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Developing the International Manager

BA- Concepts and Principles of International Management (CPIM)

Date submitted:

Lecturer:

CONTENTS

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Title…………………………………………………………………………………………….1

Contents………………………………………………………………………………………..2

Introduction……………………………………………………………………………………3

Chapter 1. Theories of Management in Cross Cultural Effectiveness.........…………….....5

Chapter 2. Case Study and Country Profile..........................................……………………15

Chapter 3. Developing Cross Cultural Effectiveness ...........................................................22

Chapter 4. Cross Cultural Communication and Barriers to Cross Cultural

Communication…………..........................................................................................................27

Chapter 5. Ethical Aspects of Cross Cultural Effectiveness....................………………….30

Conclusion……....…………………………………………………………………………….33

References…….…...………………………………………………………………………….34

INTRODUCTION

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The purpose of this paper is to take a look at international management from a practical point of

view, considering the potential problems and cultural issues that an international manager can

experience in a foreign country. In this report, we are going to consider the case of the French

manager who has been expatriated to Kazakhstan. According to Harzing (2003), many

multinational corporations opt for the parent-company nationals rather than host-country

nationals, and the reasons behind that choice can be the following:

• Transfer of the technical and administrative knowledge to host-country

• Lack of qualified professionals in host countries

• Management development that allows the manager to get international experience

Working abroad is not an easy task, and the manager has to possess certain personal traits and

abilities Not all of the foreign assignments succeed, and the reason for that is poor preparation

and lack of knowledge about the country and the people that would make the process of cultural

adaptation smoother. Not all of the multicultural corporations provide their managers with the

training, and therefore, the manager who is going to work abroad needs to prepare

himself/herself.

The preparation we are going to talk about in this report is based on the three steps suggested by

Browaeys and Price (2008, p.112):

1. Self-awareness

2. Cross-cultural understanding

3. Adapting professional skills to the business culture and culture in general

The above steps are very important for managers who plan to work abroad. Each of these steps is

based on different cultural theories and provides us with the information on the effects of cultural

variables on business and management. The cultural issues that the manager from the west can

come across within an Asian country are very specific. The paper shows the relevance of

preliminary managerial trainings, as well as development of special programs for adaptation of

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the expats. Following this three step process will help to find the most appropriate method of

adopting business skills across cultures.

Before talking about the case study and its details, I would like to mention that apart from

theoretical underpinnings, most of the information in this case study is primary, i.e. obtained

from the interview. Also, since Kazakhstan and the whole region of Eurasia have not been

explored in research of Hofstede and Trompenaars, the data about cultural dimensions factors is

not accurate and empirically proven. This case study has been researched to show how a

European manager perceives the new settings of Central Asia and what could be done to improve

the adaptation of expats in that region.

Chapter 1

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Theories of Management in Cross Cultural Effectiveness

The manager has to lead, plan, organize and coordinate the employees. These functions seem to

be very simple, but when it comes to managing across the cultures it can get complicated.

According to Jackson (2002, p. 18), ‘working internationally means that we have to work with

people who have different cultural heritages. Cultural differences should be taken into account

when communicating and interacting with cultures. Although multinational corporations are

supranational in operations and strategy, people do not necessarily share the same values’.

One of the key aspects of relations between a manager and an employee is the trust. Fukuyama

(1995) defines trust as “inherited ethical habit”. Ideas, values and relationship patterns constitute

the ethical codes by which society regulate their peoples’ behavior. Ethical habits are natured by

repetition, tradition and example. Trust can be considered as an expectation that arises within a

community that there will be regular, honest and co-operative behavior amongst its members.

This means that building trust with the employees is to do with culture, and not knowing how to

gain trust of the employees may lead to awkward situations and bad decisions. For this reason

this work will be focused on reviewing and applying different cultural theories to the real

situation.

The theories presented in this chapter are relevant to the research because based on them the

cultural profile of the expatriate manager and the host country will be made.

