Sealed Air Corporation Business - Case Study Example

Analysis of Case study

1. Introduction

Employees are the significant and valuable assets in an organizational setup. These employees, using their physical and mental capabilities, will effectively run their organizations and orient them in successful paths. That is, under the guidance of leaders, employees would only successfully complete all allocated organizational tasks and in the process attain their departmental and importantly organizational goals. When organizational goals are accomplished, organizations would achieve their targeted profits, market share, and many more positive objectives. So, it is clearly evident that employees play the optimum role in the success or failure of organizations. Considering their crucial role, it is of paramount importance for organizations and its leaders to constructively and efficiently manage those employees by taking care of their behaviors, so that those behaviors are aligned with organizational goals and functioning. This is where the role of Organizational Behavior assumes significance. Organization Behavior or OB for short involves studying employees’ behaviors in an organizational setting and then optimizing those behaviors for organizational advantages as well as employees’ benefits. So, in line with OB concepts an analysis of the case study, Sealed Air Corporation: Globalization and Corporate Culture would be carried out. Sealed Air has been a market leader in the industry for a long time, but is battling with issues of cultural differences among its various companies. The company has diversified and has acquired numerous firms in various social cultures, and that is creating dissonance between Sealed Air’s culture and certain other cultures.

2. Background

Sealed Air Corporation is a packaging material and systems manufacturing company that was founded in 1960. It produced protective packaging items that includes Jiffy Mailers & Bubble Wrap (plastic bubble sheets), Instapak (a foam-in-place packaging system used by electronic companies), Aircap and PolyCap (cellular cushioning systems), Trigon (tamper-evident currency bags), Cell-Aire (polythene foam), among others. More than 90 percent of the company’s range of proprietary features is not available with their contemporaries thereby making it a market leader in packaging and cushioning sector. Starting with the late 1980s, several important changes were happening in the company. A massive reorganization and simplification program involving its entire manufacturing operations under a program called World Class Manufacturing (WCM) was launched with the intention of increasing efficiencies and reducing waste. A major financial restructuring called the recapitalization was also undertaken and as a result a majority share of the value was paid out to shareholders. Apart from the US, the company had its presence in Europe. It was only during 1990s that the company thought of positioning itself as the world’s leader in packaging technology and solutions, and so by 1996, the company had 48 plants and a presence in 25 countries. This required new structures and systems to be brought in, particularly management of employees from different backgrounds. As far as its production is concerned, it was divided into three divisions – Packaging product, Engineering product, and Food packaging and their heads were positioned in United States. New Information systems were introduced and initiatives were taken to facilitate knowledge transfer and experience across the various geographic locations of the company.

3. Key IssuesThe company had more than 25 selective acquisitions of different sizes, outside of its home operations and in that direction started seeing issues of culture involving its human resources. Firstly, the globalization restructuring of the company brought some concerns among the other international managers, particularly in Europe, where they had a feeling of centralization of power at the headquarters. Though the informational flow as a result of restructuring made things easy for them, they felt their authority has been reduced. Secondly, recapitalization of 1989 was seen as a dangerous move by some of the European conservative groups of employees, who could not understand why the company would add so much debt to its capital structure. This was however a proven success in the US. Thirdly, people from different nations have different social, cultural, political, and various other backgrounds thereby leading to varying views. There is also difference in the social norms of different societies. The right and wrongs of a society are different from place to place. For instance, employees in some countries saw Sales as a second rated job that did not carry significant social prestige. In addition, requesting for orders in United States is a normal thing; however that was considered to be a breach in etiquette in other countries, like Japan. Fourthly, although technology helped to a certain extent, the physical distance of employees working in different corners of the world brought out issues of its own. As during one of the integration, Hickey noted - “It’s tough to bond over 12,000 miles across the pacific” (Paine and Wruck). Fifthly, Sealed Air’s WCM program, again a hit in the States, faced some resistance in Europe, with respect to accepting worker’s opinions and inputs.

