(TIỂU LUẬN) it was widely used by other MNCs such as starbucks, oreo and coca cola, who also emphasized localization as their focus on managing across cultures

Table of Contents
Executive Summary.......................................................................................................................2
Introduction....................................................................................................................................3
Issues in cross cultural management............................................................................................3
1.

2.

Cultural misunderstanding................................................................................................3
1.1.

Particularism and Universalism.....................................................................................3

1.2.

Language barrier............................................................................................................4

Change in management and adaptation...........................................................................4
2.1.

Uncertainty avoidance...................................................................................................4

2.2.

Individualism.................................................................................................................5

Case studies....................................................................................................................................5
1.

2.

Cultural misunderstanding................................................................................................5
1.1.

Particularism and Universalism.....................................................................................5

1.2.

Language barrier............................................................................................................6

Change in management and adaptation...........................................................................7
2.1.

Uncertainty avoidance...................................................................................................7

2.2.

Individualism.................................................................................................................9

Recommendations........................................................................................................................10
1.

Sense-making approach in local business...........................................................................10

2.

Change management adaptation process............................................................................11

Action plan...................................................................................................................................12
Conclusion....................................................................................................................................16

0


References.....................................................................................................................................17

1


Executive Summary
The objective of this report is to analyze several issues related to cross-cultural management
faced by L’Oréal Vietnam by outlining the problems, providing application and
recommendations based on the theory as well as introducing a Gantt chart for action plans.
The first dilemma of L’Oréal Vietnam comes from cultural misunderstanding due to national
culture differences between Vietnam where high particularism is primarily focused, and France
where high universalism is highly concentrated.
The second issue is that L’Oréal Vietnam workers find it hard to adapt to new management
practice that is the result of cultural differences between France and Vietnam. Since France has
high uncertainty avoidance so structure and regulation are mandatory in work, which is contrary
to the low uncertainty avoidance in Vietnam.
To fit the setting of the project with L’Oréal Vietnam’s commitment, the company should
investigate new understandings about cultural values through a sense-making approach. In terms
of change management process, the role of leadership and cross-cultural adaptation process can
encourage employees’ trust and cultural intelligence (CQ) including cognitive, motivational and
behavioral competencies to be flexible with new organizational settings as well as avoid cultural
shock.
Overall, it is suggested that the company should localize the messages and campaigns that they
received from the parent company as well as integrating Kotter’s eight-step model for
implementing changes for maximizing employees’ involvement in decision making. The action
plan, illustrated using the Gantt chart, promotes a new system of weekly training that provides
employees with better understanding of new concepts under the scope of Vietnamese cultural

context. The solution reduces the difficulties caused by language barriers for future projects by
offering employees more opportunities to improve their English proficiency.
In conclusion, the solutions provided had a high chance of success as it was widely used by other
MNCs such as Starbucks, Oreo and Coca-Cola, who also emphasized localization as their focus
on managing across cultures

2


Introduction
National culture diversity refers to the diversity in a country group of birth among members with
a few or various differences of individual’s culture distinctions (Hambrick et al. 1998). The
characteristic of multinational enterprises (MNE) is described as the cultural diversity within the
working environment, which plays a dominant role in enhancing employee's devotion and
engagement towards the firm (Sawyer & Thoroughgood 2015; Nicola & Thomas 2004).
However, cultural diversity can become a source of intragroup conflicts which poses challenges
within the organization such as cultural misunderstanding, language barriers, conflicts, and
inefficiency of task performances (Balachandran, Wennberg & Uman 2017; Nguyen 2019). This
paper aims to demonstrate the current issues that L’Oréal Vietnam is facing in a culture diversity
workplace, along with theories and a case study for application. Hence, viable recommendations
will critically be provided for L’Oréal Vietnam for further development.

L’Oréal was established in 1990 by Eugène Schueller - a chemist with entrepreneurial spirit who
developed his first hair dyes and sold them to various hairdressers in Paris (L’Oréal n.d.).
Through strategic brand acquisition and innovative global expansion, the company has achieved
a strong reputation and built up into a multinational company. In 2007, L’Oréal Vietnam was
established, along with 12 cosmetics well-known brands including Lancôme, Yves Saint Laurent,
and Maybelline New York (L’Oréal n.d.). Owning diverse and complementary brands from
drugstores to luxuries to cover various needs of customers, enabling L’Oréal Vietnam to have
competitive advantages over their competitors in the market (L’Oréal n.d.).

