Module 12: Inter - cultural communication in organizations in the Barents region Developed by Prof. Olga Ivanishcheva Murmansk State Humanities University, Murmansk, Russia Overview The purpose of the module is to give an idea of the types of organizational culture, to consider national and cultural factors in formation of organizational culture that influences the performance of a company, to give a brief description of the specific organizational culture in Russia and Norway. Learning Objectives Upon completion of this module, you should be able to: 1. Describe the main categories of organizational culture in general and national organizational cultures in particular 2. Describe how your business depends on the national organizational culture. 3. Explain how the peculiarities of the Russian organizational culture influence the company work. Required Reading Hall, E. 1976. Beyond culture. Garden City, NJ: Doubleday Anchor. Hofstede, G.H. 1980. Culture′s Conseguences. Newbury Park, CA: Sage. Budur N. These Strange Norwegians. Moscow: Egmont Russia Ltd, 2005. http://psylib.ukrweb.net/books/inostra/txt13.htm (Budur N. Eti stranniye norvezhzi. Moskva: Egmont Rossiya Ltd, 2005) Zhelvis V.I. These Strange Russians. Moscow: Egmont Russia Ltd, 2002. http://www.klex.ru/7of (Zhelvis V.I. Eti stranniye ryssliye. Moskva: Egmont Rossiya Ltd, 2002) Key Terms and Concepts organizational culture “baseball team” organizational culture club organizational culture academic organizational culture defensive organizational culture easy organizational culture strict organizational culture modern Russian organizational culture Learning Materials 12.1. Introduction Some researchers distinguish concepts “organizational culture” and “corporate culture”.The concept of “organizational culture” includes the emphasized element “complete idea of the purposes and the values of an organization”, and the concept “corporate culture” emphasizes the element “complex of the assumptions unsubstantially accepted by all members of a certain organization and determining the general behavior accepted by the organization as a whole». In this module these concepts will be considered as synonyms. Organizational culture is a set of behavior models acquired by an organization during adaptation to the environment and the internal integration. These models proved their efficiency and are accepted by the majority of members of the organization. According to Edgar H. Schein: а pattern of shared basic assumptions invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internalintegration that have worked well enough to be considered valid and therefore, to be taught to newmembers as the correct way to perceive, think and feel in relation to those problems (http://www.businessmate.org/Article.php?ArtikelId=36) Components of this culture are: • the accepted system of leadership; • styles of conflicts resolution; • the current system of communication; • position of an individual in the organization; • symbolics: slogans, organizational taboos, rituals. 12.2. Types of Organizational Culture There are different types of culture just like there are different types of personality. Researcher Jeffrey Sonnenfeld identified the following four types of cultures. Academy Culture Employees are highly skilled and tend to stay in the organization, while working their way up the ranks. The organization provides a stable environment where employees can develop and exercise their skills. Examples are universities, hospitals, large corporations, etc. Baseball Team Culture Employees are "free agents" who have highly prized skills. They are in high demand and can get jobs elsewhere rather easily. This type of culture exists in fast-paced, high-risk organizations, such as investment banking, advertising, etc. Club Culture The most important requirement for employees in this culture is to fit into the group. Usually employees start at the bottom and stay with the organization. The organization promotes from within and highly values seniority. Examples are the military, some law companies, etc. Fortress Culture Employees don't know if they'll be laid off or not. These organizations often undergo massive reorganization. There are many opportunities for those with timely, specialized skills. Examples are savings and loans, large car companies, etc. (http://managementhelp.org/organizations/culture.htm) In his thesis E. Sklyar proposes an organizational culture typology. According to it there are two types of organizational culture: strict and easy one.The easy organizational culture is characterized by the minimal inequality of employees, unstructured tasks that employees accept, evolutionary changes, priority of rational decisions, responsibility of the employees.Basis of easy organizational culture are legality, competence and knowledge. Effective management of a company with this type of organizational culture is largely determined by high level of professional skills of the employees. The strict organizational culture is characterized by the inequality and privileges for employers, a priority of political decisions, rejection of risky decisions by employees; attention to the relations in a group, structured tasks