Case study on International Joint Ventures

The extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. Does not in any way imply the existence of a society that is less or more humane than another, it simply denotes the social structure

The extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally.

Does not in any way imply the existence of a society that is less or more humane than another, it simply denotes the social structure

Power Distance Index UK: 35 Japan: 54

Power Distance Index

UK: 35

Japan: 54

Problems in relation to Japan/UK: Relationship between the superior and the subordinate, mainly when British is subordinate of Japanese In UK: Validation and defending of a superior’s role is expected But if British subordinate challenges superior’s role, would be accused of being offensive

Problems in relation to Japan/UK:

Relationship between the superior and the subordinate, mainly when British is subordinate of Japanese

In UK: Validation and defending of a superior’s role is expected

But if British subordinate challenges superior’s role, would be accused of being offensive

Problems in relation to Japan/UK: Interaction between subordinate and superior In Japan: Initiatives taken by the middle management Superior plays a very vague role when it comes to making a decision in order to protect him from losing face

Problems in relation to Japan/UK:

Interaction between subordinate and superior

In Japan: Initiatives taken by the middle management

Superior plays a very vague role when it comes to making a decision in order to protect him from losing face

Problems in relation to Japan/UK: Interaction between subordinate and superior In UK: Superior makes decision based on subordinates opinions Takes full responsibility for decision If wrong choice made, no less respect from subordinates

Problems in relation to Japan/UK:

Interaction between subordinate and superior

In UK: Superior makes decision based on subordinates opinions

Takes full responsibility for decision

If wrong choice made, no less respect from subordinates

Problems in relation to Japan/UK: Interaction between Japanese and UK Japanese say things ambiguously, need to listen to underlying tones British direct and frank

Problems in relation to Japan/UK:

Interaction between Japanese and UK

Japanese say things ambiguously, need to listen to underlying tones

British direct and frank

Individualism: loyalty to oneself Collectivism: loyalty to family or group However, Citizens of an individualist culture are more likely than not to be part of volunteer organizations or join the military voluntarily Hence, a very unclear definition given.

Individualism: loyalty to oneself

Collectivism: loyalty to family or group

However,

Citizens of an individualist culture are more likely than not to be part of volunteer organizations or join the military voluntarily

Hence, a very unclear definition given.

In Hofstede’s surveys: Individualism indicated in questions relating to the availability of personal time, the amount of freedom given to an employee in solving a problem and the presence of challenging work to accomplish.

In Hofstede’s surveys:

Individualism indicated in questions relating to the availability of personal time, the amount of freedom given to an employee in solving a problem and the presence of challenging work to accomplish.

In Hofstede’s surveys: Collectivism was indicated by the training opportunities given, the physical conditions of the work environment and the use of ones skills on the job.

In Hofstede’s surveys:

Collectivism was indicated by the training opportunities given, the physical conditions of the work environment and the use of ones skills on the job.

Individualism Index Value (IDV) UK : 89 Japan: 46

Individualism Index Value (IDV)

UK : 89

Japan: 46

Japan: Organisation orientation Factors in the external market are of less importance with regards to employment in the company UK: Market orientation Job aspects (eg. Pay) dependent on market value

Japan: Organisation orientation

Factors in the external market are of less importance with regards to employment in the company

UK: Market orientation

Job aspects (eg. Pay) dependent on market value

Japan: Inclined to run machinery unattended Strive to attain multi-machines operation UK: Would rather run them with operators who have had previous experience Contented with the distribution of one operator for each machine

Japan:

Inclined to run machinery unattended

Strive to attain multi-machines operation

UK:

Would rather run them with operators who have had previous experience

Contented with the distribution of one operator for each machine

Minimizing uncertainty in the form of rules and structures Japan:92, UK:35 Trust Reputation Hierarchy structure

Minimizing uncertainty in the form of rules and structures

Japan:92, UK:35

Trust

Reputation

Hierarchy structure

Attention to the future versus the past and present Japan:80, UK:25 Affects the way decisions are made All business relations are long term

