The Role of Virtual Multicultural Teams in Corporate Culture

62 El Guindi & Kamel

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Chapter V

The Role of VirtualMulticultural Teams in

Corporate CultureAmira El Guindi

Maastricht School of Management, The Netherlands

Sherif KamelThe American University in Cairo, Egypt

ABSTRACTInformation and communication technologies are impacting today’s organizations andbusinesses in many diverse ways. The implications are perceived at the individual,organizational, and national levels. The old accustomed-to boundaries of nationaleconomies and markets are giving way to globalization and newly emerging trends.Competition is increasing, and due to the forces of change, the world market will sweepaside the small market players to make way for global organizations that are capable ofpenetrating the world markets through a massive global outreach strategy. In that respect,there is a need to invest in innovative business models such as virtual multicultural teamsthat are capable of handling the pressures of growing competition while capitalizing onthe evolution of information and communication technology.

Global organizations need to operate through a very flexible structure that allowsfreedom and speed, and replaces the hierarchical models with structures that are flatterand adequate for stronger and more efficient communication. Such a structure will allowbottom-up decision making and self-management and will capitalize on the advantages of

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The Role of Virtual Multicultural Teams 63


employing multicultural teams; the diversified capacities, knowledge and businessperception of these teams will be conducive to more in-depth innovation and creativity.Virtual teams can provide an organization with a solid opportunity to compete, makingit easier to adapt to different situations and reducing conflicts. This chapter reflects theresults of a study conducted in Egypt that targeted the determination of the possibility ofreducing multicultural team conflicts by establishing a corporate culture that could havea strong influence on team members using virtual teams. The study covered six organizationsoperating through virtual multicultural teams and describes the analysis of the findingsthat relate to the role of corporate culture, the management style, and conflict resolution,among other elements.

Global organizations face the challenge of operating through global multiculturalteams whose members—coming from different cultural backgrounds—often stumble intoconflicts that influence the overall performance of the organization. The core issue of thisstudy is the impact of multicultural team conflicts on the overall organizational performance.Therefore, the objective of the study was to examine the relationship between corporateculture and multicultural team conflicts and to determine whether it is possible to reducemulticultural team conflicts by building a corporate culture in which all individualcultures would fit and where the management plays a vital role in transmitting thecorporate culture to different teams in order to help global organizations become moreefficient using virtual multicultural teams.

INTRODUCTIONGlobalization is the new way to economic growth today, representing a strategy that

should ensure open, unregulated access to the world’s markets, integrating societies in a waythat enables individuals, corporations, and nations to reach around the world farther, faster,and cheaper in an attempt to close the digital divide. Globalization is coupled with thecontinuous developments taking place in information and communication technology thathave contributed to the emergence of the global organization that operates throughmulticultural and virtual teams. These teams are made up of people coming from differentcountries and having various cultural backgrounds—factors that could stand in the way ofcommunication (Wederspahn & Solow, 2000). However, it is also important to note that eventeam members coming from the same cultural backgrounds face conflicts that jeopardize theirefficiency (Wagner-Johnson, 1999). There are many reasons behind such conflicts, includingdifferent views, attitudes, expectations, and perspectives, conflicting interests, misunder-standings, backgrounds, social or moral levels. However, the difference in cultures comesat the top because it has most of the impact on teams’ conflicts, which suggests thatmulticultural teams are more susceptible to face conflicts (Wederspahn & Solow, 2000).

Virtual teams’ conflict is another dimension to be considered by global organizations,which are an outcome of the evolution of information and communication technology. In“Taxonomy of Virtual Organizations,” Bultje and van Wijk (1998) suggested that a virtualorganization is characterized as being a network of independent, geographically dispersedorganizations with a partial mission overlap. Virtual organizations use virtual teams sup-ported by information technology to communicate and coordinate their activities irrespectiveof their location. Virtual teams, if operating efficiently, provide the organization with a better



chance to compete since they facilitate the adaptation to different situations in differentgeographic areas and the response to emergent markets needs everywhere. However,multicultural aspects need to be well integrated, forming an all-star team that works in favorof the organization and become capable in reaching a wider and more diversified range ofcustomers. Many global organizations operating with multicultural teams need to modifytheir culture or create a new corporate culture that supports and enhances global teambuilding. However, there are organizations that have strong corporate cultures and are ableto direct their team members towards their desired channel, using their culture to unify theirmulticultural teams under one target, one culture, and one way of doing business; i.e., thecompany’s (Elkington, 1999).

This chapter reflects the outcome of a study1 that was conducted in Egypt studying thechallenges facing global organizations operating through multicultural teams, whose mem-bers—coming from different cultural backgrounds—eventually stumble into conflicts thatinfluence the overall performance of the organization. However, having a strong corporateculture is not enough to increase the efficiency of multicultural teams; the culture should beflexible and encourage openness to new ideas and different ways of doing things. Addition-ally, it is important to address the role of management in setting a strong corporate cultureand in formulating a winning multicultural team; this can be realized by enabling new andinnovative ideas to encourage team members to be creative and to accept each other’sdifferences. The study also covered some important, related elements such as size and typeof the business, the environment in which the organization operates, and the nationalitiesand cultures amongst others.

When studying sample organizations in Egypt, the study focused on a number ofissues, including the influence of a strong corporate culture on multicultural team conflicts;the degree of its flexibility; whether conflicts increase among virtual teams; managementrole’s in reducing conflicts, and what should the culture preach to reduce cultural conflictsin multicultural teams. The methodology used in the study was mainly descriptive; i.e.,attempting to describe the problems faced by multicultural teams and the relationshipbetween the level of such problems and the corporate culture. There were a set of interviewsconducted with top- and middle-level managers in a number of organizations, as well as thedistribution of a questionnaire among organizations using multicultural teams.

The study assumed a definition for a “strong” corporate culture—namely, one that hasa certain influence on its employees’ initial values and perceptions that succeeds in changingsome of their pre-existing, individual values.. For instance, if the corporate culture is strongin which values promotes honesty and transparency, a person who comes from a culturewhere people are usually too proud or too shy to talk openly about their mistakes would findthemselves changing their habits because of the influence of the corporate culture on theirvalues, which are translated into their behavior and actions. The study assumed a definitionfor a “flexible” corporate culture—namely one that does not confine its employees to one setof procedures they have to follow; rather, it tries to group them under the same values andgoals and gives them enough space to try to use their own ways to realize organizationalobjectives, thus fostering creativity and innovation. The study was more concerned withcultural differences; hence, the main criterion in choosing the samples was the diversificationof cultures rather than comparing certain industrial or economic sectors. The second criterionwas choosing organizations that need and are currently operating through multiculturalteams. Finally, it is important to note that all organizations studied were operating in Egypt.



GLOBALIZATION —“ONE WORLD, ONE TEAM”

The world economy is undergoing a fundamental transformation as a result of global-ization. To maintain global competitiveness, international business must address rapid,sudden, and complex changes in the world economic environment. Devoting long periodsof time to developing new products, establishing new systems or entering new marketsensures extinction. Choosing to be second into a new market is no longer a successfulstrategy, and taking the safer, slower route is no longer safer. Some local businesses arealready suffering from the impact of globalization with overseas competitors infiltrating theirmarkets. Therefore, easier and more open access to markets, continuing improvement inperformance, the ability to respond rapidly and flexibly, technological innovation, difficultyof doing it alone, and tolerance for diversity all should be considered if a company wants togo global (O’Hara-Devereaux & Johansen, l994). Today’s business environment is driven bychange; an organization has to have a flexible structure that enables it to keep transforming,increase its responsiveness and speed, and cope with the unexpected (Trompenaars &Hampden-Turner, 1998).

