Cross-Cultural Teams: The Role in Business


Modern organizations can be viewed as complex entities consisting of numerous departments and depending on various factors. This sophistication and the developed infrastructure help to resolve complex tasks and work at the international level (Zheng, 2017). However, it also requires specific managerial effort and practical strategies to ensure specialists representing various cultures and races can function and cooperate to achieve existing goals (Bernstein et al., 2021). Under these conditions, leadership and effective strategies acquire the top priority as the framework to cultivate the desired corporate culture within collectives, build a favorable atmosphere and work relations, and create the basis for future improvement. At the same time, leaders have to overcome multiple barriers and resolve conflicts to ensure organizations can evolve (Plummer, 2018). For this reason, the existing body of knowledge devotes much attention to investigating leadership, its styles, strategies, and how it can be used to establish the basis for successful goal achievement and positive change.

Leaders’ Role

The increased attention to the sphere can be explained by its scope and significance in the modern world. Thus, Thomas and Peterson (2017) assume that leadership encompasses numerous aspects and activities, making it a unique phenomenon with multiple definitions. The generalized and simplified one views it as the action of leading a certain team or organization to attain existing goals (Schein & Schein, 2016). It means that a leader is responsible for the state of every individual, his/her access to resources vital for effective work, and the unit’s progress (Deresky, 2016). As a result, he/she becomes the central change agent responsible for addressing current problems and selecting methods to resolve them.

At the same time, researchers admit the changing nature of leadership and its role in multinational corporations. Jacobs and Crockett (2021) say that today, influential leaders should possess outstanding knowledge in numerous fields, making their preparation more complex. They should be ready to implement effective managerial practices, create strategies for further evolution, and solve conflicts emerging as a result of people’s interaction (Jacobs & Crockett, 2021). In such a way, leaders face new requirements for their work emerging as a result of the fast-evolving environment and growing sophistication of international relations. Under these conditions, the choice of effective styles, strategies, and approaches also becomes more complex.

Cross-Cultural Teams

The rise of cross-cultural teams is one of the significant factors explaining the radical changes in the sphere of leadership. Abramson and Moran (2017) define these units as groups consisting of individuals from various national backgrounds and possessing different cultures and mentalities. The emergence and spread of these teams can be explained by several aspects. First, Luthans and Doh (2020) say that international companies and organizations can be viewed as the most important feature of the modern world. The high level of globalization, technological progress, and transport provide these units with an opportunity to function in different regions and expand their target audience (Noe et al., 2020). As a result, they acquire an advantageous position compared to organizations working in one country. For this reason, going global is viewed as one of the main goals for most units nowadays.

In such a way, the evolution of cross-cultural teams is an inevitable process because of the trends mentioned above. Dowling et al. (2017) are sure that the increased diversity and numerous mentalities help organizations to evolve because of the wider variety of options and visions of the same issue. As a result, companies benefit from a higher number of incentives and the chance to consider one aspect from different perspectives. However, Rockson (2019) is sure that cross-cultural teams introduce numerous challenges for leaders and managers as they require specific approaches and methods to align the effective cooperation between individuals and ensure they understand each other. Otherwise, there is a high risk of failure and undesired outcomes.

Corporate Culture

Thus, the spread of cross-cultural teams and their increased importance for the work of modern organizations require effective tools to control individuals’ daily interactions and cultivate desired behavioral patterns. Bashforth (2019) considers corporate culture as the fundamental issue that can help to perform this task and align collaboration within teams. Driskill (2018) defines it as a set of beliefs, behaviors, and attitudes determining how employees and management interact and work together to support the organization’s evolution. Corporate culture is closely linked to the national culture and is impacted by traditions, cultures, and employees’ attitudes (Stewart & Brown, 2019). As a result, cultivating the desired culture becomes a challenging task because it requires considering all these aspects and creating the framework that would be acceptable for all team members.

An established and effective corporate culture is also linked to higher performance levels, especially in cross-cultural teams. For instance, Taras et al. (2021) compare the results of companies with strong and weak corporate cultures. The study shows that organizations with an established set of rules observed by the majority demonstrate better results than units where no unified framework exists (Taras et al., 2021). The major barrier to demonstrating desired performance levels include conflicts, lack of understanding between workers, inability to make a compromise, or cultural differences reducing the effectiveness of cross-cultural cooperation (De Gersem, 2020). It means that creating and cultivating the corporate culture acquires the top priority for international companies as it helps to manage diversity and promote higher inclusion levels.

Under these conditions, powerful leadership acquires the top priority as the way to cultivate the necessary corporate culture and organize the work of high-performance cross-cultural teams. Harzing and Pinnington (2017) say that culture and leadership are inextricably linked as founders or influential leaders set new frameworks regulating interactions within teams and relations between employees (Groysberg). They also have the authority to shape it over time, responding to changes in external and internal environments (Dessler, 2016). The best and most influential leaders should be aware of cultures within a unit and find a balance between them to establish the only unified approach accepted by the majority (Valentine et al., 2019). For this reason, leadership and corporate culture are closely related.