that employees accept. Basis of the strict organizational culture are force and charisma The easy organizational culture is effective in the cases when situational requirements of the market are defining the company activity, and the strict one is effective in a stable, predictable environment. For the constantly changing market this type of organizational culture is ineffective (Sklyar 2002) 12.3. Nationally-Oriented Typology of Organizational Cultures G. Hofstede′s ideas demonstrated existence of some national differences in organizational cultures. Though Russia wasn't in this project, but by estimating the Russian organizational culture in G. Hofstede′s parameters, researchers came to the following conclusion: the Russian organizational culture is characterized by the high level of collectivism (8,36 %) and avoiding uncertainty (7,96 %), as well as by rather low indicators on feminine-masculine factors (6,55 %) and the power distance (5,94 %) (Sulim 2009). Researchers mention the difference of organizational cultures of the West and the East. Russia, being on border of the European and Eastern cultures, has the features of both. The most important difference between the East and the West lies in the field of the relation to work and understanding of its role in human life. E. g. the Japanese tend to explain their success by their national traits and the special attitude to the business, based on continuous improvement of working conditions of employees. Japanese management style is based on persuasion, instead of enforcement. A boss does not distinguish himself from his employees, his task is not to manage work carried out by the other people, but to promote interaction of employees, to give them necessary support and help, to build a harmonious relationship. As a rule, there are no detailed duty regulations, and regulations on structural units are very general in Japanese companies. The Japanese employee is estimated not by his individual work, but by the contribution to work of the team and to performance of corporation. Relation to work, accuracy and punctuality, interaction with colleagues, aiming at performing work programs are considered to be important criteria. Japanese management sees in their employees profitable resources. The staff are trained and used to their maximum. The Western businessman assumes existence of the inconsistent (contradictory) relations between work and management. The Western management considers an employee as taken to perform a certain task, or for a certain place of work. The Western management uses the method of command management "from top to bottom" with the authoritarian elements, i. e. supervision and instructions management, instead of motivation to cooperation. American management is characterized by the approach to a personality as to the workforce unit with the individualism emphasized (individuals work), individual decision-making on the basis of the powers, concentration on self-responsibility and self-affirmation, a short-term hiring. The fast estimation and promotion of staff, specialization of activity, formal, quantitative methods of performance estimation are peculiar to the American organization. American management is characterized by the focus on the capital. In Japan management practices is characterized by the orientation on the personality (a person is the centre of economic activity) is peculiar. This idea is expressed in the approach to a person as to a personality, collectivism (cooperation), collective decision-making, long-term hiring. The slow estimation and promotion of staff, lack of narrow specialization of staff are peculiar to the Japanese organization. The main strategy of the American management is the material interest of employees and the competition between them that makes the strongest win. In Japan the main strategy is fidelity and unity of employees of the organization, their cooperation and coexistence One of the founders of Sony Company Akio Morita mentioned that in Japan at first they employ people, and afterwards look how they can be used. These are welleducated people, but they are very different. The manager should examine them for a long time as "rare stones" and builds a wall, combining them in the best way: Stones happen to be round, square, oblong, big and small, but managers should define, how to put them together». On the contrary a traditional American company is “built” using identical bricks and focused on the levelling of personality in the company development. USA′s leading corporations use employees better and more effective by developing the "feeling of winner" in them. They respect traditions and on their basis form the organization′s main values. In the American corporations they say that they want to think of themselves as about winners". Therefore various methods of competition promotion are used for the employees. 