Globalization: Different corporate cultures

Financial and political experts have been ruling the world since the latter years of the 20th century, merging everything as they go: countries, with political and economic groupings such as the EU and NAFTA, and private multinational corporations operating in global markets based on worldwide competition. The same arguments are put forward time and again: mergers create synergy, increase market shares and slash costs. These scenarios may be fine in theory, especially for the “apparatchiks”, but they seldom stop to think about individuals. Have all these mergers changed the slogan “Think global, act local” to “ Think global, act global”? Unfortunately, it is quite clear today that 90% of all mergers do not reach the expected levels of synergy and that more than 50% of all multicultural mergers, acquisitions or partnerships are doomed to failure. The main reason for this is our complete lack of understanding of the multicultural problems posed by the globalised economy. Cultural diversity is not simply going to disappear tomorrow, letting us plan our strategies on the assumption of mutual understanding. It is in itself an extremely rich phenomenon which, if examined carefully, could yield incalculable benefits for all of us, widening our views and helping us devise better policies and more profitable activities. People of different cultures share basic concepts but view them from different angles and perspectives; this can lead them to behave in a manner which we find irrational or even in direct contradiction with everything that we hold as sacred. Failure to understand this can damage business and create heavy losses for potential partners. There are many reasons why individuals are who they are and why they behave differently from other people. An individual’s personal history plus the collective memory of the country in which he is living combine to create a basic “country culture” that is automatically reflected in the individual’s behaviour. The country culture creates the fundamentals of a “corporate culture”, which is in turn strongly related to a specific “management culture”. Every country has its own values It is quite amusing to compare how the British, the Australians, the Americans and the French behave in a business environment. Here are a few typical examples. The British feel at home with other English-speaking people, with whom they have little difficulty in establishing easy-going but effective relationships. They start meetings with pleasant small talk and a good splash of their legendary sense of humour. They are quite informal, use first names and easily take off their ties. They have simple, friendly relationships with their business partners, bosses and colleagues. They also have plenty of ideas, can improvise well, although they are not very well organised or very punctual. They are not good at making quick decisions and take time to think through several alternatives. They think long term rather than short term. They are careful to find the right work-life balance. American businesspeople have the reputation of being the toughest in the world but, in many respects, they are the easiest to deal with. Americans are individualists, they like to go it alone without checking with head office every five minutes. They are at ease and informal straight away: jacket off, first names, talking loud. They put their cards on the table right from the start and like making “deals” when they negotiate. They are used to making up their minds fast, using brute force as an argument, and taking risks. Time is money. But they are also very keen on following set procedures. They are patriots and have a somewhat limited knowledge of different countries and cultures. They use quite different expressions from the British : “You’re talking bullshit” ( US) = “I’m not quite with you on that one” ( British) “You’re going to get hurt” ( US) = “I’m not sure this is advantageous for you” ( British) “Jack will blow his top” ( US) = “Our chairman might tend to disagree” (British) “Yes, but what happens if …?” is a good question with Americans. The Australian culture is based on egalitarianism, on the idea of a classless society in which everyone is treated equally regardless of their wealth, education, background or colour. In business, Australians have a simple approach with their bosses, colleagues or partners. They are excessively modest, love criticising themselves, but strongly dislike being criticised by anyone else. They hate being under pressure and take more time than others to make decisions. Their “laisser-faire” attitude is legendary. They are not natural leaders. They are always slightly “absent” in international negotiations, due to their lack of knowledge of other countries and cultures. They are not the hardest workers in the world but compensate for this by being honest and straightforward, which always saves a lot of time. For the French, France is the centre of the world. They arrive at business meetings formally dressed, use surnames and formal introductions. Seating is quite often arranged by order of rank. They tend to be slightly arrogant in negotiations and logic dominates their arguments. They find it difficult to relax. Living up to their reputation as Cartesians, they will quickly pounce on anything illogical and often refuse to compromise. They often talk too much at meetings and find it hard to keep to an agenda. They have grandiose plans but they rarely make important decisions during a meeting, preferring to refer back to the “boss” back at headquarters. Normally, they know little about other countries and cultures and are not really interested in them. They seldom speak other languages, especially English. On the other hand, they are creative and technical, but not very sales-oriented. International companies that are able to synergise the different national qualities offered by their multinational, multicultural staff are far better equipped to face today’s heightened transnational competition. This is why an experienced consulting company can often be of great assistance to international, multicultural corporations during critical periods of integration.
Paavo Wiro, président-directeur général de PW Consulting Partners

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