Symptoms

The purpose of finding the symptoms is to determine the underlying reasons behind the three

major concerns.

1. High levels of expatriate management turnover

2. Guest complaints have tripled

3. Increased level of tension between expatriate and local staff members

Firstly, there is an expatriate turnover resulting in inconsistent service and another

symptom.

Furthermore the declining level of service that also triggered guest complaints. An increasing

level of tension between some local employees and the expatriate management as well as the

lack of communication and overstaffing between these groups can be seen as symptoms since

these directly cause the problems described later in this analysis.

Another symptom is the vacation resort industry in the British Virgin Islands has blossomed

into a highly competitive and profitable market, the high competition that is expected to exist

in British Virgin Island. This growth and the reputation of British Virgin Island as the

“premier chartering location in the world” have drawn the attention of vacationers, as well as

major developers. West Indies Yacht club resort was under extreme pressure to offer a unique

vacation experience to the customers and to differentiate the resort from others in the region.

Finally, West Indies faced a number of challenges from the local labor market laws and

regulations. These laws stressed the hiring of locals; increased job protection as well as placed

extreme pressure to promote the locals to management positions. The consequences of the

labor laws have resulted in the hiring of unqualified employees to “meet” the quota; increased

overhead by remaining staffed during the off-season and has limited the ability to retain only

the best workers

 Identify and Analyze the Problems

1. Poor management relations with local staff

From this point a lack of intercultural competence should be observed as a problem. Most of

the managers were visiting the resort for a short period of time. The ones who lived at the

resort preferred to deal with the guests rather than the employees. Thus, they neglected the

opportunity and did not contribute enough time to build relations of trust with their working

staff. Trust is a crucial tool for managers especially when the employees are not motivated by

the potential rewards and promotion. From the case, it is visible that the locals are not eager

to understand the needs of the management and understand the requirements of the

managements as they perceived the directorate as a part of a different culture, as “the others”

– geographically and hierarchically. It is obvious whether a manager has been successful in

building relations of respect, understanding and friendship with the locals or not. Only the

ones who adapted to the local culture, established strong interpersonal relations and were not

afraid to involve themselves in all, even unpleasant parts of the job – only those managers

were mostly respected. The relations between managers and the local staff affect the overall

performance immensely. We cannot say that the problem is the labor law, that benefits for the

lack of motivation, but a wrong understanding of what motivated the people in this particular

country. Looking at Edward T. Hall’s model of the High and Low context communication we

see local employees in a High Context communicational culture, meaning communication is

implicit, information is less written/formal, understandings are more internalized of what is a

communicated and long term relationship is more important. Indeed, the importance of strong

boundaries affects the communication - who is accepted as belonging vs. who is considered

an "outsider”. As U.S. is a Low communicational culture it would be more difficult for the

management to enter the local team because it is more difficult to create close relationships as

they are considered to be “outsiders”. Management seems to fail in its understanding of the
local lifestyle and priorities and then, to find the ways to build relations of mutual

understanding and trust, which was of a great importance for the locals. Therefore it is vital to

ensure that there is mutual respect, sharing of common values and understanding of the

common goals, which is essential for building a team.

2. Poor performance by the local staff

Due to the local law restrictions, which provide guarantees for the locals to be safe at their job

position, WIYCR employees were not very motivated to achieve the goals set by

management. Using the Hofstede Cultural Dimensions theory concerning the Power Distance

we could see that the scores for United States and British Virgin Islands are very far from

each other (40 and 78). Power Distance refers to the extent to which the less powerful

members of organizations and institutions (like the family) accept and expect that power is

distributed unequally. Since workers have a High Power Distance attitude, it means that they

have high dependence needs and their superiors are more likely to be inaccessible. They

prefer to follow the given orders and do not participate in the discussions. The model in which

employees were being told that they can work harder and gain more money didn’t work.

Supervisors were usually confused because they couldn’t find a way to motivate their

employees. In consequence of miscommunication between the leaders and the workers plus,

which was aggravated by a lack of understandable disclosure of employee’s tasks, the quality

of service was decreasing and the guests' satisfaction level was falling. Looking at employees’

performance, we could assume that some of them do not understand exactly what they have to

do. 70% of functional illiteracy cannot arise only from trainings in the beginning of

employment, which do not account for particular experience and skills of a person in relation

to the duties as a part of broader operations and activities. As it has been mentioned in the

case most of the workers didn’t want more responsibility. Some of the managers gave clear

directions and goals, but were never present during their implementation. Some could not
give a full, fair, accurate, timely and understandable explanation of what should be done.

Thus, most of the employees were not clear about tasks they are performing. Employees of a

High Power Distance culture need very strict hierarchy and understandable explanation for

the whole group in order to understand their tasks better as they would not need to make the

choices by themselves. If U.S. managers would see the differences, the more quality of

performance might be received from employees.

3. Poor managing by the expatriates

Entrenchment of American perception and working standards in addition to a

misapprehension of local values resulted in an intension and a decline in the quality of work.

From the second Hofstede Cultural Dimension we would compare the Collectivist culture and

Individualism culture. U.S. has a score of 91, whereas British Virgin Islands (BVI) only 14.