Issues in cross cultural management
1. Cultural misunderstanding
1.1.

Particularism and Universalism

The two terms “universalism” and “particularism” are postulated in Trompenaars's model of
national culture differences. The author postulated a cultural dimension of : (1) universalism as
the bias of rules where the same principles are utilized in both common and special situations,
and (2) particularism as the bias of relationship where the specificity of situation determines how
principles should be applied in practice (Harzing & Ruysseveldt 2014; Caloria 2019). The
3


differences between the two cultures can possibly raise conflicts between employees and
managers who come from different nations, which in turn directly affect employee's
performances (Long & Fox 1995; Bohorquez & Andres 2017).

1.2.

Language barrier

One of these could cause communication issues is language barrier, to adapt into a multicultural
workplace, where non-native speakers could interact with each other and simplify the
communication between international teams, the ‘lingua franca’ was created for this purpose
(Angouri 2013). Due to its presence and dominance in the global market, English was chosen as
the ‘lingua franca’ due to its effectiveness of delivering messages and the popularity of English
across the world. Hence, it is required for employees to speak English when applying to MNEs.
Moreover non-native English speakers may struggle to comprehend advanced words or technical

words in the business world, therefore misinterpreting the information could cause disruption
with the workflow(Lai & Yang 2017).

2. Change in management and adaptation
2.1.

Uncertainty avoidance

According to Hofstede (2021) & Snitker (2010), uncertainty avoidance reflects the extent to
which members of a society attempt to cope with anxiety by minimizing uncertainty. French
cultures have high uncertainty avoidance, their work should be planned and structured into a
model, while Vietnamese with low uncertainty avoidance prefers the flexibility in the workplace
and their project not placed in a mold like French. Therefore, different working cultures might
have negative impacts such as uncomfortable feelings for Vietnamese workers due to strict
regulations that decrease their innovation process. As a result, employees will less present their
ideas to the upper management (Stower 2013). Therefore, it will demotivate their contribution to
business performance.

4


2.2.

Individualism

Individualism and collectivism describe that whereas at the individual or personality level it
measures whether people prefer to work in groups or work individually (Bhawuk et al. 2004).
Through academic research, individualism has been a part of European culture since the early
modern time (Berry et al. 1997). While in East Asian cultures like Vietnam, they prioritize the
value of collectivism following the path of Confucianism, where it prioritizes group interest over

individuals desire (Kim 1997). Difference in cultures leads to a conflict where one culture is
dominated by another one, in this case high individualism could cause overwhelming stress for
employees caused by high levels of competition, making employees hard to adapt with new
changes.

Case studies
1. Cultural misunderstanding
1.1.

Particularism and Universalism

The first dilemma is cultural misunderstanding between L’Oréal Vietnam and its headquarter –
L’Oréal Paris. This issue arises from a culture dimension postulated in Trompenaars's model of
national culture differences of the two terms “universalism” and “particularism” (Harzing &
Ruysseveldt 2014).

In Vietnam, engagements between employees and managers are highly focused which attributes
to enhance devotion in the working environment (Xoan & Earl 2020; Rich, Lepine & Crawford
2010). At L’Oréal Vietnam, employees and managers work under strengthened relationships
which create the flexibility over discipline for minor mistakes that can considerably be tolerance.
The acceptance towards employee's blunders implies that individual circumstances can be more
important than certain rules within the organization (Long & Fox 1995; Lindberg, Ojakangas &
Prozorov 2016). This notion has illustrated the presence of high particularism in the Vietnamese
context, which is against the norms and values of L’Oréal Paris where high universalism is
highly concentrated.

5


In fact, the working environment in France is more formal where appointments are frequently

made for all business matters and people do not mix private and public spheres in workplace
context (Touron 2011). Thereby, the culture is perceived as task orientation rather than social
orientation (Touron 2011). Those contradictory patterns compared to Vietnam, have created
reluctance to bypass mistakes occurring in the workplace. Thereby, different levels of
forgiveness from top managers towards employees can create unfairness, which possibly trigger
conflicts, bullying, discrimination, or psychological distress that detrimentally affects task
performances (Nguyen, Teo & Dinh 2020; Tuckey et al. 2009). Consequently, contracting culture
poses challenges for L’Oréal Vietnam to transfer ideas from a global project to a domestic
project, as practices are applied differently between cultures of universalism and particularism.

1.2.

Language barrier

Language barrier occurs both in the organization itself and cross-culture business, which poses
complex obstacles for the organization (Henderson 2005).

