Cross cultural management 3rd chapter 9 (9) culture and corporate strategy

Slide 9.1

Chapter 9
Culture and corporate
strategy

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Slide 9.2

Strategy and corporate culture
• The relationship between company culture and
strategy:
– Is strategy a product of culture?
– Is culture a product of strategy?

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Slide 9.3

Cultural factors of strategy
In what way is the formulation of strategy affected
by cultural differences? (Fatehi, 1996):
•Relationship with the environment
– Mental framework of two types of persons:
• ‘engineering-oriented’
• ‘symbiotic-oriented’.

•Relationship among people

– Interpersonal relationships within a company:
• Differences among employees towards a company’s
strategy (e.g. between US and Japan).

Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015


Slide 9.4

Effect of national culture on strategy
In what way can national culture affect strategy?
• Leadership and decision-making
– the choice of strategy
– the way it is realised.

• Impact of national structure on strategy
– sector of products and services.

• Multinational and its local subsidiaries
– culture differences in foreign markets.

Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015


Slide 9.5

National culture and corporate strategy
• Importance of the country manager because
he/she:
– Defends the company’s market decisions

– Satisfies the demands of the local subsidiary
– Assumes the role of ‘cultural interpreter’:
• gives information about the national situation;
• understands the corporate goals and values.

Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015


Slide 9.6

Global market strategy
• Global assignments can be very important
strategically for the company.
• The international manager has to:
– Gain insight into the attitudes of those involved in a
cross-cultural situation
– Modify his/her management strategy.

• This means:
– Not having the same strategy whatever the

circumstances
– Applying skills in one context to another.
Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015


Slide 9.7

Culture shock
• Culture shock refers to unpleasant experiences with

other cultures.
• International managers experience culture shock at
three levels:
– Emotions
– Thinking
– Social skills and identity.

• Culture shock phase is an integral part of the
adaptation phase (Marx,1999).

Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015


Slide 9.8

International company strategy
• Kinds of co-operation: from mergers and
takeovers to joint ventures, alliances and
partnerships.
• A merger of two companies:
– Presupposes a change of ‘culture’ in the new
organisation.

• From different countries:
– Increasing complexity of exchanges of interaction
between cultures
– Other organisational problems arise due to
inevitable change of culture(s) involved.
Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015

Slide 9.9

Conclusion
• National culture influences a company’s strategy.
• Organisational culture is a part of the strategy.
• In the process of strategy development lie the
same levels as in culture.
• Not only does the organisational culture change
but also the company’s strategy.
• Difficulties with all kinds of co-operation on the
cultural front, particularly in cross-border M&As.
• Going to work abroad implies a cross-cultural
adaptation.
End

Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015