One of the most significant works in cross cultural management is the book by Geert Hofstede

Culture's Consequences, Comparing Values, Behaviours, Institutions, and

Organizations Across Nations (2001). Hofstede did not just describe different cultures,

what made this work revolutionary is the analysis and comparison of cultures. For this research,

the 5 dimensions theory will be used, these dimensions are crucial to business culture of any

country. This theory will help the manager to understand how his culture differs from the host

culture and act accordingly. According to Hofstede’s 5 dimensions theory, every culture can be

measured by the following 5 main dimensions:

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High Power Distance vs. Low Power Distance that is the extent to which the less powerful

members of organizations and institutions (like the family) accept and expect that power is

distributed unequally. This represents inequality (more versus less), but defined from below, not

from above. It suggests that a society's level of inequality is endorsed by the followers as much

as by the leaders. Power and inequality, of course, are extremely fundamental facts of any

society and anybody with some international experience will be aware that 'all societies are

unequal, but some are more unequal than others'.

Individualism vs. Collectivism on the one side versus its opposite, collectivism, that is the

degree to which individuals are integrated into groups. On the individualist side we find societies

in which the ties between individuals are loose: everyone is expected to look after him/herself

and his/her immediate family. On the collectivist side, we find societies in which people from

birth onwards are integrated into strong, cohesive in-groups, often extended families (with

uncles, aunts and grandparents) which continue protecting them in exchange for unquestioning

loyalty. The word 'collectivism' in this sense has no political meaning: it refers to the group, not

to the state. Again, the issue addressed by this dimension is an extremely fundamental one,

regarding all societies in the world.

Masculinity vs. Femininity, refers to the distribution of roles between the genders which is

another fundamental issue for any society to which a range of solutions are found. The IBM

studies revealed that (a) women's values differ less among societies than men's values; (b) men's

values from one country to another contain a dimension from very assertive and competitive and

maximally different from women's values on the one side, to modest and caring and similar to

women's values on the other. The assertive pole has been called 'masculine' and the modest,

caring pole 'feminine'. The women in feminine countries have the same modest, caring values as

the men; in the masculine countries they are somewhat assertive and competitive, but not as

much as the men, so that these countries show a gap between men's values and women's values.

Uncertainty Avoidance Index deals with a society's tolerance for uncertainty and ambiguity; it

ultimately refers to man's search for Truth. It indicates to what extent a culture programs its

members to feel either uncomfortable or comfortable in unstructured situations. Unstructured

situations are novel, unknown, surprising, and different from usual. Uncertainty avoiding

cultures try to minimize the possibility of such situations by strict laws and rules, safety and

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security measures, and on the philosophical and religious level by a belief in absolute Truth;

'there can only be one Truth and we have it'. People in uncertainty avoiding countries are also

more emotional, and motivated by inner nervous energy. The opposite type, uncertainty

accepting cultures, are more tolerant of opinions different from what they are used to; they try to

have as few rules as possible, and on the philosophical and religious level they are relativist and

allow many currents to flow side by side. People within these cultures are more phlegmatic and

contemplative, and not expected by their environment to express emotions.

Long-Term Orientation vs. Short-term orientation: this fifth dimension was found in a study

among students in 23 countries around the world, using a questionnaire designed by Chinese

scholars. It can be said to deal with Virtue regardless of Truth. Values associated with Long

Term Orientation are thrift and perseverance; values associated with Short Term Orientation are

respect for tradition, fulfilling social obligations, and protecting one's 'face'. Both the positively

and the negatively rated values of this dimension are found in the teachings of Confucius, the

most influential Chinese philosopher who lived around 500 B.C.; however, the dimension also

applies to countries without a Confucian heritage. (Hofstede, 2009)

It should be noted that Hofstede’s theory has been criticized for leading to stereotyping, some

dimensions not being justified, and for the research behind the theory being conducted only

within IBM. Trompenaars' and Hampden-Turner's Cultural Factors is an attempt to fill the

gaps made in the work of Hofstede and focus on different dimensions. I believe that combining

both Hofsted’s 5 dimensions theory and Trompenaars’ and Hampden-Turner’s cultural factors

theory will help to obtain the most complete and accurate information about countries involved

in cross cultural management process.