Within the organization, the employees seek information and instruction from the top managers
to provide clarification of work tasks (Madera, Dawson & Neal 2014). Previous studies from
Mount & Back (1999) demonstrated that the manager believed their messages should be clearly
and accurately conveyed by subordinates for proper process of task performance. However, at
L’Oréal Vietnam where members experience linguistic diversity, communication becomes more
challenging as the manager concerns that the employees do not understand their messages or
highly rely on other employees' translations.

Multilingualism, which means the co-existence of more than one language in the organization,
can lead to misconceive messages, since interaction is primarily orientated towards the members
of one group, thereby little information is exchanged across linguistic boundaries (Tange &
Lauring 2009). Furthermore, language barrier also creates ambiguity involving uncertain workrelated expectations which leads to subordinates' failure of task's responsibility (Eatough et al.
2011).

6


Regarding cross-cultural business, language barrier causes delay for the working process when
the headquarter – L’Oréal Paris assigns a global project to L’Oréal Vietnam. The translating
process of transferring ideas to be appropriate in the Vietnamese context may require a rigorous
and systematic multistep method (Kiing, Rajgor & Toh 2016). Hence, it is frustrating to ensure
the translation is equivalent, consistent and meaningful in Vietnamese language, as inaccurate
translation can cause conflicts among the organization and crisis for the brand.

Dolce & Gabbana, an Italian luxury fashion brand, confronted its crisis in China when they
created a controversial promotional video of a woman using chopsticks to eat pizza and pasta
(Tyler 2020). The content involves a male voice asking for “sensitive" sentences, or the way the
brand intentionally chose the model with “narrowed eyes” that represent the hallmark of racial
stereotypes towards the Chinese (Ban & Lovari 2021). The criticism later led to a boycott from
the Chinese and threatened D&G’s bottom-line as Alibaba and Jingdong excluded D&G from
their online platform, attributing to the loss of 98% of market share (Shih 2018; Stevenson
2020). As cultural misunderstanding is unacceptable for the Chinese to bypass the brand's
mistake (Ban & Lovari 2021). Hence, the use of “sensitive" words arising from language barriers
that cannot capture the equivalence and consistency of original Italian words, leading to cultural
misunderstanding between the two cultures.

2. Change in management and adaptation
2.1.

Uncertainty avoidance

The issue is that Vietnamese workers find applied management practice of L’Oréal corporation is
unfeasible to adapt in local operation. Because it shows that each company has a particular
organizational culture which could be difficult for someone with a completely different

background to assimilate (Trindade 2015). As a result, lack of consensus is posed to the new
management practice, which is the result of cultural differences proven in Hofstede dimension
(Schein & Scheiner 2006). The presence of issue illustrates L’Oréal Vietnam and L’Oréal in
French headquarters have different values of uncertainty avoidance and individualism(Figure 1)
7


L’Oréal Vietnam employees have a culture of low uncertainty avoidance that encounters a
receptive attitude of adventurousness, synthetic thinking and openness (Nguyen & Aoyama
2013). These workers tend to enjoy flexible working styles and emphasis on the importance of
experience and practices through ambiguity (Phan n.d). As unforeseen events will be perceived
as opportunities for low uncertainty workers to self-improvement (Guss et al. 2012). Together
with the flexible preference and comfortable feeling in an ambiguous environment, people are
highly creative in the workplace.

In France, a high uncertainty avoidance society, people prefer consistency and avoid approaching
uncertainty situations because they feel more stressful to handle with ambiguity that could affect
their job performance and security (Stower 2013). In the workplace, managers reduce risks and
maintain stability by working based on structures and strict regulations. Meanwhile, L’Oréal
Vietnam employees have to follow the orders and less likely present alternative plans to the
supervisors since there is a fear of breaking their expectations. Consequently, staff with limited
self-decision rights might decrease management innovation, corporate creative system and
adaptive ability (Shane 1995). Therefore, if L’Oréal wants to fully utilize the talents brought by
new workers, its management should be adjusted to the structure of the local firm (Trindade
2015).

8


Figure 1: Country Comparison between France and Vietnam (Hofstede Insight n.d)

2.2.

Individualism

L’Oréal Vietnam operation suffers conflict management which can be explained as Vietnamese
workers embrace collectivism culture, while L’Oréal headquarter in Paris ties to the self-concept
of individualism. Thus, the cultural values create substantial influence on particular leadership
styles and working structure, which in turn impact subordinates' reaction to work differently
(Yang et al. 2012).

