Who Gets the Assignment?

Our company is looking for a manger to send to China on a three-year assignment to staff and run a new branch of our industrial products company. The internal pool of twelve people interested in the position was narrowed to three candidates from which the selection committee must decide on one manager. There are four factors that need to be looked at before ultimately choosing from the candidates. First, the environmental forces must be assessed. Second, the role of management must be understood by the candidates. Third, there must be and understanding of the Countrys culture, values, and thought process in regards to business through Geert Hofstedes 5 cultural dimensions. Finally, the challenges that the company will face in doing business with China must be explored Examining the environmental forces involved is essential to planning a successful foreign business. Environmental forces are made up of eleven external forces over which managements have no control, as well as the internal forces that management administers to adapt to changes. Some of the most important forces to consider are the economic, political, and legal environments in order to determine the plan with minimal risk. Competitive forces include the competition of a firm, the number and location of competing firms, and the activities that the competing firms participate in. A firm has no direct control over their competition, but a firm may influence the competition by competing in the same markets as the competition or lobbying for barriers to entry into a particular market. The agencies available for distributing goods make up the distributive forces. Economic forces are composed of the GNP, GNI, unit labor costs, and personal consumption variables that impact a firms ability to do business. Socioeconomic forces compile the characteristics and distribution of populations. Financial forces are the interest and

inflation rates, also including taxation. Legal forces encompass the laws governing the international operations of multi-national companies. Physical forces include the topography, climate, and natural resources of a nation. Political forces comprise the local political climate, government structure, and international organizations. Sociocultural forces include the culture, attitudes, values, and beliefs of the local environment. Labor force is the composition, skills, and attitudes of the local labor. Finally, technological forces are the technical skills and equipment for converting resources into finished products. (Waldu lecture notes CH1 Slide 10) In order to choose the best candidate, the role of management must be understood. What is management? Hofstede (2007) refers to management as getting things done through other people.coordinating the efforts of people towards common goals (pg. 412). Most importantly, management is always about people and because it is always about people it is a part of the culture of the society in which it takes place (Hofstede, 2007, pg. 413). Across the globe the role of management is to guide people within an organization to meet to goals of the company. Management teams worldwide have the same objectives, but their culture and value systems are different. When a manager is sent to a different country he or she must be able to adapt to customs and values of the specific culture in order to be a successful manager. If the manager wants to create a thriving atmosphere he or she needs to understand the people that he or she will employ. In this situation the manager must staff and run a new branch of the company and in order to do so he or she must understand what will make the branch successful in China. What makes a branch successful in one country might not make it successful in another. With this in mind, all three candidates are perfectly capable of running a successful branch within their respective location, but which one will better adapt to his or her role in China? Managing a successful business operation in China requires much research and planning. The person must be

fully prepared for the cultures, ideas, and practices of the foreign environment, as well as fit in with society to provide the best outcome Geert Hofstede, a Dutch consultant and researcher, developed four cultural dimensions using cross-cultural communication to survey employees worldwide. The framework he developed primarily focused on work values and how they differed based on culture. The four dimensions include: individualism-collectivism, power distance, uncertainty avoidance, and masculinity-femininity. Later, in collaboration with researcher Michael Bond, created a fifth dimension, long-term orientation. Individualism and collectivism (IDV) measures the degree to which people in the culture are integrated into groups. Societies with a more collectivism style are in strong groups that look after each other in exchange for loyalty. Societies with an individualism cultures look after themselves and immediate family more than other people or groups. They are rewarded for independence. Hofstede defines Power Distance (PDI), as the extent to which members of a society expect and accept power to be distributed unequally. It is comparable in terms to social inequality, but the interpretation comes from the lower ranks of society and not the upperechelon. Societies with large power distance are more focused on things like seniority and age, and people want directions. A small power distance environment is more of a managed leadership style. The society consults and gives advice, rather than giving orders. Uncertainty Avoidance (UAI), is a societys comfort with uncertainty. Breaking it down into three levels shows how different cultures are programed for uncertainty. According to Hofstede, this section pertains to mans search for truth. Cultures that avoid uncertainty have strict laws and rules; they focus on safety and security measures. Cultures with strong

