Global Diversity: Importance of Cultural Differences

In a globalized company, the workforce is diverse, coming from a wide range of backgrounds and countries. Companies have international subsidiaries which hire local populations for work as well as send expatriates for setting up and managing international subsidiaries. Geographically dispersed companies need to become familiar with local customs, consumers, and employees. The culture divided between international employees, particularly between core and subsidiary workers, needs to be bridged for the organization to maintain morale and boost collaboration. Corporate culture needs to make an explicit emphasis on globally applicable values and ethics based on which an organization will function, but also recognize the uniqueness of certain cultural or geographical components of its subsidiaries (Vogelsang, 2013).

Ignoring these cultural differences as minor can have significant human capital management implications in various areas. It can affect management hierarchy as some cultures value employee autonomy while others expect employees to defer to managers, creating potential bottlenecks in the operational processes. Commitments and agreements, adherence to deadlines, may be perceived differently with some cultures taking them literally, while others approach them flexibly creating problems with deadlines. Communications are affected as some cultures are direct while others are extremely passive, this may lead to potential internal conflicts. Simply being aware of the differences is not enough, corporate cultures and managers must consider adaptability and solutions that encourage employee trust, comfort, and corroboration on an international scale.

Diversity, despite all the differences and challenges, is not a negative aspect. With a competent approach, inherent synergies can be developed that will enhance creativity and performance. Such systems can be recognized and accepted by co-workers, and methods to enhance inclusiveness and participation. Global managers can maximize their worth to the organization and the effect of corporate cultural unity by making strategic decisions that manage borders virtually and physically that sustain the performance of multi-ethnic, multifaceted employees (Vogelsang, 2013). Leaders have a significant influence on organizational culture by shaping it and setting the tone on how employees perceive work experience. Depending on the leadership style, managers may have qualities that define the corporate culture or guide employees as role models or teachers. Leaders need to have the ability to understand human nature and personality differences which are key to any organizational culture. From a global cultural perspective, it requires a leader to understand a wider variety of work styles, backgrounds, and determine aspects of interaction, cultural perspectives, and personality that contribute to complex synergies (Trapp, 2014).

A goal in human capital management for AGC can be to create an engaging global workplace. As organizations expand internationally, they often fail to find a balance between business goals and creating an enticing workplace that develops global leaders and engages local employees. Not only must regional compensation and development plans be met but regional employee engagement approaches are necessary as well. An engaged employee is not only someone who is content in the workplace but who is involved and invested in the organization’s business goals. However, employee engagement differs for each region, with correlations to intent to stay with the organization. China may have low levels of engagement but high intent to stay, while in South America, in a growing economy, even engaged employees to look for new opportunities. Multi-faceted strategies for human capital management can be used for engagement, such as annual surveys, social programs, traditional employee roundtables, and management 360 assessments (Sierra-Cedar, 2015).


Sierra-Cedar. (2015). Global human capital management best practices. Web.

Trapp, R. (2014). Why successful leaders acknowledge cultural differences. Forbes. Web.

Vogelsang, J., et al. (eds.). (2013). Handbook for strategic HR: Best practices in organization development from the OD network. AMACOM.

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