For collectivism, L’Oréal Vietnam prioritizes the interdependence and harmony among group
members where the corporation puts efforts on promoting employee’s corporation in achieving
organization-wide objectives. They believe that collaboration and group support can avoid
conflicts to maintain a comfortable workplace and enhance the tendency of self-improvement
(Nguyen & Nguyen 2012; Goncalo & Staw 2006). Moreover, collectivism culture reflects the
supportive leader behavior where employees receive and respond with such as extra role
behavior, honesty and loyalty (Kececi 2017). Overall, collectivism transfers supportive
management which in turn allows subordinates to promote the group's interest and organization’s
performance (Graham 1989).
However, in France, people tend to have high individualism which prioritizes the fulfillment of
individual desire over teamwork. The empowerment of doing work individually allows intensive
innovation within the organization because innovation is the outcome of a free flow of ideas
generated by dissent rather than society consensus (Gacolo & Staw 2006). Meanwhile, L’Oréal
Vietnam workers will suffer from frustration because lacking a group support causes them to lose
direction and be isolated from organization (Manetje 2009). Moreover, high individualism is
examined to have impacts on conflict management, as disengaged collaboration and
overwhelming competition (Purohit & Simmers 2006).

The same situation happened to Dolce & Gabbana Group launching a misleading advertising

campaign in China. The failure of advertising is the result of businesses making personal
9


decisions of using third person perception to analyze the market (Tyler 2020). Thus, cultural
misunderstanding is obvious from the brand’s lack of collaboration with local employees for
marketing content feedback (Gogan et al. 2014). As a result, personal decisions are characterized
by the individualist culture of Dolce & Gabbana, which is not integrated well in the Chinese
collectivism environment, leading to low quality decision making (LeFebvre & Franke 2013).

Recommendations
1. Sense-making approach in local business
Vietnam culture is considered as high particularism which attaches special importance to
relationships and trust. To reshape “global message” fitting with the practices of the Vietnam
community, L’Oréal should build strong networks with not only local managers and employees
but also local communities to investigate new understandings about cultural norms, values and
practices in order to make sense of organizational settings in context of local business.
The business can apply a cultural sensemaking process to figure out common interpretations
between the conflicts of different perceptions due to cultural differences and improve project
performance in the local community (Torkkeli & Ivanova-Gongne 2020). Collective sensemaking approach can be applied through three stages: scanning which gather information by
specific research methods, theoretical assumptions and communication practices; interpretation
involves the act of individuals (eg. employees) construct and combine their interpretations about
novel situations in complex cultures; and lastly responding to local commitment by decisionmaking stances based on cognitive frames (Fellows & Liu 2016).

The process of cultural sensemaking can be supported by the conversational practices (eg.
argumentation, metaphorical communications...) with local employees through the use of
material practices and artefacts (eg. metaphors, prototypes). Therefore, this can also build the
project's commitment to transform the global values to be appropriate with the local community.
Besides, the process can build more trust and avoid stereotypes that are causing the conflicts
between employees and crisis for the brand.

10


2. Change management adaptation process
In terms of change management practice, multinational corporations like L’Oréal should create
trust and specific guidelines through different approaches to encourage employee’s adaptation to
organizational changes. Some researchers found that organizations dealing with high uncertainty
avoidance tend to invest in employee’s training programs rather than ones in low uncertainty
avoidance contexts (Peretz & Rosenblatt 2011). Employees are able to easily adapt to the change
in management practices by the construction of a multicultural leader with an open mindset and
have cognitive knowledge about different roles they have to play during the change management
process (Feng 2014). The role of trust plays an important role in the context of organizational
change since employees who trust new management are willing to manage types of vulnerable
uncertainties during change (Allen et al. 2007).

Cross-cultural adaptation process, especially cross-cultural training, supports multinational
companies to establish common values and rules that create the synergy between various
cultures. More specifically, cross-cultural training allows managers and employees to reach
intercultural learning to develop cognitive, affective, and behavioral competencies needed for
understanding about managerial processes (Dalluay & Jalagat 2016; Zakaria 2000).
Employees’ cultural intelligence (CQ) which involves cognitive, motivational and behavioral
components could be enhanced through that training to easily adapt unfamiliar circumstances
due to new cultural settings as well as increase the awareness of flexibility to organizational
change (Figure 2; Thomas & Inkson 2004). Therefore, they can promote their self-confidence in
individuals and teams by empowering the control over the difficult challenges in cultural shock
and practices to avoid the barriers of prejudices, stereotypes that restrict their understanding of
the solution.