uncertainty are likely to resist change, even when it comes to their careers. They want procedures laid out clearly for them. Weak uncertainty avoidance cultures look at conflict as a positive aspect, are more innovative, praise risk tasking, and look at career change positively. Masculinity Femininity (MAS) is what Hofstede describes as role distribution between the male and female gender. According to Hofstede, womens roles across cultures differ less than mens do, and that mens values among countries vary considerably, from very assertive and competitive and maximally different from womens values on the one side, to modest and caring and similar to womens values on the other. He also finds that women in more feminine countries have the same modest, caring values as men; and in more masculine countries they are more assertive and competitive, but not quite as much as the men are, so the more masculine countries show more of a gap in values between men and women. Feminine cultures have less variation between male and female roles; meaning leadership roles are just as open to women as they are to men. Comparatively in a masculine culture, the male roles are more task focused and the female roles are focused more along the relationship aspect; achievements are strongly emphasized, the socioeconomic culture lives to work, and the primary goal is maximizing business performance.

Hofstede realized that his study primarily represented a western perspective. When working with his colleague Bond, he added the fifth dimension after using a questionnaire created by Chinese scholars to survey, Long-term Orientation / Pragmatic-normative (PRA) sometimes also referred to as Confucian Dynamism. It is the level at which people overcome obstacles that they couldnt normally overcome with only will or strength. In long-term

countries, citizens focus on valuing actions that will affect their future. They also have a normative orientation, meaning they want to establish the absolute truth. In short-term countries, citizens focus on the present and past more to understand that what happens around them cant be explained. They also have a pragmatic orientation, meaning they dont think its possible to fully explain the complexity of life. They believe truth depends on the situation, context, and time. Long-Term Orientation is the most recently added dimension greatly due to more indepth surveying of Asia through a questionnaire. Since it has been so recently added, there arent as many countries that have had their respective data completely calculated, and therefore are not offered as part of the analysis. In Hofstedes description, it deals with Virtue regardless of Truth, meaning the level that people of a certain culture will endure to overcome challenges that cannot be overcome by sheer will or strength. Societies that are long-term-orientated place value in the following; thriftiness, collective face-saving, social order and hierarchal relationships. Short-term-orientated societies value the following; personal survival/security/respect/dignity, individual face-saving, spending-centered, generous & spendthrift, tradition is revered, fulfillment of social obligations, as well as the significance of past and present values. Some examples of Long-term-orientated societies would be; China, Hong Kong, Taiwan, Japan, South Korea, India, Brazil, and Singapore. Short-term-orientated society examples would be; Pakistan, the United Kingdom, Nigeria, Philippines, Canada, Zimbabwe, the United States, and Germany. After providing an analysis and review of Hofstedes 5 dimensions an application of the dimensions are also important. An in-depth analysis of the application of these 5 dimensions is also important. In the following paragraphs they will be applied to Japan, India, South Korea, Middle East countries, and most importantly the United States.

In comparison to the U.S. Japan scores higher in Power Distance, and Pragmatism; which in itself can present slight hurdles, but could be overcome to possibly create an environment that is conducive to a very equitable business arrangement. Considering Power Distance, and how China leans more toward supporting inequalities between people, this could pose a challenge to a company from India possibly doing business in China, since equality and sharing a particular burden are more the nature of the Japanese. Under Pragmatism, the Japanese might find doing business in China more of a challenge because of the disparity in thinking about when, where and even if the truth should be disclosed. This could have the potential to severely injure the necessary trust that is required to foster a productive Japanese business in a Chinese environment. When comparing Individualism, Masculinity, Uncertainty, and Indulgence; Japan score significantly higher in all the aforementioned categories. Under Individualism, since Japan leans strongly toward much less nepotism, along with more of an individualistic ideal of working rather than group work; the business complexities of teamwork would have to be an adjustment that a Japanese company would need to focus on. In regards to Masculinity, Japan could find it a challenge in the possible lack of ability to find a middle-ground when it comes to the level of commitment to business versus personal and private matters. Japan might also be challenged when comparing the importance of success, and find that the intensity level of goal-driven competition and achievement is not as strong as their own. Also, when looking at Uncertainty, Japan being a very clear cut and dry, rule abiding society; could possibly find the more ambiguous Chinese hard to create a clear and delineated business path with. When comparing Indulgence, both Japan and China are on the lower end of the scale, meaning that both societies are more restrained in the aspect of being able to control their desires, urges, and

