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MODCON, a home mechanical and electronics firm specializes in the development, production and sales of mechanical and electronic devices aimed at making interesting, modern items at reducing the time it takes to do task around home. MODCON have been able to adapt well to changing demands in the external environment due to their flexible approach to problems solving. They have produced innovative items related to cooking, home maintenance and repair. One of their items is a refrigerator that includes a TV, internet and Wine Cooler.
Within operation and organization within MODCON the core issue seems to be a lack of understanding in cultural differences between employers in its head office that is in Washington, USA and the recently expanded Argentina as a result of research and growth statistics in the country.
The lack of understanding of difference between culture in the head office as well as the subsidiary of MODCON. As a result the management team of both countries asked for an input and opinion on the issues, the aim is to provide views on working with the differences in culture as a way in assisting MODCON expansion in Argentina.
The following is a detailed assignment that shall by category cover possible issues that are currently faced at MODCON.
Task 1 - marks
One of the ways to begin to understand the conflict between the two MODCON offices is to refer to studies of cultural differences such as those conducted by Hofstede's (1991) and INSEAD. Using these and any other relevant lectures, outline some of the key difference or features between American and Argentinean cultures, and look at the implications of these differences.
Culture involves ideas, customs, social behavior of people and particular group of certain social class, it is the totality in which man of a society lives. Within management and organization different adaptations are put into effect according to its regional culture. With culture we are able to understand employees and customers hence being able to perform duties and perceive targets. Many research have been conducted and analyzed in organizational behavior relating to culture, the following is the analysis that was obtained by "Geert Hofstede" between the late 1970's and early 1980's
Geert Hofstede had studied culture varies and working organization with different regions and was able to outlined culture dimensions that could effect management and performance into:
He was able to notice difference in the acceptance of power distribution within organisation was perceived differently within culture and social groups. Participation of employees shall be dependant to the organisation structure of a particular company.
In most culture established was employees had been reflecting and caring individually (personally) and families whereas remaining emotionally too independent groups or working organisation.
Gender equality and acceptance within working environment, assertiveness and competitiveness of employees was differently perceived in cultures whereas acceptance of women was found to be of problem within societies and level of commitment and work ethics had varied from region to region.
Uncertainty avoidance index
In organisations employees had responded differently in assurances and uncertainty, from culture difference most were examined to have preferred stability and assurances of all matters.
Long term orientation
Other practise within culture had been long living and practised, certain practise could have different impact to the organisation overall performance.
Table detailing Geert Hofstede findings for Argentina and America:
Long term orientation
Another research was conducted by anthropologist "Edward T. Hall", in his finding he was able to categories culture according to the notion of time, and he grouped into two distinctive classes namely
It follows the notion "lone thing at a time"
It follows the notion "multiple handling of task within a time period"
Table representing Edwards T. Halls's findings
Interpersonal relation are coordinate to present schedule
Present schedule is subordinate to interpersonal relation
Appoint time is rigid as the schedule co-ordinates activity
Interpersonal relation co-ordinate activity; appointment time is flexible
One task at a time
Multiple task simultaneously
Time is tangible
Time is flexible
Activities are isolated from organization as a whole; measured to output time (activity/hour)
Activities are integrated into organization as a whole; measures as part of overall organizational goal.
As a result of the researches conducted and examined above the following are the do and don't that the MODCON can account within the organization between Argentina and America
Doing business in Argentina
Doing business in America
What to do:
Handing of business cards, though they have a working knowledge of English they appreciate any effort you make in Spanish
Time, meetings do arrive on time but do not expect an Argentinean counter part to do so. It is common to arrive 10 to 15 minutes late.
Addressing, use "Senor and senora" followed by the fathers name when addressing.
What not to do:
Pointing, when making a gesture use a hand and not a finger.
Don't miss to attend on opportunities to socialize as the Argentineans make a point to know their colleges.
What to do:
Handing of business cards, though they have a working knowledge of
Time, meetings do arrive on time and the counter part to do so.
