Intersoft of Argentina - Essay Example

INTERSOFT OF ARGENTINA Table of contents 1. Executive summary 2. Introduction 3. Company background and history 4. Pressure that the company underwent 5. Acquisition of Orgland A. matters that went wrong. B. preventive measures that would have been undertaken 6. Conclusion 7. References INTERSOFT OF ARGENTINA Executive summary Intersoft is a software company that has its headquarters based in Argentina. It has over the recent past grown and advanced to become one of the fastest growing software companies not only in the country but also in the region. Since its founding back in 1983, it has witnessed massive growth in the company resources and the returns that it has been making. The number of employees has also greatly increased over the years. According to the case, a brief history of the origin of the company is given. It also goes ahead to give a summary of the relationship that exists between the founders of the company who were Emilio Lopez and Felix Racca and their employees. An introduction is also given as to the relationship between the employees and the Russian partners that they had been in contact with. The problems that existed in the relationship are also highlighted in the case. The solution to the problem is also given and the measures that would have been put in place by the company to alleviate the problems. In the case, further, the problems that were faced by the programmers of the two partners. This was when either of them visited the other countries other than theirs. This case, has addressed some key points as in regards to the company. The main points include the language barriers that existed between the two parties. This were the Russians and the Argentines. The second issue that is addressed is the communication issues that exists between the management. The two managements had issues that they had to deal with as pertains to communication. They are clearly outlined in the case. The case also develops a clear distinct between the work ethics in the different countries. Each country had different work ethics as compared to the other. They are discussed in the case. The case also develops an understanding of the cultural relationships that were developed by the integration and the relationships between the two companies from different countries. Both country has different standards, practices, and norms that it seeks to implement. As such, by the companies being from different countries, there existed many differences in the means of operations. As such, the relationship between them resulted to the change of the customs and the adaptation of other different ones. These are all clearly defined in the case. It seeks at developing an understanding of all the aspects in relation to this. Introduction Intersoft Company was founded back in the year 1983. Two partners, Emilio Lopez and Felix Racca, founded it. Following its founding, the company had a 30% share of the open software market in Argentina. Following this, it was one of the fastest growing high tech companies in the whole of Latin America. The company mainly operated in three different phases. The first phase was the provision of systems software. The second phase was dealt with applications software while the last phase dealt with other application services. By 1995, the company was making great profits from its operations. In the year 1995, the company recorded 2.5 million dollars after tax profits. By this year, it had 220 employees. In the same year also, the company had opened up five more branches in an effort to diversify its operations. The branches were in Spain, Brazil, Russia, Mexico and Uruguay. This was indicative of the continued growth and development that the company was making. The strides that it was making in the field of research were also many. The founders of the company met while pursuing a course in computer science. This was at the University of Buenos Aires. According to Emilio, a co-founder, the motivation behind the founding of the company was to see to it the founding of a company where truth and creativity would be rewarded. It was also to see to it that the customers were charged reasonable prices for the services that were rendered to them. Following much advancements in the strategies of the company, it was able to advance to great levels. Through this, it became global in its services and in its reach. This has made it acquire a global status and all the other benefits that accrue from it. They include the high returns from the services. The pressure encountered by the company The company was however subjected to much bias. This was the anti-Argentine bias that existed in the market. It stated that “if the software wasn’t foreign and wasn’t expensive, then it wasn’t any good.” This was much against the operations of the company. The company since its founding advocated for reasonable prices for its services to the customers. As such, their prices were hence lower as compared to the other firms in the industry. According to the manager, the company had to do much in order to win contracts form the customers. This was due to the bias that had been formed in the market. The company had started targeting the middle and small sized companies in their products and services. Due to the high inflation that was eminent in the market, the companies experienced hardships I their bookkeeping. As such, they wanted software that would manage their bookkeeping techniques and process. The economy at such a time was closed. This made the software from other countries not to be accessible for the demand for the software. This made the Intersoft Company identify a niche in the market and exploit it. Exploiting was the secret for the company. This is due to the absence of material competition from international companies. Exploiting made it have a strong grip of local market. This also made it to acquire adequate resources for the expansion into the other markets. Due to the control that it had acquired of the local market, it was subject