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Little about management

In our proposal (included in appendices) we stated that our primary intention was to conduct a literary review of material surrounding this topic. To this end we sought out journal articles relating to the issues involved in managing across cultures. A lot of the specific material is available, for example focusing on American managers dealing with Europe or Managers from the West dealing with management in the East. Although some of this was relevant we wanted to take a more international approach and look at the issues all managers, regardless of where they are from or who they are dealing with, should be aware of when managing across cultures.

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The paper initially reviews literature dealing with culture and its role in business. We then go on to look at the growing importance of cultural awareness and how globalisation is forcing the issue of managing across cultures on managers. A section dealing with the implications, which arise concerning quality and appraisal, follows this. We then proceeded to look into how managers and companies can deal with the challenges of managing across cultures via the creation of a corporate or ?third? culture and discussed the creation of this ?third? culture. The final review section finds us identifying and over-viewing the various models that are used for identifying differences in national culture with a view to helping managers recognise such differences and therefore, helping them deal more effectively with the challenges of managing across cultures.

In our proposal, we also stated our intention to meet with a European marketing manager of a successful global company. A representative of our team met with Mr. Des Collins, European marketing manager for Bridgestone/firestone Europe at the Bridgestone/Firestone offices, Hampton Square, Balbriggan on Wednesday the 26th of March.

We then proceed to the analysis we conducted on the answers supplied to us by Mr. Collins. These findings are then compared to our earlier material and a final conclusion drawn up. We would like to thank Mr. Collins for taking the time from his busy schedule, to see us.

Culture and its Role in Business

Today, international business is growing and global strategies are being employed as never before in modern times. There is added emphasis on the need for understanding of emerging values among managers across cultures, which has never been greater. Culture can be described as ?an extrapolation of the past and ?learned behaviour rather than innate (Paliwoda and Thomas, 1998). Culture is an intricate system of communications, which incorporates the biological, as well as the technical behaviour of human beings with their various systems of expressive behaviour. It is not borne merely due to the country in which one resides. Research has shown ?the sense of belonging to an important ethnic group may override, and even nullify, the feeling of belonging to a particular nation-state? (Usunier, 2000). It is the sum total of a way of life and includes such things as behaviour, values, beliefs, languages and living practices shared by members of a society and consists of implicit and explicit rules through which experience is interpreted. People from different national cultures often operate under different assumptions about what is appropriate behaviour. The function of culture is to establish modes of conduct, standards of performance and ways of dealing with interpersonal and environmental relations that will reduce uncertainty, increase predictability and therefore promote survival and growth among the members of any society. As a result, organisational structures are impacted by distinctive cultural traditions.

Managers face a global uniform environment, which could eventually lead to the homogenisation of managerial attitudes across cultures. It has been said, in the past, that countries exhibit very different views on the make up of business ethics, which are regarded as being based largely in cultural diversity. One culture may focus on different aspects of an agreement (legal, financial) than another, which may choose to concentrate its attention on alternate aspects (personal, relationships). Some cultures focus on the specific details of an agreement (such as the documenting of the agreement) whilst others focus on how certain promises may be kept (process and implementation). Using the Americans and the Japanese as an example, further illustrates this point: Japanese negotiations centre on negotiating personal relationships while Americans tend to negotiate contracts. In organisational settings, these cultural differences in underlying assumptions can significantly affect interactions when individuals from various nationalities meet. Contrasting cultures force people to view and value the many social interactions involved in finalising agreements in a different manner. According to those who embrace the paradigm of cultural distinctiveness, each culture has its own sense of beauty that has been developed through history and is composed of attitudes, values and related behaviours (Ball and McCulloch, 1996).

Research seems to indicate that the importance of national culture in cross culture management is diminishing and suggests that the world is moving toward a single, global management culture. This new belief has been encouraged by the work of many key individuals in modern day. Studies note that as a result of the increasing interconnectedness between varied local cultures, a global culture could eventually emerge. The importance of this change could eventually prove immeasurable, should it occur, as there can be serious repercussions due to lack of cultural awareness. Compromising a culture?s moral values can be considered extremely difficult and it is more likely that one country will try to impose those same values on the other (Seitz, 2001). This is no longer acceptable in business terms. Businesses can only expand in globalised markets by adhering to the needs, perspectives, and accepted procedures of their foreign partners/counterparts.

The field of international management owes a great deal to cultural anthropology, a study that focuses upon cultural distinctiveness. Without the insight provided by these studies, many businesses would have struggled to steer clear of the pitfalls involved in cross-cultural negotiations (Rosenbaum, 2003). Cultural differences can influence business negotiations in unexpected ways, as many a hapless trader has learned. Although globalised communications and marketing have made the world much smaller in many ways, deep differences remain between cultures. Negotiating has always been a delicate business and one, which is handled with extreme care, with the intent focused on not insulting/offending trading partners. This takes on even more significance when your negotiating partner is halfway around the world. Existing differences extend well beyond surface behaviours, such as proper table manners and the exchange of business cards, and even beyond deeper cultural characteristics, such as attitudes about relationships and deadlines. Careful preparation must be undertaken in an attempt to avoid any potential danger zones and help a business navigate positively around them.

