Cross-Cultural Values in BMW Company - Research Paper Example

Introduction The ability to expand into various regions of the world is one which is pertinent to an organization’s success. An organization which is working toward this expansion is BMW, an auto company based in Europe. The organization is working toward a manufacturing operation in China, specifically which will be used to enhance the organizational features and provide lower costs for the manufacturing of parts for automobiles (BMW, 2010). Establishing a presence in this different region and creating the correct connections between the two facets of the organization is one which requires a specific structure and setup. At the same time, challenges and opportunities need to be analyzed so the correct strategy can be established for the corporation. The difference between Chinese and German culture is one of the main ways in which BMW will need to look into, specifically because of cultural, communication and economic differences between the two countries. Overview and Structure of BMW BMW is an international corporation which focuses on the development of automotive vehicles and different types of manufacturing parts. The company began in 1916 with the foundation in Germany. The main mission of the company is to provide innovation and growth, both as a corporate structure and within the external environment. The overview is followed by the structure, which is first divided by the product line of the company. There are three brands which are a part of the group, including BMW, MINI and Rolls – Royce Motor Cars. These brands are combined with several makes and models that make the corporate identity of BMW as the main component of the developed automotive vehicles. The locations for manufacturing and sales are located in over 150 countries, all which are focused on the same innovation and technology used for motor vehicles (BMW, 2010). The corporate structure which has been established through BMW begins with a board of management. There are six members and a main chairman on the board, all which are responsible for the executive decisions and overview of the corporation. This is followed by a supervisory board, which is based on representatives that are from the stakeholders of the corporation. These are combined with representatives for employees, which are elected by employees and become representative of the various departments in the BMW structure. There are also divisions with basic managers in research and development departments as well as production, both which are able to combine the possibilities of the corporation with overall growth (BMW, 2010). Cultural Differences The German culture for business is one which is based on types of corporate governance that are a part of the expectations. German companies operate under a dividend policy, which associates with a hierarchical structure. Each individual is able to take a specific dividend from the model with personal contributions to the company. This is furthered with shareholders who are able to incorporate ideas and concepts that are a part of the corporation. German companies further this with an organizational structure that is based on each individual having responsibility for one part of the company. This creates a manufacturing line with the industrial components matching the firm and the values which associate with this. The structure is based on individual power, hierarchical structure and the organizational environment which gives every individual responsibility for working within the organization. Equity is expected to be seen in terms of the main hierarchy as well as through individual human resources and manufacturing. Through this, investments continue to grow and individuals in the company are able to take a specific place that contributes to the corporation, specifically based on individual values (Gugler, Yurtoglu, 2002). The operations in China differ from this main structure because of political affiliations and the main understanding of business. There are two types of operations which are emerging in China, specifically because of political and economic affiliations. The first is based on the business which is a public sector. To become a public entity, one has to comply with state regulations and is monitored through the political system. The affiliation is one which is based on specific laws for export and importing as well as labor laws and regulations with the organization of a business. In the past two decades, the public businesses have split into private firms, which are no longer held by the same monitoring of the government. However, compliance with legalities and the politics of each region is still paramount. The economic reforms which are occurring with private businesses are based on the economic growth that China is now experiencing as well as the desire for businesses to build the country. The values that are associated with this culture are created with internal networking and structures of connections between businesses. While China is beginning to open to foreign entities, there is an established group of businesses that are working together with private regulations to ensure that China continues to grow with the economic growth that is continuing to stimulate the culture (Duckett, 2000). The concept of internal networking, the closed community and the political structure is opposite to the German operations of business, making it difficult for both to comply with the needs of foreign expansion. Hall’s Communication Context When looking at Hall’s communication context, it can be seen that cultural biases are the first block which will need to be focused on, specifically which are based on the values, meanings and expectations that are a part of a work force. This is combined with the need to understand how culture can shape and modify what one believes within a work force. The perspective that comes with communication levels is changing this so it can be understood by employees and those working within China while closing gaps in