The continuous change in information and communication technology is dramaticallyaffecting the way people do business in terms of organizational structure and workingenvironment. The technology is making the global work more possible; it forms an essentialtool for coordinating global production and distribution, exercising operational control, anddriving policy formulation and implementation (Lipnack & Stamps, 1998). Consequently, thishas been giving birth to the new virtual organization using international and virtual teams,with a lot to manage with respect to diversity and corporate culture. In “Team Work and GroupDynamics,” Stewart, Manz, and Sims (1999) point out that the early days of the team systemwere heavily influenced by a concept known as socio-technical systems that stresses theneed to optimize both the social and technical aspects of work. The technical aspect isconcerned with the equipment and processes that produce goods and services, and the socialaspect is concerned with relationships among workers. The application of socio-technicalsystems resulted in the shift to work groups or teams in which technology and people canbe matched together. The introduction of teams was associated with performance improve-ment and productivity increase in many companies. Business Week claims that teams canincrease productivity by 30% or more and can substantially improve quality. Procter andGamble2 (P&G) is considered one of the pioneering corporations in applying teams to itsoperations for organizational development as well as a competitive advantage (Lipnack &Stamps, 1998). As a corporation, P&G also benefited from the team strategy in realizing upto 50% decrease in manufacturing costs as well as improving quality, customer service, andleveraging reliability, in addition to intangible benefits such as quickness, decisiveness, andtoughness (Stewart, Manz, & Sims, 1999). Moreover, through the 1970s and 1980s, GeneralMotors3 (GM) Corporation made many efforts to use teams in its operations. GM’s trials werevery successful and led to the Saturn experiment, currently GM’s most successful divisionin terms of customer satisfaction. Motorola, Ford, Chrysler, Boeing, Honeywell, GeneralElectric, and Xerox are among the prominent companies who are active with teams (Stewart,Manz, & Sims, 1999). Federal Express4 has a thousand clerical workers divided into teams offive to 10 people; these teams helped the company reduce service problems by 13%(www.fedex.com).



FORMATION OF VIRTUAL TEAMSIn their book “Virtual Teams,” Lipnack and Stamps define five basic stages that outline

team development: forming, storming, norming, performing, and adjourning. Most teamspass through the five stages, but some of them skip some phases, others go through themin different order, and the length of time for each phase might be different for some teams.Team composition is not easy; it demands a lot of cooperation and compromise, and failurecan occur at any point in the sequence (Hellriegel, Slocum, & Woodman, 1998). When teammembers are dispersed in more than one location or organization, they need to pay specialattention to these five stages. Having fewer opportunities for face-to-face interaction, thesevirtual teams should use the five stages to anticipate their life cycle and predict their momentsof stress in order to avoid them (Fisher, Rayner, & Belgard, 1991).

The globalization of economies enabled organizations to work across countries andexplore new markets. Electronic media are dissolving the connection between physical andsocial places. People can sleep in different time zones and still be members of the same team.Although separated by great distances, they can still discuss matters, argue points, solveproblems, exchange documents, share files, and make presentations together (Bhalla, 2000).Today’s virtual organization is sometimes a complex mix of permanent, temporary, face-to-face, ad hoc, geographically distributed, culturally diverse, vertical, and horizontal teamsmoving across space, time, and organizational boundaries (Knoll & Jarvenpaa, 1995).

The new forms of organizations do not wipe out the old ones—they add to them andchange them, demonstrating why today’s networked organization benefits from the positiveaspects of the old organizational forms, namely, the specialized functions of bureaucracy, thelevels of hierarchies, and the coherence of small groups (Lipnack & Stamps, 1997). A virtualteam, like every team, is a group of people who interact together to accomplish complementarytasks leading to the same objectives. They are unified by the same purpose but, “unlikeconventional teams, a virtual team works across space, time, and organizational boundarieswith links strengthened by webs of communication technologies” (Lipnack & Stamps, 1997).People working at the same place can communicate easily. They have meetings together, candrop into each other’s office, or even encounter each other in the hallway. Today, organi-zations need to conduct work in different countries. They need to reach other markets andincrease their responsiveness. Virtual teams enable them to be competitive (Brake, Walker,& Walker, 1995). Today’s virtual teams’ site or workplace is a computer or a cluster ofmachines and an ephemeral place of bits in cyberspace, as in a World Wide Web site (Lipnack& Stamps, 1997). Teams and organizations expand their presence online; they create onlineplaces and load them with the information that used to be available in the physical sites ofplaces. Global companies that do not acknowledge that will find themselves at a greatdisadvantage; sooner or later, they will have to adjust to this new reality (Neuhauser, Bender,& Stromberg, 2000).

Trust is the cornerstone of the virtual team structure. Virtual teams operate in complexand changing environments. They need both flexibility and speed for adaptation. A lack oftrust could lead to the interruption of the flow of information, which drives teams to stumbleinto confusion (Wederspahn & Solow, 2000). Without trust, each team member will beworking alone and protecting his or her own interest, heading towards a disaster for the wholeorganization. In virtual organizations, absolute cooperation inside the same team andbetween different teams is mandatory (Neuhauser, Bender, & Stromberg, 2000). Teammembers do not only need to trust each other’s integrity, they also need to feel they have



at least the same level of competence, otherwise how could they depend on each other’sresults and use them as a basis for further work (Lewis, 1999). Virtual or not, each organizationhas a network of relationships formed by past experiences and interactions between teammembers. This network is the social capital of the organization, its “stock of relationshipresources” (Lipnack & Stamps, 1997). In virtual teams, trust is not easy to establish but soeasy to lose. Mistrust is easily spread among the organization; one bad experience with a teammember influences his reputation and results in people warning others about working withhim.

Misunderstandings constitute a part of virtual teams’ conflicts. They are usuallycaused by the lack of trust. Smart communication tools should help to minimize this lack oftrust and consequently misunderstandings. It is difficult to prove how good you are bysending emails. You need to work with your team members and show them reliable results.At-the-same-place teams have the advantage of being able to establish trust faster; they willhave because proficiency can be more easily demonstrated through face-to-face meetings(Saphiere & Hofner, 1996). One has a better chance to explain and communicate informationin a face-to-face meeting. Moreover, it is easier for others to judge if a person can be a reliableteam member to count on from the way he/she presents idea. However, if he/she presentsthe ideas online, one would find it hard not to be skeptical, at least at the beginning, simplybecause the tools available to utilize for explanation are reduced to the minimum. For thesereasons, face-to-face meetings are very important for virtual teams, especially at thebeginning when people need to trust each other in order to start working together whilescattered in many places (Neuhauser, Bender, & Stromberg, 2000). After establishing theteam, meetings can become less frequent, but they should never stop because they areessential to renew team members’ trust in each other and keep the relationships going. That’swhy instant communication is needed, like that provided by a high-speed full bandwidthcontinuously available audio/video/data link (Lipnack & Stamps, 1997).

MULTICULTURAL TEAMSTeam members’ compatibility is an important factor in understanding team composition.

This compatibility is referred to as “fit” by Stewart, Manz, and Sims (1999): “Team fit existswhen there are positive social relationships among team members.” People are usuallyattracted to those who share the same interests, beliefs, and values; this creates synergy andhomogeneity, which foster cooperation among team members. However, a counterargumentsuggests that diversity can be more useful for teams because too much homogeneity blockscreativity and pushes teams to operate within very limited boundaries and keep doing thingsthe same way, no matter how changing and dynamic the environment is (Andrews, 1998).