Factor Description

Universalism vs.

Particularism

Universalism is about finding

broad and general rules. When

no rules fit, it finds the best

rule.

Particularism is about finding

exceptions. When no rules fit,

it judges the case on its own

merits, rather than trying to

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force-fit an existing rule.

Analyzing vs. Integrating Analyzing decomposes to find

the detail. It assumes that God

is in the details and that

decomposition is the way to

success. It sees people who

look at the big picture as being

out of touch with reality.

Integrating brings things

together to build the big

picture. It assumes that if you

have your head in the weeds

you will miss the true

understanding.

Individualism vs.

Communitarianism

Individualism is about the

rights of the individual. It

seeks to let each person grow

or fail on their own, and sees

group-focus as denuding the

individual of their inalienable

rights.

Communitarianism is about

the rights of the group or

society. It seeks to put the

family, group, company and

country before the individual.

It sees individualism as selfish

and short-sighted.

Inner-directed vs. Outer-

directed

Inner-directed is about

thinking and personal

judgement, ‘in our heads’. It

assumes that thinking is the

most powerful tool and that

considered ideas and intuitive

approaches are the best way.

Outer-directed is seeking data

in the outer world. It assumes

that we live in the 'real world'

and that is where we should

look for our information and

decisions.

Time as sequence vs. Time

as synchronisation

Time as sequence sees events

as separate items in time,

sequence one after another. It

finds order in a serried array

of actions that happen one

after the other.

Time as synchronisation sees

events in parallel,

synchronised together. It finds

order in coordination of

multiple efforts.

Achieved status vs. Ascribed

status

Achieved status is about

gaining status through

Ascribed status is about

gaining status through other

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performance. It assumes

individuals and organisations

earn and lose their status every

day, and that other approaches

are recipes for failure.

means, such as seniority. It

assumes status is acquired by

right rather than daily

performance, which may be as

much luck as judgement. It

finds order and security in

knowing where status is and

stays.

Equality vs. Hierarchy Equality is about all people

having equal status. It assumes

we all have equal rights,

irrespective of birth or other

gift.

Hierarchy is about people

being superior to others. It

assumes that order happens

when few are in charges and

others obey through the scalar

chain of command.

(ChangingMinds, 2011)

Table 1. Trompenaars' and Hampden-Turner's Cultural Factors

Yet another important theory is Edward T. Hall’s Cultural Factors. These factors are context,

time and space.

Context has to do with how much you have to know before you can communicate effectively.

High-context means that most of the information is either in the physical context or initialized in

the person, while very little is in the coded, explicit, transmitted part of the message. In

comparison to the meaning of low-context communication is the mass of information is vested in

the explicit code (International Business Cultures, 2010).

Highly mobile environments where people come and go need lower-context culture. With a

stable population, however, a higher context culture may develop.

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Table 2. High-context and low-context culture

Another factor, time, falls in two categories: monochronic and polychronic time. Monochromic

time means doing one thing at a time. It assumes careful planning and scheduling and is a

familiar Western approach that appears in disciplines such as 'time management'. Monochronic

people tend also to be low context. In Polychronic cultures, human interaction is valued over

time and material things, leading to a lesser concern for 'getting things done' -- they do get done,

but more in their own time. Polychronic people tend also to be high context. Western cultures

vary in their focus on monochronic or polychronic time. Americans are strongly monochronic

whilst the French have a much greater polychronic tendency -- thus a French person may turn up

to a meeting late and think nothing of it.

Table 3. Monochronic and polychromic action

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The third factor is space. Hall was concerned about space and our relationships within it. He

called the study of such space Proxemics. We have concerns about space in many situations,

from personal body space to space in the office, parking space, space at home. Some people need

more space in all areas. People who encroach into that space are seen as a threat. Personal space

is an example of a mobile form of territory and people need less or greater distances between

them and others. A Japanese person who needs less space thus will stand closer to an American,

inadvertently making the American uncomfortable. Some people need bigger homes, bigger cars,

bigger offices and so on. This may be driven by cultural factors, for example the space in

America needs to greater use of space, whilst Japanese need less space (partly as a result of

limited useful space in Japan).

