Significance of diversity in multinational companies

Sample Solution

    Diversity is a critical factor in the success of any multinational company. Research has demonstrated that diverse workforces come with numerous benefits, including better problem-solving abilities and creativity, improved risk management, enhanced decision making capabilities and increased organizational performance. As Alan Joyce states,

diversity can lead to improved strategy formulation and debate within the organization. Therefore, it is important for businesses to create an inclusive culture that encourages different perspectives and ideas from all members of staff. The importance of diversity in multinational companies cannot be understated. By having a diverse range of employees from different backgrounds, countries and cultures brings together different points of view which leads to innovative thinking and business solutions that may not have been considered otherwise; providing companies with an advantage over their competitors. Moreover, evidence shows that employees who feel respected by their employers are more likely to stay longer in the organisation which subsequently increases job satisfaction levels among other advantages (Deloitte Review 2018). Despite this however there still remain significant challenges for leaders when managing multicultural teams due to differences across language barriers as well as varying cultural norms (McLoughlin & Thomas 2006). If not managed carefully these issues could lead to disagreements amongst team members leading high levels of conflict or even worse – complete breakdowns between teams/intercultural communication problems/misunderstandings etc (Mckinsey 2020). Furthermore if organisations lack flexibility around accommodating individual needs such as religious holidays or personal leave then team morale could decrease significantly leading towards negative outcomes such as reduced productivity or turnover rate increases (Deloitte Review 2018). To ensure successful multicultural collaboration the onus falls onto leadership teams’ shoulders who need manage effective intercultural relationships through regular communication channels such as ‘town hall’ meetings so they can align objectives while building trust across various departments throughout the organisation (McLoughlin & Thomas 2006; McKinsey 2020). Additionally there should also be flexible approaches taken towards managing cultural differences such as allowing cross-functional working groups or even global conferences where senior executives attend; whereby employees can discuss initiatives for improvement thus creating an environment where everyone feels valued equally regardless race gender or religion (McLoughlin & Thomas 2006). In conclusion it is clear that diversity plays an integral role in organisational success by enabling companies to tap into new markets aiding them grow their brand awareness while creating a strong sense pride amongst its workforce through mutual understanding respect inclusion acceptance which ultimately will help boost overall financial performance figures overtime. Therefore whilst there are indeed some challenges associated with managing intercultural dynamics experienced by corporate leaders they must strive conduct themselves ethically professionally while implementing best practices accordingly if they wish succeed long-term at delivering optimum results within their industry sector