One study quantitatively demonstrated this by comparing culturally diverse teams withculturally homogeneous teams. In the early stages of team performance, culturally homoge-neous teams were found to have more positive social interactions and performance. However,over time the processes of the culturally diverse teams improved and became as effective asthose of the homogenous teams. After about four months, the culturally diverse teams scoredhigher than the homogeneous teams for some measures of creative performance (Stewart,Manz & Sims, 1999). This indicates that links between group diversity and workersperceptions are complex, and additional research needs to be done to understand howindividuals react to groups with varying composition (Andrews, 1998). Teams from differentcultures with different cultural values and beliefs stress the importance of understanding the



areas of cultural impact where performance is critically influenced by the most invisible, yetingrained elements of the human character (Kennedy, 1998). This raises a very importantquestion: Does a country’s culture stand alone in affecting team member’s way of seeing anddoing things? And where does the organization’s corporate culture stand in that regard?

CORPORATE CULTUREThe organizational infrastructure is composed of hardware, software, and, more

importantly, peopleware; the corporate culture is the peopleware in action” (Neuhauser,Bender & Stromberg, 2000). Corporate culture has been present since the first groups bandedtogether to accomplish a common task (e.g., hunting, farming, defense). It is the beliefs of anorganization, its values, and actions. It makes up the corporate personality and is anaccumulation of the organization’s shared experiences (Elkington, 1999). In order to work ona global scale, the organization needs to adapt to change both externally in terms of designing,marketing, selling, and delivering, and internally in terms of developing new strategies andbuilding a new corporate culture to fit the strategies. Unless this is done, the old culture couldget in the way of the organization success (O’Hara-Devereaux & Johansen, 1994).

Culture is often defined as the way to do things. Neuhauser, Bender and Stromberg(2000) describe the three layers of corporate culture in their book, “Culture.Com,” as follows:(1) the first layer is the shared underlying assumptions and core values of the organization,the deepest layer of culture that is more related to what employees and management believein, and what makes them loyal to the organization; (2) the second layer is behaviors and habits,i.e., “the way we do things around here”; and (3) the third layer is symbols and language, i.e.,the most visible and simplest level of culture, how the people dress, how they treat each other,how their offices look, and how they use time. Sometimes the organizational culture turns intoa set of ingrained habits so that it becomes invisible. If another way of doing things issuggested, employees start acting with confusion, and any other way of doing things seemsto them less practical.

Neuhaser et al. (2000) discuss a study of firms with strong cultures in the electronicsindustry that identified five possible limitations of a strong culture:1. making employees vulnerable to burn out from continuous long hours;2. making people unwilling to change what they do;3. coloring the interpretation of information and events;4. encouraging everyone to participate in behaviors that few people do well; and5. encouraging ego involvement that heightens the emotionality of events.

The idea of self-managed, empowered teams frightens managers who are used to thehierarchical structure and feel their authority and power in the organization threatened.However, current trends associated with both the needs of modern workers and improvingproductivity indicate that the number of organizations using teams will continue to grow andthat teams may eventually become the dominate organizational form for accomplishing work(Stewart, Manz & Sims, 1999).

The following is the outcome of the study that was conducted in Egypt in 2001 in sixdifferent organizations to determine the impact of virtual multicultural teams on organizationalperformance and the role played by corporate culture and management in reducing multiculturalconflicts.



CASE STUDIESDuring the course of the study, 21 interviews were conducted with senior and middle

managers and 300 questionnaires were distributed to staff members in the different organi-zations. It important to note that the response rate was relatively high—86% of the resourcesaddressed. The focus of the questions was mainly on corporate culture and its role ininfluencing the performance of multicultural teams. The questions were aimed at discoveringthe management role in each organization and how it contributed to the transmission ofcorporate culture to different teams. The questionnaire provided information on multiculturalteam conflicts and culture flexibility in each of the six organizations. Table 1 represents thesix organizations studied; they were selected because they all operate through multiculturalteams and have diversified cultures in an attempt to include as many different culturalbackgrounds as possible. Following the description of each case is the analysis of the surveyconducted that provides information on corporate culture strength, team members’ willing-ness to work in teams in general and in multicultural teams in specific, their preference formulticultural teams when it comes to long and short term assignments, culture flexibility,virtual teams use in the organization, and management role. It is important to note that for eachcase the corporate culture has been studied according to 10 cultural variables: environment,time, action, space, power, competitiveness, structure, communication, individualism, andthinking. Moreover, it is important to mention that the percentage of expatriates in theorganizations used as case studies varied dramatically from one case to another, ranging fromless than 1% to 30% of the total staff.

CASE #1 – DAELIM GROUPDaelim Group includes four main divisions; its first division, “Daelim Industrial Co.,

Ltd.,” was founded in 1939. It is one of South Korea’s leading international engineering andconstruction contractors, with projects in more than 20 countries and 2600 engineering andconstruction professionals. The other three divisions are “Daelim Petrochemical Division,”“Web-Tech Venture Capital Co., Ltd.,” and “Icitro for Internet services.” Daelim Group is aglobal company based in South Korea with overseas offices in Egypt, Iran, Malaysia, thePhilippines, Saudi Arabia, Singapore, Taiwan, the United Arab Emirates, the United States,Vietnam, Indonesia, Kuwait, and India (Daelim, 1999).

Daelim Industrial Co., Ltd. provides a complete range of services such as feasibilitystudies, project management and financing, engineering, procurement, construction, start-up operation, and maintenance. Daelim Petrochemical Division provides a complete productcombination ranging from basic petrochemicals to high-functioning, value-added products.Web-Tech Venture Capital Co., Ltd. invests in the development of promising hi-tech venturebusiness dealing in high value-added products, and Icitro provides state-of-the-art Internetservice networks. Daelim’s Egypt Branch was established in Cairo in 1980. Its team was formedof 15 members including Egyptians and Koreans to supervise and support various projectsundertaken by the company in Egypt. Daelim Group’s culture is strong in South Korea, wherepeople have a common understanding of the norms, goals, and processes and are proud towear the company’s uniform in their offices. In Egypt, both the language and the culturepresented barriers in communications between Koreans and Egyptians. However, this did notdeter the Daelim Group from engaging in mergers, restructuring, and venturing into new



businesses, which reflected a determination to keep a global position. This was emphasizedthrough operating multicultural teams in the countries where it has established subsidiaries(www.daelim.com).

Daelim Group Survey AnalysisIn the case of Daelim Group, 80% of the respondents agreed on one cultural variable

and indicated that they have different perspectives of the cultural variables and therefore arenot influenced by one strong culture. With respect to teamwork, all respondents expresseda belief in it and in the positive impact it has on company performance, with 63% admittingto having conflicts with their team members. As for multicultural team conflicts, 88% of therespondents agreed that conflicts increase with team members from different culturalbackgrounds; 63% of them have faced ethnocentric behaviors from their team members; andonly 25% thought their own cultural orientations might be counterproductive. However, itis important to note that only 25% think teams should be made up of people from differentcultural backgrounds and only 12% preferred to work with expatriates.

Daelim Group seemed to be a company with a weak5 culture, with team members comingfrom different cultural backgrounds having great difficulties understanding each other andworking together, and most of them preferring to work with people from their own culture,confirming the natural human tendency that is to stick more to similar people. However, 63%of the respondents indicated that when it comes to work in multicultural teams, they usuallystick to the company’s way of doing things in order to get the job done,. This indicates thatcorporate culture had an influence on team members’ behavior and represented a key factorthat grouped them around the same concepts, despite their differences. Although 25%acknowledged having more differences than common grounds with their multicultural teammembers, 63% was a majority indicating an influential corporate culture and representing acontradiction with the previous indications. Thus, interviews’ analysis was the only way to

Company Field Teams’ Nationalities Sample Surveyed Daelim Group Engineering and

Construction Egyptians and Koreans 8 Egyptians

4 Expatriates Lucent Technologies

Communication Egyptians, Americans and Dutch

74 Egyptians 3 Expatriates

Procter and Gamble Consumer Goods Egyptians, British, Yemenis


Regional IT Institute

Information Technology and Human Resources Development

Egyptians, Lebanese, Palestinians and British


Seavin Services Egyptians and Americans 5 Egyptians 2 Expatriates

Technip Group Engineering and Construction

Egyptians, French, Italians, Filipinos, South Africans, Polish, Canadians, and Americans.