impulses. This could work out well for a Japanese business, as they wouldnt have to worry about the major distraction factor when it comes to focusing on tasks at hand in the business world. In Comparison to India, China scores higher in Power Distance, Masculinity, and Pragmatism; which can pose a slight challenge with how India presents and carries itself culturally. This could reflect in some areas by making it seem that India is capitulating to what China is expecting, and could lead to some business development benefits leaning in favor of China. Under Power Distance, China would not see individuals as being equal to each other, along with expectations that the interest of the group should be placed higher than the individual. In Masculinity India will not be as driven as China in competition, achievement, and success in a particular field. The field of Pragmatism would illustrate that India would be more opposed to reaching a positive end result by any means possible than China would be. The Chinese are more inclined to adjust their traditions to achieve a certain end result; and are more interested in persevering through situations to reach their desired end result. To summarize, China and Japan have some major cultural similarities in regards to the potential of operating a successful Japanese business within Chinas culture; but management needs to be aware to the challenges as well, which could prove to be a little more daunting than anticipated if not; especially where it pertains to the Individualism and Uncertainty Avoidance sections. India scores higher on Individualism, Uncertainty Avoidance, and Indulgence which, in the long run; could balance the business scale in regards to their weaknesses. On the topic of Individualism, India would face a little challenge here because their work would be focused on more of an individualist setting rather than a group as China would be. In regards to Uncertainty Avoidance, India seems to be more rigid in terms of following strict guidelines;

and are probably more prone to establishing an ethical and fair business-like environment, with less inclinations towards nepotism. As to Indulgence, India is apt to be slightly more socially indulgent, which could conflict a little with China leaning slightly toward the socially restrained side; but both countries score closely compared to the other areas mentioned. This should not have a major effect on business practices of an Indian company in China. In summary, China and India are pretty well matched in Power Distance, Masculinity, Uncertainty Avoidance, and Indulgence; India would probably only face minor hurdles when it comes to Individualism, and Pragmatism when thinking of opening up a business in China. When comparing China with South Korea, the scoring trends more toward identical linear associations in most categories. The closest scoring categories (which are the majority); Power Distance, Individualism, Pragmatism, and Indulgence, look to be all within a range of not creating too much disparity when it comes to business work ethics. The majority of the challenges will lay in the rather large scoring disparities between Masculinity, and Uncertainty Avoidance. In regards to the differences between countries in the Masculinity comparison, it would stand to reason that a South Korean company would find itself in a possibly challenging position; one in which it would feel that the higher quality of life expectations of its native South Korean employees would be hard to balance with Chinas underlying natural competitiveness could create a rather large rift in the attempt to seamlessly integrate a South Korean business ideology within a Chinese culture. Also, when looking at the even larger disparity between South Korea and the Chinese in the category of Uncertainty Avoidance, there could be even more potentially hazardous challenges to overcome when inserting a South Korean business within China. Mainly speaking, the strict guidelines that South Korean businesses tend to operate in would run the risk of becoming mildly diluted. The ability

