The Management of Cultural Pluralism to Address the Challenges of the Emerging Markets: Entrepreneurial Experiences in China

Abstract

As previously discussed, differences in leading principles accepted by members of distinct societies are likely to produce significant behavioral variances. This conclusion has induced many scholars to examine whether some particular management practices have become typical of various countries as a consequence of their cultural differences or as a result of their specific political and economic systems. The interorganizational knowledge transfer process asserts that a considerable divergence in cultural aspects of management between developing countries and emerging economies may be expected: this gap may cause a high and serious level of complexity facing a company, which seeks to invest in an emerging economy.

Western Companies and Emerging Markets: Cross-Cultural Management Practices

Motorola was founded in 1930, the earliest production of the car radio and sound, and later developed into wireless communications, space communications. The “Fortune” magazine included Motorola between 500 global firm with the amount of 29.398 billion US dollars revenue, profit 962 million US dollars, the amount of assets 28.728 billion US dollars.

The main reason of success of Motorola is its corporate culture: to provide users with superior quality, reasonable price products and services to meet the needs of the community; enterprises are to reap the benefits of this process, and continuously develop and grow, so as to provide the employees and shareholders the opportunity to achieve their legitimate objectives.

To benefit the global positioning of the cultural strategy Motorola’s corporate values are respect for every employee as an individual human dignity, openness, so that each employee directly involved in the dialogue, so that they have the opportunity to share common goals with the company to play out their maximum potential; so that each employee being subjected to training and access to development opportunities, ensure that the company has the most competent, most pay attention to the efficiency of the workforce; respect for the senior staff of the labor; to wages, benefits, material encouragement of employees to make a corresponding return of labor; competency-based; implement the universally recognized—providing equal development opportunities to staff policy.

Motorola, the values of these companies for each employee to create a healthy and positive culture. Motorola to humanism as a starting point of the world’s cultural strategy, Motorola, as multinational corporations face of the diverse culture, develop their strategies in their culture is neither stubborn nor blindly follow his country’s culture, the company has always maintained that a diversified is a positive tool to business ethics opinion applies to international business management, the key is to properly deal with cultural diversity. This capability can be acquired through training and become a part of corporate culture.

For multinational operations, the right understanding of local culture and a different result, there will be a huge difference, outside the field are familiar with culture, to promote personal growth and, more broadly, to learn different ways to deal with the problem, learn more outside the domain of cultural respect. Establishment of a genuine multinational, in which each national culture where multinational companies are likely to solve international problems, their opinions and contributions, and this organization is possible, have the ability to absorb the essence of each culture.

For instance, in China, Motorola constantly encouraged the career advancement of its business executives, and investments in the country were made on the basis of four major strategies, proving a profound understanding of both Chinese and Western cultures:

• 1. To increase the scale of investment in China, even before the year 2000 to reach more than 25 billion US dollars.

• 2. Localization of the full realization of personnel, including senior managers, but also to the use of Chinese workers.

• 3. To speed up the local procurement, the procurement before the year 2000 to more than one billion US dollars.

• 4. To expand joint ventures, domestic enterprises promote common development of enterprises, including the Midwest.

Motorola’s investment in China’s seven joint ventures and set up a production base in Tianjin are the introduction of Motorola’s advanced technology and first-class products. In China, Motorola implemented a series of technical cooperation projects in which cross-cultural exchange and the integration of enterprise development played an important role in allowing cross-border cooperation to gain momentum, ensuring a dynamic and bright future.

The company employees create a good environment, material culture, and institutional cultural environment. Motorola provides 80 h of paid leave to staffs each year to ensure the physical and mental health and good working condition. The company, through the Employee Assistance Program to employees and their family members, provides mental health counseling and organizes health education. Motorola employees enjoy the host government by providing all medical, pension, and unemployment protection. Furthermore, this company in cooperation with Tsinghua University establishes a “Motorola Manufacturing Research Center, Beijing Asia.” This center is Motorola’s first one outside the US manufacturing technology Research laboratories.

Intel is a leader in innovative technologies that change the way people live and work. Their every success is due to the efforts of their global, diverse workforce. They are committed to investing in their employees and celebrating the myriad of cultures, lifestyles, experiences, and ideas they have to offer.

The concept of diversity is present in their vision like: “At Intel, diversity is a way of life. It’s the way they do business; it’s the key to their success as an innovative leader in technology.”

The diversity of their employees is the ingredient for success that sets Intel apart. Their employees are located all over the world and represent a variety of different backgrounds, yet each person has one thing in common, a commitment to creating market-driving products and technology designed to make a difference. The perspectives, abilities and experiences of their workforce are key to the success of their company and fundamental to their role as a technology leader. Through their innovative thoughts and actions, their employees, based in over 40 countries, have proven that it is possible to impact and change the way that people live and work around the world.

Company’s Intel was built on great ideas and core values, including discipline, quality, and risk taking. They honor, value, and celebrate the unique viewpoints of their employees, communities, customers, suppliers, and other partners in the global marketplace. They are committed to creating a work environment that is stimulating and inspirational.

The company’s dedication to diversity is evident in its hiring practices: between 1989 and 1998, Intel almost doubled its hiring of women and under-represented minorities in technical fields. It recently pledged to spend at least $1 million per year over the next decade on programs such as scholarships, job training, and internships to bring more women, minorities, and the disabled into the workplace.

Their employees are as diverse as our customers, vendors, and colleagues in the global market. This worldwide perspective helps us anticipate, and provide for, the growing needs of a changing marketplace. Here are a few examples: the collaboration of Intel teams halfway across the world from each other was key to the development of Intel^® Centrino^® processor technology.