6 Organizations 6 Professions/sectors 14 Nationalities 237 Egyptians 21 Expatriates Total = 258

Table 1: Case Studies



explain and understand the reason behind this contradiction6. Daelim Group had a stronginflexible culture that needs to be modified in order to suit a global presence. Team membersare forced to follow the company’s way of doing things, but when they are asked about theway they conceive things, their answers are very diversified and denote the fact that thecorporate culture influences their behavior but not their thinking.

With respect to team performance ratings, Daelim Group’s respondents preferred bothteams from the same cultural background working together for a short time (50% rated theperformance as very good) and teams from different cultural backgrounds working togetherfor a long time (38% agreed on a very good performance for this team). This again denoteda preference for change since people from the same culture risk becoming too homogeneousto add anything new to the team when they work together for a long time, while people fromdifferent cultural backgrounds are more able to form a creative team if they work together fora long time and cross the stage of intense conflicts. With respect to culture flexibility, whenfaced with multicultural conflicts, 50% of the respondents indicated that they stick to thecompany culture; 25% involve the supervisor; and only 25% try to solve the problemthemselves. These results indicate the influence of corporate culture on employees’ actions,especially with 88% of the respondents more loyal to the company than to the team or thework getting done.

With respect to virtual teams, Daelim Group does not rely heavily on virtual communi-cation. The office in Cairo reports to the head office in South Korea, but written reports areusually sent by mail, and the most frequent form of virtual communication used in DaelimGroup is phone calls. Management thinks that face-to-face meetings are the best way tocommunicate and that electronic mail create a lot of confusion, which confirms that in theabsence of strong and reliable communication tools, virtual teams find it very hard to functionproperly. As for the role of management, management needs to play a stronger role intransmitting the corporate culture to the branch office and to present suggestions to the headoffice about how to modify the corporate culture in order to make it more readily absorbedby Egyptian team members. “Daelim Group corporate culture is not strong in Egypt. Egyptiansshould travel to South Korea and spend time in our offices there to develop a sense of loyaltyto the company,” according to Daelim’s general manager, Choi.

CASE #2 – LUCENT TECHNOLOGIESLucent Technologies’ history goes back to 1869 when Elisha Gray and Enos Barton

formed Gray and Barton in Cleveland, Ohio, in the United States. Later, their enterprise becameWestern Electric. In 1881, American Bell purchased a controlling interest of Western Electric,which became the manufacturing arm of all the Bell Telephone companies. AT&T took overAmerican Bell in 1899, and Bell Labs was created in 1925 from the AT&T and Western Electricengineering departments, which had been combined in 1907. The heritage of Western Electricand Bell Labs is at the core of Lucent Technologies, which was created and became fullyindependent in 1996 as part of AT&T’s decision to split into three separate companies. LucentTechnologies employs over 140,000 people worldwide from various cultures. It operates infour regions globally: North America, Europe, the Middle East, and Africa; Caribbean andLatin America; and Asia Pacific (www.lucent.com).

Lucent Technologies designs, builds, and delivers a wide range of public and privatenetworks, communications systems and software, data networking systems, business



telephone systems, and microelectronic components. Bell Laboratories, the innovationengine of Lucent Technologies, is its research and development arm. Lucent Technologiesprovides broadband access network solutions offering an advanced portfolio of solutionsfor copper, fiber, and wireless access to meet the growing demand for bandwidth capacityfor a variety of services, including analogue voice, analogue data, integrated switching datanetwork, data switching lines, and Internet protocol. Moreover, it offers data networkingsolutions, mobility network solutions, optical network and packet core solutions, worldwideservices solutions, Web hosting, and content distribution solutions.

Lucent Technologies existed in Egypt since 1981, with 20 years’ experience in buildingtelecommunication systems with major accounts and projects including Telecom Egypt.Egypt’s branch had 350 employees including 20 expatriates. Based on the downsizing thatoccurred in 2000 in the Telecom industry and the declination in the branch results that wasmainly impacted by the economic conditions in Egypt, the number went down to approxi-mately 200 employees including five expatriates. Since 1999, Egypt’s branch has been aregional office serving North Africa, Jordan, Syria, and Lebanon. The core of LucentTechnologies’ culture is diversity in all operations as a reflection of its deeply held valuesand corporate responsibility. Diversity is an integral part of Lucent Technologies’ businessenvironment because it believes that diversity provides a differential advantage andcontributes significantly to customer satisfaction and business success. Lucent Technolo-gies is a good example of multicultural-virtual teams being part of its culture; virtualcommunication is very common and quite intense in the corporation.

Lucent Technologies Survey AnalysisMore than 80% of the survey respondents agreed on the same orientations for eight

cultural variables that make Lucent Technologies a good example of an organization with astrong corporate culture that, more or less, unifies employees under the same way ofperceiving things. With respect to teamwork, all employees involved in the sample expresseda preference to working in teams and a belief in the added value that teamwork brings to theorganization. This is despite the conflicts that 92% of them face with their team members andwhich could be the result of the difficulties the company is currently going through.

With respect to multicultural team conflicts, despite the large percentage of teammembers facing conflict with their colleagues, only 42% indicated that these conflictsincrease in multicultural teams, indicating that the majority of teams’ conflicts in LucentTechnologies is not caused by cultural differences. This suggests that multicultural teamconflict might not be very significant because of the strong corporate culture. While 50% ofthe respondents acknowledged having faced an ethnocentric behavior from people fromother cultures, nobody thought his or her cultural orientations might be blocking him/her fromunderstanding the others or from performing well. Lucent Technologies is among thecompanies that encourage multicultural teams. “Americans, Egyptians or Dutch, our cultureis that we depend on each other to be successful, what we need is team spirit and cooperation,”as indicated by Bermudez, Learning Consultant at Lucent Technologies. 58% of therespondents indicated that all the teams’ members followed the company’s “way of doingthings,” which again reflects the influence of a strong corporate culture that groups diversemembers under the same theme and has them doing things together with their team memberscoming from different cultural backgrounds. Moreover, 58% of the respondents expresseda preference to work with expatriates; this indicates that the corporate culture is not only



strong but also global, since it promotes diversity and openness for working with differentpeople, instead of fear of working with people who would have different ways of seeing anddoing things.