of group work between native South Korean businessmen/women, could be severely undermined by the more relaxed business etiquette of the Chinese in comparison. This could also create a business advantage, as the South Koreans would be more prone to running their business more as a military operation, with extreme guidelines; and ultimately could super-charge whatever business they chose to open in the Chinese business community. Summarizing South Korea in regards to China, this comparison of cultures shows greater similarities than the other two (Japan, and India); but that does not mean that it would be the easiest to integrate a South Korean business into China, versus a business from Japan or India. The main reason is that South Korea and China have the largest disparities within the Uncertainty Avoidance group; which tends to align itself with controlling the future, as well as different rules and laws in different situational circumstances. Knowing this, the South Korean businessman/woman, should definitely take into consideration their rigid format in respect to the Chinese being more lenient. According to Hofstedes website, Middle Eastern countries (Egypt, Saudi Arabia, Iran, and Nigeria) fall in the same window as China in the dimensions Power Distance and Collectivism. Both display collectivist society with strong, loyal relationships, as well as a hierarchal order which reflects inherent inequalities among society members. They differ in areas such as feminism, uncertainty avoidance, and pragmatism. Norway differs in every cultural dimension from China besides Uncertainty Avoidance, in which both countries exhibit a flexibility with their adherence to laws and rules. The American countries (US, Brazil, Mexico, and Argentina) relate to China by both showing masculinity, being driven by competition, and having flexible adherence to laws.

CHINA
150 100 50 0 CHINA

The greatest challenge of conducting international business in China is the lack of human resources. Chinese workers follow a hierarchal structure in which each person has a specific role, and they follow only what higher people tell them to do. Another challenge is communication, as cultural misunderstandings can make business negotiations very difficult and time consuming. In order to conduct business in China you must have a manager who can bridge the Chinese culture to your home culture. Some bureaucratic tasks that are simplified in home countries may be time consuming and extremely difficult in China. For example, simple tasks such as opening a bank account may take up to 5 months to do in China. A necessity to have successful business operations in China is building strong business relationships; however, rather than only conducting business with Chinese counterparts you must put in the effort to learn about them outside of the business spectrum. Learning about them on a personal level will allow you to get the most out of your negotiations and relationships. Now, after reviewing and analyzing Hofstedes five cultural dimensions and the challenges of conducting business in China, the question, Who gets the assignment, can be better answered. There are three very distinct candidates for the position in China, Tom, Firdaus, and Gunther. All three candidates are very successful business professionals but not all of them would be a good fit for the position in China. First, it is important to understand the role and meaning of management. Second, it is even more significant to review their professional background as well as their personal background. Lastly, the advantages and disadvantages that each candidate would face upon being chosen for the position must be determined. This will result in choosing the optimal candidate for the position.

Tom is the first candidate reviewed for the management position in China. Toms professional profile consists of being a mid-level manager with an MBA and a finance undergraduate degree from Ohio State University. Tom is also part of the local Council on Foreign Relations. With regard to his personal life, he is single and a very accomplished athlete. However, Tom has no foreign experience and has been out of school for 20 years. Next, Firdaus is the second candidate reviewed for the management position in China. Firdauss professional background consists of being deputy VP of HR at corporate. Firdaus joined the company on the operations side but made a successful transfer to the human resources department. She has a PhD from that University of London in engineering. Firdauss family emigrated from Yemen to the U.S. when she was in grade school. She speaks, reads, and writes Arabic both traditional and Yemen dialect. She is married and has two children. Finally, Gunther is the third candidate reviewed for the management position in China. Gunther is the VP of the German-based EU company and has a functional background in accounting. Gunther lead the German based company to sector leader in only 7 years. He has an undergraduate degree in anthropology and speaks German. Gunther is timely, accurate, well organized, and detailed. All three candidates are great managers with stellar reviews. What are the advantages and disadvantages they would each face upon managing in China? There are a couple of advantages that would make Tom and excellent manager at the new Chinese branch. Tom is already a manager and has a very strong background in business. These skills are essential to running a new branch of the company. His involvement in a foreign relations council means he has a knowledge of foreign affairs. He is also single which would mean less complications when relocating to China. However, there are also disadvantages, Tom has no foreign experience, which could severely complicate things for a manager because he