to much pressure to expand. This is because the benefits that it would attain from expanding would be many for the company. The company was hence in a race to acquire the acceptance from the local consumers. They also had to prove the genuineness of the software they made. They also had to create trust among the people of the quality services that they offered. This made them get much pressure. The company had entered the market on a high. This was because it had acquired more than 30% of the control of the market. As such, it had to meet the expectations that were laid on it by all the stakeholders. This was especially so in the ensuring of quality of the services and the software. They also had to competitively aware of the existence of the competitors. They as such did the best that they could do to see to it that they acquired not only the demand but also the trust from the people. This was in order to foster the relationships with the customer. Good relationships meant that they would have repetitive demand for the services. The pressure that existed for the company was hence to ensure that all these are maintained at the same time. The acquisition of Orgland The relationship between Intersoft and Orgland began back in the year 1992. This was after the visit of the Russian President, Mikhail Gorbachev to Argentina. It was the desire of the company to have top-notch programmers. Russia at the time had all that they wanted. During a radio talk show, Racca seized the opportunity in order to gain access to the Russian programmers. Russia gave much hope for the expansion of the company. As such, they sought to train the top programmers and then send the back to the country to open up branches there. With this, they would get a strong grip of the Russian market before the other competitors went there. The country also gave more hope not only for the country of Russia, but also for the countries such as Germany and Japan. Any delay would be costly for the company as the big players in the industry would go there and limit the progress of the company. The main reason that can be attributed to Intersoft seeking a collaboration with Orgland was to get complementary capabilities. This was in order to get overall competitiveness in the market. According to the heads of the company, they wanted to have an upper hand over their competitors. This would be through the early entry into the Russian, Japanese and the German markets. They believed that through this, they would be able to increase their levels of sales. The Russian programmers were introducing and equipping the Argentine counterparts with knowledge on object oriented programming. According to the founders of Intersoft, this would be a wave for the future. They could clearly see the prospects for the expansion of the programming techniques that they were learning from the Russians. They sought to use this to improve their competitive advantage in the market. This would make them a big force to reckon with in the industry. Intersoft expected Orgland to play the role of initiators into the Russian market. It was through them that the company wanted to gain entry into the market. Through this, it expected that it would make good results and returns from their operations in the country. By Orgland being strategically located in the “silicon City “, a few miles from the capital of Russia, it would give room for the Intersoft Company to establish itself into the market. The company also sought to seek the benefits of the Graphics User Interface, (GUI). This was one of the proficiencies of the Russians. They had so much experience into it that the founders of Intersoft saw the advantage of having them on their side. On their part, the Argentines had not excelled or advanced on the same. They were just beginning to introduce it into their operations and scope. The company also weighed its chances on the cost of taking a few Russians into Buenos Aires, and training and working with them. This would be an expensive undertaking and might in the end, not be effective to the company. This made the Intersoft Company to buy Orgland. With this, they would keep the Russians employees in Russia. They would also double their salaries in order to motivate them to perform even better. This was also to prevent losing them to the competitors. With this, they would work and communicate with them over the internet. This would be very financially fit for the company and there would be no strains as compared to bringing them to Argentina. The matters that went wrong The main problem that existed between the partners was cultural differences. They have been illustrated in the case as being the sources of all conflicts. The Russian culture was completely different from the Argentine. According to Racca, the Russians are more anarchical and hierarchical as compared to the Argentines. With this, the Russians are more rebellious towards the authorities. On the other hand, the Argentines are not rebellious to the authorities but rather, they just ignore them. He gives an example with how the Russians perceive things. According to them, it is not right for peers to share their views with the bosses. This is if there is a possibility of an agreement at the peer level. This is contrary to the Argentine way. In this, they have no boundaries. The peers are free to discuss anything with the management as they deem to be fit. He describes the Argentines as non-respecters of class of any hierarchies that exist. This major cultural difference exists between them. Therefore, a problem would affect their relationship. A good example would be if a peer from Argentina would address a boss from Russian origin. The lack of class respect would offer a major effect on the streamline flow of work between the partnerships. The second problem that existed was the weather, tastes and preferences of the food from the people of the different countries. This is denoted in the case where Otero, travelled to Orgland. The first instance was the opposition that was placed on the suggestion