understanding (Samovar, 17: 2009). The problems of integration that BMW is faced with is one which is reliant on the levels of communication, specifically which can create gaps or which will lead to a deeper understanding of what is required through the establishment with a combination of Western and Eastern values. The communication gaps that are a part of growing into China are based on the expectations with the organizational structure. The German structure is one which communicates on hierarchy. One is supported with individual recognition, moving up the corporate ladder and investing in the company. However, this type of individual communication with Germany is one which isn’t understood in Chinese structures. Instead, the Chinese have a belief that the organization should achieve goals together and should accomplish new networks and affiliations within the region for growth. The communication that is from the reflections of growth in the community then becomes a controversial component of the building of the corporate structure. The main way of communication that has to be established is one which is reliable according to community, networks and building confidence within the environment with a sense of community growth (Child, Mollering, 2003). Hofstede’s Cultural Dimensions Model The main component which is regarded between the Western and Eastern divisions of BMW can be seen with the Hofstede Cultural Dimensions model. There are five dimensions which are a part of this model, which includes small vs. large power distance, individualism vs. collectivism, masculinity vs. femininity, weak vs. strong uncertainty avoidance and long vs. short term orientation (Hofstede, 7: 2001). The comparison of the BMW culture in regards to the German and Chinese culture is seen in the table below. Table 1: Cultural Dimensions of BMW China Germany Small Power distance Large Power distance Collectivism Individualism Masculinity Masculinity Weak Uncertainty avoidance Strong Uncertainty avoidance Long term orientation Short term orientation (Varner, 2000). When analyzing BMW culture, it can be seen that opposing forces are a part of this. Work ethics, structure of corporations and gaps in communication then follow the different cultural associations (Hofstede, 2001). Trompenaar’s Task Versus Relationship Model The second model which incorporates the same opposing values is Trompenaars ‘ Task Versus Relationship Model. This is similar to Hofstede’s model, with four main areas of development between cultures, seen in the table below. Table 1: Trompenaars’ Task vs. Relationships Egalitarian / Decentralized Person / Informal Style Incubator (fulfillment – oriented) Guided Missile (project – oriented) Task / Formal Style Family (power oriented) Eiffel Tower (role oriented) Hierarchical / Centralized (Trompenaar, 1997). The task and relationship model is one which shows the diversity in cultures as well as the division in ways of thinking. The Western model is one which shows the hierarchical structure, specifically which is noted in the style of BMW. The Chinese culture is decentralized, specifically with a focus on fulfillment of projects. In the decentralized component, everyone fulfills the task and is gratified by maintaining the complete process and seeing the results. In the hierarchical, different processes are divided, many which lead to individuals not seeing the end result or procedure which is followed. The person and informal style is also closer to Chinese thinking, specifically because of family orientation, whereas the BMW culture in Germany is based on every individual fulfilling one role within the corporation (Gibson, 2002). Corporate Culture and Problems of BMW The aspect of culture which is noted in BMW is one which has opposing sides in terms of work ethic, culture and communication. The corporate culture of BMW is one which is rejected in terms of the Chinese organizational structure as it is identified by a hierarchy, specialization and individualized expectations within the corporation. Chinese structures; however, are family oriented and based on fulfilling the roles and expectations as a team and in a decentralized way. More important, the values and the belief systems between the two become divided because of these expectations and the changing fulfillment that is incorporated into the culture. The interactions in the work place, expectations from the hierarchy and the overall culture which is developed in BMW then moves in direct opposition to the Chinese culture. Solutions for BMW Even though there are challenges with the cross cultural affiliations and values which are expected, there is also a potential for growth in BMW. If the communication, managerial experience and the organizational structure is established in the correct manner, then the building into the manufacturing company in China can lead to substantial growth. If there is the correct establishment with the culture, then BMW can begin to work into a stronger global market. The ability to create a reputation within China will open the Eastern market to the corporation and will provide a deeper understanding of the market. If the community is strongly established and works with a positive viewpoint with BMW, then the growth in the East will grow substantially, with the reputation not only being based on the concept of a stronger work environment, but also which will carry to the marketing in the external environment (Hampden Turner, Trompenaars, 2: 2000). Solutions for Management Style The management style which needs to be incorporated into the main approach for the business is first based on knowledge transfer and communication. The more knowledge that managers and employees have within the business, the more likely it is that gaps will close in terms of values and communication. Training and development, communication on the aims and objectives and a strong internal work force need to be established with the incorporation of the company into China. The communication that is required through training, development and