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Text 5. Management and cultural diversity

Before you read discuss with your partner what nationalities could these managers typically be? Then read the text, and see if your suggestions above coincide with the nationalities mentioned.

1. “I want to get this contract signed fast – and get the plane home!”

2. If I go on selling like this, I’ll earn more than the boss! I can’t let that happen!”

3. “There’s no hurry! Tonight, you can come and eat at my home and tomorrow we’ll play golf!”

4. “What an awful idea – reporting to two different bosses!”

5. “He looks much too young to be doing a major deal like this!”


Managing a truly global multinational company would obviously be much simpler if it required only one set of corporate objectives, goals, policies, practices, products and services. But local differences often make this impossible. The conflict between globalization and localization has led to the invention of the word ‘glocalization’. Companies that want to be successful in foreign markets have to be aware of the local cultural characteristics that affect the way business is done.

A fairly obvious cultural divide that has been much studied is the one between, on the one hand, the countries of North America and north-west Europe, where management is largely based on analysis, rationality, logic and systems, and, on the other, the Latin cultures of southern Europe and South America, where personal relations, intuition, emotion and sensitivity are of much greater importance.

The largely Protestant cultures on both sides of the North Atlantic (Canada, the USA, Britain, the Netherlands, Germany, Scandinavia) are essentially individualists in such cultures, status has to be achieved. You don't automatically respect people just because they've been in a company for 30 years. A young, dynamic, aggressive manager with an MBA (a Master in Business Administration degree) can quickly rise in the hierarchy.

In most Latin and Asian cultures, on the contrary, status is automatically accorded to the boss, who is more likely to be in his fifties or sixties than in his thirties. This is particularly true in Japan, where companies traditionally have a policy of promotion by seniority. A 50-year-old Japanese manager, or a Greek or Italian or Chilean one, would quite simply be offended by having to negotiate with an aggressive, well-educated, but inexperienced American or German 20 years his junior. A Japanese would also want to take the time to get to know the person with whom he was negotiating, and would not appreciate an assertive American who wanted to sign a deal immediately and take the next plane home.

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In northern cultures, the principle of pay-for-performance often successfully motivates sales people. The more you sell - the more you get paid. But the principle might well be resisted in more collectivist cultures, and in countries where rewards and promotion are expected to come with age and experience. There is an example of a sales rep in an Italian subsidiary of a US multinational company who was given a huge bonus. But then his sales declined dramatically. It was discovered that he was deliberately trying not to sell more than his colleagues and to earn more than his boss which he thought would be an unthinkable humiliation.

Moreover, Singaporean and Indonesian managers objected that pay-for-performance caused salesmen to pressure customers into buying products they didn't really need, which was not only bad for long-term business relations, but also quite simply unfair and ethically wrong.

Another example of an American idea that doesn't work well in Latin countries is matrix management. The task-oriented logic of matrix management conflicts with the principle of loyalty to the all-important line superior, the functional boss. You can't have two bosses any more than you can have two fathers. Andre Laurent, a French researcher, has said that in his experience, French managers would rather see an organization die than tolerate a system in which a few subordinates have to report to two bosses.

In discussing people's relationships with their boss and their colleagues and friends, I am convinced we can also distinguish between universalists and particularists. The first believe that rules are extremely important; the second believe that personal relationships and friendships should take precedence. Consequently, each group thinks that the other is corrupt. Universalists say that particularists cannot be trusted because they will always help their friends, while the second group says of the first 'you cannot trust them; they would not even help a friend'. They say there are many more particularists in Latin and Asian countries than in Australia, the USA, Canada or north-west Europe.


Task 1. Answer the questions:

1. How would you explain the concept of ‘globalization’?

2. Why might a 50-year-old Japanese manager be offended if he had to negotiate with or report to a well-educated but inexperienced 30-year-ol American?

3. Why is the pay-for-performance principle popular in northern cultures might well be resisted in more collectivist cultures?

4. Why do universalists disapprove of particularists, and vice versa?


Task 1.Find words in the text which mean the following.

1 the use of reasoning rather than emotions or beliefs

2 understanding or knowing without consciously using reason

3 respect, prestige or importance given to someone

4 having a higher rank because one is older

5 to have hurt feelings because someone is being disrespectful

6 money or something else given in recognition of good work

7 additional money given for better work or increased productivity

8 a feeling of shame and loss of dignity or self-esteem

9 to give up a job or position

10 devotion and adherence to accepted moral standards


Unit 3


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Task 4. Agree or disagree with these statements. Give your reasons. | MARKETING

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