Managing the Multinational Enterprise in a World of Different Cultures: Some Fundamental Remarks on the Pluralism of Cultures and its Managerial Consequences

Abstract

In the course of globalization one problem is becoming increasingly important for the management of many multinational enterprises (MNEs): How should managers treat different cultures and legal environments? And how should conflicts be handled that result from fundamental differences concerning legal regulations, world views, value systems, and fundamental principles of life? The solution to this problem as proposed in this essay will require a fundamental change in the behavior of MNEs. It will result in modifications concerning all five classical managerial functions: planning, organizing, staffing, directing, and controlling. In the present essay we focus on the contribution of responsible management to resolve or prevent conflicts resulting from its own behavior. The solution to this problem requires a clarification of two basic questions: (1) How should management organize the interaction with different cultures? Should management accept the proclamation of Western values (proclamation approach) or start an unprejudiced mutual process of learning between cultures (learning approach)? (2) What are the implications for the design of the management process, i.e., the above-mentioned managerial functions and their relations to each other, resulting from the answer to this question?

Keywords: Multinational enterprise, globalization, pluralism, culture, management