does not know what to expect from running a business in a foreign country. The fact that he has been out of school does not necessarily impact his knowledge and experience as a manager in his current location, but it could in China. Business is globalizing at such a rapid pace and universities strive to teach business strategies that could be successful in an international environment; Tom could benefit from these classes. There is no doubt that Tom is already a successful manager but his profile does not make him the strongest candidate for the position in China. Although he wants to develop his career in this area the current position is not the best for a first foreign experience. Firdaus also has certain advantages and disadvantages of being the manager of the new branch in China. Firdaus has the advantage of having international experience both in her educational life and in her personal life. She has successfully adapted to the culture of the United States and England. Clearly demonstrating her ability to thrive in different cultures. She also speaks Arabic which would be a great asset to the branch because the main Chinese customers are using products with Middle Eastern petroleum operations. Firdaus has also been involved with two very important and distinct branches of the company operations and human resources. These are two branches that are essential in the effectiveness of a company. Having experience in both areas is invaluable. The disadvantages to Firdaus is that she is married and has two children; this would make relocation much more complicated and expensive. Her family would have to make adjustments. Her children would have to go to a new school but, her husband being ready to take a leave of absence from work shows the support she has from her family. Gunthers advantage is that he has already managed and made a branch of the company very successful. Gunther is very methodical and organized and has encountered success because of his discipline. He has international experience leading a company in Germany. Gunthers main disadvantage is

that Chinese culture is very different than the culture in Germany. He will also have to relocate and adapt to a completely new environment. The US and EU are starkly different from China and it could be a rough transition for him. Firdaus is the best person for the job. She has lived in several different cultural environments (Middle East, Western Europe, USA) without issue. She has specifically handled objections based on culture from others, such as her practice of wearing a headscarf. She has solid interpersonal skills as she is well liked by all in her department despite cultural differences. She has a record for excellent performance in her current VP of Human Resources position. Someone who works in HR and therefore handles many people from a plethora of backgrounds would be well suited to manage an international project. In addition, her husband is already prepared to relocate for the next several years in order to support her new role in the company. The logistics are perfect, the skills required for the job are definitely there, and therefore she is the most qualified candidate. Hofstedes Five Dimensions are a highly practical tool for evaluating cultural context. Each of the five dimensions is critical to comparing and contrasting the culture of countries. The Five Dimension concept is also crucial to evaluating potential cultural conflicts in international business relationships. This tool can be used to make problematic and complex hiring decisions for international business positions, such as the one made in this case. By using Hofstedes analyses, it is possible to build stronger businesses abroad. They are ultimately more stable and less likely to fail because of cultural differences in corporate practices, the goal of any business leader whose goal is to succeed internationally.

Works Cited: Books in Print Circulation: International Business: The Challenge of Global Competition. McGraw-Hill/Irwin, The McGraw-Hill

Companies, Inc., 1221 Avenue of the Americas, New York, NY, 10020. Copyright 2013, 2010, 2008, 2006, 2004, 2002, 1999, 1996, 1993, 1990, 1988, 1985, 1982. Print.]] Professor Waldus Lecture Notes Chapter 1 Specific Internet Sites: The Hofstede Centre, Culture Tools, Country Comparison; Retrieved on January 29th, 2014 from http://geert-hofstede.com/countries.html http://www.businessinsider.com/the-five-biggest-practical-challenges-for-foreign-smes-in-thechinese-market-2010-12 http://www.upi.com/Business_News/Energy-Resources/2013/08/22/China-boostsArgentina-trade-energy-partnerships/UPI-22701377200191/ http://www.ibtimes.com/so-long-yankees-china-brazil-ditch-us-dollar-trade-deal-brics

(2012, 12). Environmental Factors Affecting International Business. StudyMode.com. Retrieved 12, 2012, from http://www.studymode.com/essays/Environmental-FactorsAffecting-International-Business-1333532.html