by Richard Pooley
Developing an awareness of
cross-cultural factors in
international business and
handling them properly is
essential if you want your global
business activities to be
The client rang me out of the
blue. Could I fly to Munich and
help solve a crisis? I agreed, but
after hearing a brief account of what
hadhappened, I wasn't optimistic I
could provide a solution.
Eighteen months earlier two
famous international companies -
one Japanese, the other German -
had signed a joint venture
agreement to develop, produce and
launch a product that had the
potential to capture a new market.
The joint venture would combine the
marketing skills of one company
with the technology and design skills
ofthe other (my client).
To the management of both it
must have seemed the perfect
business marriage. Within weeks of
the deal being signed, a group of
Japanese design engineers was sent
to Bavaria to work alongside a
German team of similar size and
expertise. The energy and
enthusiasm surrounding the deal was
But, within a few days of their
Management Services Spring 2005Undestanding customers
arrival, the Japanese engineers were
in a state of shock. They found their
German collaborators to be rude,
inconsiderate and lazy. The Germans
interrupted during meetings and
presentations, and showed no
interest in reaching consensus
through the numerous 'pre-meeting'
meetings that are an integral part of
Japanese business culture. The
Japanese were uncomfortablewith
the German way of arguing
everything out in front of everyone:
for the Japanese, the potential for
loss of face was just too big. They
also disliked what they saw as the
Germans' willingness to go home,
even when tasks were unfinished.
As for the Germans, they were
equally unhappy with the Japanese,
many of whom seemed unable to
speak English, the supposed common
language of theteam. The Germans
complained that even those who
could speak it didn't state their
opinions clearly and frankly. By the
time I was called in, the two sides
were hardly speaking to each other.
They expressed opinions that can
only be described as racist.
Communication had broken down
completely. The team was disbanded.
We're all the same, aren't we?
So what had gone wrong? The
answer isthat the two organisations
should have been aware of the
dangers that can arise when teams,
or individuals, from different
cultures are suddenly brought
together in the workplace.
"We are all influenced
by the culture from
which we originate."
and sticking to
Unfortunately, It is still rare for
senior executives to take crossculturaldifferences seriously when
making decisions on mergers,
acquisitions, joint ventures and
licensing agreements in the
international arena. It doesn't help
that institutional shareholders and
analysts rarely regard cross-cultural
differences as significant, either. Yet
there is plenty of evidence that
cultural differences are a major
reason why so many of cross-border
joint ventures fail.
It israre for organisations to
bother with the nitty-gritty details
of how the people lower down the
hierarchy will run meetings, make
Spring 2005 Management Services
decisions, solve problems, manage
staff and communicate proposals.
Yet, people from different cultures
carry out all these procedures
differently in diverse ways. The
trouble is, each culture assumes
their way is the 'normal'one.
Unexplained deviations from these
norms are perceived as, well,
deviant and even devious. People
start to think: can we trust people
from other countries who do things
in this strange way?
In the case of the German and
Japanese companies, neither
organisation bothered to give their
people any understanding of the
cultural attitudes and behaviour of
the other side. No attempt was...