The increase of globally dispersed teams has strengthened the importance of effective collaboration across cultural boundaries. The purpose of this research was to examine how cultural diversity influences collaboration processes such as communication, trust, and conflict management. As well as analyzing how these processes affect creativity in globally dispersed teams. The research was mainly based on Diversity Management Theory and supported by Hofstede’s cultural dimensions and a qualitative methodology with an interpretivist approach. The empirical findings determine that cultural diversity improves creativity by contributing diverse perspectives and problem-solving approaches, and creating challenges connected to communication barriers, trust-building, and conflict. Moreover, effective management is important to transform diversity into positive outcomes. Organizations can use these empirical findings to create structured diversity management strategies, enhance communication practices, enable trust, and manage conflict more effectively. To furthermore improve collaboration and creativity in globally dispersed teams.