12.4. Specific Features of Modern Russian Organizational Culture and its Types Some of the Russian researchers distinguish the following types of modern Russian organizational culture: "friends", "family", "boss". The "friends" type is typical for the companies established in the days of reorganization in the USSR (1985-1991) called Perestrojka when new possibilities for organizations and activities appeared. It was very difficult to make your way in the new environment on your own. People felt uncertainty and consequently they involved their friends and relatives to the companies. In the commercial activity friends tried, first of all, to stay friends, but the organizational purposes sooner or later came into a contradiction with the culture of the interpersonal relations and destroyed them. Friendship turned into rivalry and even hatred. The organization with the "family" type is characterized by rigid hierarchy with the roles of the father and mother, the older and younger sisters and brothers. Relationship in this type is based on feelings with the absence of any official rules. A boss is sure that the employees should understand him/her immediately. Employees without any accurate instructions try to understand what the boss wants from them. Everyone here does not the thing he/she had to, but the thing that seems more important from the family point. The "boss" type reveals the fact that in Russia people are afraid of the boss. All the company problems are associated with the mistakes of the top management. Bosses are thought to lack skills or to be stupid. Employees believe that in other companies there are good bosses that can change things for the better. As a result people say bad words about bosses, thus feeling their real helplessness. Many researchers describe how the Russian national culture influences organizational culture of the Russian companies. First, in the past the care about others, paternalism was the typical manifestation of Russian organizational culture. It was caused by many reasons, and first of all by weak social politics of the state, as well as by the by orthodox ethics. When in Western Europe and the USA state insurance were already developing, the Tsar government in Russia issued the bill (1906) that obliged businessmen to finance all social programs applied to the employees. Rich Russian businessmen started to build hospitals at factories, maternity shelters, schools and housing for workers and employees paying their living. Afterwards the tradition of rest and treatment at resorts at the expense of companies appeared. Orthodox ethics became a part of organizations culture with the guiding idea of loving a person close to you. Secondly, for the Russian group (brigade, artel) protection against irresponsibility of power was always very important. Already at the end of the XIX century A. Engelgardt mentioned that the Russians in principle like to work together, but prefer to be rewarded individually. The researchers proved: the Russians are afraid that at group work someone will escape work and use the results of other people’s work This fear is stronger in Russia, than in the countries of Western Europe. Thirdly, there are some peculiarities of participation of ordinary workers in management in Russia. The Russians participate in management more, than the Americans It is surprising, as authorities in Russia never allowed people to participate in management too much and asked them to do it only in the critical moments. But there is one peculiarity of Russian participation in management: the Russians have a lot of constructive proposals for the top management, but, as a rule, they avoid to put it into life and don't want to take responsibility for their consequences. Fourthly, there is a tendency of making of professionalism stronger within the organizational culture. The survey showed that 70 % of businessmen are interested in further developing of their skills (see Belyayev, Korotkov 2000). The specifics of the Russian organizational culture is defined by the following parameters “boss-subordinate”, “relations between employees” and “attitude to work”. Parameter “Boss-Subordinate” The relation “boss — subordinate” has recently considerably transformed in the Russian society. The following are the social norms specific to different types of bosses in Russia. 1. A boss can influence subordinates by means of fear. E.g., if work is not performed, the boss has the right in the most rude way, up to shouting and threats, to demand its normal performance from subordinates. Such influence by means of fear was especially used in the Soviet period. At that time not shouts and threats made people afraid but the threat to lose the party membership card (Communist party card), i.e. not to be part of the Communist party. Loss of the party membership card was perceived as the career end, as the end of creative life, almost as death. This tradition is not completely gone. According to polls, the majority of respondents allow a to be rude if it seems that work goes badly. 