The Influence Of Organisational CultureVersusNational Culture Within The Global Group of Companies Author: Paul RB Kelly Date: 12 th March 2004 Course: Organisational Behaviour Table of Contents: Executive Summary Page 3 Company Background Page 4 Research Analysis Page 6 Recommendations Page 13 References Page 15 Appendix (Survey questionnaire attached as a separate document) Executive Summary: Research (1) indicates that national culture has a greater impact on employees than does their organisation’s culture and this report examines both cultures within VOLE Inc. a seventeen month old company with the ambition to establish a worldwide presence within three years. At the moment VOLE is small enough to debate and address these issues but diverse enough with operations across four continents in fourteen countries to already be experiencing the strains of cultural differences, particularly between the Far East where the company has its roots and the recently opened markets of Western Europe and the United States. It will hopefully lead to the formulation of some agreed corporate communication policies as these will become increasingly difficult to put together and implement as global expansion delivers a veritable Tower of Babel to the organisation if it achieves its rapid growth predictions. Company Background: VOLE Worldwide Inc commenced trading in November 2002 and offers the world’s first managed Voice over Internet Protocol (VOIP) communications network. Providing a videophone package similar to a mobile / cell phone plan, VOLE manages the service which includes provision of a videophone for free use, while the customer just talks.
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For an affordable flat-price monthly fee, the customer enjoys unlimited video-talk time in addition to full videophone support. The company was founded in Singapore, where the unique VULGATE software that powers the VOIP network was developed and where VOLE Worldwide has its headquarters. It has a strong Singaporean heritage evidenced by the head office management team being exclusively from the Far East region, although the CEO personally has substantial work experience in the United States. Far Eastern shareholders in the company are currently in the majority, with one significant European investor, but as the company grows and expands its shareholder base through venture capital investment, there is likely to be a more international spread of investors.
Growth was initially concentrated regionally with individual VOLE trading companies being set up in Malaysia, Thailand, The Philippines and Indonesia. In November 2003, VOLE UK was formed, probably a little earlier than originally planned in the global roll out, and very quickly a number of European territories have also commenced trading in Germany, Spain, Portugal, Ireland, Austria Hungary and Ukraine. Major efforts are currently being made to move forward in the USA with the first company VOLE Company just started trading in Florida, where the roll out will be on a State by State basis. Customer growth will be viral in nature as the primary offering to the corporate sector is the reduction in telephony charges so it is likely that a new customer in Thailand will, for instance, generate a new customer in that organisations UK or other international subsidiary. The financial model for the company’s growth cements this viral relationship by transferring 25% of the revenue base from the sale producing country to those countries which will require a local install and support for the global subsidiary’s of the original client. Trading companies are now located on four different continents, and with a primary objective of working together for each company’s mutual benefit, it will be necessary, as the organisation grows across the world, for each VOLE company to understand each other better.
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Each company will face language, ethnic and custom differences that may often make what is being said and what is being heard two very different things. As more colleagues come on board as JV partners, and VOLE continues to expand its cultural diversity, this must be professionally managed and dealt with to enable an early awareness of the problems that will undoubtedly arise through a period of rapid growth. It was therefore decided to commission a survey of the current senior management of the individual VOLE global trading companies, as well as head office personnel, to attempt to identify areas of difference that might require attention and response from management. Nineteen participants were selected, who answered a web based survey anonymously, and eighteen responded. Head office based in Singapore provided one third of the participants, the balance from the current global JV companies.
The survey is attached as an appendix to this report. Research Analysis: 1) I like the buzz and stimulation from taking risks. Average Score: 3. 87 / 5 The answers here indicate a reasonable degree of entrepreneurialism throughout the companies surveyed. This is important for the development of VOLE JV Companies, as it requires the ability not only to manage a start up business but also one offering clients new technology, an added pressure in achieving success.
2) I prefer senior executives who provide comprehensive and logical explanations for their decisions. Average Score: 4. 13 / 5 A very positive indication of a strong desire for clear, open and informative leadership which may well be a result of an element of insecurity amongst the JV companies selling the new VOLE technology and not having enough information to feel comfortable with the VOLE offering. It offers a challenge to head office to keep communication lines simple, instructive and helpful. 3) If a person’s job performance is insufficient, it doesn’t matter how much effort he or she made. Average Score: 3.