On the individualist side (U.S.) we may see only relationships that do not go beyond “I” and

the family: everyone is expected to look after him/herself and his/her immediate family. On

the collectivist side (BVI): we find society in which people from birth onwards are integrated

into strong, cohesive in-groups, often extended families in exchange for unquestioning

loyalty. That brings us to the idea why Americans fail in communication with locals and why

the local values are not taken into consideration. We can clearly see that workers of

Collectivist culture see more importance in the relationships rather than tasks, while

management considers tasks over relationships. This might be a root problem as it belongs to

the leadership style: Americans use task-oriented style where they place an emphasis on the

job itself. Locals are more interested in maintaining good relationships with their

subordinates. But since more of the management were not present all of the time, it was

almost impossible. Indeed, for the local employees combining private life and work were of a

major importance whereas Americans were not willing to combine private life and business.

Some of the managers were working directly from the U.S., coming to the resort only during
peak periods for a longer time, than during off season. An absence of the founder for most of

the time, due to his age, affected the working conditions for both: the managers and the

employees. We conclude that this all issues create an unhealthy work environment, when both

the parties were not interested in improving team work and communication within the team;

they could not create a union due to the difference in cultures. It resulted in the lack of

attention to the performance standards: employees were rude to the guests and did not

perform their tasks; some of the managers canceled their contracts before the ending date. The

resort staff was comprised of local employees and expatriate management, leading to cultural

communication difficulties, which have been reflected in recent business performance.

Develop Alternative Solutions

1. The first option is to do nothing and leave everything as it is.

2. A second alternative in order to improve between management and local staff is to

create a culture awareness program for managers coming from the United States. This

cultural awareness program would help managers to better understand and ultimately

prepare for their expatriate assignment. The program would touch on issues such as the

differences in individualism vs. collectivism and power distance between the two cultures.

Expatriates from the U.S. going to BVI need to be aware that managing styles are

different and need to be adapted in order to connect with local staff and be successful.

They need to be trained to move away from the “I conscious” and fulfill obligations not to

self but to the group they work with. Also, the workplace employees in collectivist

countries the employee employer relationship is more like a friendship link, but for the

expatriates it is more important to succeed in their task than creating relationships with

locals. To tackle the problem in regard to hierarchy it is crucial to look at how different

members in an organization are perceived by management and what do low level

employees expect from their supervisors. Expatriates from the U.S. are used to minimize
inequality in between employees; and employees are encouraged to make their own

decisions whereas in low PD countries such as British Virgin Islands managers make the

decision for the employees. Including all these issues in the cultural awareness program

would expatriates already prepare better for their tasks.

3. Another solution is to try to create a closer relationship between expatriates and locals.

This can be done by having regular events planned that expatriates attend as well as local

employees.

4. To improve local staffs work performance management needs to set clear objectives

for their employees and follow through. MBO would help local staff to have objectives.

However, in our point of view a little adjustment needs to be made. Instead of letting

locals set their objectives management should be the ones setting the objectives for their

employees. As the Fijis have a high score in PD employees expect to be told what they

need to do. Upon fulfilling objectives employees who achieved their objectives should

receive an appropriate award. Monetary awards are not as important for cultures with a

low score in individualism. Our suggestion is to reward employees with shorter work

hours on fridays for example so they can spend more time with their families and friends.

5. Implements job rotation for locals.

6. As guest complaints have tripled it should be priority for management to figure out

why and how to resolve the dissatisfaction with guests. This can be achieved by

establishing a feedback system that guests have to fill out at the end of their stay.

Evaluate Alternatives

1. Doing nothing would be the worse idea since the situation is not very likely to change

and doing nothing would worsen the situation. Managers and locals relationship would

not improve resulting in an even higher expatriate turnover, lowering service and

dissatisfaction between the locals and managers.

 2. A cultural awareness program would definitely help future expatriates to prepare for

the cultural differences that they have to face when managing abroad. The cost factor

should be an issue, but the seminar can be conducted on site by the company who hires a

specialist in that field. An investment in such a program is a good idea if managers

actively participate and respect the cultural differences and adapt their management style

accordingly once they start their expatriate assignment.

3. Planning events at the workplace and local community where employees as well as

management attend seems to be a good idea. Local staff would definitely welcome the

idea since they come from a collectivist country. For the expatriated on the other hand it

should take some getting used to. But the cultural awareness program should have

prepared expatriates accordingly.

4. To implement MBO with the slight modification that managers set objectives in

addition to the rewards that give employees more free time to spend with family and

friends should be a good way to motivate locals. Again, expatriates need to be able to

adapt to the different way of managing and need to be aware those monetary awards are

not as important.

5. To implement a job rotation would improve employees interest in work, but on the

other hand more training may be required which is associated with additional costs

6. In order to find out why and in what areas guest complaints come from it is a good

idea to give out comment cards at the end of guests stay. This is easy and cheap to

implement without any problems.

Select Solutions

As the best solution(s) we would implement all but the first one. Starting with preparation of

expatriates for their assignment in their home country and make them aware of how managing

may differ. To help locals and expatriates connect events may be helpful. Establishing a MBO
style of management with the adjustments as described above will help improve staff

efficiency and performance. Even though job rotation may proofs to be costly it can increase

employee retention as they get a wider range of tasks and are exposed to more departments

countering the effect of being bored of the same tasks every day. Finally creating guest

comment cards to find out what guests are not complaining about and prioritize problems in

order of occurrence so they can be fixed.