People and Culture in the Management of an Organisation - Coursework Example

work Assignment Brief Module People and Culture Total Pages: 7 Word Count: 7*250 = 1750 Table of Content Definition of problem 2 Analysis of the problem 4 Statement of alternative solutions and/or courses of action 7 References 9 Hall J., Johnson S., Wysocki A. and Kepner K., No Date, Transformational Leadership: The Transformation of Managers and Associates, University of Florida, [Online] Available: http://edis.ifas.ufl.edu/HR020 [April 17, 2009] 9 Bibliography 11 Executive Summary This report focuses on the broad area of people and culture in the management of an organisation. People management is extremely crucial for all business houses, big or small. Every organisation strives to build a high performance culture where the employees are at the top of the priority list. Hundreds of models have been built and theories devised to address the various problems people face at work. This report revolves around a hypothetical case whereby the impact of an acquisition and change leadership on the people of the organisation is analysed. All important aspects of leadership and cultural integration after an acquisition are brought to focus. Definition of problem After five years of run-away success in the domestic country of UK, Warner Motors takes over a Japanese company to get access to its technology prowess and R&D knowledgebase. Once it has access to the new technology, it aims to integrate new technologies with its manufacturing prowess to create commercial and passenger vehicles that offer a great value for money. It is all but evident that the combined intellectual capital of an organisation lies more among the team members and less in the physical assets of the company. In the face of an acquisition what matters to Warner Motors most is language and cultural integration. As a business strategy, Warner Motors kept the entry level executives at place however the medium and senior management team was brought from the home country. In Japan people are more committed to their organisation and work compared to their western counterparts. For their entire working life, people serve one company and grow along with it. Even the management recognizes the zeal among its people and stick with them through thick and thin. In contrast to what happens in Japan, in countries like US and UK, the top management is more anxious to create shareholder value than to make its employees happy and retain them for a lifetime. In times of need they aggressively recruit people and in case of an economic downturn or business failure equally aggressively they retrench people. (Rehfeld J.E., 1994) While in Japan leaders are mostly authoritative and hence people are more exposed to egalitarian management styles, in US managers are friendlier and less autocratic. Warner Motors’ take over of the Japanese company resulted in wide scale job loss and a sudden change in the work culture for the people. While the management team consisted of English speaking people, the bottom of the pyramid had native people of Japan. The challenge facing Warner Motors is efficient cross cultural management or integration. Cross cultural integration addresses issues like managing people in organizations with a focus on the diversity in language, culture and work values. People at Warner Motors, Japan were going through a difficult time. The native people were threatened by the sudden phenomenon of layoffs and were finding it difficult to cope with the new management style. Similarly the top management from the UK was finding it equally difficult to make things work in an environment where people were shaky and apprehensive. Coordination and integration became a major problem which directly had hit upon the employees. (Martens W.J.M. and Rotmans J., 1999) Among the various problems faced by the people associated with Warner Motors, few most important are as follows: 1. Change Management/Leadership Style 2. Resistance to change 3. Language and Cultural Differences Analysis of the problem Peter Northouse (2001) defines leadership as course of action whereby one individual influences his team members to achieve a common goal. (Hall J. et al, n.d.) Leaders play a crucial role in building a bridge between people and diverse culture. Before the acquisition, the employees of the Japanese automobile company were dependent on the top management and decision making was solely centralized. However the managers at Warner Motors were democratic in nature. The process of decision making was decentralized and employees were suddenly expected to get involved in the core business practices more actively. (Grzeskowiak M., February 2006) However the older staff of the company was found to be reluctant in embracing such changes. According to Kotler J. and Schlesinger L. (1979), the four most common reasons behind resistance of change are narrow self interest, misunderstanding, inability to tolerate changes and varied perception of situations. The resistance identified in case of the employees of Warner Motors to any of the aforementioned factors. (King N. and Anderson N., 2002) Language is one important hurdle that any company faces on its path to globalisation. Difference in languages between countries impedes the exploitation of any business opportunity that might exist between them. When companies come together and operate on a global level, it is important that there is one official language to communicate. Effective communication is the key to success of any business venture. Language barriers not only hamper communication but can also lead to potential miscommunication and much hassles. To coordinate business efforts domestically and abroad efficiently, the team members and top level managers need to exchange ideas quickly and effectively. In case of differences in language, a lot time and effort is wasted in translation from one language to another. (Stahl G.K. and Mendenhall M.E., 2005) Warner Motors need to carry out a detailed analysis of the ways of Japan and learn the nuances of the native language. More so is the case when considering integrating human capital. Language barriers can cause much harm to day-to-day business operations. In this case, since technology transfer is the primary idea and objective, language is even more important. If there exists a language barrier, employees of the domestic country would face much difficulty in picking up new knowledge and implanting them in the business processes. The