Addressing, they prefer being addressed to their title e.g. Dr, Sir, Ms or Mr followed by their first names.
What not to do:
Don't expect companies to be the same, in America business culture differ from company to company.
Don't be surprised of Americans to reject gifts or physical contacts as they respect their privacy.
Task 2 - 15 marks
There are two culture models of strategy based on culture assumptions. These are the controlling and the adapting models. Discuss which one is associated with the Argentinean subsidiary, and which is associated more with the American head office (provide supportive evidence)? Which model would you recommend and believe more relevant for MODCON?
American head office
From observation and research that examine and detail of the American culture, the type of cultural strategy that is adapted at the American head office of MODCON is the "Controlling model", a cultural strategy that features a centralized and formalized means of organization management, the goals and target of a business are planned formally and division by expert consultants assist in strategies.
Characteristics of controlling model:
Centralised and formal
Information and objective
Achievement oriented and task implemented
Cultural features that support American culture include:
Truth is determined by facts and figures manipulated by models of mathematics, i.e. Environment can be known
Decision taken by those presumed to have most power/knowledge i.e. Top manager make best decision
Time is linear of value and segmented.
Argentinean subsidiary office
The Argentinean office is a subsidiary office to the head office allocated in the United States of America (USA), having its targets and objectives set forth from the head office the office is to perform according to plan. As of this factor the Argentinean office implements a culture strategy known as "adaptive model"
Characteristics of adapting model:
Decentralised and informal
Information is more qualitative and subjective
Strategic direction, implementation is locally determined
Cultural assumptions of the model include:
Environment is unknown (cannot be known)
Personal relationship and interaction is a key
Strategic implementation is hindered due to internal capabilities.
Recommended cultural model for MODCON:
MODCON is a business organization that aims at maximization of its profit and income from the service are provides, so as to reach targets/goals effectively functioning and efficiency in organization / working must be a guarantee. This can be possible if the working ethic and environment of the organization if of the same nature at application, suggesting the application of the controlling model for MODCON.
Task 3 - 14 marks
One of the functions of cross-cultural studies is to provide a guide to cultural difference. However one consequence is this can lead to over-dependence on cultural stereotypes. What are stereotypes? And what might be the negative side of stereotypes?
Cultural stereotypes are practices, customs in which a certain society of group tends to be viewed, common assumption that are taken into account by many upon account with. These are assumptions and characteristics based on image and not definite character of the particular society example: Americans are taken to be friendly and socializing whereas not all Americans generally are friendly or socially.
Most stereotypes that are assumed have found to be of negative perception; the following are the consequence as a result of cultural stereotypes:
Wrong interpretation of society, wrong expectation and hinder of progress in that particular society.
Result into selection of wrong cultural strategic model in organization and management of business.
Task 4 - 15 marks
When Argentinean and American managers meet to discuss their present concerns, one aim will begin to work as a team. When forming a team, how the team works, or process strategies are just as important as performing the task. What would be the three key process strategies that you believe this team of managers need?
The ability in which company targets are achieved is made possible through cooperation and working together within a company or business, forming a team within an organization/business has become highly adapted in most management practices permanently or temporally environment example of working teams include:
Being able to adapt/introduce a working teams correct in discussing particular situation is important so as to be able to reach conclusion effectively, time-full and at cost efficient.
When establishing the team to conduct meting between managers/employees of different culture and society or level the team established is a "multicultural team" hence:
Vast experience in different market
Commitment in the strategic direction of the business
Allow communication to improve
Promote better decision making and creativity within its members.
From appointment and establishment of a working team that shall comprise managers from both America and Argentina creation of a task strategy, a review and conceptual analysis that shall govern, guide the team. The following is a task strategy for MODCON:
Creation a sense of purpose
For its member to be able to participate, objective and focus/reason for establishment of the team be detailed so as to assure functioning of its member and productivity of its existence
Assign role and responsibilities
Definition and description to member roles, this shall ensure participation and through role professions can be used to reach to productive data and information for outcome determination.
