International Diversity Management?

Internationalization & Diversity Management are two huge buzz words in business and we are constantly getting tortured with them in our day to day life. The first thing that pops into my mind is always the quote by David Brower “Think Local, Act Global” – oh no, sorry the other way around “Think Global, Act Local”. But isn’t their a little truth in both?

Internationalization of firms?

When it comes to internationalization I often just start to think about the little things you realize when you just walk through the city. We are getting clothes made in Bangladesh by H&M, eat Wagyu beef from Japan, listen to Beatles music from the UK and are finally aided by a German nurses in Switzerland.

Well, that maybe a little easy to explain internationalization but that the obvious for all of us. So let’s try to take a more scientific approach. What we can recognize from UNCTAD statistics is that there is an increasing amount of exports and investments in foreign markets. Companies such as General Electrics have a massive amount of assets, sales and employees in foreign countries as you can see in the world’s top 100 non-financial transnational companies statistics.

On a more generic level, one of the most popular theories is done by Bartlett & Ghoshal, saying there are four basic types of internationalized firms: Global, International, Transnational and Multinational companies. So finally, the question in the end is just: How are you internationalizing?

International Diversity Management?

Well, let’s come back to our core topic and try to figure out what internationalization means for that.

I think without any doubt that we have covered the important and state-of-the art topics in this field over the last month. We have heard about women in supervisory board by Katrin and Thomas, work-life balance and children, Entrepreneurship, ethnic minorities and even about homosexuality.

On a broader scale with most big companies operating in a bunch of countries or even all over the world these topics make it really difficult for companies to cope with all these requirements and to build up a successful diversity management.

However, according to the IPMA/NASPE Benchmarking Committee, diversity management “[…] efforts in the workplace facilitate the exchange of new perspectives, improve problem solving by inviting different ideas, and create a respectful, accepting work environment, all of which make good business sense.” Thus it can be major criteria of success for companies.

These questions are also really interesting when it comes to corporate identity or culture of companies which in some how is discussed in the framework of the country-of-origin theory by Harzing & Sorge. But that would be another issue…

In the end, firms may have to start doing both: “Think Local, Act Global” and “Think Global, Act Local”.

8 Responses to “International Diversity Management?”
  1. Izzy says:

    I like the slogan, it shows the balancing act companies are actually undertaking by turning international. Global yes, but local too, and above all global… However, i didn’t really get your point. What is the core statement of the post? Or does it conclude that internationalization and diversity management are becoming inseparably because of the “think and act global AND local, too”?

  2. martinjaja says:

    Thanks for your answer. Let me directly come to your question – what the core statement of the post is about: What I have basically done was trying to put together the process of internationalization and the upcoming issue of diversity management for multinational corporations showing that there are strong interdependencies between both streams.

    Thus, I agree with you that internationalization and diversity management are becoming or are already inseparable.

    Now let’s come back to the slogan. I think it can be seen as a symbol of the “dilemma” multinational corporations are in due to the constantly changing business environment. In the picture, they start breaking out of the original slogan “Think global, act local” which is the start of breaking up the old thinking. As shown in the text, I rather take another step by saying you have to do both – Think and Act global and local!

    The whole discussion is also very interesting when you look on the idea of corporate cultures which to some extend shall transferable all over the world and wherever the company goes!

  3. thob84 says:

    Thank you for your post Martin! I like that you picked up our topic of Mr. Dörrenbächer’s lecture – Internationalization of firms. You gave us illustrative graphics and models about scope and types of internationlization. However, it would be very interesting to connect this issue to our topic diversity management in more depth. Clearly, this requires another post.

  4. Izzy says:

    Thanks Martin for the clarification. It makes sense to me, now. However, I agree with Thomas. The connection of internationalization and the increasing importance of diversity management could be highlighted more clearly. For example you could include a short comparison of companies with different levels of international action and how / if they deal with diversity management. Real life examples are always a good way to grab attention and demonstrate your ideas 🙂

  5. katjo2010 says:

    Very nice connection between internationalization and diversity management and I like the illustrations 🙂
    I think it is a very difficult act for a globally transacting company to find the right balance between international standards and local customization of guide lines regarding different areas, diversity management being one of them.
    This would be a great topic for further posts where the connection could be discussed in more detail 😉

  6. martinjaja says:

    This is a great idea to pick up the topic again, this time time trying to do it in a more practical way. Of course, the post is in somehow abstract and there is not a real outline in the end but actually that wasn’t the purpose. I just wanted to put two things together, trying to find out about relations between them rather than finding a solution or even a final position of the topic.

    The question of proper examples is obviously eligible due to the abstract argumentation. However, this is rather difficult to find in real life without great insights to a firm. Aspects such as women quota are obviously well known from many companies because it brings you publicity. However, the the strategic approach or programs are normally not published as I know.

    I haven’t really worked in HR. So if you know some specific firm program dealing with that topic I would love to get to know it!!

  7. Mary says:

    … not much to add! Except this nice graphic from Mr Müller.

    He states that companies must integrate global integration and and local adaptation as well as worldwide learning. According to that, international companies go away from giving their local subsidiaries high degrees of freedom but try to combine all three factors. More and more companies evaluate their managers by worldwide standards and handle key issues in HRM in the same way. If they also put effort in local adaptability and relevance, this approach is beneficial. This so-called transnational strategy has to integrate global knowledge transfer and global learning by real and virtual networking. Makes sense for me!

    A study by Conn & Yip proves this. They found out that a worldwide oriented strategy for global leaders is effective – if companies organise their compensation, employee assignment and training processes more efficiently, this causes a measurable increase in worldwide transfer of critical capabilities (as innovation speed, quality management and competitive production).

    You can find the study Internationale Organisationsstrategie by Mr Müller here.

  8. diiasg says:

    I dont know if the buzzword GLOCAL has come up but i heard it a while back and i felt like it fits right in here. Im not sure where i heard it which makes me sad or else id be able to back track and find it.

    regardless…great post..the graphs and diagrams make it easier to understand.

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