Leadership Models

At the same time, the direct correlation between the two phenomena mentioned above introduces the need for effective leadership styles and strategies to promote positive changes. Tarique et al. (2022) emphasize that the choice of the model depends on a leader, team, and expected results. The leadership style should align with the current organization’s demands and desired corporate culture. For this reason, top managers might face a serious challenge in selecting the correct approach to working with teams (Banks et al., 2019). Barak (2016) views it as an essential factor impacting results and the work of cross-cultural units. That is why the choice and employment of effective leadership models are given much attention.

The diversity of leadership styles is explained by the variety of organizations’ types, cultures, and goals. Vaara et al. (2019) state that the evolution of the modern world directly influences this field of knowledge and promotes the reconsideration of already existing approaches or the creation of new ones. As a result, numerous styles and paradigms might be used by leaders regarding the situation. The existing body of literature introduces various typologies of leadership styles; however, the most popular one offers the five paradigms such as authoritarian, participative, delegative, transactional, and transformational (Farahnak et al., 2020). Analyzing the given models, Blane (2017) assumes that transformational leadership has become more topical nowadays because of the rise of cross-cultural teams and the necessity to be adaptive and flexible. At the same time, authoritarian and delegative models remain relevant, but their use is limited to specific situations or companies with an established organizational culture implying the strong and authoritarian top manager (Schein & Schein, 2016). At the same time, transformational leadership is expected to promote positive change and increased flexibility and adaptability levels, which are vital for modern cross-cultural teams (Dobbs & Walker, 2019). For this reason, it can be viewed as the preferable approach to cultivating the desired corporate culture.

Transformational Leadership

Numerous research works and authors accept the critical importance of transformational leadership in the modern world and its ability to improve the work of cross-cultural teams. Shepherd and Williamson (2022) define this paradigm as a specific leadership approach causing changes in individuals, groups, and social systems. In the ideal scenario, it contributes to positive change in all followers to make them more effective and prepare their transformation into influencing leaders (Svendsen et al., 2018). The idea of transformational leadership was first introduced by James McGregor Burns who emphasized that leaders following this style can inspire individuals to alter their expectations, visions, and motivations to work together and achieve existing goals (Svendsen et al., 2018). In such a way, a new vision of the given field emerged and became relevant because of the changing working conditions.

Transformational leadership theory offers several important ideas that can explain the change within organizations and their better work. Groves (2016) says regarding the theory, the range of follower attitudinal and performance outcomes can be explained by leaders’ ability to impact subordinates and promote the desired organizational change. In such a way, leaders remain central figures responsible for the work of teams; however, their roles change from direct commanding to actively participating, encouraging, and motivating others (Groves, 2016). It leads to the establishment of better relations within a collective and building a desired corporate culture (Groves, 2016). As a result, cross-cultural teams benefit from using the transformational leadership approaches as they promote better understanding between individuals. Furthermore, Mao et al. (2017) state that the relationship conflict between a team leader and team members can be moderated by such personal qualities as humor, trust, or attachment on the one hand and subordinates’ transformational perception on another. This assumption explains the importance of the implicit leadership theory as one of the frameworks for aligning better cross-cultural collaboration.

Implicit Leadership Theory

Creating and managing effective cross-cultural teams require increased attention to people’s visions of how the work should be organized and their ideas of how to collaborate. Under these conditions, Martinko et al. (2018) view the application of the implicit leadership theory to explaining the work of collectives as a beneficial way to outline the critical issues and address them. The given framework rests on the idea that all individuals or employees have their own cognitive representations of the world (Guo, 2018). These constructs and notions are employed to interpret surroundings, control behaviors, and create specific expectations of leadership and colleagues’ actions (Guo, 2018). Moreover, the establishment and development of these implicit visions depend on people’s culture as it influences their mentalities and responses to different triggers (Guo, 2018). For this reason, for cross-cultural teams, applying the implicit leadership theory might be a beneficial way to acquire better outcomes by accepting inbuilt differences existing in employees.

In such a way, implicit leadership theory has become a potent tool for managing cross-cultural teams. Guo (2018) assumes that its focus on specific individuals’ representations and their mentalities is vital for aligning better cooperation between representatives of various cultures. Adhering to the idea that all employees have their own expectations of leadership styles and approaches, a leader can create a more effective and universal corporate culture (Mao et al.,2017). It would encompass the current views and attitudes and, at the same time, alter the undesired ones by inspiration, motivation, and persuasion as the significant tools to shape implicit representations (Mao et al.,2017). As a result, leaders will acquire the chance to be more effective and manage cross-cultural teams avoiding conflicts because of the radical differences in expectations.

