MULTINATIONAL TEAMS AND CULTURAL DIVERSITY
The word ‘‘diversity’’ here can be defined as a mixture of people with different group identities within the same social system (Fleury, 1999).With the onset of Globalization, and relaxation in trade and investment policies by emerging economies, companies across the globe have been forced to expand their businesses in all foreign lands. It is implicit that organization cultures have thus evolved to build up teams with members from different cultural backgrounds. Project Managers, apart from being responsible for handling complex global business processes, have an added task of understanding cross culture differences among the team members. Team members also have to bear the responsibility of understanding what is phenomenally prevalent in a multicultural team- shared values and beliefs.Intercultural Communication in Saudi Arabian Companies are based on perceptions. Values are one’s perceptions about how things should be done, whereas beliefs are one’s perceptions about how things are done in his/her (country’s) culture.
For example, a U.S. citizen would prefer working individually whereas a Korean would rather work in a collective system. (Javidan, M. & House, R.J. , 2001).Such differences in the way team members perceive their roles and perform their duties and responsibilities, pose serious challenges to both effectiveness and efficiency of the team. (Wederspahn, Gary M., 2005). Studies have been conducted to identify critical factors, considered vital to the successful functioning of a global multicultural team, and perceptions about the level of difficulty in achieving the same. One such study published in MIT Sloan Management Review (Summer 2001) surveyed 58 global teams and identified that cultivating trust among team members is the most important (rated 6.52 on a scale of 7) and difficult(rated 6.06 on a scale of 7) of all challenges like overcoming cultural barriers, aligning individual goals, and setting objectives for the team members. Cultural differences impact team performance in collective problem solving, decision making, and communicating with each other. Awareness of contrasts between cultural values may help resolving conflicts among team members, and generate trust and understanding, thereby providing them to leverage cultural diversity to build a stronger team.
OBJECTIVES OF THE RESEARCH
In context of the cultural diversity prevalent in organizations, as mentioned above, the objectives of this research paper is to identify and investigate-
- Cause and effect of relationships between communication and project teamwork quality and level of team performance
- Factors challenging communication within team members
- Role of trust in the communication process
- Role of trust within the relationship between communication and project team performance.
The objectives are met by illustrating organization culture of Saudi Arabian companies and the prevalence of cultural diversity, an in depth review and understanding of the process of traditional and modern communication, and role of the same in building trust amongst members of a multicultural team.
BACKGROUND AND CONTEXT
Saudi Arabia as a country is Muslim dominated and it is situated in the Middle East region of the world. Saudi Arabia has recently opened its economy to the world and with increasing business globalization and liberalization many multinational companies and corporations are working in Saudi Arabia. Since there is a lack of skilled and trained professionals in various sectors in the country many companies tend to hire workforce from foreign countries.
Intense project work is going on in Saudi Arabia during the last two decades on account of the government’s desire to reduce dependence upon petroleum revenues, to build infrastructure, develop industry and take the country socially and economically forward. With the bulk of the country’s workforce being composed of migrants, the project teams operating in the country are staffed by members from various North American, European and Asian countries and are heterogeneous in nature (Senescu, et al, 2011, p 3).
These foreign members are working cooperatively with their Saudi Arabian counter parts in various teams, i.e. SABIC owes its success to the people who make up our company. The company employs a diverse, multinational workforce of over 33,000 employees, who are from 100 countries. (www.sabic.com)
Moreover, there are many companies in Saudi they have employees from different cultures such as, ARAMCO, National Poultry Company and company of Pharmaceutical Industries, which are multinational companies with their headquarters in Riyadh, Saudi Arabia, and are renowned organisations with business interests in multiple sectors. Since the organisations have business interests in multiple sectors, it is a common occurrence that there are multiple teams working on different projects and team members belong to different nationalities and cultures. Some of these companies have achieved successful projects; on the other hand some of them reached World recognition because of the success of local projects. Some also have branches in some countries in European and Asian such as, SABIA Company.
