UNIT 1: BARRIERS CAN GIVE A COMPETITIVE EDGE

“OVERCOMING CULTURAL BARRIERS”

This text talks about overcoming cultural barriers when a company decides to go global.

When a company reaches a market saturation in its domestic market, it can decide to expand their market
overseas markets.

In general, there are many advantages when a company goes global:

- the possibility to increase sales and profitability

- create new job opportunities.

However, there are also different barriers:

 One of these is the differences regarding local languages and cultures.

For example, the Lexus case. This brand didn’t have success in Europe because the European
population was loyal to the local brand.
One way to overcome this barrier is by trying to adapt to local culture and invest on advertising the
product at local level.
 Another barrier is when in the company there are differences among workers because they have
different language, they come from different countries and have different culture. For instance,
Chinese workers have different lifestyles from European workers.

However, if a company can overcame those barriers – this could be a competitive edge because workers
can learn one from another and benefits from different cultures.

APPUNTI

Reasons for a company to start looking outside its domestic market (= to go global)

1. Increase sales and profitability

2. Enter new markets
3. Create jobs
4. Outmaneuver competitors
5. Enlarge the customer base
6. Make use of excess capacity off-season
Unit 2: COMMUNICATING ACROSS THE CULTURAL DIVIDE

This text talks about the main differences between a few years ago and nowadays.

Until quite recently, company’s leaders were used to travelling abroad to meet foreign colleagues.
Nowadays, these leaders interact with foreign clients or vendors without even leaving in their office. For
instance, an HR (human resources) manager who works in Europe, on the same day, can talk with a
colleague in Asia and a customer in Asia.

This increase in interactions across different countries can result in a dramatic contrast in styles, cultures,
and expectations. That’s why it’s important for companies to have access to the interpersonal and
management skills needed to be effective and successful in they countries they operate.

According to a global HR consulting firm, there are significant differences in core personality traits. Based
on a survey result, 39 different traits have been identified that can be summarized in what industrial
psychologist call “The Big Five’:

- Emotional balance
- Extroversion
- Consciousness
- Agreeableness
- Openness to new experiences

An example of these differences can be seen in extroversion scores. For instance, European business
leaders are usually extrovert, while Countries like Japan and Saudi Arabia are more introvert and concerned
about maintaining group harmony.

Considering cultural differences is very important when you have to communicate with colleagues from
different countries. To be successful when working with different cultures, you should recognize the
difference in cultural behaviors and personality to adapt your behavior and communication style
accordingly.

APPUNTI

Strategies for effective cross-cultural communication:

- Respect differences
- Listen actively
- Avoid stereotyping
- Build self-awareness
- Recognize the complexity
- Distinguish perspectives
- Be honest
- Be flexible
- Think twice
- Ask questions
Unit 6: CASE OF THE “KILLER ELEVATOR”

THE IMPORTANCE OF UNDERSTANDING THE LOCAL CULTURE

This text is about Schindler, one of the most important elevator suppliers in the world.

Although this company is known globally, it had problems in selling its products in Japan since the incident
in June 2006 in a Tokyo housing complex where a malfunction of one of its elevators caused the death of a
teenager. The company, which denies responsibility for the incident, is currently under police
investigations.

The main mistake the company did was in the days after the incident, as Schindler decided not to
cooperate fully with the local instigators or to apologize (until it had identified the cause of the
malfunction). The Japanese public opinion was inflamed by this behavior and since then, the company has
received no one elevator order.

The lack of an immediate apology was seen as a big misjudgment because in Japan corporate executives
are expected to apologize immediately and argue about fault later. In Japan showing remorse is not taken
as a legal admission of guilt like in the West.

As a consequence, the mass media and public started talking about the "killer elevator" and the image of
the brand was damaged.

According to a PR consultant with experience in rebuilding corporate reputation in Japan, Schindler will
have to perform many purification rituals to give the right example and show that it is a model corporate
citizen.

Another important step for Schindler will be to focus on gaining the support of journalists who cover social
issues. Only when Schindler has re-established its reputation in the social press it can hope to restart its
business again in Japan. Meanwhile, Schindler has learnt a hard lesson about operating in a different
culture from its own: in West you are pre-programmed not to apologize until you are guilty – that’s why it
didn’t apologize right after the death of the teenager.
Unit 7: THE ART OF JOINING DIFFERENT CULTURES

WHY INTERNATIONAL MERGERS OFTEN FAIL

Mergers and acquisitions (M&As) are transactions in which the ownership of companies is transferred or
consolidated with other entities.

