Perceived Effects of Power Distance on Organizational Change in a Multicultural Organization

Abstract

Organizational change researchers have reported an accelerated rate of change in modern organizations, with as many as 70% of them reportedly failing to deliver expected results. Change management scholars and practitioners have yet to reach consensus on the main contributors to this high rate of failure, despite having evaluated a variety of organizational change success factors. The purpose of this qualitative single case study of a multinational financial organization was to explore the concept of power distance with an aim to increase understanding and general awareness of its perceived effects on the process of an organizational change in a global and multicultural environment. The conceptual framework was based on Hofstede\u27s model of cultural dimensions that differentiates cross-border business in terms of cultural differences. Of the six cultural dimensions, this study focused on the power distance dimension. Data were collected from in-depth telephone interviews with 10 key informants from a multinational financial organization. A six-phase elaborate thematic data analysis was conducted, including: (i) familiarization with data, (ii) descriptive coding, (iii) themes identification, (iv) themes review, (v) themes labelling, and (vi) producing the report. The findings revealed that the cultural aspect of power distance has an impact on the various elements of cross-border organizational change, such as utilization of hierarchy, relationships and interactions, power balance, organizational structure, and change communication. This study will potentially contribute to positive social change by promoting a value-for-money change process in intercountry multicultural organizations through design and implementation of sustainable change programs supported by increased understanding of the power distance aspect of the change process