Proposed participating companies and their multicultural team compositions
This section of the study highlights information and statistics about Saudi Arabian companies across different industries, with multinational and multicultural team composition. (Chamber Of Commerce, Riyadh)
First, the Saudi Company for Pharmaceutical Industries : has large staff who are from a different nationalities which is a manufacturer of pharmaceuticals and medical supplies and listed on the Saudi Stock Market Sections of the company’s Manufacturing Division, which included professionals, manufacturers and marketing department and sales department and management and strategic planning and investment department.
There is diversity in the nationalities of the employees in the company of the Saudis and often have their work in the Department of Administration, accounting, investment, strategic planning and nationalities of East Asia (Philippines, India, Pakistan) in the Department of Manufacturing technicians and manufacturers are about 30% from the staff, and in the marketing department who are from Lebanon and Syria and Egypt are about 40% of the working group, as well as nationalities European working as advisors to the company or in advanced manufacturing and patent medicines as well as partners of the company they are about 30% from the staff in the company .
Second, National Poultry Company: Is a production of poultry and eggs, organic vegetables and is listed on the Saudi Stock Market is a family business the company has a staff of diverse nationalities sections of the company’s Manufacturing Division, which included professionals, manufacturers and marketing department and sales department and management and strategic planning and investment department
There is diversity in the nationalities of the employees in the company of Saudi Arabia have their work in the Department of management, accounting, investment and strategic planning are about 20% of Staff and nationalities of East Asia (Philippines, India, Pakistan) in the Department of Manufacturing technicians and manufacturers and are about 40% of Staff, and in the marketing department they from Lebanon, Syria and Egypt they are about 20% from the staff in the company , as well as nationalities European working as consultants in the company or in the advanced manufacturing they are about 20% from the Staff in the company.
Third, Qassim Cement Company
CEMENT company that produces a number of species is listed on the Saudi Stock Market The company has a staff of diverse nationalities sections of the company Manufacturing Division, which included professionals, manufacturers and marketing department and sales department and management and strategic planning and investment department. There is diversity in the nationalities of the employees in the company of Saudi Arabia have their work in the Department of management, accounting, investment, strategic they’re about 50% from the staff and nationalities of East Asia (Philippines, India, Pakistan) in the Department of Manufacturing technicians and manufacturers they about 20%, and in the marketing department located in Lebanon, Syria and Egypt they about 10% from the staff, as well as nationalities European working as consultants to the company or in advanced manufacturing they are about 10% from the staff in the company .
The review of existing literature on the subject throws up a number of interesting issues.
Communication success is critical for a project team. It has been observed by many researchers (Kerzner, 2006;Boddy, 2002; Dismore and Cabanis-Brewin, 2006) that the majority of problems associated with a project team are raised because of problems of communication between the team members so it is crucial for any organization to successfully manage its projects and focus on the communication between team members.
Kerzner, (2001, p12), is of the opinion that a large number of projects were not able to attain their goals and objective within the stipulated time or failed their purpose entirely. It is also observed that lack of communication is one of the major reasons behind such project failures (Kisielnicki, 2011, p 35).
Kerzner (2006) also argues that most important challenges associated with communication are the variety of team members in a team who come from various educational and cultural backgrounds. Although their technical education might be sufficient, their managerial skills and communication methods still lack a proper finish. As a team effort in a project each member is required to gain some new talents and to learn how to manage various activities in a co-ordinated manner so that all performance objectives can be meet as per the planning (Goczol and Scoubeau, 2003; Maylor, 2005).
Communication is a very important part of collective working and of goal achievement methodology of any team. Effective and efficient communication leads to a higher level of understanding, sharing of common goals and objectives and appreciation of each other’s achievements and drawbacks.
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‘Communication can be easily defined as an exchange of ideas and thought process in both verbal and non-verbal form, which leads to a meaningful and legible conversation.’(Kerzner, 2001)
In any communication, the following are the main factors or entities involved: a sender – the person or entity who is wishing or willing to send a message; a recipient or intended recipient – the person or entity for whom a message is released or conveyed; a message (in both verbal or non-verbal format) – the actual content of the communication which is transferred from sender to recipient, and; a medium – the tool or action through which the message is transferred from sender to recipient (i.e. the act of speech, gesture, written words, among other things) (Simons, 1991).
