Culturally Diverse Teams and Social Interaction Influence on Team Effectiveness in Small and Medium Enterprises in the ICT Sector in Malaysia

Abstract

This research seeks to establish a conceptual understanding of the extent to which group interactions of cross-cultural workforces affect organizational performance in Malaysian small and medium enterprises (SMEs) in the information and communication technology (ICT) sector. Drawing on qualitative case study experiences of ICT SME workforce comprising owners and managers, team leaders, employees and clients, it attempts to understand if culturally diverse teams, through social interaction, exert a positive or a negative effect on team effectiveness. Three separate groups of stakeholders were interviewed over a period of one year who provided divergent perspectives on diversity and team effectiveness. Simultaneously, participant observation techniques were extensively used to gather insights from team-building sessions, annual dinners, new staff induction and other informal events organized by the SMEs under study. The study concluded that though homogeneous sub-groups within cross-cultural workforces teams performed well in delivering technical solutions in the ICT sector, cultural differences created social interaction barriers, particularly communication obstacles, with clients as well as within the team which often hampered work effectiveness. Additionally, the dialectical and ambivalent nature of the technical and social needs of team composition comprising both expatriates and Malaysians provides an interesting arena for further investigation in a wider quantitative survey study to validate the negative outcomes of social interaction on cultural diversity and to contest these theories with positive outcomes as postulated by new organization theories such as informational diversity theory.