Positive Impact Of Multiculturalism In Business

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5.2 The positive impact of multiculturalism on businesses These companies described before all have in common to employ different kinds of employees, but only the multinational companies are focused in this paragraph, due to the fact that these companies are dependent on implementing different minorities into their company. First of all, divisions within groups often occur along cultural lines and promote disharmony, dissatisfaction and declining performance among multicultural teams. This problem, also called faultlines, is more likely to develop when the combination of the group fosters cultural divisions, for example German-Chinese teams often develop faultlines, since everyone knows who is German and who is Chinese. To prevent this, managers…show more content…
Individuals tend to adapt their ideas to those of the dominant group, which leads to a negative impact on the decision-making process by making the group closed for new ideas. Multicultural groups have several cultural perspectives and therefore are less endangered to group thinking. In general, when teams are established with individuals from different cultures, it often takes a more time to understand each other, than for group members of the same cultural background. Now when a group is set up of multicultural individuals, the team is able to work statistically faster than groups which only consist of one cultural origin, since the before mentioned faultlines are weakened and the members of the group are more curious about each other’s background. Furthermore, by means of solely multicultural team members the work performance is higher because of the creativity interchange between the cultural groups. Therefore, multicultural employees need to be performing in groups, where a high performance in complex, international tasks is…show more content…
Problems occur between companies based in different countries due to differences in culture, broader institutional environments, business norms or other unknown challenges which stand out in the communication process between the two institutions. One example for such a clash of cultures in terms of mergers and acquisitions is the merger between Daimler and Chrysler. In this case, German and American managers were set to make a huge change to both companies but struggled in the beginning due to cultural differences. However, strategic alliances might be a solution on short-term bargaining for both companies, but on the long run mergers are beneficial for both
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