The leaders of their Technology and Manufacturing Group use diversity to broaden team perspective on projects.

Through training, intercultural initiatives, and employee groups, Intel is creating stronger bonds between employees, helping them celebrate their diverse cultures, and giving them the resources they need to develop and achieve their personal goals.

Source: http://www.intel.com

Ericsson was founded by Lars Magnus Ericsson in 1876 and has today grown to having 78,000 employees and customers in over 175 countries. The company’s main business is telecom network equipment and related services, where it is the world’s largest provider. Contracts with most telecom operators mean that Ericsson today serve more than 40% of all mobile users. Ericsson also manages operator-owned networks, serving 250 million subscribers around the world.

Ericsson is a world-leading provider of telecommunications equipment and related services to mobile and fixed network operators globally. Over 1,000 networks in 140 countries utilize Ericsson’s network equipment and 40% of all mobile calls are made through our systems. Ericsson is one of the few companies worldwide that can offer end-to-end solutions for all major mobile communication standards.

India represents a very important country on the Ericsson map. Ericsson has been associated with the Indian telecommunications industry for almost a century. At Ericsson there is a view upon diversity that all culture has their sides. It is more up to the individuals working in Ericsson to use their common sense and be more patient when working abroad. The managers should assume difference when working abroad and thereby not being surprised when differences occur. Ericsson has not had any problems due to diversity in their working places.

The fact that the majority of Indian citizens understand and speak English makes India a more attractive country to enter. Ericsson sees this fact as one of India’s strengths as a market compared with the Chinese market. English is the language that holds the country together, it is the only language that all Indians can use and understand each other.

Ericsson does not have any communication problems due to difference in languages, Swedish and English. The large difficulty that Ericsson has encountered related to communication misunderstandings is the fact the Indian employees has problems with leaving a negative answer to a question that a manager asks. When an Indian employee is asked to perform a task he will avoid a negative response to the manager even though he knows that he will not be able to finish the task in the given time frame, it shows weakness. This is the major problem that Ericsson has encountered when dealing with communication problems.

Managers at Ericsson must be clear and specific in their communication with Indian employees concerning time and task assignment to avoid misunderstandings.

At Ericsson, throughout the entire working process, there is a risk for misunderstandings in communication. The philosophy of European companies when dealing with processes there is a straight line from point A to point B and all obstacles that you encounter you try to solve as efficient as possible. In India, it is different, when they face a problem they can be stuck there for weeks before someone makes a decision and the process can continue. This is a problem encountered by Ericsson that the misunderstandings can occur anywhere in the working process. The time perspective is quite different when dealing with Indian culture and Swedish culture.

Ericsson has noticed that their Indian employees are not as addicted to deadlines as their Swedish counterparts. It is not unusual that it can take up to a week longer than planed for an Indian employee when performing an assignment.

The leadership style in India is hierarchical and employees in India have great respect for their leaders and managers. It is not considered polite to confront a leader or argue against him. On the other hand, at Ericsson, there is a more consensus leadership style, or so to say a “Swedish management style.” There is a respect toward your managers but you are not afraid to confront him or argue with him.

Ericsson has not encountered any major difficulties dealing with this, and there is some adaptation of the leadership style when dealing with Indian employees but this is mainly done by the individual manager. Some Indian employees prefer the Swedish consensus management style and there are individuals who prefer the more hierarchical approach to management style.

Alcatel-Lucent is a global communications industry leader with the innovation, expertise and vision for a connected world that moves at the speed of ideas. On December 1, 2006, Lucent Technologies was merged with Alcatel, with its headquarter in Paris.

Having operations in more than 130 countries, Alcatel-Lucent is a local partner with global reach. China, one of the most rapid developing markets in communication industries in the world, plays a crucial role in Alcatel-Lucent’s global development strategy. In 2008 Alcatel-Lucent had about 10,000 employees in China, of which more than 4,000 were R&D-related staffs. China is one of the countries where Alcatel-Lucent locates its main R&D and production centers. With strong competence in local R&D and production, Alcatel-Lucent set R&D centers in Beijing, Shanghai, Chengdu, Qingdao, and Nanjing, respectively.

In this combination of western and eastern cultural environment, cross-cultural management is an important factor that needs to be considered for successful operations. On the basis of the previous theoretical discussions on cultural aspects in communication interactions, the following sections contain some empirical comparisons which explain the differences between the Chinese and western R&D project teams as well as the cultural implications of these differences. Thereafter we present the lessons learned from Alcatel-Lucent R&D centers in China about the encounters between high context culture and low context culture.

An Alcatel-Lucent China R&D product quality improvement program was initiated according the following lines: Normally a project work is divided into several feature tasks, and each has a feature owner being responsible for technical implementation and subteam leadership. In addition to the established review process, a “second feature owner” is assigned to the one who does his/her own feature and who is willing to help others and take charge of documentation review and code inspection procedure.

The relationship among team members is strengthened through the working process. On the other hand, quality is improved given the second owner’s more objective leadership role at the review checkpoint. Alcatel-Lucent’s software project management process is based on a stage gate model, which is called Quality Gate Procedure. It provides a general list of tasks whose completion is important to new product development.

The purpose is to reflect the driving criteria for defining, creating, and verifying the hierarchical development work, i.e., releases, products, and features. A release is a full solution, which consists of multiple product lines. And a product line in turn covers several features which interwork to serve specific functions. Each stage-gate consists of a series of tasks to release product line and feature levels. A formal review will be held at the end of each stage-gate to check the completion of the tasks, then a go/no go decision will be made by the gate keepers.

Source: http://www.alcatel-lucent.com