Some people are more territorial than others with greater concern for ownership. They seek to

mark out the areas which are theirs and perhaps having boundary wars with neighbors. This

happens right down to desk-level, where co-workers may do battle over a piece of paper which

overlaps from one person's area to another. At national level, many wars have been fought over

boundaries. Territoriality also extends to anything that is 'mine' and ownership concerns extend

to material things. Security thus becomes a subject of great concern for people with a high need

for ownership. People with high territoriality tend also to be low context.

People with lower territoriality have less ownership of space and boundaries are less important to

them. They will share territory and ownership with little thought. They also have less concern for

material ownership and their sense of 'stealing' is less developed (this is more important for

highly territorial people). People with low territoriality tend also to be high context.

Understanding these cultural factors can help cross-cultural management in many ways. When a

manager accumulates sufficient knowledge about the way the organizations in a host country

work, the cultural factors and dimensions he/she will be able to evaluate the situation more

objectively, for example if people are late for meetings it may be because they are polychronic,not because they are disrespectful or lazy.

It is crucial for the international manager to understand the company’s policy on managing

international subsidiaries. Permutter (1969) distinguishes between four approaches:

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Table 4. International strategy

(Jackson, 2002)

The knowledge of the international strategy of the company allows the manager to see the bigger

picture, understand the processes within the company and make more accurate decisions. Each of

the approaches has a range of advantages and disadvantages in terms of managing international

workforce, for example ethnocentric approach brings the company more money but it doesn’t

allow opening many managerial positions for the local workers in a host country.

Another important aspect of working abroad is choosing the right management style. Different

styles were needed for different culture and each leader needs to know when to exhibit a

particular approach.

Four of the most basic leadership styles are:

- Autocratic

-Bureaucratic

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-Laissez-faire

-Democratic

Autocratic leadership style is often considered the classical approach. It is one in which the

manager retains as much power and decision-making authority as possible. The manager does

not consult employees, nor are they allowed to give any input. Employees are expected to obey

orders without receiving any explanations. The motivation environment is produced by creating

a structured set of rewards and punishments. This leadership style has been greatly criticized

during the past 30 years. Some studies say that organizations with many autocratic leaders have

higher turnover and absenteeism than other organizations. These studies say that autocratic

leaders rely on threats and punishment to influence employees, do not trust employees and do not

allow for employee input.

Bureaucratic leadership style is the style whereby the manager manages “by the book¨

Everything must be done according to procedure or policy. If it isn’t covered by the book, the

manager refers to the next level above him or her. This manager is really more of a police officer

than a leader. He or she enforces the rules.

Democratic leadership style is also called the participative style as it encourages employees to

be a part of the decision making. The democratic manager keeps his or her employees informed

about everything that affects their work and shares decision making and problem solving

responsibilities. This style requires the leader to be a coach who has the final say, but gathers

information from staff members before making a decision. Democratic leadership can produce

high quality and high quantity work for long periods of time. Many employees like the trust they

receive and respond with cooperation, team spirit, and high morale. Typically the democratic

leader develops plans to help employees evaluate their own performance, allows employees to

establish goals, encourages employees to grow on the job and be promoted, recognizes and

encourages achievement. It is most successful when used with highly skilled or experienced

employees or when implementing operational changes or resolving individual or group

problems.

Laissez-faire leadership style is the style in which the manager provides little or no direction

and gives employees as much freedom as possible. All authority or power is given to the

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employees and they must determine goals, make decisions, and resolve problems on their own

(Essortment, 2002).

