Case study analysis on Cross-Cultural Issues in International Management.

Case study analysis on Cross-Cultural Issues in International Management Name Grade Course Tutor`s Name (June 23 2011) International management and cultural conflicts "International Management comprises a decision making process in planning, organizing, leading, and controlling in a multicultural area" (Nowakowski 2000, p. 136 cited in (Rozkwitalska, & Gdańska, 2009, p. 91). Thus international management involves all those basic principles of management which are fundamental to basic management functions. However the task is to transfer them to an international scenario far different from the current one. In order to do this, managers must have skills and proficiencies needed to manage issues related to cross cultural dimensions. International management is a consequence of increased globalization and increased competition that has led businesses to leave their boundaries and experience businesses in a new environment and culture (Rozkwitalska, & Gdańska, 2009). However, managing cultural issues is not an easy task. "Culture is more often a source of conflict than of synergy. Cultural differences are a nuisance at best and often a disaster." (Hofstede, n.d). Thus cultural management is one of the most critical issues in International management where companies usually pay off in off-shore business expansion if they do not accommodate themselves according to the various cultural dimensions of the new business centre. Disney Land faced the similar cultural conflict when it grew and started a new theme park in France named as Euro-Disney Land. Management tried to use the similar strategies in France as the used in USA and the results were drastic. Following is an account of difference in cultures of France and USA based on Hofstede`s cultural dimensions. Main cultural differences in USA and France based on Hofstede`s cultural Dimensions Hofstede (n.d) presented 5 elements to that can be ascribed to various societies to ascertain their cultural dimensions. These elements are (1) Power Distance Index (PDI), (2) Individualism (IDV), (3) Masculinity (MAS), (4) Uncertainty Avoidance Index (UAI) and (5) Long-Term Orientation (LTO) (1) Power Distance Index (PDI), determines the degree of inequality that persist in an economy as a function of wealth and power among individuals of that society. A higher value on this index means a greater level of inequality among individuals and a lower value on this index means a lower level of inequality. The value of PDI for France is 68 and that for USA is 40. It means in USA discrimination among individuals on the basis of class and caste system is lesser as compared to France (Hofstede, n.d). (2) A higher value on Individualism (IDV) relates to a culture which has more focus on individual rights and their achievements. And a low value on this index means a more family oriented society which focuses on collectivism. IDV has a value of 71 for France and 91 for USA. It means in USA, individualism is more dominant over collectivism in comparison to France (Hofstede, n.d). (3) A higher value on Masculinity (MAS) indicates a male-dominant society and a lower value means a more balanced culture having equal rights and opportunities for males and females. In France the value of MAS is 43 and that of USA is 62. Thus France offers far more equal opportunities for both males and females (Hofstede, n.d). (4) A higher value on Uncertainty Avoidance Index (UAI) means the level of acceptance for uncertainty in a particular is lower and vice versa for lower value. The value of UAI for France is 86 and that of USA is 46. It means people of USA are more tolerant towards uncertain conditions as compared to France (Hofstede, n.d). (5)The value of LTO is not available for France thus comparison cannot be made on its basis (Hofstede, n.d). Thus there is a significant difference in the culture of USA and France in terms of Hofstede`s cultural dimensions. Cultural differences can also be measures using "Seven Dimensions of Culture" given by Hampden-Turner, & Trompenaars (2000). These dimensions involve: 1) Universalism versus Pluralism, 2) Individualism versus Communitarianism 3) Specific versus Diffuse, 4) Affectivity versus Neutrality, 5) Inner directed Versus outer directed 6) Achieved status versus ascribed status and 7) Sequential time versus synchronic time. Seven Dimensions of USA versus France culture 1) Universalism is attributed to a culture which is guided by rules and regulations. On the other hand Pluralism relates to a culture having more social ties in which interpersonal relationships are preferred over general rules. USA is characterized by a more Universalist culture (Workman, 2008). The value attributed to Universalism in vase of USA is 93 and that to France is 73. It means USA society is more rule oriented as compared to France (Trompenaar's, 2009). However both USA and France are Universalistic societies. 2) High value on Individualism means the society in which people are more self-reliant and they believe on their own decision making whereas Communitarianism is a societal attribute where people work together and manifest themselves from the acumen of their partners. Both USA and France follows individualism (Workman, 2008). For USA the value of Individualism is 69 and that for France is 41. Thus USA is a more individualistic society than USA (Trompenaar's, 2009). 3) A specific culture is the one where private and public life is supposed to be managed separately. However diffused culture allows its people its people to interlink their private and public life (Workman, 2008). USA has a higher specificity in its culture as compared to France. However, France is also a specific culture having lower position than USA in this regard (Trompenaar's, 2009). 4) A neutral culture is the one where people are not supposed to show their feelings to others whereas affective culture...