Introduction
Assessment of the national characteristics, such as language and
traditions, can provide high level indications as to how well participating
nations are likely to work together on international projects. In reality,
these characteristics may be too general to provide any more than an
indication as to whether there are likely to be significant problems, or
identify whether any special management techniques are likely to be
required. Therefore, there is a need to understand the characteristics and
approaches to work and business from a more detailed, business or
organisation, related cultural perspectives.
Over time, organisations develop their own unique culture. This Corporate Culture
will be strongly influenced by the national culture of the
organisations originating nation. However, other aspects will also
influence the Corporate Culture of organisations. These may result directly
from the process, or marketing needs, of the organisations. They may also
come from less direct sources, such as trading partners, competitors or
transactions with other nations.
The Corporate Culture characteristics can be considered to be external to
the management of international work, but they will have a significant
impact on the work itself. This could be in the structure, reporting, or
management requirements of the work. They could also effect the
practices of the work, such as decision making, work group tasking, or
resource management. Managers will have some control over these business
cultural characteristics. However, the amount of control may be limited. In
addition, the work may be subject to sudden changes, as a result of
business decisions made by the stakeholder organisations. Because of the
limited control over these cultural influences by the work, they provide an
additional level of risk which needs to be taken account of in risk
management planning.
- Culture Clashes
The Corporate Culture of every organisation will be different. For
most basic transactions, such as sales / purchase of supplies any
differences may not be noticeable. As business transactions between organisations
become more complex, any differences become more noticeable.
Differences are often most noticeable when organisations need to work
together in order to complete a product, service or other work. Some
examples of the culture clashes that may occur when organisations
need to work together include:
- Mergers
When one organisation is acquired by another. The two organizations
may have different historical and industry origins, which results in
the two organisations having different working and management
methods. Traditional rivals may not be able to reconcile differences easily,
at any level of the organisation.
- Sub Contracts When purchasers and
suppliers need to work together in order to provide the final
product. The purchaser may have more exacting requirements than the
supplier. All of which need to be undertaken before the product is
considered acceptable. The requirements may include additional
process steps, more comprehensive documentation, additional testing,
preparation of more reports
- Outsourcing When
routine operations are performed by an external organisation. The
outsourcing organisation may not have the depth of knowledge.
Following outsourcing, the additional management safeguards,
necessary to control the work, may not be fully acceptable.
- Joint Ventures When a number of partners
work together to provide a product. Partners may not understand the
way the other partners work, or their preferences regarding
management issues such as reporting. Partners may have different
ideas and approaches to achieving the product of the venture. Partner
organisations may have slightly different objectives for the
work.
Usually these differences in Corporate Culture are visible in the
early days of working with other organisations. However, they may also
appear when moving to a new stage of the work, or when major changes are
required. Differences in Corporate Culture can also appear after a change of
management or the introduction of a new strategic direction.
Any differences in Corporate Culture between organisation must be identified
and resolved quickly, otherwise they will have a detrimental effect
on the product. This may result in the product not being as successful as
originally envisaged. Ultimately, these differences will have a detrimental
effect on the organisations concerned.
Understanding Culture
It is therefore essential that managers, involved with international
work, are aware of the business characteristics of participating nations.
This awareness will allow them to utilise the business practices for the
benefit of the work, including:
- Understanding the way participants work and conduct their business
- Understanding the additional constraints that may be required by
various participants
- Being aware of the potential impact of differences in business
characteristics
- Assessing how much the Corporate Culture characteristics can be
adapted to the work needs
- Assessing how much of the management needs will have to be adapted
to the Corporate Culture of the participants
Details of the Corporate Culture of nations and organisations can be more
difficult to obtain than data on national cultures. This may be because the
data is only available within the organisations, or is produced in the
native languages. The use of techniques, such as dimensional analysis, can
improve the level of data available on participants, as well as indicate
levels of difference and tolerance. In order to undertake the analysis, a rigorous
approach should be adopted, using a systematic framework such as Spectra
Analysis, from Migrators.
Details of the Spectra Analysis approach are also discussed in the
Research Focus topic assessing elements of International
Management.
Further information is also available for download on the Papers & Presentations
page. A case study illustrating how Spectra Analysis can be used to help
resolve Corporate Culture issues encountered following a merger is available
for download, by clicking on the Case
Study link.