With what has been seen, Sealed Air has a solid organizational culture that has yielded tremendous results in all these decades. As a company, the management and its policies have treated their employees fairly and have been employee-friendly in line with OB. The issues that they currently face stem from one common source – integration of foreign units. It is but natural that any company in today’s business environment, aspiring to be a global player, undergoes these hurdles. Interactions with people from different societies will bring forth differences. At the same time, the player who makes the best out of these differences is seen as the leader. 4. Recommendations

Below are some of the recommendations to resolve the key issues faced by Sealed Air Corporation and to establish them internationally.

Understanding local culture would be the first step while moving into a particular nation or society. This could then help Sealed Air to frame policies and processes based on that culture. For instance, what are the societal rights and wrongs, and in that light, what would be the alternatives for the company are some of the things that should be considered. In that direction, under glocalization, the branding and marketing must be localized as well. Any type of communication has to be translated to respective local languages, not only in terms of linguistics, but also based on their cultures, else it is sure to fail. As there are issues relating to physical distances, conscious effort has to be put in to make employees across nations ‘heard’. In the initial stage during integration, some people from headquarters could travel to the acquired company, and vice-versa. In addition to that, technology must be put to its best use, including video calls, voice calls, and video-based conferences. Although Sealed Air has a principle of open communication, it is best in the interest of various cultured people that any communication be reiterated and documented at the end, so that there are no ambiguities in understanding. Until the other team is seamed into the working, consistent efforts should be put in, to ensure that they understand what is being communicated, and also should be given adequate chances to voice their opinions, which will make them feel included in the company. Any business transaction that entails interaction with third-party local people, like suppliers or customers, would require practices to be changed as per the local customs of the nation. Business practices could be modified as per the norms of the society that the company operates in. For instance, as noted in the ‘Issues’ section, if direct asking of orders is not considered as etiquette, then let the Japanese Sales team use their own methods of bringing in new orders, and let their US counterparts stick to direct requests.Cross-cultural differences could actually work in favor of the organization, if used wisely. For example, in some countries, especially, South Asia, thrift is a significant virtue. Therefore, wastefulness in supply chain should be discouraged here, and that could result in significant cost-cuts. This is something that the company could emulate in its western operations as well. On the flip side, a manager from the same cultural background could also see professional training programs as a wasteful or lavish expenditure. It is here that the management should step in, and elucidate on the long term benefits of such trainings for the company. In line with OB concepts, Sealed Air should create a framework of cross-cultural structure in which policies, procedures, practices, and systems are systematically created and regularly updated for multi-cultural employees. This system can help in binding them together as one company across the world, and yet flexible enough to suit the local societies, thereby bringing in a strong organizational culture.

Core values of the company should be identified and all business units around the world should adhere to it. For instance, ethics has been an integral part of Sealed Air’s growth and is something that people associate with the company’s brand, and must therefore be followed in all its units. For newly acquired companies, even in places where unethical practices are quite common, trainings could be arranged to make new-employees understand why ethics is such an intertwined part of Sealed Air’s existence. Also, since line managers themselves take care of hiring, practices such as recruiting his or her friend, or hiring someone from the competitor company must be strongly discouraged, as they go against the best interests of the company and its value system. Values that serve to give an identity to the organization must be upheld, and societal norms could be overridden to achieve this. 5. Conclusion There is a vast difference between a company that is multi-national and one that is global. While the former refers to a company that has offices in different nations, the latter refers to a company that has truly integrated into world-wide markets. Sealed Air belongs to the second category, one that is aspiring to be a leader in its market segment. To achieve this, the management not only has to resolve issues arising out of cultural differences of the nations that it operates in, but has to look for methods to leverage the power of culture and optimize it to the company’s advantage. If Sealed Air is successful in doing this, it would not only be deemed a global company, but would also be successful in achieving their dream of becoming the global leader of packaging industry in the world.

Work Cited

Paine, Lynn Sharp and Karen Hopper Wruck. Sealed Air Corporation: Globalization and Corporate Culture. Boston: Harvard Business School, 2005.