With respect to team performance ratings, respondents rated performance of multiculturalteams equal to that of the performance of teams from the same culture, with 58% indicatingbelief in diversity and change rather than in homogeneity. On the one hand, teams from thesame culture are good if they stay together for a short time, only because, after that, thereis a risk that they might become unable to add anything new to the team or the work done.On the other hand, multicultural teams face some conflict at the beginning, especially in thestorming phase, which is the second phase in teams’ composition. After that, in the normingphase, they understand each other but keep their differences (especially if the culture isflexible) and their ability to innovate and use their differences to complement each other. Withrespect to cultural flexibility, 67% of the respondents proved to be more loyal to the companythan to the team or the work, indicating once more a strong culture. However, 75% were notsure if it was their own culture that was blocking them when facing multicultural team conflicts.Although strong, the culture is quite flexible because it encourages employees to acknowl-edge and consider their cultural differences. As for the deployment of virtual teams and thepossibility for conflicts, managers indicated that they are minimal because virtual teams arepart of Lucent Technologies’ culture, which includes electronic mail, video conferencing,teletraining, and conference calls. As for the role of management in reducing the conflicts andspreading the corporate culture, managers acknowledged the differences between culturesand the conflicts they produce. “I found that people in Egypt are too embarrassed to expresstheir opinions sometimes, it takes time to build confidence and trust,” according to Bermudez.Management of the company set the objectives together with team members, and theneveryone takes responsibility for their actions. Moreover, performance appraisal is veryimportant to keep teams on the right track and push them to be cooperative; it is the waymanagers control teams’ behaviors and performance. Managers interviewed acknowledgedthe importance of multicultural teams because they permit exposure to wider perspectives andlearning from other cultures. At Lucent Technologies, managers encourage teamwork spirit,respect between team members, and the right to express opinions.

CASE #3 – PROCTER AND GAMBLEEstablished in 1837, Procter and Gamble7 began as a soap and candle company in

Cincinnati, Ohio, USA. During the 1980s, as an important new player in health care andcosmetics and fragrances, Procter and Gamble became a global company. Sales reached 10billion US dollars, and as it approached its 150th anniversary, the company was poised for themost dramatic period of growth in its history. The company that began as a small midwesternpartnership had grown into one of America’s largest multi-national corporations. In 1993, thecompany sales exceeded 30 billion US dollars, whereas more than 50% of sales came fromoutside the United States (www.pg.com).

Procter and Gamble manufactures and markets a broad range of consumer products inmany countries throughout the world. The company’s products fall into five businesssegments: fabric and home care, paper, beauty care, health care, and food and beverage. Thecompany has won many awards, and was placed fourth on the list of “100 Best CorporateCitizens” by Business Ethics Magazine. It was also ranked among the 10 great companies



to work for by Food Processing Magazine. Leveraging its new global strengths, the companyestablished a worldwide research and development network, with research hubs in the UnitedStates, Europe, Japan, and Latin America, and achieved leadership positions for many brandslike Pampers, Pantene, and Ariel, products that became truly world brands.

Procter and Gamble’s Egypt Branch was established in 1986; today it has 1,030employees of which 10 are expatriates. The office in Egypt has sent 40 qualified employeesto work in company branches around the world. Procter and Gamble Egypt is owned by Procterand Gamble Switzerland, which is the European headquarters of the company, and its generalmanager reports to the president of the company in Central and Eastern Europe and the MiddleEast region. The company faces the challenge of managing a very large organization with aninternational presence. Through acquisitions, advances into new lines, and investment inresearch and development, the company has positioned itself in the market with a very solidcompany image and has gained customers’ loyalty for its brands. It is known for its strongglobal corporate culture reflecting the famous Procter and Gamble core values and code ofethics, which is the main reason behind choosing it to figure among the samples. Moreover,having a global presence, the company uses virtual teams to coordinate its activities whilesuccessfully operating through multicultural teams and through a global rotation system inwhich subsidiaries spread all around the world keep exporting Procter and Gamble expertsto other subsidiaries whenever their expertise or specialization is needed, regardless of theirnationalities or cultures.

Procter and Gamble Survey AnalysisMore than 80% of the survey respondents agreed on seven cultural variables indicating

a strong corporate culture. With respect to teamwork, all respondents expressed a preferenceto work in teams, and 60% reported having conflicts within their teams. With respect tomulticultural team conflicts, 50% of the respondents indicated that conflicts increase withteam members from different cultural background, and 30% faced ethnocentric behaviors.Around 10% thought their cultural orientations were counterproductive. Procter and Gamblerespondents appreciated the efficiency of multicultural teams; they all thought teams shouldbe built from people from different cultural backgrounds due to the positive experiences itcan bring to the company. 70% felt it was important to follow the corporate culture, and 50%of respondents preferred working with expatriates, denoting a strong influence of corporateculture where nationalities become irrelevant when it comes to working in teams.

With respect to teams’ performance rating, respondents had a preference of 63% forteams from the same culture for short-term assignments and 50% for multicultural teams forlong-term assignments. With respect to culture flexibility to solve multicultural team conflicts,82% of team members believed that it was their own cultural orientation that was blockingthem, which reflected a flexible culture promoting openness to diversity. 45% of therespondents’ loyalty went to the company, which is another indicator for a strong corporateculture. With respect to virtual teams, the company was employing various virtual toolsallowing more flexibility but causing some problems. “Misunderstandings arise sometimeswhen people interpret words differently in an email, and it is not easy to clear them,” asindicated by Rhommana, a company brand manager. The company’s management believesthat virtual teams add a lot to the organization by transcending the barriers of time and space;therefore, reliable communication tools are provided to teams members as soon as they startworking with the company.



With respect to the management role, the company style reflects a strong corporateculture and a preference for multicultural teams. Management is very clear in supporting thecorporate culture and in teaching the core values and principles to the newcomers, andcompany loyalty is built by adopting the policy of promoting employees from within thecompany and hiring at the entry levels only. The company emphasizes diversity, believingthat multicultural teams can reach great levels of performance and add fresh ideas to the workprocess, and team members have to cooperate in order to reach the common targets.

CASE #4 – REGIONAL IT INSTITUTEThe Regional IT Institute8 was established in 1992 in Egypt —a pioneer in providing

ICT training and education to decision-makers, managers, and professionals in the ArabRegion. The Institute’s mission is to close the technological gap between a developingcountry, Egypt, and the world by investing in people and keeping pace with the massive andcontinuous developments taking place worldwide (Kamel, 2000).

The Regional IT Institute, located in Cairo, is a not-for-profit organization supportedfinancially by the educational programs it provides. There are 18 employees working at theinstitute, two of whom are expatriates. Having formulated a number of strategic partnershipswith a number of international organizations and institutions for the delivery of its programs,the Institute operates more as a virtual organization. The Institute delivers professional andeducational development programs in the fields of information technology, management, andsoftware development. Its objective is to introduce and diffuse information and communi-cation technology into various types of organizations, both at the private and public levels,in order to help develop first-class managers, experts, practitioners, and trainers (www.riti.org).

The Institute’s activities are delivered using different formats ranging from long-termacademic development degrees and diplomas (six to 24 months), medium- and short-termprofessional programs (six to eight weeks), and short-term courses and workshops (one totwo weeks]. These activities reflect the human development needs that are identified by thecontinuous assessments and market surveys. Through its international alliances andpartnerships, the Regional IT Institute has at its disposal many channels helping it to developits capacities by the provision of the highest quality, most up-to-date training programs,according to global standards. The Institute is dealing with challenges related to culturalissues: “It was never easy to transfer the MBA program and implement it successfully in theEgyptian market. The norms and values are different, and the focus of the program courseswas also different” (Kamel, 2000). The Institute had to adapt the program to the Egyptianenvironment without altering its core focus, such including case studies from the Egyptianmarket. Dealing successfully with other cultures without being blocked by the differencesand adjusting to them is one of the reasons why the Institute was chosen to serve as a caseexample. The Institute interacts with hundreds of students daily, as well as with professorsfrom various countries, in the frame of a multitude of training programs.

The Institute faced the challenge of building a global virtual team. “The global virtualteam needed to include members representing a heterogeneous group with diversity incultures and countries” (Kamel, 2000). To achieve that, the Institute had to enhance bothinternal communication and control. For the design and delivery of the programs and courses,the Institute relied on a wide roster of national and international experienced professors,



instructors, lecturers, academics, and professional trainers. In other words, the teamsoperating at the Institute were not only multicultural but also virtual, which was anotherreason behind choosing the Institute as part of the sample. “It is important to note that themodality of operation of the Regional IT Institute could be perceived as being virtual in a non-conventional way, which brought to Egypt for the first time in the education sector a formof a virtual organization operating through global virtual teams” (Kamel, 2000).

