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What is Culture?

 Culture is the distinctive

life-way of a people united by a common language and governed by rules and models for their beliefs and behavior.  In laymans terms, culture is what we live everyday and what we bring with us to the workplace.

Individuals Path to Cultural Competency

Learning is like a journey, in that, it is a path that we follow to enlightenment. A model developed by David Hoopes, gives us a model to cultural competency. His outline illustrates the development of cultural competency in every one of us. Competency implies having the capacity to function effectively. It will be interesting to see where, we as individual, fit into this continuum.


Multiculturation Selective Adoption Appreciation/Valuing Acceptance/Respect Understanding Awareness Ethnocentricity

Continuum of Cultural Competency in the Workplace

Even though, we may be culturally sensitive, our work environment may not be at the same level. This can be attributed to the numerous people employed and the different ideologies they possess. As you review this continuum, one can see how these steps parallel those in the Individuals path to Cultural Competency.

Continuum of Cultural Competency

Cultural Competence Cultural PreCompetence Cultural Blindness Cultural Incapacity

Cultural Proficiency

Cultural Destructiveness

Indian and Chinese companies learning a lesson: Going International isnt a snap

Going International. But Why?

 A Paradigm Shift In Concepts.

 Not only to acquire business but also to get

them done.

Cultural Conflicts- A Bottleneck

 Indian and Chinese companies perceive that

the local workers are exactly of the same nature as that of their workers.
 Militarized management Vs. Human-oriented

 Centralized decision-making System.

 The local employees sometimes do not feel

comfortable with styles of Indian and Chinese management.  Failing to project own employees as team players with the local employees in other countries.

Reconciling cultural differences in the shortest time is crucial to the success of a business merger
- TCL President Li Dongsheng

When different cultural traditions meet in the marketplace and inside organizations, managers face tough choices about the values that they and their organizations will live by.

Life would certainly be a lot simpler if other people would just shape up and see things our way! As ridiculous as that statement looks when written out, that is often what we think when things aren't going well, particularly when communication starts breaking down. This document looks at ways of approaching cultural differences.

Communicating Across Cultural Lines

Communication is one of the most basic means of getting your idea across, but when it comes down to communicating with someone outside your comfort zone things can become a little unnerving. We have some suggestions that may alleviate those apprehensions.

Ways to Facilitate Communication Across Cultural Boundaries

Recognize differences Build Your Self-Awareness Describe and Identify, then Interpret Dont assume your interpretation is correct Verbalize your own non-verbal signs Share your experience honestly Acknowledge any discomfort, hesitation, or concern 8. Practice politically correct communication 9. Give your time and attention when communicating 10. Dont evaluate or judge
1. 2. 3. 4. 5. 6. 7.

cross-cultural management minimizes:

Worker alienation that can result from

misunderstandings of etiquette, values, and behaviors. Costly discrimination suits that arise from poor communication and worker alienation. Unnecessary terminations that result from communication breakdown and misinterpretation of employee behaviour.  Managers' reluctance to hire and work with culturally diverse workers. "Racism and discrimination that can result from misinterpretations of the behaviours of others."9

Merger of Daimler Chrysler

 In the period leading up to the Daimler-

Chrysler merger, both firms were performing quite well (Chrysler was the most profitable American automaker), and there was widespread expectation that the merger would be successful

 Stockholders in both companies

overwhelmingly approved the merger and the stock prices and analyst predictions reflected this optimism.  Performance after the merger,however, was entirely different, particularly at the Chrysler division.

 In the months following the merger, the

stock price fell by roughly one half since the immediate post-merger high  In addition, there were significant layoffs at Chrysler following the merger  Differences in culture between the two organizations were largely responsible for this failure

 Operations and management were not successfully

integrated as equals because of the very different ways in which the Germans and Americans operated:  while Daimler-Benzs culture stressed a more formal and structured management style  Chrysler  favored a more relaxed, freewheeling style (to which it owed a large part of its pre-merger financial success).

 In addition, the two units traditionally held

entirely different views on important things like pay scales and travel expenses.  As a result of these differences and the German units increasing dominance, performance and employee satisfaction at Chrysler took a steep downturn

 There were large numbers of departures among

key Chrysler executives and engineers, while the German unit became increasingly dissatisfied with the performance of the Chrysler division.  Chrysler employees became extremely dissatisfied with what they perceived as the source of their divisions problems: Daimlers attempts to take over the entire organization and impose their culture on the whole firm.4


When cultures clash, no matter what the cause, things inevitably evolve into a 'them' and 'us' environment.

Merger of Hewlett-Packard (HP) and Compaq Computer

Cultural integration
 Cultural integration of two organizations

following an acquisition depends on the compatibility of the contents of their respective cultures as well as the demographic flows of persons into and out of the new entity.  Merger of HP and COMPAQ took place in 2002.

Culture at Compaq
 Compaq tended to be more market-

oriented and aggressive.

 Here people appeared to be quite good at

having constructive open conflict, making decisions and moving on.

Culture at HP
 HP had a traditional way emphasing on

teamwork, consensus, and the long-term view.  HP has a strong value around respect for the individual and trust for the individual.  They never want conflict. They will really wouldn't make a decision until virtually everyone in the room was in agreement.

Similarities in their cultures.

 There are certainly some cultural

similarities between the two companies on the IT server front,". "They both approach it from the hardware background."

Merger HP and Compaq

 After 18 months of bitter fight, the biggest

merger in the technology industry was completed. At the time of merger, it was worth $19 billion approximately.  The New HP has retained a few of the Compaq products and brands, especially in the business PC range.  Customers continue to hear Presario brand of PCs and iPaq handhelds.

HP ready to take on IBM

 The new HP now wrestle out to be the world

No. 1 computer company. HP produces more PCs and dominates the printer market but IBM's services organization is roughly three times as large as HP and Compaq's combined. Analysts says that size does not matter than trust and the technology these giants have build over customers after a divisive merger battle.

What do they gain?

 The big gain for the combined entity


 Coupled with the elimination of

overlapping computer product lines, this lead to LOWER COSTS for the same revenues.

 HP gains Compaqs services

business, its DISTRIBUTION NETWORK especially for consumer desktops and of course its BUSINESS CUSTOMERS.
 This merger also helped the new

company for NEGOTIATING better rates with suppliers

 Hence in India, prices came down and

hence become more competitive which helped them in garnering a greater share of the market.  Single factory, improved logistics, strengthened distribution system and better negotiation with suppliers are some of the areas which would help in cutting cost.

Compaq with its strong Intel and HP with strong positioning in the mid-range category will give a tough fight to both IBM and Sun.  Compaqs extensive installed base of Intel servers would be quite a boon to the new setup in the servers category. Servers is an area where the new entity will have a lot to look forward to.

Things they do
 Carletons firm helped HP conduct 144 focus

groups and 150 interviews in 22 countries.  The data from the interviews was used to shape an integration plan that included the early appointment of the top three levels of management, a Fast Start training program that brought HP and Compaq employees together in the first weeks after the merger, and a multitude of meetings in which employees explored mutual cultural issues.

Language barriers and icebergs

 Much of the company's early work has been

focused on two areas: minimizing disruption to customers and working to avoid internal culture clashes.