The notion of leadership is also related to the motivation. Motivation has been defined as the

individual, internal process that energizes, directs and sustains behavior. In other words,

motivation is the force that causes people to behave in a particular way, whether positive or

negative. A very important aspect associated with motivation is the employee’s morale, which is

the attitude or feeling about the job, about superiors and about the firm itself. This means that an

employee with a high morale will be more dedicated and loyal to the job. High morality of the

employee results from different positive aspects to the job and the firm, for example, being

recognized in the workplace and being financially secured. Motivation is the process of

providing reasons for people to work in the best interests of the organization.

Maslow’s hierarchy of needs is the theory based on the concept that people act to fulfil five

levels of needs, which are personal requirements from the most important to the least important.

The five categories of needs from the most important are: Physiological needs (the need to attain

basic human needs, for example food, shelter), Safety needs (the need for physical and emotional

security, for example job security, health insurance), Social needs (the need for a sense of

belonging), Esteem needs (the need for respect and recognition of others) and Self actualization

(the need to grow, develop and become all that he/she is capable of). However, needs at one level

do not have to be fully satisfied before the next need. This means that one does not have to

satisfy his/her basic needs before trying to attain feeling of safety in the job or firm itself. This

theory holds that motivation to work arises from a variety of social, psychological and economic

forces. People need income to pay their bills, feel that they have a role in society and also feel a

sense of achievement. As it may seem to some people, the more a worker gets paid, the more

encouragement that worker has to work more hours and produce more output. However, not

everyone works for money. A large percentage of workers say they would continue to work even

if they had enough money to live comfortably without working. Another aspect of happiness

from labor is the non-monetary incentives the environment that is being worked in. People prefer

to work in a safe, pleasantly colorful environment. In short, there are many different reasons why

people get up and go to work each morning and the levels of satisfaction differs from one person

to another.

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Herbezrg’s motivation-hygiene theory

Another theory was the Herzberg’s Motivation-Hygiene theory holds the idea that satisfaction

and dissatisfaction are completely separate issues. In other words, not that low pay can cause an

employee to feel bad, a high pay will make him happy. Herzberg believes that there are two

factors with regard to his theory. Motivation factors are the job factors that if present increase

motivation but whose absence does not necessarily result in dissatisfaction. They include

achievement, recognition, growth etc. These aspects are called satisfiers if present. On the other

hand, Hygiene factors are the job factors that decrease dissatisfaction when present. They include

supervision, working conditions, job security. Herzberg believes that there is no dissatisfaction

because at any time there must be an employee who is not happy (Motivation Proposal, 2010).

Chapter 2. Case study and country profile

The case study is meant to review and research the socio cultural background of the host country

that the expatriate manager needs to know to succeed. The report is based on the real situation,

most of the information was taken from the interview with the French manager of a French and

Kazakh joint venture Katco. For ethical reasons, the real name of the manager will not be

mentioned; instead the pseudonym Jean Girardet will be used. Jean kindly shared with me hisexperience of working abroad in a country with very different culture and traditions. Jean was

sent to Kazakhstan for 3 years to work as a maintenance manager of the uranium station. He was

very happy with this experience, as he said, it gave him better understanding of communication

across cultures and definitely improved his managerial skills. To give the readers better

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understanding of the host country of this research, the country profile that also includes cultural

aspects will be made.

Country Profile

This country profile is based on the information of Foreign and Commonwealth Office (2010).

Geographical location:

Table 5. Map of Kazakhstan

Full name: Republic of Kazakhstan

Population: 15.6 million (UN, 2009)

60.5% Kazakh, 24.5% Russian,2.9% Uzbek, 2.7% Ukrainian, 1.5% Uighur 1.4% German, , 1.4% Tartar,

1.3% Korean, other groups less than 1%

Capital: Astana

Largest city: Almaty

Area: 2.7 million sq km (1 million sq miles)

Major languages: Kazakh, Russian

Major religions: Muslim 65%, Russian Orthodox 30%, Protestant 1.3%, Other 3.7%

Monetary unit: 1 Kazakh tenge = 100 tiyn

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Main exports: Oil, uranium, ferrous and nonferrous metals, machinery, chemicals, grain, wool, meat,

coal

Economy: GDP in 2010 7% (Central Asia, 2011)