Regional IT Institute Survey AnalysisIt is indicated that 80% or more have agreed on seven cultural variables, showing a

strong corporate culture. All respondents have a preference to work in teams and believe thatteams have a good impact on performance, with only 33% admitting to having conflicts withtheir team members. Respondents’ answers reflected a positive experience with multiculturalteams, with 33% indicating that conflicts increase with team members from other culturalbackground. 44% pointed that they have faced ethnocentric behaviors, and 33% think theirown cultural orientations block them sometimes. 89% of the respondents believed that teamsshould be built from people from different cultural backgrounds, and all respondentsindicated that they had positive experiences with multicultural teams. Over 56% favoredmulticultural teams because, in the long run, members complement each other denoting apreference for diversity, especially with 89% preferring to work with expatriates rather thanwith people from the same culture.

The majority of the sample (89%) agreed that teams from the same culture would havea very good performance if they work together for a short time, which again denotes apreference for change. 67% agreed that a multicultural team can have an excellent performanceonce it crosses a certain stage. With respect to culture flexibility, to solve multicultural teamconflicts, 73% of respondents felt that their culture could be the reason for conflict, denotinga flexible culture that preaches openness and acceptance of differences. As for virtual teams,the management indicated that the Institute had three different programs with three differentuniversities within three different countries; in other words, the Institute operates more asa virtual organization—“we meet virtually everyday,” as indicated by Sherif Kamel9. Phone,facsimile, electronic mail, and Web posting reflect interactions. Communication dependsheavily on trust between counterparts. However, misunderstandings occur sometimesbecause of language or change of the contact persons.

With respect to the management role, the analysis of the interviews indicated that theInstitute depended on a strong flexible and dynamic culture, which is the guiding factor foroperations. “Our culture is very strong. The proof is that any employee who joins the Institutehas to adapt to this culture and not the other way around,” as indicated by Khaled Wahba,the Institute’s academic programs manager. Rules and processes are agreed upon first, thenteams can enjoy a degree of delegation and empowerment. “You can give your back to yourstaff and trust they will do the right thing,” according to Kamel. The corporate culture at theInstitute reflects an appreciation for the advantages of multicultural teams. Management putsa lot of effort into selecting the right people who can fit inside a system that encouragesdiversity. Kamel says, “Teaming is very beneficial when it involves people from differentcultures.” The management recognizes cultural differences but believes that cultural prob-lems can be solved by understanding and mutual respect.



CASE #5 – SEAVINSeavin is a joint-venture agreement between Day and Zimmermann Services (DZS) and

Vinnell Corporation to provide personnel support services for the United States Air Forceand Army training teams and selected contractor personnel at five separate locations inEgypt. Seavin program started in 1993 and employs around 800 people, 5% Americans andthe rest are Egyptians. Vinnell Corporation is a TWR10 company. It is a recognized leader infacilities operation and maintenance, military training, educational and vocational training,and logistics support in the United States and overseas. Since its beginnings during the GreatDepression, Vinnell has successfully completed projects in around 50 countries located infive continents for a variety of government and commercial customers. Day and ZimmermannCorporation was founded in 1901 and is headquartered in Philadelphia, with annual revenuesof 1.5 billion US dollars, 26,000 employees in 150 locations worldwide and completed projectsin over 75 countries. The corporation provides many services; among them are engineering,construction, and program management (www.dat&zimmermann.com).

Seavin’s activities are mainly within the functional areas of operations, maintenance,and repair responsibilities. The company manages housing units at five locations, makingassignments and terminations; conducting inspections; preparing and processing leases;and maintaining and operating family housing furnishings and equipment. In addition, Seavinfurnishes all offices within the remote site complexes to include office equipment andmachines and consumable office supplies. Seavin has been chosen to serve as a case examplebecause of the interaction of multicultural teams composed of Americans and Egyptians inaddition to the influence of corporate culture. The program was established on temporarybasis and management did not meet to establish a specific corporate culture to suit theprogram environment. The two companies that made the joint ventures, Vinnell and Day andZimmermann, have totally different cultures that are almost opposites as indicated by J.Peterson, the Program Operations Coordinator at Seavin.

Seavin Survey AnalysisA majority of 80% has agreed on the same orientations for five cultural variables,

indicating the existence of a corporate culture but does not really proving it is a strong one.With respect to teamwork, 91% of respondents expressed a preference to working in teamsand its positive impact on organizational performance, with 55% admitting having conflictswith their team members. As for multicultural team conflicts, 64% denied having more conflictswith people from different cultural background. 64% have detected ethnocentric behaviorsfrom their team members, and only 18% thought their cultural orientations might block themsometimes from performing well. 91% of the respondents have a preference for multiculturalteams, and 100% prefer to work with expatriates. Most of the respondents had positive workexperiences in multicultural teams, with 45% indicating that they usually follow the company’sway of doing things when working in multicultural teams, and 36% had more common groundthan differences. These percentages show that, although team members were not influencedby a strong corporate culture, they got along together well and their performance was notheavily altered by cultural conflicts.

With respect to teams’ performance rating, responses were very diversified, but 45%of the respondents preferred multicultural teams who have worked together for a long time.With respect to culture flexibility, 55% of the respondents referred to corporate culture, while



36% tried to examine their own cultural orientations, and 9% referred to their supervisor. 73%of the respondents were found to be more loyal to their work than to the teams or the company,denoting a weakness in the corporate culture but efficiency in completing the job. As forvirtual teams, Seavin’s operations were scattered in five locations in Egypt and report directlyto the United States, which necessitates a virtual mode of communication. One of themanagers interviewed, Galal El-Massry, indicated that “it saves a lot of cost, not to mentionthe ability to reach hundreds of people at the same time and the speed of response.” However,the biggest disadvantage detected was that clearing a misunderstanding would take fiveminutes if the two parties are at the same place but might take days if they were communicatingvirtually, which matches the theory stating that communication is usually more difficult forvirtual teams, especially in the absence of trust.

With respect to the management role, culture influence was not very clear; Seavin is ajoint venture between two companies and was established only five years ago. Moreover,the program was a temporary service provider serving a specific project that was ending soon,which did not motivate managers to put much effort into enforcing corporate culture andhelping employees to absorb it. Instead, managers relied on a set of specific rules and a strongcontrol. Management acknowledged the impact of cultural differences on multiculturalteams’ performance, with an emphasis on the effort management puts into selectingemployees.

CASE #6– TECHNIP GROUPFounded in 1958, Technip was a French engineering and construction company. Today,

Technip Group has several engineering centers located in different places including Paris,Rome, The Hague, Dusseldorf, Los Angles, Houston, Caracas, Rio de Janeiro, Luanda, AbuDhabi, Shanghai, New Delhi, and Kuala Lumpur. The company has a permanent staff of about10,000 and annual revenues of nearly three billion Euros. Technip Group is one of the world’sfive biggest full-service engineering and construction groups operating internationally in thefield of hydrocarbon and petrochemical facilities. During 1999, Technip Group achievedstrong growth contrary to most of its major competitors and despite an economic environmentthat remained difficult. Technip Group’s business is designing and building industrial andservice facilities. It handles everything from preliminary studies to turnkey delivery forindividual units, as well as fully integrated complexes in a wide range of sectors, covering bothits core activity of hydrocarbons and petrochemicals as well as selected industries. TechnipGroup’s principal fields of activity have developed along four main lines: oil and gasproduction, oil refining, petrochemicals and fertilizers, and diversified industries and archi-tectural engineering. For any project, Technip Group can provide the following services:engineering, procurement, construction, and project management services(www.technip.com).