Communication methods and techniques are one of the critical factors for successful and harmonic working of a team.
McDonough and Kahn , (1996,P.4) researched the usage of information technology in global teams. They examined the use of IT such as fax, email, phone calls, and teleconferencing, and the results were seen as important technologies for the higher performing teams.’ Email and other written media have an advantage when language is a barrier.’
An effective and efficient communication can be explained as a two-way communication in which free ideas and dialogues were exchanged which are correctly understood and gather an appropriate response within a reasonable time period. The entire exercise of communication should lead to resolution of a particular problem or progress the project at hand (Delia, 1987).
It has been observed by many academics and researchers that the majority of problems associated with a project are raised because of a lack in communication between the team members. It is, therefore, critical for an organization to manage its projects in such a way that when the exchange of ideas is in the form of facts, details, discussions or project outlines, the communication should be absolutely clear and concise so that the goals and objectives of the project can be met in a more efficient manner.
Many factors are challenging communication success. These factors are due to the complexity of the project team environment itself, i.e. technological environment, and also to the different individual field of experiences (Barnlund, 2008).
There are many challenges which can be associated with communication like cultural barriers, language barriers, lack of understanding of each other’s working style and communication technology, or lack of appreciation of differences between each other, etc (Barnlund, 2008).
“Geographical distance decreases the possibilities for the team members to meet face-to face reducing the spontaneity of communication. It also reduces the amount of real time interactivity, because of the time differences. Travel still plays a major role, since face-to face meetings cannot be replaced entirely by the use of modern information technology”According to (Paasivaara, 2005).
Boutellier et al, (1998) also argue “ information technology offers increasingly better alternatives to support Communication during those time periods when the collaborators are working apart”.
Culture can be described in simpler words as a set pattern of knowledge, belief and behaviour, along with a shared pattern of attitudes, value system and social norms, which is followed as a general trend with minor variation by a group of people belonging to certain area, country, religion, community or region (Carriere and Bourque, 2009).
Culture and language have been interlinked with each other for many centuries. It has always been considered that civilized cultures have languages, and languages spoken by people when they differ are accepted as people belonging to a different culture. Over the time, there have been clashes and contradictions between people belonging to different cultures over such issues as belief system, languages, lands, god, customs and rituals. Each culture has a certain inherent way of communicating with each other by using a synchronised combination of verbal and non-verbal communication, which is complemented by visual aids, gestures and tone. It has developed over the ages and has evolved in many ways. Each culture has hidden meanings, understood notions of certain things (Child, 2001).
The research on heterogeneity in project teams throws up two compelling findings. Studies show that heterogeneity results in improvement, in project work quality and output, on account of the richness and variety brought to the project tasks by the multiple skills and abilities of a diverse workforce (Mehta, 2002, p 3). It is, however, also evident from different studies that such diversity in teams makes it difficult to manage and control them effectively on account of the different cultural and ethnic backgrounds of their members (Lee-Kelley & Sankey, 2008, p 54).
Various studies by Hofstede, Trompenaars, and other researchers reveal that people from different national and ethnic cultural backgrounds have varied personality traits, with regard to dimensions like individualism, collectivism, organisational hierarchy, time, uncertainty and risk and short or long time orientation. Hofstede, in particular has engaged in extensive research over many years with residents of numerous countries and regions. His studies have led him to categories national cultural characteristics in five important dimensions, these being (1) collectivism v individualism, (2) masculinity v femininity, (3) power distance, (4) uncertainty avoidance and (5) long term v short-term orientation (Hofstede, 2001, p 37).
Whilst later researchers have added to Hofstede’s findings and have added cultural traits, Hofstede’s findings continue to be widely accepted. His research organisation continues the work of categorising the cultural characteristics of different countries into these findings dimensions. His findings for the individual scores of these dimensions for four countries, which are geographically distant and span the globe, are provided below.
|Power Distance||Individualism||Masculinity||Uncertainty Avoidance||Long-Term Orientation|
Power Distance Individualism Masculinity Uncertainty Avoidance Long-Term Orientation
Saudi Arabia 95 25 60 80 NA
UK 35 89 66 35 25
India 77 48 56 40 61
Malaysia 104 26 50 36 NA
(Source: ITim International, 2009, p 1)
The sharp differences in the scores of these cultural dimensions of the four selected countries can be seen from the above table. Such cultural differences influence the perceptions, reasoning, thought processes and the personal, public and workplace behaviour of the inhabitants of these countries.