2. Besides, influence on subordinates by means of traditions is possible as well. The tradition when the employee believes that his/her boss has the unconditional right to give any orders that are to be followed without objections exists in Russia for centuries. The Russians believe that it is important for an employee to be punctual, 70 % of people consider that it is impossible to complain without letting the boss know, and the half of respondents agrees that an employee shouldn't ask questions to a boss, argue with him/her, discuss his/her orders. On the other hand, the same number of people said that the person, who disagrees, should defend his/her point of view. The discrepancy of answers shows that traditional norms decay and the new rejecting the traditions are formed. Traditional norms of authoritative business interaction are more often recognized by undereducated and old people, than by young and well-educated. Most likely due to age or lack of education people doubt and as a result don’t want to contradict their boss. 3. Due to the development of the market relations it would be possible to expect formation of new norms of business interaction when the boss influences by means of incentives. The norms connected with the expert power of boss become stronger. He/she should influence employees by means of knowledge. An ideal boss is represented as the person who possesses special knowledge in the field where he/she works. Subordinates decide to obey him/her because of his/his skills. It seems to be normal when the boss is focused first of all on business, "is married to the job" and at the same time is capable to accept criticism from the employees. If spouses work in one company, personal relations between them at work are not possible. 69,4 % of respondents supported the idea to prohibit wives to be subordinates of husbands. Mainly this is the women’s opinion. Such attitude is the result of the Soviet era. At that time the related relations on work in most cases objectively harmed to business. Such relations in the company, especially if the husband is the boss, gave the chance to one of spouses to work badly or not to work at all, getting a good salary from the state. Relations, including husbands and wives, children and parents etc., are called "domesticity" and from time to time were exposed to inefficient prosecutions from the state. According to the public morals these cases were perceived negatively. The Russians still keep it in mind (Sergeeva A. The Russians: Stereotypes of Behavior, Tradition, Mentality http://lib.rus.ec/b/265695/read) Parameter “Relations between Employees” The Soviet power paid attention to organizational culture at the companies and factories. E. g. parties and holidays, demonstrations and community work days on Saturdays ("subbotniki"), company clothes and symbolic existed. These actions and activities connected people with the bonds of organizational spirit and made them attached to the place of work. Under communism, competition between groups was encouraged, but competition between individuals was discouraged. The result of this tradition is that Russians tend to like working in groups and are good at doing it (Fey C.C., Danison D.R. Organizational Culture and Effectiviness: the Case of Foreign Firms in Russia // Article Collection in Business across Culture. BIS – Campus Kirkenes. Autumn 2009. Eds. Galina Smirnova, Teresa Chen and Peter Haugseth. Р. 250). However research of the foreign companies working in Russia, showed that at the Russian companies there are 2 groups which are divided by a barrier. There are 2 different sub-cultures. People in the top management, sales and accounting departments were largely young, new to the company, open to trying new ways of working and highly motivated. People in the production department were mostly older and had been working at the company for many years. Many of the second group of employees primarily wanted a stable job with a salary they could live on and were not eager to change the way they had worked for years. Both groups were highly motivated by membership in their own functional sub-groups but not by their membership in the organization as a whole. Communication between 2 groups is very poor. The long tradition of responding only to central authority means that many organizations in Russia, on the surface, still react in ways that appear to place little value on responsiveness, the pursuit of the goal of the company, shared responsibility of employees. In the Russian companies the lack of integration among functional sub-cultures takes place. There the manager says "Workers work. engineers know everything"(Fey C.C., Danison D.R. Organizational Culture and Effectiviness: the Case of Foreign Firms in Russia // Article Collection in Business across Culture. BIS – Campus Kirkenes. Autumn 2009. Eds. Galina Smirnova, Teresa Chen and Peter Haugseth. Р.238, 244, 247). Russian Researches confirm this fact. According to N. Sklyar, for the modern industrial Russian companies the management inattention to opinion of workers and their awareness of production development plans is normal, as well as fear to apply new approaches and to risk (24 %) (Sklyar 2002). Parameter “Attitude to Work “ In the period of socialism in Russia it was considered that with the common property for means of production people work for "idea" instead of the economic benefits (Zaytseva 2012). Nowadays employees of the industrial companies appreciate force and authority of the power (72 %) and financial reward (67 %) (Sklyar 2002). Employees of the oil and gas industry companies in Siberia to the question “What does work mean for you?” revealed different types of