Cognitive Representations

Speaking about implicit leadership theory, it is also vital to admit the concept of cognitive representations. Guo (2018) defines it as existing cognitive representations of the world peculiar to employees belonging to different cultures. The given ideas are formed under the influence of various factors. These might include religion, local customs, persona and interpersonal relations, politics, and cooperation with other individuals. Guo (2018) assumes that any person has multiple cognitive representations linked to different issues which continue to evolve and affect everyday interactions. From the perspective of implicit leadership theory, this concept can be viewed as an inbuilt construct that affects the degree to which an individual can be integrated within a team and work as a part of it. For this reason, establishing the desired organizational culture within international teams is impossible without considering the cognitive representations of employees.

Under these conditions, the effectiveness of leaders is closely linked to the ability to address these inbuilt constructs and work with them. Abramson and Moran (2017) state that influential top managers are also good psychologists who can realize a person’s expectations and work in the ways that help to fulfill his/her basic needs. It helps to support a high level of motivation and guarantees a specialist remains engaged in the work, and demonstrates high performance levels. At the same time, the increased attention to cognitive representations can help to establish a unified culture that would be accepted by most individuals. It might require additional discussions and negotiations; however, a better understanding of this aspect will contribute to faster problem resolution and making a compromise.

Individualized Consideration

However, addressing differences between employees and their cognitive representations might be difficult and time-consuming. Moreover, the tendency towards the fast evolution of global companies and their transformation into complex entities consisting of numerous workers means leaders face a more complex task. It implies motivating a constantly growing number of individuals representing different cultures and cultivating a corporate philosophy that would satisfy them (Laiet al., 2021). The complexity of this task requires the use of practical components and methods of transformational leadership. Individualized consideration is often viewed as one of such approaches. Groves (2020) defines it as a method implying focusing on each individual’s needs to create the desired atmosphere and avoid conflicts. It means that a personalized approach becomes an effective way to manage cross-cultural teams.

The effectiveness of individualized consideration and its importance for transformational leadership is evidenced by several factors. First of all, Lai et al. (2021) say that this method helps to offer support and encouragement to followers when they need it. Moreover, to create supportive relations and cultivate the necessary culture, transformational leaders should ensure communication lines are open, and employees can use them to share their visions, ideas, or proposals (Abramson & Moran, 2017). It will help to recognize the unique contribution of every individual and make him/her feel as a part of a team (James-Maceachern, 2018). At the same time, individualized consideration provides leaders with an opportunity to collect information about employees’ cognitive representations and guarantee they are considered to create the necessary culture. For this reason, this method plays a vital role in the work of modern organizations.

Transformational Leadership, Implicit Leadership Theory, and Corporate Culture

In such a way, the rise of global corporations created the basis for the emergence and evolution of cross-cultural teams as the major units within organizations. The differences in mentalities, representations, and visions affect the work of teams and should be managed by creating the appropriate organizational culture. Most specialists agree that the given task can be performed using transformational leadership methods, which are potent tools to inspire and motivate employees (Abramson & Moran, 2017; James-Maceachern, 2018). Farahnak et al. (2020) outline the direct correlation between the use of the given measure and the probability of positive outcomes, such as reduced number of conflicts and better understanding in teams. For this reason, the method can be used within various organizations.

At the same time, the implicit leadership theory can also be linked to building the organizational culture and its cultivation. The information provided above shows that implicit constructs and cognitive representations critically influence individuals’ behaviors and their responses to specific triggers. For this reason, it becomes critical to use individualized consideration as the method to address these differences and create the desired culture within the organization. The transformational leadership, implicit leadership theory, and the given tool might form a specific framework impacting teams and contributing to establishing a positive atmosphere.


Altogether, the existing body of literature accepts the growing role of cross-cultural teams in the work of organizations. Along with numerous benefits, the given diversity also introduces new challenges for leaders who have to work with representatives of various cultures. Under these conditions, transformational leadership approaches supported by implicit leadership theories acquire the top priority. They help to address the personal characteristics of every employee, motivate him/her, and cultivate the desired corporate culture necessary for improved interactions between individuals. Individualized consideration is also viewed as the tool to collect information about employees’ cognitive representations and use it to create a unified framework accepted by all individuals.

In such a way, the reviewed literature shows the topicality of the selected topic and the relevance of transformational leadership to the modern world. Using specific approaches to motivate individuals, managers acquire the chance to improve their understanding of their major problems and assist them in their resolution. It becomes especially important for the globalized world and cross-cultural teams. The diversity typical for modern units requires specific measures to address it and ensure all options on the work of a team are analyzed. For this reason, it is vital to determine the correlation between the organizational culture and various leadership models.


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