The Nordic values of work-life balance in diverse teams in multinational corporations

Abstract

Globalization brings about transnational and diverse teams (Earley & Mosakowski, 2000). The study of geographically dispersed, diverse, and multicultural teams has been growing rapidly within psychology and cross cultural management studies (Stahl, Maznevski, Voigt, & Jonsen, 2010; Minbaeva, Fitzsimmons; Brewster 2021). Teams offer companies potentially effective ways to combine the various skills, talents, and perspective of a group of individuals to achieve corporate goals (Staples & Zhao, 2006). This study explores responsible management and change of mindset in corporations. Multicultural and diversified teams offer great potential in international collaboration. The success of diversity management connects positively to growth and innovation just like work-life balance is an important indicator of efficiency and work welfare.

Inclusion challenges in diverse teams

It is an established fact that improved representation of heterogeneous characteristics in organizational demographics and of minorities at the higher levels of the organization is important for dynamics of inclusion. (Joshi & Roh, 2007). Diversity management as organizational or business strategy may have an effect on diversity outcomes. Whether companies are proactive or reactive in relation to external pressure (e.g., political or competitive) or internal pressure (e.g., from top executive expectations and resources allocated) may have an effect. The success of diversity management is positively connected to growth and innovation and negatively connected to risk-aversion, times of downsizing, and strategic moves aimed at efficiency. (Joshi & Roh, 2007). The organizational history and culture also signals the company’s approach to diversity. The management of diversity in organizations induces a competitive advantage through reducing cost, attracting human resources, generating successful marketing, increasing creativity and innovation, assisting with problem-solving quality, and facilitating organizational flexibility (Cox & Blake, 1991). Becoming aware of implicit practices in time is transformative and suggests new areas of content related to responsible management to help people empower themselves to live full personal and professional lives.

Responsible management and work life balance

Work-life conflict is both the responsibility of employees as well as their organizations. Long work hour of companies has blurred the line between family and professional life. Therefore, to help the employees to balance both the roles appropriately companies have implemented many employee-friendly practices such as work from home, flexi-time, fun at workplace. The effects and blurring effects have only exacerbated due to lock downs during Covid-19. Diversity and work-life initiatives is at the core of the new social contract of negotiation between employers and employees. The basic outline calls for workers to commit their best contributions and greatest energies to the job in return for interesting work, respectful treatment, developmental opportunities, and an environment that responds to individual needs. Those provisions are critical for best outcomes. Flexible working opportunities also attract and retain qualified staff in organizations (Croucher and Kelliher, 2005). Work-life balance is the result of the satisfactory level of involvement in the various roles in one’s life.  If the roles played at work and in family domains are incompatible, it results in an imbalance in work-life. Work life balance concerns spending time with family, time for emotional wellbeing and health of family members, support from peers, childcare and satisfaction with the workload (Karakas and Lee, 2004). Absolute balance of work and family life is a growing challenge. Communication about work-life programs is essential. Although an organization may offer work-life benefits, the positive effect depends on the senior management’s endorsement, company culture, manager and leader’s awareness and individual’s perception, as we shall see. Moreover, to manage employees from diversified background organizations are required to adopt heterogeneous practices rather than any generic practice.

This study

This study is based on a qualitative methodology of observing and interviewing high performing diverse team in seven subsidiaries of Danish, Japanese, American and Chinese multinational corporations in Tokyo. It is a qualitative field study. The first from observations and interviews in 2013-14 and the second from interviews in the corporations in 2019 and online in 2021). The diversity attributions in focus are nationality, functional expertise, experience - and gender.

While some studies may view diversity and work-life balance as separate functions, the business case for managing diversity is, in large part, the same for work-life balance. Both diversity and work-life initiatives promote employee commitment, improve productivity, lower turnover, result in fewer employee relations challenges, and decrease the likelihood of unethical business practices. (Konrad and Mangel, 2000; Kirkman Shapiro, 2001). A common thread that links the reasons of work-life benefits is organizational culture. This study explores

• Society norms
• Organizational culture
• Team work 
• Individual conditions and perceptions

Observations

It is found that Danish corporations by comparison emphasize – arbejdsglæde – which means fulfilling work content - and equal conditions for women and men (salary, promotion and work-life balance[1]). Against this background, Japan has made efforts to maintain its working population and to raise its productivity in faces of a society with a declining population and economic stagnation. Economic reforms including the promotion of women in the work force – womenomics - have introduced a number of measurements to improve productivity. These should enhance corporate governance and reform the mindset of corporations in Japan towards stronger global competitiveness. Specifically, companies must enhance diversity amongst board members to build business acumen. Further, they should honor the merits of all employees irrespective of gender, nationality and age. Finally, the performance appraisals, rewards, communication, and employee welfare conditions should be fair and transparent. However, in spite of these policies a majority of Japanese companies are struggling to appoint female and foreign directors. It is even a challenge to appoint Japanese directors who are not in-house or already belong to the business system.

Moreover, Japanese organizations and the supporting culture of long working hours, virtues of hard work and commitment also have led to deficiencies such as an increase in incidents of stress. Conservative traditions also pose problems of integration and inclusion in the Japanese workforce. The present study explores the policies and practices of work life balance in seven international corporations in Tokyo. In comparison, the Chinese corporation’s employees were agile and robust to stress and the American corporation installed a four-day workweek with increased productivity.

The study offers examples of how these corporations responsibly leverage diversity and exemplify how they are catalysts of change and progress that benefit a diverse workforce in each their idiosyncratic ways. It also shows that responsible management was contingent on a number of factors in business organizations. The study exemplifies a number of solutions to similar principles rather than a one fits all.

[1] Denmark, as the Nordic countries, scored high in the OECD reports on happiness from 2012-2020. The reports measures are trust in the welfare system, employment, education, and work-life balance.