challenge facing Warner Motors is to weed out the language differences and bring about a smooth way of functioning. (Cartwright S. and Cooper C.L., 1996) Cultural uniformity or comfort level between countries goes a long way to establish good successful business ventures. Differences in culture have the potential to make or break alliances. Many a times cultural differences exist but not on the surface level. However even subtle but meaningful cultural differences can make the management feel that the solid ground beneath their feet has suddenly turned to quicksand. In the case of Warner Motors where the lower end of the employee pyramid is hired locally, and the top level executives and managers move from the domestic country any potential cultural differences can come in the way of the business. So much so that even differences in food habits can cause a lot of trouble to the employees. On a superficial level this might not appear as important a factor, however a deeper analysis reveal that such issues has the potential of decreasing the productivity and efficiency of employees. When the primary objective is to learn new technological processes and get adapted to them, the time frame set is very narrow and thus employees need to be ultra efficient and adaptive. Such cultural differences should be avoided as much as possible. (Shenkar O., 2001) Cultural and language differences will not only affect the mental and physical being of the employees of Warner Motors but can also affect the long run profitability of the business venture. Such instances can do a lot more harm than what can be imagined. To make sure that Warner Motors’ businesses operate smoothly beyond the confines of national boundary, it is important for them to analyse and take stock of the situation within a short time frame. (Stahl G., June 2005) Statement of alternative solutions and/or courses of action Damage control in the form of newer and better strategies has to be implemented. The management needs to brainstorm and come up with ways of integrating the business processes of both countries. Both the interests of the locals as well as the broad company objective needs to be kept in mind while addressing the issue of cross cultural management. At all times, responsibility and trust plays an important role in improving the competitiveness of the employees and thus the organisation. Just mere transfer of responsibility will not do the trick. Instead the company through its actions and policies need to make the employees feel valued. Almost all people management theories reflect on the fact that real motivation comes from within an individual. Such motivation develops when people feel that their work is appreciated and efforts are valued. Valued individuals are efficient and productive and contribute largely to the success of an organisation. Warner Motors like its technology should strive to make its people a source of competitive advantage and not a hurdle. This can be achieved only when the management shows signs of trust on its people. The element of trust is extremely crucial in cases of mergers and acquisitions. Absence of trust can give rise to a vicious circle of mistrust and unproductivity. (Lencioni, 2005) In the context of Warner Motors, the sudden acquisition gave birth to mixed feelings in the hearts of its employees. The present style of management is much more conducive in bringing out the best in one. However due to prolonged exposure to an autocratic style of leadership, the employees are facing trouble in accepting changes and take on a more active role. The present management needs to try and help themselves as well as the native employees to feel comfortable and safe within the organisation. For successful integration of two corporate cultures, the management has to be extremely patient and instead of worrying about it, they should try and make the cultural differences an asset for the organisation. References Cartwright S. and Cooper C.L., 1996, Managing Mergers, Acquisitions, and Strategic Alliances: Integrating People and Cultures, Pg 215, Published by Butterworth-Heinemann, 1996, ISBN 0750623411, 9780750623414. Grzeskowiak M., February 2006, Management Styles, Bio Space Inc, [Online] Available: http://www.biospace.com/news_story.aspx?NewsEntityId=9885 [April 17, 2009] Hall J., Johnson S., Wysocki A. and Kepner K., No Date, Transformational Leadership: The Transformation of Managers and Associates, University of Florida, [Online] Available: http://edis.ifas.ufl.edu/HR020 [April 17, 2009] King N. and Anderson N., 2002, Managing Innovation And Change: A Critical Guide For Organizations, Published by Cengage Learning EMEA, ISBN 1861527837, 9781861527837. Kotter, J. and Schlesinger. L. (1979) "Choosing Strategies for Change." Harvard Business Review 57(2): 106-14. Lencioni Patrick (2005), Overcoming the five dysfunctions of a Team, Jossey Bass Martens W.J.M. and Rotmans J., 1999, Climate Change an Integrated Perspective, Published by Springer, ISBN 0792359968, 9780792359968. Rehfeld J.E., 1994, Alchemy of a Leader: Combining Western and Japanese Management Skills to Transform Your Company, Published by John Wiley and Sons, ISBN 0471008362, 9780471008361. Stahl G.K. and Mendenhall M.E., 2005, Mergers and Acquisitions: Managing Culture And Human Resources, Pg 65, Published by Stanford University Press, ISBN 0804746613, 9780804746618 Shenkar O., 2001, Cultural Distance Revisited: Towards a More Rigorous Conceptualization and Measurement of Cultural Differences, Journal of International Business Studies, Vol. 32, 2001. Stahl G., June 2005, Impact of Cultural Differences on Merger and Acquisition Performance - Advances in Mergers and Acquisitions, Cary L. Cooper & Sydney Finkelstein (eds.), Journal, [Online] Available: http://www.managementtoday.co.uk/search/article/548112/impact-cultural-differences-merger-acquisition-performance-advances-mergers-acquisitions-cary-l-cooper-sydney-finkelstein-eds/ [April 17, 2009] Bibliography Clarke, CC, Lipp, GD (1998) Conflict resolution for contrasting cultures. Training and Development, 52: 15. Clyne,.M 1994. Intercultural communication at work. CUP Davis, KA and Henze, RC (1998) Applying ethnographic perspectives to issues in cross-cultural pragmatics. Journal of Pragmatics, 30: 399-419. Delooper, F. (1988) Toward internationalismreadings in cross-cultural communication, 2nd edition. International Journal of Intercultural Relations, 12: 75-78. 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