of the weekly meetings being held. This was a proposal that was raised by Otero, but was greatly opposed by the Russians. Their objections were based on their different cultures with the Argentines even on the management styles. The weather was also very cold for Otero. This could not be compared with the weather back at Argentina. The food that they consumed were also not to his liking. He as such, did not eat it. He because of this lived on the canned tuna which he had brought with him from Argentina. He was very eager to return home. This had a major effect to the relationship that exists between them. By being uncomfortable in the presence of your partners, makes the relationship and work conduct not be good for the success of a company. This denotes the difficulty in the development of the programs between the countries. The Russians would not appreciate it if their food was greatly disliked and their weather by the people who they were supposed to work with. The argentines on their art would also not feel good is their foods and weather and ways of life were disliked by their partners. This would also not be healthy for the development of the relationship between them. Iskhakov, who is an employee of Russian origin, on June 1995, flew to Buenos Aires. This was to work at Intersoft. He had planned to be there for only two weeks. This was however not so as he had to stay for much more than that period. He stayed there for a period exceeding two months. Before leaving Orgland, his colleagues at Orgland had told him to be weary of the Argentine food. They had also warned him greatly of the food at the labs usual lunch spot. He stated that he greatly disliked the food. This as earlier pointed out can result to the destruction of the relationship between the two parties. The other problem that existed between the two companies and the to countries was the language barriers. The employee struggled to work with each other as they could hardly communicate. A good example in the case is the visit of Iskhakov to Buenos Aires. He stated that his Spanish was not good enough for him to understand the movies that existed then. It was also not that good to engage in communications with the fellow employees. He goes further ahead to state that the only contact that he had was with Gabriel. This was because he was originally a Russian. The language barriers hence stood in the way for the development of the relationship between the countries and the companies. The addressing of the issues should be relevant and crucial for the betterment of the affairs and the growth of the company. The Russians had on their culture a belief on the existence of masters and slaves. This was contrary to the Argentine culture where such were absent. This is denoted when Alexey Iskhakov describes Orgland. He says that there is the complete absence of vertical hierarchy. He also goes ahead to state that there is the absence of delineation between the masters and the slaves in the departments. As such, they are all equal. This is something, which denotes their belief in the master slave relationship. This has an attribute of the slave having little or no say I the undertakings of the company. They are expected to subdue to the masters in all instances. Earlier in the case, they had been described as not believing in the discussions between the peers and the bosses. This is also the case in this case. In the argentine way, the regarding of the subordinates, as slaves would demotivate them. This would also make them form a revolt to the management. The Russian bosses on their part would like to be regarded as masters. They would also expect the subordinates to undertake all the activities that they describe of them. This is an area of conflict which would addressed by the companies. The existence of good relations would be key for the development and the success of the respective companies. The alleviation of the differences and the finding of solutions for the problems would be key to the success of the company. This is because it will result to the betterment of the relationships between the parties. The cultural differences can be addressed through the putting in place of a program. This should be in order to educate them on the differences present. It is also in order to inform them of how to deal with the differences and how to embrace them. They should also be knowledgeable of how to work with them without affecting the harmony in the workplace. Measures should also be put in place to see to it that the employees are taught the languages that are used by their compatriots. This is in order to foster the communication between them. With communication, the undertaking of tasks will be easy for the job. Good interpersonal relations are also built through effective communication. The attitude to the foods should also be addressed. The people should be taught on how to appreciate the unique natures of the different countries. This should make them to appreciate them as compared to hating them. The putting in place of the above stated measures should have helped in the removal and the reduction of the problems that emanated from them. The problems in this case cannot be termed a technological. They are managerial. It is the objective of the management to see to it that they facilitate the relationship. This is especially so those that exist in the workplace. It is their goal to see to it that workplace harmony is maintained in the highest levels possible. If the management had put in place measures that are aimed at addressing this, the problems would not have spread to great levels. The management during the implementation of the acquisition process failed to acknowledge the cultural differences that existed. As such, it did not put in place the relevant resources that were required to meet the differences that existed. The different countries had different cultures and practices. This made it necessary for the company during the acquisition to acknowledge this and well prepare for it. By failing to do