A merger is a consolidation of two entities into one.

Acquisition happens when a company takes the ownership of another entity’s stocks, equity interests or
assets.

According to the text, M&As give an opportunity to cut costs, increase profits and benefit from another
company’s knowledge and expertise.

However, some studies have shown that only 9% of mergers are completely successful in achieving their
objective. The reason is linked to 3 conditions which happen when M&As take place:

1. the first condition is that it is not the same business as usual

2. the second one is that there are short timeframes
3. third point is that people making decisions are biased in a particular direction

Considering these 3 points, it is essential to have strong governance and clear goals.

Another frequent cause of failure is to underestimate the cultural differences in integrating two different
companies. The main risk is that people will leave the acquired organization because of these differences.

However, cultural differences can add value, as there is an opportunity to learn new way of working.

Lastly, it is important to remember that often mergers happen when at least one of the two parts is doing
badly. To measure the success of a deal, a company should measure the business value and compare it to
what it would have been without the deal.
Unit 9: CAN A NEW CEO AND CULTURE CLASH AFTER MERGER?

RESCUING A MERGER THAT’S GOING WRONG

The text talks about the integration problems started in 2006 after the merger of Alcatel and Lucent, two
companies specialized in the telecommunication equipment sector.

The problem was mainly related to cultural differences between the two companies as Lucent was
American and Alcatel was French. To solve this internal disagreement, a new CEO (Chief executive) was
named in 2008 was named after more than two-years of suffering from a mishandled integration.

According to some experts, cultural sensitivity is crucial in running a global business. A good business
leader has to embrace the cultural differences of workers and turn them into a competitive edge. A way
could be to encourage team-work as people will collaborate with others.

Another advice is that a new merger has to maintain the best of the past, but it has to show also a new
culture to be more attractive and to improve its performance.

Moreover, communication and common aims are essential to be successful when integrating two
companies. The senior team has to decide the vision of the company and then explain it to all the
employees and create a communication plan to keep each stakeholder informed about the progress of the
company. This will help create a common culture, as well as making internal and external stakeholders
aware of positive changes in the company.
Unit 10: INTERNATIONAL ASSIGNMENTS – CHALLENGES AND OPPORTUNITIES
This text is about international assignments, a process that happen when a company decides to invest in
promising employees and they are asked to work abroad, especially in the new emerging markets, for a
long period of time.

For companies it has become a strategic necessity to have workers who know how business is done in Asia
and the Middle East, places which are the most important emerging markets of the world.

However, businesses find it difficult to find adequate people who want to work abroad, as young people
are usually more willing to travel but they have less skills than older workers, who don’t want to work
abroad as they have family in their home countries.

Another issue related to this topic is that global mobility is expensive, and many companies fail to recover
their investment, as it has been shown that 15% of staff decides to leave the organization.

One reason is that people do not receive upgrades in their careers when they come back, so they start to
look for a new job.

Therefore, it is essential for companies to understand and satisfy the expectations of their returning
workers in order to have a strategic edge.
??
Unit 11: NO PLACE LIKE HOME

EXPATRIATE FAMILIES

This text is about a special kind of spouses, people who have decided to follow their partner’s business
career around the globe.

In the last few years, companies have been moving their executives around the world and their spouses
have followed them. However, many spouses find it difficult to find a job at the same level they had at
home. According to a study carried out at the University of Toronto, only 20% of relocated employee’s
spouses can find employment while abroad.

Lack of work and cultural shock, combined with living family and friends can cause bad consequences for
the employee’s family.

As a matter of fact, family concerns are the most used reason for overseas assignment refusals and early
returns.

For instance, the text talks about the story of a couple. After the marriage the man has been following his
wife’s working career around the world, and he spent time re-inventing his own working career every time.
Eventually he managed to find clients in every location they went, but not all the trailing spouses are so
lucky.
Unit 13: VIRTUAL TEAMS NEED TO BUILD TRUST
WORKING IN VIRTUAL TEAMS

Virtual teams are groups of people who work together from different places around the world using
technology and Internet. This means that someone in the group has to wake up early in the morning and
others have to work in the evening.

However, the most important thing is building trust among the group, but it becomes harder when people
don’t see each other face-to-face.

One solution could be to organize a face-to-face group meeting at the beginning, which will help people get
to know each other and build trust much more quickly.