Reaching of decision
Means and modes in which final decision and say from discussion can be concluded and later setting of implementation structure.
Task 5 - 15 marks
One of the key HRM activities that the Argentinean subsidiary is still engaged in is the recruitment and selection of personnel in such areas as marketing, sales and production of its products. What would be some of the key issues and concerns that MODCON needs to address in this process?
Human resource management, a division within an organization/company that objects to the control and division of work and work power within the company/organization, within human resources is associate with recruitment, laws etc. MODCON as an organization associated with production and selling of goods (products) and service shall have an organization structure of which the task/functions of recruitment of employees are performed through the Human resource department/manager.
Recruitment of qualified individuals for the vacant post within marketing, sales and production of MODCON within the Argentinean branch should put into the account the following concerns and within the process:
How to access equivalent labour
Gender issues, education level and age (retirement), different culture and societies work different within different condition. In Argentina having major decision taken by men and of elder age will be beneficial towards implementation and target achieving.
Different national values
Values and norms are associated with cultural/traditional practises, so as to enable functioning of the organisation employees should be able to participate and work as a team hence it is important to consider recruitment of personal that shall be able to fit within the community/work place.
Accessing of the graduates
Employing qualified personal for a particular position is significant; however the level of education and practical experience is important towards company operation and profit maximization.
Method adapted in recruitment
The method in which employment selection and appointment is conducted is important for the cooperation of employees towards new employees in the organisation/business. free, fair and open recruitment systems harvest positive impacts to the company e.g. recruitment agency, internal applications and job upgrading to personnel upon education and less adaptation of personal connection.
Upon successful identification and appointment of a personnel for a position before contract agreement the candidate must be subjected to a probation period at which she/he will be introduced to the working environment and ethics of the company/organization according to position and socializing. Important things to include within this period when evaluating shall be:
Absorbing of cooperate culture
Training programs and observation
Culture assumption embedded
How she/he fits to the nature of peer and hierarchical relation
Mutual respect, competitiveness and cohesiveness
Social event participation
How the candidate is welcomed and ability to fit into the society of the organisation.
Task 6 - 18 marks
Many companies do not think of cultural diversity as a source of competitive advantage, although authors such as COX and BLAKE (1991) believe that competitive advantage derives from diversity. Outline what you believe to be the six advantages of cultural diversity (also provide rationale for your choices)?
Three basic organizational strategies for managing cultural difference is by Ignoring, Minimizing or utilizing (students manual)
Ignoring as we all have to ignore cultural difference among ourselves and not take it as a problem
Minimizing conflicts as much as possible and minimizing showing off as one culture is a superior culture, all cultures are equal; Respect each other in a team
Utilizing all the man power available despite the cultural differences everyone has his/her own knowledge which can be useful in an organization.
''Diversity is taking people from different expectations, and at different stages of life and melding them into a force that will drive the company's profitability and competitiveness.''(B.P.Noble students manual)
Cox and Blakes believe that cultural diversity is a competitive advantage:
1. Sensitivity to different markets
2. Resource acquisition
3. Improve decision making
4. Enhance creativity
5. Reduces cost
6. Organizational flexibility and responsiveness
Sensitivity to different markets as people come from different countries with their own cultures they tend to have they own taste and preferences on products, the way the Americans will like their products or what they consumes will be different from the way the Argentinean will prefers theirs. So by working together this will let them understand each other on their like and dislikes and it will be easy for them to produce products that will be accepted in the each ones home market
Enhancement creativity , learning across cultures means learning to be open to self awareness and to be willing to analyze ones own cultural baggage. It means to able to assess views of own and others culture, to evaluate the effectiveness of interaction, and to developed strategies for dealing with differences. By coming from different cultural background each one of us will have our own ideas; difference in creativity by being in team it is easy for one to learn new ideas and techniques which will be useful to the organization.
Reduce cost this will help in a situation where there will be a subsidiary one will not incur cost and sending an expatriate they can use the locals to run their organizations.