motivation of the modern Russian worker. Direct dependence on age can be easily distinguished. With increase in age of a respondent work is perceived as a source of money to live (10.9 % for the age of 20-30 years, up to 54 % for the age from 40 till 50 years). For young employees under the age of 30 years work means a way to achieve success, to take a certain position in society, to develop their skills and reach success. In 2009-2010 54.7 % of the workers answered that they would like to have one more profession or other skills (Shaburova 2012). However in the majority of the modern Russian oil and gas companies they don't consider training and professional development of employees as a priority. In Russia in general and in a number of the large oil and gas companies the tendency to reduction of expenses on training and personnel professional development persists. A research showed that the most widespread method of personnel professional development is training (Gaysina 2009). 12.5. Comparative Analysis of the Scandinavian and Russian Organizational Cultures Hofstede′s typology was tried to be applied as a universal method of the description of features not only out of, but also within the national cultural tradition. The territorial zones corresponding to the main national types of Hofstede′s typology are distinguished in the Russian organizational culture. The Swedish economic model is more acceptable for the Northwest region of Russia where the Murmansk Region is situated, and also for some regions of Western Siberia. The priority in such culture is given to the quality of life and care about the weak people ("female” model). American or German economic models are closer to the Moscow, Center of Ural and Baikal Regions. Cultural differences exist even within one region (E.N. Ivan′shina. Regional Features of Organizational Culture of the Companies //http://www.unn.ru/fsn/k2/students/hopes/6.htm) Within the module analyses of the differences of the Scandinavian and the Russian organizational cultures seems to be important. In their article Smith P.B., Andersen J.A., Eklund B., Graversen G., Topo A. “In Search of Nordic Management Styles” mentioned, that the Nordic managers unlike the non-Nordic in their work rely more on subordinates and co-workers and less on formal rules and superiors (Smith P.B., Andersen J.A., Eklund B., Graversen G., Topo A. P. 145). In Russia as we see, the distance between a boss and employees is sometimes huge. Following the laws isn't a habit in Russian business. The analysis of stories of the Russians about their work in the Norwegian companies shows the difference in organizational cultures of Russian and Norwegian companies. From all the differences between the Norwegians and the Russian it would be important to name the attitude to work when working and personal time is strictly distinguished. If the working day of a Norwegian ends at five o′ clock, five minutes past five everybody leaves the office. To build good relations with colleagues in a Norwegian company, it is necessary to be more attentive to them, to their traditions, to try to catch its spirit. The company can have less than a half of the Norwegians with colleagues coming from more than 50 countries. Therefore the organizational culture in a company very democratic, everyone brings something to it. We don′t have any dress code, as well as in many other Norwegian companies. Even in banks employees don’t wear suits. In general the organizational culture in Norwegian companies is very informal without almost no distance between bosses and employees. You don’t need to work a lot (evenings and days off), but you must do quality job with high performance and reliability. In the company it seemed to be strange that people do not discuss other people’s salaries. In general conversations about salaries are considered to be improper. However once a year the tax authorities publish lists of all taxpayers where it is possible to find both your colleagues and bosses, and prime minister, so that everybody can see their salaries according to the tax declaration for last year. Norway is one of the few countries where this information is made public. And here as though underhand, as a teenager watch pornography, the Norwegians start to see the salaries (Conversation with Alexey Feldhandler //roem.ru/2011/04/05/addednews20680/) The poll carried out by us among Russian employees of the Russian-Norwegian company SIVA (Murmansk) in September, 2012 revealed some peculiarities of working in a joint company. Employees of the company mention that bosses do an emphasis on development of the personal initiative of employees, expanding the zone of their responsibility, motivation system is based on incentives and recognition of their performance. Atmosphere in the company is friendly, informal communication is used, there is no strict hierarchy, management communicates with subordinates as if they are equal, and employees trust the skilled management, but can independently plan their own work. The main thing is to achieve the goal. Employees can choose their own means to do it. Norwegian management promotes employees′ training. The difference in mentality is perceived by the Russian employees. Employees can achieve success in their career, if they are smart and ready to risk. The company welcomes performance but not laziness. 