constant contact with consumers can then be combined with understanding knowledge management. This is based on defining behaviors, cultural values, expectations of the company and reactions that arise in given situations to close gaps in the corporation (Holden, 52: 2002). Another approach which needs to be used when working into a different country is to combine the communication with the understanding of culture shock and how this may create resistance or specific reactions to given situations. This is based on a cultural shock triangle, which is established from trying to adapt to a different culture. Confusion, inappropriate behaviors, isolation and responses such as depression and anxiety are some of the components that are associated with this. When a corporation with Western values is establishing in an Eastern country, there is the need to recognize that this will come from both sides and needs to be altered to lower the amount of strain and confusion in the environment while receiving positive reactions with a flexible work force (Marx, 5: 1999). The main approach which needs to be taken in terms of the management and structure is one which is based on a combination of strategy and creativity. The strategy to be implemented is one which needs to recognize the difference in the Chinese values and standards, specifically as defined by the workplace structure and the way in which different individuals respond within the community. The management can then use creativity to ensure that a new organizational culture is developed. It is noted that when a corporation is able to provide a culture within a given organization, as opposed to carrying the same values from the older aims and objectives, then it cancels differences in belief and diversity in thought. The creativity will then include an incorporation of values from managers, specifically with the leadership skills and development, while initiating new structures and values that are within the internal environment of the organization (Henry, 17: 2002). Solutions for Structure and Reporting Methods The structure and reporting methods are based on the main strategy for communication and values that BMW can create with the managerial expectations. The main structure which needs to be incorporated is based on the concept of power structures which are implemented through managers and those that are within the business. Since the Eastern companies are focused on community type organizations, the power structure is one which should implement a hierarchy that offers cooperation and team building among those that are in the work force. This should be furthered with the culture that is established from the main structure. When the structure is established, aims, goals and objectives should also be created in return for the power structure. The more in which individuals can contribute to the manufacturing plant as teams, the easier the structure will become in establishing a positive return (Hofstede, Minkov, 15: 1997). The second component of structure which should be established is based on the values and diversity that is within the corporation. The main component to this is to establish an understanding of the functions in which of the individuals hold while defining the value in the company, specifically based on the aims and objectives that are currently a part of the organization. As this is incorporated into the structure, there will be the ability to reach more goals while creating a deeper understanding of what is expected of those working for the company. The structure should be inclusive of the knowledge base within the organization while redefining the values that are expected within the organization. Furthering this will then establish a different understanding of the values that are expected in the company, specifically which redefines cultural values that are neither Western nor Eastern, but instead are defined by company values (Punnett, Shenkar, 189: 2007). The reporting models that are established can also tighten communication gaps and values that are within the structure of BMW. The reporting is one which doesn’t have a specific value associated with culture, but instead incorporates basic ideologies that are reported through the quality and quantity of the manufacturing as well as the return in revenues that are a part of the business. The association with the policies, structure and the return in the company can help to define the values and culture while establishing objectives among the corporation. The importance of the reporting models is to establish an understanding of how each of the manufacturing departments are working within the company as well as how this is reflecting among others that are a part of the management within the organization. Setting reporting models can work as a method for communication while defining exactly what the goals should be within the organization (Tayeb, 17: 2000). These methods can be followed by ethical reflections, management styles, team building, flexibility and reporting about the team work established (Barsoux, Lawrence, 52: 1990). These will be established to monitor the work ethics and team growing in the corporation. The reporting method can be done through a series of technology and tools that enhance the environment and which cross across different cultures for an understanding of what needs to be done in terms of human resources and work structure (Hampden – Turner, Trompenaars, 6: 1997). Conclusion Establishing cultural values across organizations is essential to the establishment and growth of a business. The desire of BMW to move across cultures from Europe to China is one which also creates several challenges, specifically in terms of cultural development and Eastern and Western definitions of value. The ability for the corporation to create a different understanding of culture and to develop a way which the two cultures can communicate more effectively can then provide a different association with the cultures. 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