Head of State: President Nursultan Nazarbayev

Prime Minister/Premier: Karim Masimov

Foreign Minister: Kanat Saudabayev

Cultural Profile

To create an appropriate cultural profile of Kazakhstan, I have decided to combine the two points

of view: one based observations of foreign researchers, and one based on my observations. This

approach has been taken because my perception of Kazakh culture may be subjective since it’s

my homeland. Comparison of my conclusions and conclusions made by investigators of

Communicaid (2007) allowed to make quite comprehensive cultural profile of Kazakhstan. In

the profile both general information about historical backgrounds and information about business

culture will be presented.

Kazakhstan has a long and rich history, having evolved from a nomad civilisation

dating back to the first millennium BC through various periods of expansion and

occupation by the Soviet Union to its current position as a modern nation state. Its

diverse ethnic composition combines the native Kazakh people and a lar ge

population of Russians, who r emain separated by language and religion. The

convergence of these two distinct populations has created a unique culture. Anunderstanding of this distinctive K azak h culture is essential for any organisation

or individual who want to do business in K azak hstan.

Cultural Values

There are 3 most distinct cultural values in Kazakh culture. Those are

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hospitality, tradition and religion.

Hospitality – hospitality has always been an important part of Kazakh culture.

Displays of generosity and welcoming behaviour are common in both social and

business Kazakh spheres. An invitation to the traditional Kazakh feast is the most

popular form of Kazakh hospitality. Sharing food and drink with family, f r iends and

acquaintances is an essential part of Kazakh culture and should be respected and

shar ed.

Tradition – Kazakh traditions and culture have been passed on from one

generation to another by traditional Kazakh tribal leaders and elders. Much of the

traditional Kazakh culture was lost under Soviet rule but strong elements remain

today and are celebrated among family, a central part of Kazakh society. While the

country is becoming increasingly modernised, Kazakhs hold on strongly to their

traditions and culture.

Religion – Before the introduction of the Sunni branch of Islam in the seventeenth

and eighteenth centuries, Kazaks held strong animist and shamanist beliefs.

Since Soviet r ule when many Russians came to live in Kazakhstan, the Russian

Orthodox religion has had an important presence in Kazakh society. These two

religions generally have an equal presence in K azak h society. Visiting Kazakhstan

or doing business with Kazakhs, it is important to be aware of these cultural

differences and sensitivities, as well as the unique traditions and customs of each

and how they influence Kazakh culture and business etiquette.

However, it should be mentioned that due to globalization these values are gettingweaker, and also these 3 values may be the first thing that a person from Westnotices, but after some time it will be obvious that the system of cultural values ismuch more complex.

Business Culture

Kazakhstan was under Soviet rule until it gained independence in 1991. During the

1990s, Kazakhstan went through a period of economic decline. Since then a series of

economic r ef or ms and privatisation have lead to tremendous growth and

development of new sector s including oil and gas. An abundance of natural

resources and agricultural products helped Kazak hstan’s economy a lot. Today

Kazakhstan still struggles to maintain a balance between its industr ial and

agricultural sectors and the amount of foreign investment and influence. Many

p e o p l e are investing large sums in nearby countries and establishing extensive

international networks. As Kazakhstan str ives to open its economy and borders to

the rest of the world, those wishing to invest or do business with Kazakhs should be

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aware of the unique business culture and etiquette of K azak hstan.

Business in Kazakhstan tends to take longer than in most Western societies, so

patience and taking time to establish relationships with Kazakh colleagues is

essential. Many people in Kazakhstan are Muslim so it is not uncommon for

them to tak e breaks from work during the day for prayer. Still, compared to

other Muslim countries, Kazakhstan is more secular.

Kazakh business culture dictates a strict hierarchical structu re where leaders

se par ate themselves from the group and power is distributed from the to p. There is

generally only one key decision maker, a position occupied by the most senior person

in the company. Those in a more subordinate position represent the business during

meetings but do not have the authority to make decisions. The formality and

structure of greetings in Kazakhstan reflect the position a per son has in society.