12.6. Summary The knowledge of national culture allows building relations in a group of people in a correct way. Without knowledge of organizational culture peculiarities of a country it is impossible to solve problems at the high professional level, especially in the system of the companies with foreign investments. The comparative analysis of organizational cultures allows revealing behavior of bosses and employees, improving relations between them, defining styles of communication that finally contribute to efficiency of a company, its economic success. Specifics of the Russian organizational culture are closely connected to the history of Russia and mentality of the Russian people. The problem of control, relations between colleagues and relation to work define the peculiarities of work of a Russian company. Unlike the Scandinavian organizational culture Russian companies reveal a gap between a boss and employees, as well as not following the laws. Study Questions 1. What is the organizational culture? Define the difference between business and national cultures? 2. What type of organizational culture, in your opinion, corresponds to the organizational culture of your country? 3. What key concepts of the organizational culture in Russia influence efficiency of the Russian companies in a positive or negative way? 4. Describe the peculiarities of the organizational culture in the Northern countries, using the article “In Search of Nordic Management Styles” by Smith P.B, Andersen J.A., Eklund B., Graversen G., Topo A. Glossary Organizational culture is a system of collective and personal values and norms accepted by an organization and making it united. Corporate culture is a complex of the assumptions accepted by all the members of the organization, and setting the general norms of behaviour accepted by the majority of people of the organization Light organizational culture is characterized by the minimal inequality of employees, unstructured tasks that employees accept, evolutionary changes, priority of rational decisions, responsibility of employees. Strict organizational culture is characterized by the inequality and privileges for employers, a priority of political decisions, rejection of risky decisions by employees; attention to the relations in a group, structured tasks that employees accept. References Belyayev A.A., Korotkov E.M. Systematology of the Organization. Moscow: Infra-M, 2000 // Belyayev A.A., Korotkov E.M. Sistemologiya organizatsij. Moskva: Infra-M, 2000. Gaysina L.M. Human Resource Management in the Russian Oil and Gas Companies: Modern Social Priorities: Doctor’s Thesis. Synopsis. Ufa, 2009 // Gaysina L.M. Upravl′eniye personalom v rossijskich kompaniyach neftegazovogo kompleksa: sovremenniye sotsial′niye prioriteti: avtoref. kand. diss. Ufa, 2009 Ivan′shina E.N. Regional Features of Organizational Culture of Companies //http://www.unn.ru/fsn/k2/students/hopes/6.htm // Ivan′shina E.N. Regional′niye osobennosti organizatsionnoj kulturi predpriyatij //http://www.unn.ru/fsn/k2/students/hopes/6.htm Zaytseva T.V. Formation of the Integrated Control System by Human Resources of an Organization: Theoretical and Methodological Aspects: Doctor’s Thesis. Synopsis. Moscow, 2012 // Zaytseva T.V. Formirovaniye integrirovannoj sistemi upravleniya chelovecheskimi resursami organizatsiyi: teoreticheskiye I metodologicheskye aspekti. avtoref. dokt. diss. Moskva. 2012. Sergeyeva A. The Russians: Stereotypes of Behaviour, Traditions, Mentality / Sergeeva A. Russkie: stereotipy povedeniya, traditsii, mental'nost' http://lib.rus.ec/b/265695/read Sklyar E.N. Increase of the Industrial Companies′ Management′s Efficiency on the Basis of Development of the Corporate Culture: Doctor’s Thesis. Synopsis. Bryansk, 2002 // Sklyar E.N. Povisheniye effektivnosti upravl′eniya promishlennim predpriyatiyem na osnive rasvitiya korporativnoj kulturi: avtoref. kand.diss. Bryansk, 2002. Sulim N.N. Social and Psychological Features of Organizational Culture Formation in a Company: Doctor’s Thesis. Synopsis. Kursk, 2009 // Sulim N.N. Sotsial′no-psikhologicheskiye osobennosti formirovaniya organizatsionnoj kulturi predpriyatiya: avtoref. kand.diss. Kursk, 2009. Shaburova A.V. Labor Reproduction in Oil and Gas Companies in Siberia: Doctor’s Thesis. Synopsis. Novosibirsk, 2012 // Shaburova A.V. Vosproizvodstvo trudovich resursov neftegazodobivayuschich predpriyatij Sibiri: avtoref. dokt. diss. Novosibirsk, 2012 Fey C.C., Danison D.R. (2000) Organizational Culture and Effectiviness: the Case of Foreign Firms in Russia // Article Collection in Business across Culture. BIS – Campus Kirkenes. Autumn 2009. / Eds. Galina Smirnova, Teresa Chen and Peter Haugseth. Р. 211-254. Smith P.B., Andersen J.A., Eklund B., Graversen G., Topo A. (2003) In Search of Nordic Management Styles // Article Collection in Business across Culture. BIS – Campus Kirkenes. Autumn 2009. / Eds. Galina Smirnova, Teresa Chen and Peter Haugseth. Р.139-155. http://www.hr-features.ru/content/category/4/14/27/ roem.ru/2011/04/05/addednews20680/