Moreover, it is essential to agree on a code of practice which clarify how to communicate and behave with
each other. The code should cover practical things, such as responding to emails within a fixed time.

An important aspect of management is supporting the team. Team leaders can help build trust - this is the
most relevant stage in determining the success of a team.

Furthermore, team’s coordinators have to know how to summarize important information in order to
make everyone aware of the company’s progress without inundating people with emails they don’t need.

APPUNTI

Principles for making virtual teams work:

- Get the team together physically early-on

- Clarify tasks and processes, not just goals and roles
- Agree on a shared language
- Foster shared leadership
- Commit to communication
Unit 14: A MELTING POT FOR FORGING SUCCESS

A MIXED-CULTURE WORKFORCE

The text is about a steelmaking company that is based in Saarland – a Germany state that, over the
centuries, has switched between French and German sovereignty.

The business's manager of this company (Mr. Belche) has a particular approach to get the most out of his
employees according to their characteristics; for instance, the Germans are good at practical works,
whereas the French are better at theory.

When it comes to sales and technology, the aim is to link the practical aspects (which are more German)
with the theoretical ones (which are more French). The mixing of the practical and theoretical have to be
linked to a common aim: to make good products to solve customers' problems.

An interesting approach is inviting groups of customers to visit the company, not only for practical
demonstrations of the equipment, but also for scientific seminars which allow the company to collect ideas.

So, the manager’s approach consists in putting teams of people from the different cultures together and
encourage them to learn from each other. Indeed, he believes that the mix of different cultures gives an
advantage to reach success.
Unit 15: MAKING CULTURAL DIVERSITY WORK

Cultural diversity is important due to the increasing mix of cultural and ethnic groups our society is made
of.
Learning about other cultures helps us respect different "ways of being " and perspectives, and also delete
negative stereotypes.

According to the text, nowadays companies need to collaborate with partners, who may come from
different regions or countries. To reach success, businesses need to overcome diverse structures and agree
on a common vision.

An example is the EU's MIND Network of Excellence, a multi-disciplinary research collaboration between
academics from 9 different countries. Despite the diversity across countries, the partnership is progressing
well and is achieving its aims thanks to a common vision and goal.

Furthermore, the partnership has implemented particular methods to make decisions on time. For
instance, face to face meetings usually take place quarterly and are reserved for taking decisions. Outside
of those meetings, smaller teams work on individual projects and discussions take place virtually through
collaboration tools, such as videoconferences.

In an ideal collaboration, each partner has to recognize its own strengths and learn from the other's
expertise, in order to have a shared knowledge.

Lastly, it is known that the solutions to reach success on international projects are mutual trust, common
aims and a fair proportion of the profits.
Unit 16: AN INTERNATIONAL OUTLOOK: INFOSYS TRAINEE SCHEME

This text talks about a new graduate training programme, created by an Indian company (Infosys)
specialized in the IT sector.
The programme involves engineering graduates from around the world spending 6 months in India, in order
to ensure that they will be able to work as part of an international and diverse workforce.
They will improve their technical skills, and - at the same time - they will learn more about the countries
they will operate in.

Some graduates agree that this is a unique opportunity, as companies rarely let you get in touch with
cultures you are going to work with.

According to the senior VP (vice president) of the company, there are clear business benefits to training
graduates overseas with peers from all over the world. A workforce that represents the global footprint of
the company and that is able to work together in harmony, can give the customers what they really need.
Unit 17: TRAVEL BROADENS EXECUTIVE MINDS

This text talks about the experience made by an American leader, who went to China on an international
programme designed for senior leaders.

The programme was arranged by an international nonprofit organization, which wants to improve the
quality of leadership around the world.

According to research led by a business school, the majority of business leaders believe that senior
executives need more knowledge to face new trends (such as climate change and emerging market
challenges). So, the aim of this programme is to benefit executives by giving them the opportunity to learn
more about other culture perspective and global trends.

The American businessman said that this kind of experience made him more open-minded, and he enjoyed
this trip so much that when he came back home, he hosted events to teach what he had learnt to other
businesspeople.

As a matter of fact, he believes that investment in international leadership development is essential to

succeed in a changing world.

APPUNTI
Qualities a manager should have:
- Leadership qualities
- Always take the initiative
- Should have a good understanding of latest technologies
- Should be a role model
- Ability to forecast vulnerabilities
- Sharing knowledge with team members
- Should be a fire starter
- Should appreciate efforts of team members
- Should be careful about personal limitations
- Should harmonize with new generation employees