(TIỂU LUẬN) EXECUTIVE SUMMARY 2 PART a ISSUES IN CROSS CULTURAL MANAGEMENT

In this report, there are two real-life case studies of Tung Ho company language barrier and power distance and two online case studies Tel-Aviv, Boston, and Nokia to clearly identify th

RMIT University Vietnam

Subject Code: BUSM4699 Subject Name: Cross-Cultural Management

Title of Assignment: Team Consultancy Project Written

Report Team Name: Pui Pui Pui Group Number: SGS Group 2

Student Name & ID: Le Duc Phu - s3759546

Le Phuoc Duc - s3694795 Nguyen Viet Long - s3713043 Nguyen Quang Dat - s3695518 Pham Nguyen Quynh Anh - s3759034 Nguyen Doan Nhat Quang - s3713027 Teacher's Name: Nguyen Mai Ngan

Assignment due date: 10 January 2021

Date of submission: 10 January 2021

Number of pages: 15

Word count: 2714

TABLE OF CONTENTS:

EXECUTIVE SUMMARY:

The report provides the readers the information when people work in a cross-cultural

workplace environment, such as what are the problems they have to face and the solutions for those issues In this report, there are two real-life case studies of Tung Ho company (language barrier and power distance) and two online case studies (Tel-Aviv, Boston, and Nokia) to clearly identify the problem this company is facing with related-theories In the interview report, Tung Ho shows that the work between two cultures Vietnam and Taiwan have

significantly different causes of discord in the office and that hinders the development of the company Additionally, Tung Ho also faces the power distance problem, which can cause a disagreement in the company management between the employees and the director – Mr Hsu Yi-Chih Besides the problems, the report also presents three specific recommendations for those challenges The first two solutions are for language barriers, which are allowing the managers to learn through the translation classes and providing the workers the foreign language classes Those two solutions are the benefits for the employees to overcome the language barrier and also avoid the misunderstanding in the workplace The third solution is reducing the power distance by having skip-level meetings Based on this recommendation, the lower-level employees can easily exchange their ideas, contribute their work to the higher-level employees and the company This action will make employees feel respected and they will promote themselves to the company

INTRODUCTION:

In the age of development, many organizations want to expand their business across the country, therefore, most big companies presently adapt to the cross-cultural concept The cross-cultural business helps the firms expand different marketplaces globally as well as seek the resources in many countries (Hummel 2012) With diversity, the employees sometimes misunderstand others when they have high potential in work, which is one of the big

problems when many cultures work together The difficult part is how the leader can manage the multinational team works smoothly to encourage employees to thrive in a modern

workplace (Reynolds 2017)

This report will clearly present the problems in the multinational workplace with the real national business and how to resolve it for the company to operate effectively To be more specific, this report will analyse two main issues when working in a cross-cultural

environment, then discuss two real-life case studies of Tung Ho company and two online case studies with many theories to help the readers understand the challenges in the business Finally, the report will provide some positive recommendations to resolve the cases

PART A: ISSUES IN CROSS-CULTURAL MANAGEMENT

1 Language barrier

Language challenges are considered as remarkable problems of multilingual organizations at the surface stage Generally, society and its environment have a tendency to determine figures

of speech, idioms or certain sentences in one’s vocabulary (Kaplan 1954) As a result, it is not

an easy method to articulate oneself in a way that equivalence can be obtained from one language to another (Case 2015) The possible doubts and uncertainty because of language barriers could interrupt the smooth interactions of a firm and delay the execution of that firm

If businesses apply a dominant language or follow a lingua franca, people can feel

endangered or excluded if they cannot rapidly acquire fluency and language skills (Kroon, Cornelissen & Vaara 2015) In the face of these language ambiguities, economic results, and difficult events, a loss of confidence can emerge and affect how people think and respond to each other

2 Power Distance and its related problems

Cultural misunderstandings and cultural conflicts could result from a combination of cultural similarities and differences