In 1997, Technip Group established its branch office in Cairo. The office is currentlyworking on several projects. The most important is a turnkey project worth about one billionUS dollars that is the engineering and construction of an oil refinery expected to produce100,000 barrels/day (five million tons per year), converting heavy products into disulphurizeddistillates. The teams operating at the project site in Amereya (near Alexandria) can serve asa sample because they are very diverse and are formed from people coming from France, Italy,Egypt, the Philippines, Germany, England, Canada, South Africa, and Poland. Technip Group



has recently gone through many acquisitions, which added more collaborators to theorganization’s teams, enriched their skills in all branches of engineering and construction,and enhanced their internationalization. Until 1996, more than 50% of the people working atTechnip Group were French; today this proportion is no more than 30%, with more Europeans,Americans, Russians, Malaysians, and Indians. Multicultural teams are one tool TechnipGroup is using to take advantage of complementary skills and stay flexible. Having a globalpresence, Technip Group is using virtual communication intensely, which is another reasonfor choosing it among the sample (Technip Annual Report, 1999).

Technip Group Survey AnalysisMore than 80% of the respondents agreed on no more than two of the cultural variables,

which reflects a very weak culture. All the respondents showed interest in working in teams

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Figure 1: Corporate Culture Influence

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Lucent P&G RITI Seavin Technip Daelim

Culture Flexibility

Figure 2: Culture Flexibility



and were aware of the added value teamwork brings to the organization, though 59% claimedthat they face team conflicts. With respect to multicultural team conflicts, 65% of therespondents had more conflicts with people from different cultural backgrounds, 53% facedethnocentric behaviors, and only 29% thought their own cultural orientations could becounterproductive sometimes. 65% of the respondents thought teams should be built frompeople from different cultural backgrounds, and 53% had negative experiences withmulticultural teams. Out of those who had a positive experience with multicultural teams, only6% indicated that the way they dealt with team members was always linked to the corporateculture. Despite the problems that most of the respondents faced with multicultural teams,94% thought teams should be built from people from different cultural backgroundscontradicting the fact that corporate culture is weak and that conflicts were intense.

With respect to teams’ performance rating, 41% rated the performance as beingexcellent, indicating that Technip Group respondents had a preference for multicultural teamsin long term assignments. Other ratings were so diversified that no significant trend couldbe detected. With respect to culture flexibility, 53% of the respondents tried to stick to theway things are usually done in the organization, and 53% were more loyal to the work thatneeded to be done. Technip Group is one of the samples that reflected a weak corporateculture. Team members acknowledged the importance of teamwork and the added valuemulticultural teams brought to the organization, with 94% answering that teams should bemulticultural. However, they obviously faced a lot of difficulty adapting to each other’smethods and ways of working with most of them, with 53% suffering from bad experienceswith multicultural teams. The problem with Technip Group’s culture is that the recentacquisitions left it with a number of different cultures that needed to be blended together. Thecompany needed a more flexible culture that could suit the various cultures that had to interacttogether. With respect to virtual teams, due to the global scale of its operations, TechnipGroup uses virtual communications and many of its employees are members of several virtualteams. Managers acknowledged the importance and advantages brought by virtual teaming,and teams are provided with the reliable tools for fast communication. As for the managementrole, the company management acknowledged the effect of differences in cultures on

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Figure 3: Team Conflicts Compared to Multicultural Team Conflicts



perspectives and attitudes. Therefore, management plans to use “cross-fertilization” wherepeople from different cultures get to rotate in different subsidiaries to learn more about theway people think and act. To sum up, Figure 1 shows the influence of corporate culture ineach of the six organizations examined, indicating that Lucent Technologies appear to havethe strongest corporate culture and Daelim Group the weakest.

With respect to cultural flexibility which is one of the key issues studied in the survey,Figure 2 shows that Procter and Gamble, the Regional IT Institute, and Lucent Technologieshave more flexible cultures than the other organizations.

Figure 3 shows how conflicts increase in companies with weak corporate cultures.Daelim Group having the weakest corporate culture appears to be suffering from a lot ofmulticultural team conflicts, followed by Technip Group. Although having a rather weakcorporate culture, Seavin has less multicultural team conflicts than Procter and Gamble andLucent Technologies who have stronger corporate cultures, because Seavin is a temporaryproject where people try to avoid conflict as much as possible and follow the rules ofmanagement. Such conflicts are due to the emphasis management puts on selection.

Comparing the level of team conflicts in general to the level of multicultural teamconflicts, it was found that the former is higher in companies with strong corporate cultures.In general, the survey percentages combined with the interview analysis proved the existenceof a relationship between corporate cultures and multicultural team conflicts. This relation-ship became clearer in the previous integrative Figures 1, 2, and 3, where the six organizationsare compared.

ANALYSIS OF SURVEY FINDINGSThe analysis of corporate culture’s influence on multicultural team conflicts led to some

conclusions and general findings. In general, the organizations that were found to have astrong corporate culture—Lucent Technologies, the Regional IT Institute and Procter andGamble—have less conflict within multicultural teams than those with weaker corporatecultures—Technip Group, Daelim Group and Seavin, which confirms the theory of corporateculture’s influence on multicultural team conflicts. As mentioned in the literature review,people prefer to work in teams to satisfy functional and social aspects. Thus, the efficiencyof teamwork is indisputable; all team members involved in the study expressed a preferenceto working in teams. However, when the study involved teaming with people from differentcultural backgrounds, team members’ preferences took other dimensions, and only organi-zations armed with strong corporate cultures were capable of absorbing diverse people fromdifferent parts of the globe and grouping them under one umbrella. Table 2 representsconflicts faced by teams in general compared to conflicts faced by multicultural teams in eachof the six organizations.

With respect to Lucent Technologies, the Regional IT Institute, and Procter andGamble, they operate in different environments having different types and sizes of busi-nesses, different management styles, and varying objectives. These organizations’ corpo-rate cultures must be different, each suiting specific conditions and needs. However, theyall have some common values and aspects that help their teams to operate in a globalenvironment with various cultures. The most important aspect in the three corporate culturesis flexibility. All three cultures preach openness to new ideas and creative work processes.They were successful in operating through multicultural teams having reached equilibrium



between strength and flexibility in their corporate culture. Moreover, the management rolein supporting the corporate culture was very important and regarding people as their mainasset that led them to global success with managers acting like coaches and directly reflectingthe corporate culture in their decisions and actions.

As for Daelim Group, Technip Group, and Seavin, it was noticed that—except forSeavin- they had more conflicts in their multicultural teams, and their teams’ members weresuffering from bad experiences working with people from other cultures. The reason forcorporate culture weakness was different in each organization. Daelim Group had the problemof adhering to one culture that was the driving force of the organization since it was foundedmore than 60 years ago; having the problem of not being able to transmit the culture thatmanagers considered to be strong in South Korea to its branch in Egypt; and managementneeded to be more aware of that fact. With respect to Technip Group, it was in a transition

Organization Corporate Culture

Willingness to work in

teams

Conflicts vs. Readiness to

work in multicultural

teams

Preference for

teams allocation

Short term Long term

Strong vs. Flexible Culture

General Comments

Lucent Technologies

Very Strong [8/10]

100% 42% conflicts 67% ready

Same culture for S/T Multicultural for L/T

67% loyal to company vs. 75% flexible about their culture

• Efficient use of virtual teams.

• Management supports the culture.

Daelim Group

Globally Weak [1/10]




• Not comfortable with virtual communication.