These differences in behavioural traits, combined with divergences in linguistic abilities and understandings of team members, can radically affect the quality of communication between members of diverse project teams and result in confusion, lack of understanding of instructions, breach of safety regulations, and adverse project consequences (Kerzner, 2001, p 6).
Intense project work is going on in Saudi Arabia during the last two decades on account of the government’s desire to reduce dependence upon petroleum revenues, build infrastructure, develop industry and take the country socially and economically forward. With the bulk of the country’s workforce being composed of migrants, the project teams operating in the country are staffed by members from various North American, European and Asian countries and are heterogeneous in nature (Senescu, et al, 2011, p 3).
Accordingly, the cultural diversity of the member’s team, and technological communication, are one of many challenges facing the communication on the project team. In addition, for communication technologies to be efficient personal relationships and trust between the employees is essential (Moenaert, et al, 2000).
Rousseauet. et,al, (1998, p.) have defined trust as “a psychological state comprising the intention to accept vulnerability based upon positive expectations of the intentions or behaviour of another.”
And similarly another definition of trust was provided by Weigert , (1985) who defined trust as “trust is based on a cognitive process which discriminates among persons and institutions that are trustworthy, distrusted, and unknown.”
As explained in the definitions of trust, a person makes an informed decision about whom to trust and up to what level in which areas. Trust is a dynamic concept that changes with time and the situation present in the context of particular circumstances. This entire concept of trust is explained in layman’s terms as the reasons or facts behind putting in trust (p. 970).
Another author has described trust as a two way phenomena where trust gets developed because someone deserves to be trusted by their trustworthiness and trustworthiness keeps on enhancing as they prove they can be trusted again and again
(Flores and Solomon, 1998).
It is also observed that communication skills and trust are directly linked to each other and communication puts a lot of influence on the trust level (Morgan and Hunt, 1994).
Successful communication strategy, if positive in nature, make a positive impact on the trust developed over a person and his time taken to respond to a communication are an important factor in development of trust (Guzzo and Shea, 1992).
When trust is developed between two parties the communication channels become more open and cleared and the level of cooperation also reaches to a higher level (Barnlund, 2008).
The decision making process of an individual gets entirely changed when they trust someone while making a decision and their risk taking capacity also reaches a higher level (Zand, 1972). Many researchers agree” building trust is the greatest challenge in creating successful virtual teams and organizations.” (Coutu, 1998. Jarvenpaa & Leidner, 1999)
When the component of trust is involved in a decision an individual tends to take a decision, which he alone would never have taken (Driscoll, 1978).
The level of satisfaction while making a decision also improves when trusts as a variable is involved in it. This all indicates towards a logical conclusion that trust generally improves the performance of a person in various aspects of decision-making (McKnight & Chervany, 2000).
The building of trust requires rapid responses to electronic communications from team members, reliable performance, and consistent follow-through.
Accordingly, trust has an effective role in building relationships between the members of a team, and that will be reflected in the performance of the team and their project, negatively or positively.
Teams’ performance and project success /failure
The success of many companies is determined by the success of the project team performance. Team performance can be defined as the extent to which a team is able to meet established quality and cost and time objectives (Gemuenden 1990, Schrader and Goepfert 1996, Gemuenden and Lechler 1997).
There are many issues, which face a project team’s performance. Because they are working to a deadline and the pressure to reach agreement and get started is enormous.
As an alternative to unanimous agreement, some teams evolve to the majority rules model. According to (Donald, 1999) “When a team is not in full agreement on a decision, or one or more of the team members disagrees, it is unrealistic to expect that those team members will adequately support the decision”.