As this issue is held deep within the cultural values, especially in Asian countries, it is not an easy challenge to deal with High power distance employees tend to establish a love-hate relationship with their managers on how they treat and their leadership style Considered as

the natural order, lower power employees tend to comply with the orders from higher-level ones, or else they will meet their consequences (Sweetman 2012) This is in contrast to the employees in the low power distance environment as they are less appreciate and respect their superiors due to the more freedom of speech and engagement at work A research by Wei et

al (2017) found out that the employees in high power distance environments tend to keep a good relationship with their managers to gain the access to the resources that they want, or just interest in what benefits them from that relationship In contrast, employees in low power distance environments work with their superiors or subordinates as partners As far as the freedom of speech is concerned, they believe that the distribution of power and equalities should be established and maintained Power, in this case, is a competition to acquire expert power rather than declare a social status, which is true for the high power distance group

Kim (1999) stated that connection within a high-power distance community such as Korea shows a vertical pattern Formal correspondence is mostly top-down, running through the nominated pyramidal chain of handling Optional response from the bottom is not so much

In a representative meeting between a senior and an inferior, a senior usually does much of the communicating while the inferior only shows his or her agreement Khare (1999)

manifests that, owing to the organization’s geographical structure of Indian groups (India is considered as a high-power distance country), the connection between superiors and inferiors

is restricted to ceremonial networks Furthermore, thorough and in-depth job descriptions for each employee originate the compartmentalization of tasks

As a result, there are a few casual interconnections between superiors and inferiors Hofstede (2001) further suggests that organizations and societies identified by high power distance do not have many informal contacts between upper and lower levels of the organization and advocate the consolidation of power and decision-making in a few hands of superiors

Cultures gaining high points on the UAI or cultures with a high degree of uncertainty

avoidance are usually less relaxed with uncertainty and effort through legislation, policies,

laws, restrictions and behavioral standards to minimize or handle uncertainty and vagueness

It is significantly clear that high UAI societies aim to handle improper, uncertain

circumstances not only through ceremonial, obvious rules and regulations but also through tacit, implied rules On the opposite, low uncertainty avoidance societies are familiar with uncertainty, and are secure when facing doubt or disorganized circumstances These societies

do not depend as stiffly on rule-oriented frameworks for uncertainty reduction, are usually more unprejudiced of risk-taking, and easily adapt to reform (Smith 2016)

PART B: CASE STUDIES

1 Communication Barrier

First, the language barrier is one of Tung Ho’s serious problems According to Mr Hsu, he pointed out that in the company, the difference of languages between Taiwan and Vietnam causes difficulty in communication In particular, Taiwanese cannot speak Vietnamese well and local employees cannot interact with the Taiwan language Consequently, this has caused delays in implementing ideas and projects because managers and employees in Tung Ho are often confused and do not understand each other Even though the company has more than 50 translators, it is considered an effective solution since it cannot approach all the

communication and interpretation demands in the operation and innovation of the business processes

In addition, Mr Hsu has come up with a solution using a common language for easier

communication at the company, which is English However, speaking English is a challenge for the old generation, which interferes with experienced employees at Tung Ho To explain,

in their generation, learning English was not popular and practical, therefore, people did not concern themselves and spend time on language development Another reason to explain their bad ability of English communication is a financial crisis before 1990 in the Vietnam context Specifically, they did not have the conditions to receive a good education quality and

infrastructure in learning English However, they still play an important role in the company due to their experience in the steel industry Hence, this becomes a big problem in the

company when the experienced employees are old generation and have poor English

flexibility

Applying Schein’s Cultural Iceberg (Appendix 1), language plays an essential role in

organizational culture In this case, miscommunication in Tung Ho has affected significantly the individual behavior and business operation Besides, based on Karen’s theory (1954), Tung Ho has confronted creating an attractive working environment due to shared ideas barriers Last but not least, according to Case (2015) argument on Part A, it is a huge

challenge for Tung Ho to achieve an optimal performance since the express ability of

employees is hindered

2 Power Distancing at Tung Ho

As a steel manufacturer, Tung Ho was expected to be a company that would have a decent power distancing at the workplace However, as this company has gone international, its power distancing culture is considered to be old-fashioned and unsuitable for this type of business

Tung Ho’s hierarchy is indeed a reflection of a typical power distancing structure This is the social/cultural norm in the two countries According to Hofstede, both Taiwan and Vietnam rather have high power distance within the company and the society This issue is a “double-edged sword” as it benefits while also causes damages to the firm As the employees only follow the order from their superiors, the company has no problem with its operations

throughout its growth However, this “benefit” is also a real issue for the firm in the future as

it blocks the voices and the opportunities of the newcomers, or the new generations, to further develop Tung Ho

