the uniqueness of the product or excellent quality of the services, offered by the company. In other words, each of the workers must be proud to be employed the company. Only in this way, one would be able to find a common denominator between cultures.
References
Johann. R. 2008. Cross-Cultural Management: The Case of the DaimlerChrysler Merger. GRIN Verlag.
Mead, R and Andrews, T.G. 2009. International Management 4th Edition. NY: John Wiley and Sons Ltd.
Ralston. D. (n. d) “The Crossvergence Perspective: Reflections and Projections”. University of Oklahoma. Web.