Each expression or sentence has a different meaning for each of them, and because of these differences there may be misunderstandings, internal clashes and conflicts among the team members. In fact, there are many types of challenges, which face a project team ‘global virtual teams, cultural and communication barriers’ (Boudreau, et al 1998).
Challenges and issues between cross-cultural teams are not a new phenomenon and it is generally observed in every cross-cultural team. The work force in Saudi Arabia has been trying to adjust to new patterns of working imposed by the foreign work forces. Differences relating to working styles, culture and ICT literacy have an impact on team performance, capability and efficacy.
A project’s success is a subjective phenomenon, which depends a lot on the perception of the evaluator. Bryan Trautsch, (2003, p4), states that modern day project management teams are very often large and composed of people with vastly different skills, specialism’s, and expertise. Such team members are also required to work in a controlled, coordinated, collaborative and unidirectional manner in order to achieve project objectives.
To avoid any biases it is very important that multiple opinions and evaluations are made so that a real picture of the project can be gathered. It is also has to be accepted by the team members that owing to the complex nature of projects and incorporation of innovation and new technology, developing clear and objective goals and objectives are not an easy task, and there are certain areas where ambiguity is accepted as a part of the project execution (Gemuenden 1995, Hauschildt1997).
In that situation, these clashes or misunderstandings directly affect the performance of team members, eventually leading to lower accounting performance of the entire team and project. In addition people from different countries work together on different projects and in that process they remain in regular communication. As a result, the way they communicate and orientate towards interpreting a message will be different as per their understanding and experience.
Capable individuals and their collaborative teamwork, keep an organization on the path of progression. Capabilities of a team can be assessed by measuring team efficacy and team potency (Mathieu et al. 2008).
Team efficacy can be explained as a perception and belief of an organization on a team regarding their success and failure in a particular project, while team potency can be explained as overall capability of the team in completing various tasks in a timely and satisfactory manner. A team’s overall performance can be determined by both team potency and team efficacy cumulatively (Guzzo et al, 1993).
Team efficacy is a narrow and specific term which only deals with the ability of executing a specific task by a team while as a contrasting feature a team’s potency can be determined as a general and overall belief about a team’s capability and their way of executing tasks.
Many researches put emphasis on development of a team spirit and team player spirit in an organization (Longenecker and Fink, 2008). This building of team spirit and team player spirit is directly linked with the team’s performance and they rise with increasing positive decisions in interpersonal and professional levels of relationship (Van, 2008, Bradley et al., 200 Zellmer-Bruhn and Gibson, 2006).
In a team when a member performs efficiently he contributes to the long-term strategy and goals of an organization and ensures that there is higher probability of the success of the project.
According to Bell, (2007) structure and team composition are very critical factors in the development of a team, and if a team is not composed of the right mixture of members there is a very high chance that communication related issues and challenges will keep on arising during the entire project.
Members of a team have various similarities and dissimilarities among themselves and these will always be present because of various demographic features like age, sex and gender (Gellert and Kuipers, 2008; Harrison et al., 1998). Dissimilarities among team members are basically based on difference in culture, age, nationality and social stigma attached to any particular activity (Harrison et al., 1998).
These differences in behavioural traits, combined with divergences in linguistic abilities and the understanding of team members, can radically affect the quality of communication between members of diverse project teams and result in confusion, lack of understanding of instructions, breach of safety regulations, and adverse project consequences (Kerzner, 2001, p 6). Accordingly, the lack of sufficient skills and training, personal problems, and different educational background create a lack of sufficient managerial and communication skills, etc.
Based on the literature review it seems that the project’s success or failure depends entirely on the performance of the team (efficacy and capabilities of the team).
Teamwork Quality and Team Performance
The contemporary business environment is distinguished by growing diversity and heterogeneity in the workplace. Such characteristics have developed largely on account of the entry of women and individuals from diverse cultural, ethnic, and social backgrounds at various workplace levels, combined with the progressive expansion of business and industry across the world.