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47 / 5 An interesting high score that would, from a negative perspective seem to indicate a degree of intolerance towards non-performance but from a positive viewpoint should be interpreted as impatience with any lack of effort and a realisation that the global VOLE roll out needs to happen with urgency. 4) Nobody’s wishes should be compromised in order for a business unit to achieve its goals Average Score: 2. 67 / 5 Something of a reaffirmation of the results of the previous question where people realise that early adoption of the new technology provided by VOLE is paramount to the organisations success. The company is positively seen as bigger and more important than any individual although there is a degree of uncertainty which indicates a need to remember the value an individual can bring to the operation and a need to retain their respect.
5) I like being part of a team and having my performance measured in terms of my input to the team. Average Score: 4. 27 / 5 A positive and strong affirmation of the teaming principle which will be fundamental to building a global network where interdependency will be a key foundation stone to ensure growth. 6) I like to work where there isn’t a great deal of demand and where people are generally laid back. Average Score: 1.
60 / 5 An encouraging and realistic assessment that bringing VOLE successfully to market will be hard work, graft and will require a focused and disciplined approach from all the JV companies in conjunction with head office. 7) I like things to be secure and unsurprising. Average Score: 2. 33 / 5 Again a reaffirmation of the strong entrepreneurial culture pervading the VOLE group and an acknowledgement that surprises and insecurity will be part of the future. However it is also an indication that the management forewarned should be forearmed to deal with any uncertainties or bolts from the blue. Organisational Culture: These first seven questions were intended to tap the seven primary dimensions of an organisation’s culture: Innovation and risk taking; attention to detail; outcome orientation; people orientation; team orientation; aggressiveness; and stability.
“Scores of 21 or lower indicate those who are more comfortable in a formal, mechanistic, rule-oriented, and structured culture. This is often associated with large corporations and government agencies and the lower the number, the stronger the preference for this type of culture.” (2) “Scores above 22 (The VOLE survey registered an average of 23) indicate a preference for informal, humanistic, flexible, and innovative cultures, which are more likely to be found in high-tech companies, small businesses, research units, or advertising agencies. The higher a score above 22, the stronger the participant’s preference for these humanistic cultures.” (2) ” Organisational cultures differ. So do individuals. The better one is able to match personal preferences to an organisation’s culture, the more likely one is to find satisfaction inone’s work, the less likely one is to leave, and the greater the probability that the individual will receive positive performance evaluations.” (2) 8) I am comfortable talking in a language other than my mother tongue. Average Score: 3.
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20 / 5 9) I find it difficult to always understand the language used in email correspondence. Average Score: 2. 20 / 5 Questions 8 and 9 indicate that there are problems with communication outside individual’s mother tongues and is an area for concern. Some uncertainty in talking is indicated and a definite problem with email language. 10) I am confident discussing business ideas and needs with colleagues in other countries on the telephone. Average Score: 3.
73 / 5 It is interesting to see the positive response to communication via the telephone, in contrast to the more negative answer above at Q. 8. There appears to be some conflict here. It is maybe explained by people feeling generally comfortable with the telephone as a business tool but as there is little discussion of business ideas to date via telephone between VOLE organisations the answers here seem to be somewhat questionable, particularly when the answer is viewed in conjunction with the previous reservations expressed.
11) I prefer to see my colleagues when discussing things on the VOLE videophone. Average Score: 4. 47 / 5 While the results here may well be interpreted as a positive affirmation for videophone technology, the results should be treated with caution as VOLE people are by definition adopters of the technology and are unlikely to be particularly critical of the videophone. 12) I feel that we actually do most things in business better in our part of the world. Average Score: 2. 67 / 5 The slight bias of people leaning towards being uncertain and closer to agreement in their belief that ‘things are done better in their part of the world’ might be explained by reasonable feelings of nationalism and patriotism, but this is an area that requires monitoring as it could be a source of conflict.
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13) I have learnt a lot from the different experiences of overseas colleagues. Average Score: 4. 13 / 5 A very positive result that would indicate there is a degree of constructive communication between the individual JV territories and their sharing of business experiences. 14) I get quite frustrated dealing with colleagues overseas. Average Score: 2. 80 / 5 A level of honesty demonstrated in the response to this question which is positive but obviously the frustrations experienced must be taken into account to ensure that they do not become serious issues of contention and develop into any major divergence of opinion on matters of policy that affect all the VOLE JV companies.
15) I prefer to do business in my own country and language. Average Score: 2. 40 / 5 A deliberate re-validation for Q. 12, here asked in a slightly different manner and confirms the earlier result, 2.