11

Figure 2 : Cross-cultural Competences (Reproduced from Bartel-Radic & Giannelloni 2017)

Action plan
As stated above, the primary agendas of the solutions are to integrate cultural context into
communication as well as create a more approachable method to convey L’Oréal global message
into Vietnamese context. According to Livermore (2016), the best way to resolve cultural
conflicts is to relate French culture to Vietnamese culture. This perspective is referred to as
“Localization”.

Particularly. L’Oréal Vietnam will capture the core of its parent company and adjust accordingly
to values, norms and preferences of domestic culture (Livermore 2016). Particularly, take
L’Oréal current “Growth Mindset” project as an example. In order to introduce the concept to
Vietnamese workers, the company can localize it by integrating the definitions into daily life,
making it more relatable to employees. Furthermore, as Vietnam is a country with strong
feminism characteristics, it is notable that the changes implement of localization must be built on
compromise and negotiation, by which decision making must be achieved with empowerment
and involvement between managers and employees (Hofstede Insight 2021; Gallego-alvarez,
Martinez & Consuelo 2021).

Thus, to maximize employee engagement in improvements, it is suggested that the solution will
be developed based on Kotter’s eight steps for change management (figure 3).
12


Figure 3: Kotter 8-steps for change management model, reproduced from Kotter & Cohen
(2012)
Specifically, as presented in the Gantt chart (figure 4), the action plan is divided into eight phases
with different purposes. The main activities with significant impacts for L’Oréal are described as

follows.

Firstly, the main criteria are to create the need to change by collecting feedback and analyzing
issues that the company is having in order to convince all stakeholders that this change is
necessary (Kotter & Cohen 2012). In the case of the company, it is crucial to host meetings,
collect employees’ feedback and create new communication styles by overcoming brainstorming
roadblocks. According to Livermore (2016), brainstorming roadblocks are obstacles to convey
information within a team, which are created by fears of criticism, being irrelevant and unable to
speak up. As Vietnam is a country with a high score of power distance dimension, there is a high
chance that employees are afraid to give their honest feedback as they tend to perceive the leader
as benevolent autocrat, which leads to an ineffective organization with difficulties to transcend
information from L’Oréal Paris to Vietnam (Gallego-alvarez et al. 2021).

13


Therefore, it is suggested that L’Oréal should launch anonymous feedback for employees as well
as having a department that collects employee emails and resolves conflicts within the
organization. By redefining new communication styles, it is believed that there will be more
innovative solutions, along with critical feedback that promotes better future organization.

Secondly, in order to improve the engagement of employees on new concepts and resolve
language barriers issue, the solution will also promote a system of weekly meetings, by which
the employees will have the opportunity to approach new concepts with Vietnamese cultural
context and be explained on how these contexts will bring better performance for them. There
will also be a self-learning language program to enhance employees’ English proficiency, which
will reduce language barriers and miscommunication for future campaigns. Particularly, the
solution suggests a plan for employees to have a paid account on Elsa – a self-learning English
app that allows people to learn the language within their working field (Elsa 2021). In order to
maintain the best efficiency, L’Oréal should have a limited number of accounts available for

employees that will be distributed based on pre-registrations and have a policy of taking away
the benefits if the employees do not use their accounts for more than one week.

Hence, by implementing this solution, it is expected that the level of English among employees
will be improved as they will have to utilize the opportunity given by the company. Furthermore,
as the plan promotes a more frequent, clearer, and more engaged system of introducing new
concepts, it is expected that the risks of miscommunication as well as dissatisfaction within
L’Oréal will be significantly reduced as employees are given more context and time to perceive
and interpret new concepts.

14


Figure 4: Gantt Chart for implementation
15


Conclusion
In conclusion, under the supervision of the parent company in France, L’Oréal Vietnam has
suffered many cultural problems that arise from the headquarters decision making. In order to
successfully tackle these problems, about culture differences, the higher ups of L’Oréal Paris
should enhance their internal communication, research about Vietnamese culture, following the
recommendations above, applying it with proper methods so that they can operate effectively.
The solutions provided had a high chance of success as it was widely used by other MNCs such
as Starbucks, Oreo and Coca-Cola, who also emphasized localization as their focus on managing
across cultures (Livermore 2016).

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