Cross-Cultural Management

Culture is something socially constructed and historically infused in people’s beliefs, perceptions, and behavior. It has been defined as “the collective programming of the mind which distinguishes the members of one category of people from another” (Hofstede 1980). Since business is made by people, all organizational activities, from leadership to decision-making, are somehow impacted by culture. Cross-cultural management is the group of strategies and policies, usually adopted by international or multinational firms, aiming to improve the coordination and cooperation among employees and between staff and external business actors that embody different behavioral norms and interpersonal expectations due to their respective national cultures. The basic assumption of cross-cultural management is that there is the potential of misunderstandings in the context of relationships between individuals and organizations from differing cultural backgrounds. From the 1970s to the 1990s, culture was described as a barrier to interaction and source of frictions. Yet, recently, the idea of culture as a resource of organizational learning and competitive advantage also emerged. Companies that leverage from their multicultural workforce can better satisfy different clients and speed up knowledge transfers. Therefore, the goal of cross-cultural management studies is to help identify the characteristics of particular cultures, make comparisons, and provide insights on how to conduct the cross-cultural interactions to both avoid conflicts and get benefits from the correct handling of cultural differences.