Attention to the future versus the past and present

Japan:80, UK:25

Affects the way decisions are made

All business relations are long term

Ability to engage in a set of behaviors that uses skills (e.g. language or interpersonal skills) and qualities (e.g. tolerance for ambiguity, flexibility) Tuned to the culture-based values and attitudes of the people with whom one interacts Definition

Ability to engage in a set of behaviors that uses skills (e.g. language or interpersonal skills) and qualities (e.g. tolerance for ambiguity, flexibility)

Tuned to the culture-based values and attitudes of the people with whom one interacts

Consists of a multiple intelligence and emotional intelligence as mentioned by Howard Gardner and Daniel Goleman There are four aspects mainly Linguistic Spatial Intrapersonal Interpersonal

Consists of a multiple intelligence and emotional

intelligence as mentioned by Howard Gardner

and Daniel Goleman

There are four aspects mainly

Linguistic

Spatial

Intrapersonal

Interpersonal

Successful interaction with people from other cultures whose native language is different from their own In our case study, interaction between the British and Japanese counterparts would require genuine interest to bridge the language barrier Constructive efforts to learn as much of the other language as possible For e.g. assuming a British colleague learns some key words or lingo of is/her Japanese counterpart, this would definitely foster a more cohesive work environment

Successful interaction with people from other cultures whose native language is different from their own

In our case study, interaction between the British and Japanese counterparts would require genuine interest to bridge the language barrier

Constructive efforts to learn as much of the other language as possible

For e.g. assuming a British colleague learns some key words or lingo of is/her Japanese counterpart, this would definitely foster a more cohesive work environment

Understanding the proper behaviours that would facilitate a proper introduction without any embarrassment For e.g. Asians and particularly Japanese people show courtesy by bowing slightly or even opening doors for others However this is considered ridiculous in the Western culture Thus ability or failure to adapt different spatial behaviours could make our international counterparts comfortable or ill at ease This in turn leads to various levels or success or failure in face-to-face cultural interactions

Understanding the proper behaviours that would facilitate a proper introduction without any embarrassment

For e.g. Asians and particularly Japanese people show courtesy by bowing slightly or even opening doors for others

However this is considered ridiculous in the Western culture

Thus ability or failure to adapt different spatial behaviours could make our international counterparts comfortable or ill at ease

This in turn leads to various levels or success or failure in face-to-face cultural interactions

Understand one’s own unique cultural style Allows easier comparison with others and thus the appropriate adjustment to behaviour to be compatible to cross-cultural settings Intrapersonal intelligence could be improved only if one strive’s to learn one’s own cultural style better

Understand one’s own unique cultural style

Allows easier comparison with others and thus the appropriate adjustment to behaviour to be compatible to cross-cultural settings

Intrapersonal intelligence could be improved only if one strive’s to learn one’s own cultural style better

An important aspect of cultural intelligence Successful interaction with people from other cultures is the heart of cultural intelligence According to Gardner, interpersonal intelligence goes beyond just the language aspects and is described as the ability to “read the intentions and desires of others, even when they have been hidden” For professionals to be successful in international interactions such ability to “read” people and anticipate their motivations and desires is crucial

An important aspect of cultural intelligence

Successful interaction with people from other cultures is the heart of cultural intelligence

According to Gardner, interpersonal intelligence goes beyond just the language aspects and is described as the ability to “read the intentions and desires of others, even when they have been hidden”

For professionals to be successful in international interactions such ability to “read” people and anticipate their motivations and desires is crucial

IMPROVING CULTURAL INTELLIGENCE Developed through three means: Head / Cognitive (learning about beliefs, customs, and taboos of your own and other cultures) Body / physical (using your senses and adapting your movements and body language to blend in to your foreign hosts, guests, or colleagues simply by showing you understand their culture) Heart / Emotional / motivational (Adapting to a new culture by overcoming obstacles and setbacks. People can do that by gaining rewards and strength from acceptance and success).

Developed through three means:

Head / Cognitive (learning about beliefs, customs, and taboos of your own and other cultures)

Body / physical (using your senses and adapting your movements and body language to blend in to your foreign hosts, guests, or colleagues simply by showing you understand their culture)

Heart / Emotional / motivational (Adapting to a new culture by overcoming obstacles and setbacks. People can do that by gaining rewards and strength from acceptance and success).

