Impact of Cultural Diversity on Employee Performance: A Study of Expatriates

Impact of Cultural Diversity on Employee Performance: A Study of Expatriates

Abdelfatah Arman, Osama Sohaib, Vazeerjan Begum, Aaesha Aaesha Alkharman
DOI: 10.4018/IJSSMET.342614
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Abstract

The purpose of this study was to investigate the influence of cultural diversity on job satisfaction and its effect on expatriate work performance. Structured interviews were conducted to collect qualitative data from a sample group of expatriates five participants from mixed nationalities in a private sector organization based in the United Arab Emirates. Thematic analysis identified three emergent themes of culture that negatively impacted expatriates' job satisfaction, causing reduced employee performance, and two themes were identified that increased expatriate performance at work (enhanced creativity and innovation). This research contributes to the body of academic knowledge about the effect of cultural diversity on expatriate employee performance. The value for praxis from this study are recommendations for managerial action to improve expatriate work performance.
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Literature Review

Culture and its Effect on Workplaces

The idea of culture is a critical factor in determining people’s behaviors, attitudes, beliefs, and expectations that may significantly affect how well they do at work. Geert Hofstede, a Dutch social psychologist, created Hofstede’s Cultural Dimensions Theory as a framework for intercultural communication and comprehension. According to this idea, six dimensions may be utilized to compare civilizations and appreciate their differences (Escandon-Barbosa et al., 2022), such as power distance, individualism vs. collectivism, masculinity vs. femininity, uncertainty avoidance, and long-term vs short-term orientation are important for a country’s innovation performance. Psychological needs satisfaction is another essential element that may impact expatriate’s professional engagement. They are more likely to feel happy, have job satisfaction, and be engaged if they believe their psychological requirements are being met (Giorgi et al., 2020). Additionally, a significant element that may influence the results of expatriates’ efforts at work is perceived organizational support (POS). POS stands for the degree to which workers believe their company values their efforts and is concerned about their welfare. Higher levels of POS are more likely to make expatriates feel supported and dedicated to their work, which improves job satisfaction, colleague support, and performance at work (Giorgi et al., 2020).

The degree to which an expatriate’s values fit with those of the host nation is their degree of cultural values alignment. Expatriates who adhere to the cultural norms of their host nation are more inclined to act creatively, which improves work-related outcomes (Tsegaye et al., 2019). Past research has demonstrated that psychological capital (PsyCap) and cultural intelligence are crucial elements that might affect how well expatriates perform at work and how well their coworkers assist them (Fu, 2020). It has been discovered that cross-cultural adaptation and POS influence the stress, inventiveness, and job satisfaction of expatriates (Giorgi et al., 2020). Moreover, it has been discovered that the association between cross-cultural adaptability and creative activity is moderated by the cultural values alignment of expatriates (Tsegaye et al., 2019).

A country’s culture substantially impacts how well expatriates adjust to their new environment. Those who can integrate into the local culture of their host nation are more likely to have less culture shock, communicate more effectively with coworkers and clients, and have a more favorable opinion of that nation. These expatriates are, therefore, expected to have better results at work, including greater job satisfaction, more productivity, and improved job performance (Maharaj, 2020).

The organizational culture of the host firm also affects how well expatriates acclimatize to their new environment (Kumpikaitė-Valiūnienė et al., 2022). Expatriates accustomed to one corporate culture may find it challenging to fit into another. An expatriate may need help adjusting, for instance, if they are used to working in a hierarchical organizational culture and are put in a more egalitarian one (Tahir & Savara, 2019). Hence, it is anticipated that these expatriates will have worse work-related outcomes than those who can fit into the organizational culture of the host firm, such as lower job satisfaction, lower productivity, and inferior job performance. Dev and Sharma (2021) conducted a study on employee satisfaction and gender in the Indian banking sector; their findings suggested that hiring female workers in firms and promoting them to leadership positions ensures the success of these organizations in meeting their strategic objectives.

A study was conducted on the role of cultural diversity and how it impacts work team performance at Abu Dhabi University, UAE. The study results showed that there was a significant effect on employee productivity and the overall performance of an organization (Cherian et al., 2020). AlShehhi et al. (2021) examined the relationship between organizational culture and the performance of firms in the UAE. They surveyed 131 subjects from different organizations in the UAE. The study findings revealed a positive relationship between organizational culture and employee performance. Furthermore, the authors indicated that there was a strong relationship between a worker’s performance and satisfaction; the more the employee is satisfied, the better they perform.

Handayani and Khairi (2022) determined that to ensure that workers are happy and can dedicate themselves to the organization, management must uphold the company’s standards for leadership and quality of work life. This will help workers perform better and meet the company’s goals. For instance, by conducting frequent meetings to encourage employees’ enthusiasm for their work, the organization should set clear expectations for behavior and work standards that all employees must adhere to. Retnowati et. al. (2022) recommended enhancing personnel performance; a business should be able to offer incentives to personnel in order to boost job happiness and enable future improvements in personnel performance. Additionally, according to Bangsu et al. (2023), employees in organization that adopt fair and transparent decision making processes will feel empowered and see themselves as valuable parts of the organization; thus, they are more likely to put more effort into their work and experience psychological well-being.

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