so, the problems that were experienced emanated. They advanced also due to the delay in the putting in place of all the recommended measures. This is what resulted to the company losing lot in the relationship with the Russians. The investment into IT tools should greatly alleviate the problems. The working with virtual teams is a difficult undertaking. As such, it calls for the management to put in place the measures possible to see to it that they can best manage them. One tool that can be used is the making of all parties aware that they are a team. With this, they need each other for the continued growth and development of the company. This works out well in the management of the team. Through this, all the members will be able to appreciate the others in the group. This eliminates the existence of a master servant relationship. Another method that can be used in the management of virtual teams would be the establishment of team goals and objectives. With this, all the team members will strive to their level best to see to it that they can achieve the objectives that are set for them. This will help in the creation of a drive in all the team members. This will be crucial in the making of the importance of each member to the attainment of the set goals and objectives. As indicated in the case, there was the lack of socialization in the parties form the two countries. This can be costly for the company. The best measure to address this is the looking for opportunities for the employees to socialize. This can be done through the putting in place of programs or projects that call for the interaction between the parties. With this, all the parties will be able to know each other best. They will hence be able to develop relationships between them. This will be essential in the attainment of the goals and the objectives of the company. The fostering of good relationships is the objective of the management especially in such organizations as this, which are comprised of different cultural upbringings. Socializing is the best platform to help them embrace the cultural differences that exist. Another approach in the management of the virtual teams is the encouraging of informal conversations between the team members. Human beings derive trust from gaining knowledge of the people who they work with and what they are up to. Trust is crucial for the improvement of the result that are made by the company. As such, it is important that the management should put in place strategies that are directed at the achieving of good cordial relationships between the employees. This should be a platform, which enables them to share their feelings and chat informally. This will be a good step in the ensuring of team bonding. Conclusion In conclusion, the Intersoft Company had a lot that it needed to do. This was in the seeing to it that they met all the expectations that were laid behind them. The company also following the partnership with Orgland, had much to gain. This was first the entry into the Russian market. Similarly, it would also give room for the company to exploit the other areas in the region. They included Germany and Japan. The Russians also had adequate knowledge in the field of object-oriented programing. This made them appreciate the knowledge of the Russians and their presence in the goal attainment process of the Intersoft Company. With this among other proficiencies that were held by the Russians, they would be better equipped to counter all the competition that existed in the market. They would surely become a world force to reckon with. The acquisition of Orgland was however be subject to many challenges. The cultural differences between the Russians and the argentines was one of the major challenges. This was due to culture of the Russians of being hierarchical in the administrative forms. This was opposite to the Argentine way. This prone difficulty due to the fact that they would have difficulties in interacting. Language barriers between the countries was also a challenge that needed to be addressed. Russians spoke a different dialect from the Argentines. This posed a difficulty in the communication. This would be costly for the country. This was because success cannot be achieved without the existence of communication from all the parties to this. The management to address the issues between the people from the different cultures can use many approaches. This is in order to manage the virtual teams. The methods include the putting in place of forums that enable the members of the virtual teams to talk and interact informally. Another method is the putting in place of team goals and objectives. Through this, the company will be able to better develop the relationships. This will also foster the process of teamwork. This is crucial to a company. This is mostly because it is through it that the members of the different cultures are able to embrace and appreciate the unique traits of the other cultures. Through this, there will be the existence of cordial relationships. This is crucial for the company in the attainment of the goals and objectives that it has set for itself. References DuFrene, D. D., Lehman, C. M., & Business Expert Press. (2012). Managing virtual teams. New York, N.Y.] (222 East 46th Street, New York, NY 10017: Business Expert Press. Glover, J., & Friedman, H. L. (2015). Transcultural competence: Navigating cultural differences in the global community. Harris, P. R., & Moran, R. T. (1996). Managing cultural differences. Houston: Gulf Pub. Co. Harris, P. R., Moran, R. T., & Moran, S. V. (2004). Managing cultural differences. Amsterdam: Elsevier/Butterworth-Heinemann. Harvard Business School. (2010). Leading virtual teams: Expert solutions to everyday challenges. Boston, Mass: Harvard Business Press. Harvard Business School., University of Navarra., & Richard Ivey School of Business. (1995). Case studies. Boston, MA: Harvard Business School Publishing. Jarvis, D. E. (2010). 7 essentials for managing virtual teams. San Diego, Calif: University Readers. Read More