Examine the motivation for learning about other cultures Develop the mindset that there is more than just one set of thinking as opposed to refusing to accept other viewpoints This could be cultivated through learning, evolving and thus gaining perspective. Merely memorizing a list of dos and don’ts is difficult as it differs within countries Way of behavior in other cultures is critical

Examine the motivation for learning about other cultures

Develop the mindset that there is more than just one set of thinking as opposed to refusing to accept other viewpoints

This could be cultivated through learning, evolving and thus gaining perspective.

Merely memorizing a list of dos and don’ts is difficult as it differs within countries

Way of behavior in other cultures is critical

For instance, Americans and Japanese have differing styles when presenting their name cards When presenting a business card to a Japanese colleague, one should mention “Hajima mashite”, meaning “Pleased to meet you” in a slight bow and using both hands to give the card shows a sense of respect towards the receiver and the business card However from the Westerners context, like the British, a business card is for practicality. Thus very little consciousness to show to towards the presentation of the business card

For instance, Americans and Japanese have differing styles when presenting their name cards

When presenting a business card to a Japanese colleague, one should mention “Hajima mashite”, meaning “Pleased to meet you” in a slight bow and using both hands to give the card shows a sense of respect towards the receiver and the business card

However from the Westerners context, like the British, a business card is for practicality. Thus very little consciousness to show to towards the presentation of the business card

Vulnerable to failure due to cultural misunderstandings. Paterson and Shimada (1978): cultural differences led to failure on the part of parent company managers to “understand” one another. Resultant communication breakdown - Collapse of the venture.

Vulnerable to failure due to cultural misunderstandings.

Paterson and Shimada (1978): cultural differences led to failure on the part of parent company managers to “understand” one another.

Resultant communication breakdown - Collapse of the venture.

Faulkner, in his research, found that the following attitudes were outstandingly associated with joint venture success: Commitment by top management Mutual Trust Sensitivity to company culture Commitment at lower levels Sensitivity to national culture Information widely disseminated Good dispute resolution mechanisms Reviewed Learning

Faulkner, in his research, found that the following attitudes were outstandingly associated with joint venture success:

Commitment by top management

Mutual Trust

Sensitivity to company culture

Commitment at lower levels

Sensitivity to national culture

Information widely disseminated

Good dispute resolution mechanisms

Reviewed Learning

Individual & organizational levels Cultural Intelligence as the fundamental basis Cultural mix of people not as a problem BUT as an ASSET (Cognitive)

Individual & organizational levels

Cultural Intelligence as the fundamental basis

Cultural mix of people not as a problem BUT as an ASSET (Cognitive)

Training of managers and other employees trained and prepared for the difficulties of building cross-cultural working relationships. Sending employees of partner cultures together on these courses might be useful encourage the building of informal inter-cultural contacts. Such would strengthen and develop the physical and emotional aspects of cultural intelligence.

Training of managers and other employees

trained and prepared for the difficulties of building cross-cultural working relationships.

Sending employees of partner cultures together on these courses might be useful

encourage the building of informal inter-cultural contacts.

Such would strengthen and develop the physical and emotional aspects of cultural intelligence.

Having and developing cross-cultural empathy (emotional aspect of cultural intelligence) would also prepare staff for cross-cultural understanding and lead to joint venture success.

Having and developing cross-cultural empathy (emotional aspect of cultural intelligence) would also prepare staff for cross-cultural understanding and lead to joint venture success.

Multicultural work teams could be built prior to as well as after the establishment of the joint venture. Clear communication channels and mechanisms could be put in place to avoid misunderstandings. Adequate efforts in educating joint ventures assignees about the strategic intent underlying partnership. Ensure sufficient economic and career incentives for sustained learning within and across strategic business units.

Multicultural work teams could be built prior to as well as after the establishment of the joint venture.

Clear communication channels and mechanisms could be put in place to avoid misunderstandings.

Adequate efforts in educating joint ventures assignees about the strategic intent underlying partnership.

Ensure sufficient economic and career incentives for sustained learning within and across strategic business units.

Summary & Conclusion Application: Joint Venture Hofstede’s 5 Dimensions Improving Cultural Intelligence Cultural Intelligence Cultural Diversity