Cultural diversity as a competitive tool: trust and knowledge sharing from a Malaysian perspective

Abstract

A recent race-relations study found that contrary to government claims, racism ran deep among the ethnic groups in Malaysia (Merdeka Center for Opinion Research, 2015). Diversity training is not viewed as a trust-building competitive tool. In this paper, we argue that diversity training, shared values, and cultural collectivism influence intra-organisation trust within multi-national corporations operating in Malaysia. From an economic perspective, shared values and diversity awareness induced trust can arguably result in the positive spillover of knowledge-sharing. Studies in knowledge-based view of the firm show that strategic use of knowledge-sharing creates organisational value and is catalytic to a firm's competitive advantage (Fey and Furu, 2008; Wang and Noe, 2010). This paper highlights both the challenges facing Malaysian MNEs and the latent opportunities for improved collaboration, innovation, and firm performance through diversity and trust.