International Management culture

Presented by: Prashanthi(01) Shalini(13) Sneha(47)

International management

The process of applying management concepts and techniques in a multinational environment and adapting management practices to different economic, political, and cultural environments

Reasons for going international

The company is responding to demand it discovers in another location It sees it competitors going to a particular place Chance occurrence Costs of production at home force it to cheaper areas Regulations work safety may be easier overseas

Approaches to international management

The ethnocentric approach is one in which management uses the same style and practices that work in their own headquarters or home country. Such an approach may leave managers open to devastating mistakes, because what works in the United States, for example, may not necessarily work in Japan.

polycentric management theory: In this approach, management staffs its workforce in foreign countries with as many local people as possible. The theory is simple: local people know best the host country's culture, language, and work ethic

International managers need to know

Bribery and related practices Political climate Cultural sensitivity (attitudes, values, norms, beliefs and behaviors)

Theory Z

William G. Ouchi Born 1943 An American professor and author in the field of business management He was a pioneer in introducing international leadership theory in his application of Japanese style management to corporate America

Theory Z

duration of employment Rate of promotion Amount of specialization Decision making

- Long term - Slow - moderate, workers learns all aspects of the organization - consensual, emphasis on quality - assigned to the individual - informal but with explicit performance measures

Responsibility
Control

Concern for workers

- focus includes workers life and family

Characteristics of theory Z

Consensus decision making Guarantee of lifetime employment job security Slower promotions Establishment of strong bonds of responsibility between superiors and subordinates fitting employees to their jobs A holistic concern for the workers

Theory Z companies

Japanese management

The Japanese management style popularized in the 1980s that assumes employees have an interest in good working relationships with management and other employees. Management generally has high confidence in employees, who are encouraged to participate in the management decision making. Employees are viewed as long-term assets who will stay with the same firm throughout their careers.

Japanese management

The culture of Japanese management is very famous in west Is generally limited to Japans large corporations Flagships for the Japanese economy provide their workers with excellent salaries and working conditions and secure employment The key features of Japanese management is the practice of permanent employment

employees are not dismissed thereafter on any grounds, except for serious breaches and ethics Permanent employees are hired as generalists, not as specialists for specific positions

Japanese and American management are 95 percent the same, yet differ in all important respects

Japanese

American

Lifetime employment Slow evaluation and promotion Non specialized career paths Collective decision making Collective responsibility

Short term employment Rapid evaluation and promotion Specialized career paths Individual decision making Individual responsibility

Career perception
JAPAN

AMERICA

Life long employment

Seniority promotion

Short time employment possible Promotion on merit

Increased mobility specialists

Ultimate goal: broad experience

Sources of motivation
Similarities

Differences

Responsibility Challenge Interesting work Recognition Money is secondary

seniority wage promotion system importance of the group

Indian and Japanese

Japan has had immense success in the Industrialized world. Its the second largest economy in the world. Companies like Toyota, Sony, Honda are multi-billion dollar companies. Japanese have an eye for quality and usually their management is comprised of old time technical people. They have a keen eye on future. India is a very young capitalist economy. The country for a long time tried embracing Soviet socialism. The country started to liberalize the economy in 1990s. The only private sector which are big enough companies like tata, reliance, birla.

The new age that are known for their amazing growth and management would be in for years technologies. Japanese thinks that employees are machines if one wore out they replace it. Indians oil them up again and again and then try to run again and thats why Indian companies are successful in failing. Indian managers are innovators, they take risk and use they engineering back ground for solving growth and must control over the company.

MNC

(Multinational Corporation) A firm that has operations in more than one country, international sales, and a nationality mix of managers and owners. MNC is an enterprise that manages production or delivers services in more than one country can also be referred to as an international corporation

MNC in India

MNC in India are attracted towards Indias large market potential India presents a remarkable business opportunity by virtue of its sheer size and growth Labor competiveness Indias vast population is increasing its purchasing power India is also emerging as the manufacturing and sourcing location of choice for various industries

Trends of MNC s in India

First MNC in India is East India Co in 1600 American companies accounts for around 37% and turnover of the top 20 firms operating in India The scenario for MNC in India has changed a lot in recent years, since more and more firms from European Union like Britain, Italy, France, Germany etc have outsourced their work to India

Nokia is one of the largest MNC s in India Insurance companies like AIG and Max New York Life Insurance doing business in India

Pros

Increase investment level Transferring the technology It increase host country exports and reduce its imports Integrating national economy Implementing new innovations Increase competition

Cons

May acquire monopoly power Underestimate local culture Think only about profit rather than host country interest Inflexibility in terms and conditions Heavy use of non renewable natural resources

References

http://maaw.info/ArticleSummaries/ArtSumMa rtin92.htm International Management A review of strategies and operations

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