• Strong culture in head office not transmitted to branch.

• Weak management role in enforcing corporate culture.

Regional IT Institute

Strong [7/10]




• Strong management role in enforcing a flexible culture.

• Successful virtual organization.

Seavin Average [5/10]


Multicultural for L/T

73% loyal to the work vs. 50% loyal to the company

• Acknowledgment of virtual communication.

• Corporate culture not very strong.

• Management role clear in rules enforcement.

Procter and Gamble

Strong [7/10]




• Successful virtual teams.

• Supportive management role in enforcing the corporate culture.

• Clear trend for diversity.

Technip Group

Weak [2/10]


Multicultural for L/T

53% Loyal to work 53% Flexible about their culture

• Understanding of role of virtual communication and virtual teams.

• Corporate culture weak due to group transformation.

• Management considers building a more global culture.

Table 2: Analysis Summary



period because it had enlarged the size of its business and operations to have a morediversified multinational identity. The management was aware of the change that had to takeplace, but the process was going to be lengthy. A new global corporate culture must befounded and transmitted to all subsidiaries; meanwhile, conflicts will keep disturbing teams’performance. As for Seavin, being a joint venture between two companies with differentcultures, its teams’ members did not follow the same culture, but they got along well becauseof management’s role. However, establishing a global corporate culture to suit a five-yearproject was not a practical idea. Managers led the teams by enforcing the rules and selectingthe right people from the start, which proved to be an effective management style becausethe goal is to provide certain services according to certain rules; therefore, there is no roomfor creativity and innovation.

One common factor among the six organizations was the use of virtual teams. It wasfound through the study that all organizations relied on virtual communication for certainoperations and understood the advantages of using virtual teams in strengthening theirglobal presence. Communication tools were provided and enhanced to support virtual teams.In general, teams indicated that once virtual teaming became part of the culture, misunder-standings were reduced and efficiency was increased. Table 3 provides a summary of thestudy findings demonstrating the relationships between the variables tested by the analysis.

As part of the survey, a number of interviews were conducted with senior and executivemanagers, which provided some valuable recommendations that can be considered as a roadmap for global companies operating through multicultural teams. Some of the most importantfollow.

Flexibility as part of corporate culture is vital to allow team members to express theirpoints of view and encourage team members’ ideas, even if they are different from the waythings have always been seen and done in the organization—as long as they can prove theoutcomes will be consistent with the team goals. Create loyalty to help team memberscooperate to reach organizational goals by treating them equally regardless of their cultureor location, to help build trust between team members, and to convince them that sticking tothe organization’s identity and culture will be profitable for both the organization andthemselves, and by involving them in the decision-making process. Management role is vitalin promoting corporate culture. Cross-fertilization is important in mixing people to worktogether from different countries. Language is crucial to facilitate communication among

Variables Findings

Strong corporate culture and multicultural team conflicts

A strong corporate culture reduces multicultural team conflicts.

Teamwork People tend to work in teams to satisfy functional and social aspects.

Flexible culture A flexible corporate culture preaching openness to diversity reduces multicultural team conflicts.

Multicultural virtual teams Virtual teams are efficient if virtual communication becomes part of the culture and reliable tools are provided.

Management role Management role in transmitting the culture and setting the example is vital for multicultural team efficiency; its absence reduces the influence of corporate culture on multicultural team conflicts.

Table 3: Findings Summary



members from different cultures. Resource allocation is necessary and important whenconsidering multicultural teams since it can have critical implications on organizationalgrowth and development. Team task is useful because, if the culture is efficient, multiculturalteams can bring a lot to the work, especially in long-term assignments, because they havethe time to understand each other and build the trust; in short-term assignments, multiculturalteams usually stumble in conflicts generated by misunderstandings. This delays the workdue to the fact that team members might not have the time to cross the storming stage (whereconflict is quite intense) and make it to the norming stage (where they reach a commonground). Teams’ social life is a key issue in enhancing multicultural teams’ performance bytrying to make them meet outside the working environment as much as possible.

CONCLUSIONThe business world is changing rapidly and organizations need to operate in a complex

and competitive environment. In order to compete globally, they have to redefine theirstructures and their people as they seek the optimization of their resources across borders.This pursuit of profit, growth, and/or market share has to be done in the context of profoundcultural differences through a flexible structure that permits a worldwide existence. In manycases, multicultural teams are the answer. Multicultural teams can provide the globalorganization with great success factors giving it better access to the world’s markets. Theycan enrich the work with innovation and bring a treasure of fresh ideas to the organization.Global companies should therefore provide the right environment for their teams to operateefficiently by reducing their cultural conflicts. The right corporate culture can be one of theways to keep teams members working together in harmony yet each keeping his/her ownspecial differences.

The study of the six organizations proved that a strong and flexible corporate culturecan help multicultural teams turn their differences into precious assets by reducing theircultural conflicts. It was also proved that the corporate culture must be supported bymanagers; teams might still lose their way and stumble into conflict if management is not awareof the benefits multicultural teams can bring to the organization, does not believe in thecorporate culture, or does not exercise a strong role in transmitting this culture. Multiculturalvirtual teams were found to have less conflict when provided with reliable communicationtools and when trust becomes part of the corporate culture. The study results indicated thatto operate through multicultural teams, the corporate culture should preach openness todiversity and acceptance and respect of differences. Teams must believe that their poweremerges from these differences. Building teams’ loyalty, cross-fertilization, teams’ allocation,teams’ social life, and the length of teams’ assignments are all issues to which globalorganizations operating through multicultural teams should pay attention. Moreover, teammember selection is a very important point; the beauty of a multicultural team can only be seenwhen the right pieces are chosen and fit well together to show the final picture of the puzzle.In other words, team members must be chosen not only for their knowledge and expertise,but also on the basis of their differences and how well they complement each other to formthe right combination needed for the team assignment.



ENDNOTES1 The study objective was to examine the relationship between corporate culture and

multicultural team conflicts and the role of management and a strong corporate culturein reducing multicultural team conflicts.

2 Established in 1837, Procter and Gamble is a global company with more than 11,000employees worldwide, more than 300 products, and more than five billion consumersin 140 countries.

3 Established in 1908, General Motors is the world’s largest automotive corporation andfull-line vehicle manufacturer employing 388,000 people, having operations in 50countries, and a presence in 200 countries.

4 Federal Express is a worldwide corporation with 215,000 employees and a 20 billion USdollars market leader in providing integrated transportation, information, and logistics.

5 The term “weak” here refers to the fact that the culture of the organization is not strongenough to entice the staff in the organization to commit to it either because they arenot convinced of it or it does not match their own attitude and behavior.

6 Daelim Group’s corporate culture is very strong in South Korea, where employees areproud to wear the company’s uniforms in the office and never leave their desks withouttheir famous notebook with Daelim Group logo. They are loyal, stick together, andreflect the company’s identity in every decision they make. The general manager inEgypt, Choi, indicated that this strong culture is the driving force in the company, butthe problem in Egypt is that it has not been well transmitted to the employees.

7 Today, Procter and Gamble employs more than 110,000 employees worldwide andmarkets more than 300 products to more than 50 million consumers in 140 countries(Procter and Gamble, 2000).

8 The institute is truly a global organization, having served over 12,000 students andtrainees from over 1,100 organizations from 90 countries from all parts of the world since1992, pooling different students, professors, and staff from different nations andcultures using both traditional (in-class) and unconventional (virtual) methods.

9 Sherif Kamel was the director of the Regional IT Institute during the period 1992-2001.10 TRW is a global technology manufacturing and services company working through

250 locations in 35 countries (www.vinnell.com).

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The Role of Virtual Multicultural Teams in Corporate Culture

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