In addition to the issue, the top positions in this structure are all Taiwanese This reality caused a problem in teamwork and communication between members and cultures as besides

being power distanced, there is no cultural diversity within the company’s structure The company’s decision for this non-diversity structure is understandable, as according to a research by Dr Carol Kovach (FCSIDHARTA 2016, Appendix 2), a multicultural team could result in a highly effective performance or just highly ineffective while a single cultural team should have their effective average throughout their performance, which is related to the already-mentioned UAI

However, as stated by Mr Hsu, he concerned that the young generations would be more open

to ideas and changes, which is against the cultural norms that he is familiar with, and thus will affect the company tradition and furthermore, the performance of the company

Therefore, this statement has somewhat illustrated the current problem of Tung Ho and also

in the future

3 Online Case Study

Language Barrier: Tel-Aviv and Boston

The case “Tel-Aviv and Boston” is a typical realistic example of the language barrier aspect Particularly, Tel-Aviv is an Israeli company with many local employees, while Boston is headquartered in England In this case, the managers of both two countries had a meeting call

to discuss the transformation of cloud-computing products In the online conference, the Israeli manager of Tel-Aviv had a miscommunication and used the wrong words “Don’t care” instead of “Don’t worry” This made Boston’s manager become very aggressive and the conference was terminated immediately after representative Tel-Aviv’s unintentional

statement Consequently, both two companies are also delayed in implementing their

development strategy and negatively affects sales and business relationships (Lautman, 2017)

Power Distancing: Nokia

Nokia is a perfect example of how power distance will ruin a company’s development in the long run The company was once worth $150 billion, with huge successful achievements back in the day Nokia’s loss was rumoured to be not having enough potential and resources

to keep up with Apple, a newcomer with breakthrough-innovations in the smartphone

industry However, the problem with Nokia is that its leaders were not taking Apple seriously

as their competitor Furthermore, mid-level managers and employees were not in the

discussion with their bosses about this rivalry The distance in power was just too big

(Approachable Leadership n.d.)

PART C: RECOMMENDATIONS

1 Overcoming language barriers

The language barrier is the biggest challenge to create an effective communication

environment to achieve the highest productivity inside and outside the organization, as communication is the key to bringing about effective management of the workforce (Habas 2020) Therefore, it is essential to smooth the communication activities within the Tungho company as well as diplomacy and cooperation with other companies to avoid the Tel-Aviv & Boston case above To improve the connection between factory workers, office workers, managers and upper levels of the operating department to achieve maximum understanding to bring the highest efficiency in the workplace as well as relationships with other companies

These two solutions are proposed to limit language barriers for organizations

Firstly, training courses on translating skills for managers, associates across corporate

departments, factory workers, employees, and executive managers, as well as translators or diplomatic staff, finding and connecting customers with the company According to the director of Tungho, employees and workers will work according to a predetermined

procedure by the management board, so technical terms frequently used in the working process need to be explained in a variety of languages that employees can understand clearly

In addition, cultural knowledge such as customs, norms and social standards of different countries should also be added to improve the quality of translation and avoid conflicts in communication for internal working boards as well as avoid misunderstandings when

communicating with customers or international partners of the company to avoid mistakes in the cooperation process

Secondly, providing foreign language classes for office workers and factory workers can also participate With the goal of retaining the old generation of human resources with more work experience but limited language communication, foreign language training for them is

necessary to create a normal working environment At work, avoid silence that leads to depression and misunderstanding when working together By providing staff with weekly basic to advanced English classes along with cultural experiences when communicating with other native speakers, learners can learn faster and more confident in communication

The combination of learning a new language with culture is indisputable because culture and language are two inseparable things Because the two are intricately intertwined Foreign language teachers should know the position of cultural studies in the classroom and strive to increase the cultural awareness of students and improve their communication skills (Zhou 2017)

Depending on the communication conditions and needs of the company, the company can choose one of the two ways above or both to maximize productivity when most jobs require teamwork and cooperation with outside companies during integration

2 Reducing power distance

It is crucial to reduce power distance because it can have an influence on the creativity of employees (Yuan & Zhou 2015) Creativity plays a significant role in the thriving of