Extensive workplace heterogeneity is particularly visible in emerging countries like Saudi Arabia, which have substantial wealth, are engaging in considerable development activity, and yet do not have adequate numbers of trained and educated local people to satisfy growing job needs. The overwhelming majority of Saudi projects are thus executed with extremely heterogeneous teams, comprising of members from diverse cultural and ethnic backgrounds (Central Intelligence…, 2012, p 5).
There are factors to be successful in Teamwork quality which are: collaboration in team, coordination, balance of member contributions, mutual support, effort, level of skills then it will be seem to on the performance of team. According to Egan, (2002) “diversity in skills and ability may enhance the productivity of a team because more skilled workers help and teach the less skilled, and teammates gain more from task coordination.”
Another hand according to (Hamilton, et, al, 2004. p5) observe in the first ‘teams more diverse in worker abilities are more productive, indicating that there is significant mutual learning and task coordination within the team. Second, share the distribution of team ability constant, teams with greater diversity in age are less productive, and those composed only of one ethnicity’
According to Lazear ,(1998a) “the demographic diversity potentially inhibits within-team communication and thus reduces both the effectiveness of collaboration and peer pressure, as well as the non-pecuniary benefit of joining the team.” Agree that Polzer , (2008) diverse teams “are prone to dysfunction because the very differences that feed creativity and high performance can also create communication barriers”. And also Mello and Ruckes, (2006,P.6) advise that “members of heterogeneous teams are more likely to diverge in their preferences with respect to courses of action, which will lead to lower effort.”
Although researchers agree that communication is very important for the success of a team project, there is a gap in addressing the factors challenging the communication. Ochieng and Price (2009, p4) advise to “increased research efforts in understanding influential factors that affect managing cultural complexity and communication in multicultural project teams.” But as (Egan, 2002 p4)”There is mounting evidence and opinion indicating that integrated team work is a primary key in efforts towards improving product delivery within the construction industry.”
Moreover, very little has been said concerning the impact of communication on teamwork quality and the team performance to success project and the role of trust in relation to both communication and teamwork quality and the level of performance team project performance. The purpose of this study is to investigate the factors challenging communication and their impact on the success of a project team in Saudi Arabian companies nowadays, and the relationships between communication success/failure , project teamwork quality and team performance.
The research questions are:
- What are the factors challenging intercultural communication success in a multinational team in Saudi Arabian companies?
- What are the cause and effect of relationships between intercultural communication success/failure and multinational team performance? What role is trust playing within the overall relationships?
This study is essentially subjective and will not be amenable to positivist methods or quantitative financial analysis. It is, therefore, proposed to adopt an interpretive philosophy and a qualitative approach towards the subject. The application of appropriate qualitative methods will enable a holistic and multiple perspective investigation of the issue (Daymon & Holloway, 2002, p 68).
Primary research has been conducted incorporating (a) qualitative direct interviews with open ended questions with four respondents from project teams from different companies operating in Saudi Arabia, and (b) a focus group discussion with 7 participants from companies mentioned above
Whilst the adoption of a qualitative method is bound to be challenging and will require deep interpretative study of the subject and selected respondents, it should provide valid and general sable results. It is important to conduct the qualitative interviews with empathy, facilitating respondents to open up and discuss their thoughts, opinions and apprehensions at length with the researcher (Maxwell, 2004, p 93). The researcher plans to prepare a list of open-ended questions to investigate the factors challenging communication and their impact on the success of a project. It is also proposed to audio tape the interviews and transcribe their contents later with due care.
The researcher is confident of being able to arrange for the planned number of respondents. Care will be taken to follow all ethical norms; particularly those concerned with the respondents of primary research, like confidentiality of identity, freedom from coercion, protection from harm and liberty to respond or not to respond to questions.
SCOPE AND SIGNIFICANCE OF THE RESEARCH
In the current period of business and growth and expansion all over the world, especially in developing economies of Asian and the Middle Eastern region, there is a very natural possibility that international expats would be visiting many countries and could work in different teams with members belonging to various cultures. Communication problems and challenges can be a serious threat to the success of these projects and their teams, which enhances the scope of this study. This study covers not only the identification of such challenges but also attempts to find the root cause behind these challenges and to analyze the correlation between challenges and the probability of success in project teams in Saudi Arabia.
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