Indeed, there exists another, equally treacherous aspect to cross-border negotiation: the ways that people from different regions come to agreement or the processes involved in negotiations, as mentioned briefly earlier (Japan/America example). Decision-making and governance processes can vary widely from culture to culture, not only in terms of legal technicalities but also in terms of the behaviours and core beliefs that drive them. It is the job of management to ensure that all the potential obstacles to continuous and successful business are identified and removed or avoided in an efficient manner. Numerous deals of significance have failed in the past because people chose to ignore or underestimate the powerful differences in process across cultures.

Growing Importance of Cultural Awareness

Increasingly, people working in business and management are directly in contact with other cultures. More and more often, they are involved in face-to-face contact with foreign managers, colleagues or partners. Through international mergers and acquisitions, joint ventures and through expatriate assignments, managers have to make adjustments. They may even have to rethink completely their methods of working, and even rethink the nature of the organization within which they work. Management styles, for example, may differ substantially from one European country to another. What might motivate staff in one country may de-motivate staff in another.

Differing values of managers have also been considered as a factor in organizational conflict. This has particularly been the case with multinational firms operating in and across diverse cultures where, unavoidably, there is considerable incongruity between the values of host country workers and their expatriate managers. The literature on cross-cultural management of multinational firms cites a number of instances where this incongruity has caused expatriate managers to be both perplexed and sometimes paranoid about the outcome of imposing their traditional or home-country management styles upon indigenous personnel (Gellerman, 1967; Pezeshkpur, 1075; and Badar, Gray & Kedia, 1982). The implication of such conflicts for a successful management-system is obvious: managers must factor in differences between their own environment and the one in which they must operate before they impose any value, let alone their own, on their foreign subordinates. Knowledge of value systems, then, might aid us in devising internally consistent management styles for effective ?transcultural? management practice.

Having looked in a more detailed fashion as to why there is a growing importance on the field of cultural awareness, our Team identified at least five different reasons:

1. The cultural environment affects virtually all the activities undertaken by management. Organizations establishing and running global operations usually need to negotiate with various foreign constituencies.

2. Strategic alliances are becoming more common, involving firms with different strategies and objectives. For these alliances to succeed, managers need to understand the cultural factors that influence organizational strategies and objectives.

3. Managers in foreign locations frequently find that employees behave in ways that are quite different from the managers? expectations. To lead and manage effectively it is often necessary to understand the cultural expectations that influence people?s behaviour.

4. Expatriates, employees working in a foreign location, find that culture shock can affect their general ability to function well. Cultural understanding and adaptability have been identified as contributing to better expatriation.

5. Various functional aspects of organizations, such as accounting, finance, and marketing, can differ markedly from one location to another. For an organization to be effective overseas, these functional aspects must fit the local culture.

For most managers, cultural differences are obvious between countries, which are located far from each other. But a recent study shows that you can also find, within Europe, an enormous cultural difference. With reference to this study, there are three important reasons to be aware of cultural differences and to monitor potential changes in values and attitudes:

1. In spite of the small geographical distance, there are marked cultural differences between the Central European countries that sample (Czech Republic; Hungary; Poland; and Slovakia) and a Western European country like The Netherlands.

2. It would be dangerous from a managerial perspective to treat the Central European countries as a homogenous group. For instance, the two neighbouring countries of Czech Republic and Slovakia differ sharply in four of five dimensions. This means that it may be problematic to combine activities in these two countries in a single integrated organization.

3. Some regions in the world will exhibit cultural shifts as strong as Central Europe in the coming decades. If this were true, managers would not do well to rely too much on static pictures of the cultures concerned, but to keep a keen eye on value shifts in these countries. Experience built up during the years of transition may soon become outdated.

Not only are the differences between countries important for the company?s managing. Also the cultural differences in the company itself have a great impact on its well doing. When a company goes multinational, the employees involved have to adapt in their dealings with each other. Therefore the growing trend to globalization of businesses is giving rise to a need for the development of effective international management teams. For many organizations this need will entail thinking more clearly and overtly about cross-cultural issues and systematically understanding and valuing the benefits of diversity in international teams. Achieving this requires the integration of thinking and practice relating to team building, understanding of the benefits of differing personal styles and behaviours. Although much can be achieved by working with specific teams, the truly successful global players are likely to be those which embed the change through integrated changes in selection, development, reward and recognition policies and practices. In doing this, the value of effective multicultural working can be captured at many levels in the organization and international teams, be they project based or permanent, will tend to reach high performance levels more rapidly and consistently. This in turn can help organizations build global capability and therefore, gain competitive advantage.

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