67 against 2. 416) I think my overseas colleagues do not always understand the way I think. Average Score: 3. 33 / 5 A deliberate re-validation for Q. 8, here asked in a slightly different manner and confirms the earlier result, 3. 20 against 3.
3317) People seem to do things very differently in other countries. Average Score: 3. 60 / 5 A deliberate re-validation for Q. 10, here asked in a slightly different manner and confirms the earlier result, 3. 73 against 3. 6018) I think it is necessary to stay in the office until all the days work is completed Average Score: 3.
27 / 5 It is not always a positive to get an answer to such a question veering towards agreement, but it does demonstrate commitment to VOLE at these early stages of development. It will be important that the burden of work is carefully monitored and that the major portion of work is not seen to fall on the few who have that extra commitment if a true partnership based organisation is to be achieved. 19) I prefer to balance my home and work life to suit my family and friends. Average Score: 4. 13 / 5 This is a mature response that augurs well for a balanced attitude to the pressures that will arise through growth and development amongst the VOLE participants. 20) I believe work should be a fun place rather than very serious and formal.
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Average Score: 3. 93 / 5 In the context of VOLE’s introduction of new technology and the necessity to be seen as a modern and technically competent organisation, it is important to obtain a balance between ultra formal business behaviour and daily ‘Friday dress down’ culture. Being a fun place to work does not mean any lack of motivation to work hard but fits positively with the general entrepreneurial culture identified earlier. National Culture: The final thirteen questions were intended to examine, within a national context, methods of communication, language barriers, attitudes to other nationalities in a business context, work / leisure time balance and work environmental desires. Unlike the first seven questions, there is no specific co-relation between this series of questions, other than some double validation of attitudes. What does repeat however is a general preference for informality and innovation amongst the respondents, indicating a modicum of balance between the conflicting national cultures currently represented at VOLE.
But they do differ and these differences need to be better understood and allowed for in decision making processes. Recommendations to Management Public Relations practice is defined by the Institute of Public Relations as ‘the deliberate, planned and sustained effort to establish and maintain mutual understanding between an organisation and its publics’. That definition has a very strong message for VOLE inc as it endeavours to establish itself as a global business, with the ‘organisation’ identified as VOLE Worldwide situated at the groups headquarters in Singapore and its ‘publics’ the current and the yet to be established joint venture operations that are springing up worldwide. Because of the dynamic growth of the business, sustaining clear and logical communication between the companies will be paramount to its success. A strong desire for a better structure in this area was evidenced in Q. 2 of the survey and when this is married to the understandable confusion that will naturally arise in language, as evidenced in the answers to Q.
8 & Q. 9, additional resources need to be allocated to this area to improve inter-office communication. The company has recently set up a Web based forum exclusive to JV partners but it has become quite fractious in recent weeks and some of the language used has led to quite a degree of dissatisfaction with head office responses to JV queries. The revamping of the companies web-site has also been badly handled with a Beta version appearing on the public Internet before it was agreed in general principle by the JV partners.
The language and tone of the new WWW site is also very culturally specific and misses the point of presenting VOLE as a global business. As VOLE is a global videophone business, a minimum suggestion would be that a global conference call be initiated weekly, with non-compulsory attendance, but it would be an open and free forum to express ideas and problems experienced. Q. 11 would indicate that it would be the preferred method of breaking down barriers between everybody. The call should have a fixed start and end time, be monitored so that no individual can have ‘the floor’ for longer than five minutes for any contribution and the meeting chair should rotate weekly to ensure there is no bias in favour of any group of speakers. As VOLE is in many respects a virtual organisation, with head office in effect outsourcing sales and marketing of the VOLE network to individual JV companies, who are also granted financial autonomy and control of their respective P&L functions, the primary drawback of such a structure – the reduction of management control over key parts of the business – must be constantly borne in mind.
This weakness can be best tackled from the centre by a continual emphasis on the interdependency of each VOLE JV on each other, a fact well recognised in the survey, but easily forgotten in the day to day business activities of each JV as new successful companies are built from the ground up. Maximum advantage must also be taken of the flexibility such an organisational structure provides and the ability of VOLE companies to provide a network management service simply, quickly and for a far smaller cost than the traditional video conferencing industry must be continually highlighted as the company’s USP. References: (1) N. J. Adler 2002 International Dimensions of Organizational Behavior. 4 th Ed Ciciinatti, OH: Southwestern pp.
67-69 (2) S. P. Robbins 2002. Prentice Hall Self Assessment Library. Pearson Education Company.