Normally the less senior person would extend their hand first to show respect.

Establishing close personal contacts is key to all business dealings in K azak hstan.

Kazakhs prefer to get to know a person before entering into business with them andcommitting themselves to business decisions. Kazakhs tend to have an indirect style of

communication which mak es understanding and getting to know them a little morechallenging and time- consuming. Spending the time talking and getting to know each

other will help the business relationship and ensure more efficient decision-mak ing.

Business Etiquette

• In Kazakh business etiquette, initial introductions tend to be relatively inf or mal.

Shaking hands and using first names is common, especially in more

informal settings outside of business.

• Generally speaking, business meetings in Kazakhstan are somewhat

unstructu red and open to variation. Kazakhs are very traditionally oriented but

recognise that in order to progress they must be open to new ideas. Meetings areoften a place f or discuss ion and new ideas.

• The negotiation process inKazakhstan can often become very lively andinvolved. Kazakhs are known for their love of argument and debate, but be sure

that you never openly contradict someone who is more senior than you.

• The exchanging of business cards is common practice. Business cards

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should be translated into English and Russian. When receiving a card it is polite

to take a minute to look at it carefully before putt ing it away.

• It is necessary to accept an invitation to a traditional Kazakh meal, as

hospitality is one of the most important parts of Kazakh culture and getting to know

your business counterparts on a more personal level is paramount for successful

business inter actions.

• It is recommended to show respect towards your Kazakh business

partners by taking a sensitive a ppr oach to proper behaviour and cultural gestures.

For example, a number of Kazakhs are Muslim and therefore, using the left hand to

pass something to them, for example, could bring shame to the individual and

should be avoided.

• It is recommended to dress suitably and in a conservative manner.

This is especially important f or businesswomen, who should wear modest

clothing.

• Negotiations are not always conducted in Russian, the pr edominant language

of use in Kazakh business. The issue of which language to use is a hot political topic

and one which is frequently debated in Kazakh society. I t i s b e t te r t o check in

advance the language of negotiations and have the documents translated and an

interpreter r eady.

• Many contracts and agreements are not documented, so often a handshake is

enough to make a deal .

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Chapter 3. Developing Cross Cultural Effectiveness

The company that sent Jean abroad is called Areva. Areva is a French public multinational

industrial corporation that works in two fields: production of nuclear energy and production of

renewable energy. It was created on 3 September 2001, by the merger of Framatome (now

AREVA NP), Cogema (now AREVA NC) and Technicatome (now AREVA TA). Areva works

in 42 countries, its sales network includes over 100 countries. By the end of December 2009, TheAREVA group had 79,444 employees worldwide. On 28 April, 2004 Areva acquired control of

Katco in Kazakhstan (uranium ore mining) (Annual report, 2010).

‘The Katco joint venture was originally formed by Cogema and the Kazakhstan State

Corporation for Atomic Power and Industry (KATEP) in 1996 to work on the development of

uranium resources in Kazakhstan. In 1999, the company received a licence to explore and mine

the Muyunkum site located in the south of the country. After three years of successful operation

of a pilot production plant at Muyunkum, Areva and KazAtomProm signed an agreement in

April 2004 to start the industrial phase of a joint production project. (WNN, 2008). International

strategy of Areva in Kazakhstan is ethnocentric with most of management positions being held

by French people. The ethnic mix is the following: 20% French, 80% locals out of who the

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http://www.world-nuclear-news.org/C-KazAtomProm_and_Areva_sign_strategic_agreement-1106084.html




majority are Kazakhs. The corporation has a good reputation with managing diversity in different

countries, and Jean had to prepare himself very good for the new cultural settings.

As it has been previously mentioned, we are going to divide the preparation in three steps:

1. Self-awareness – creating profile of French culture

2. Cross-cultural understanding – comparing and contrasting Kazakh and French cultures

3. Adapting professional skills to the business culture and culture in general – combining

cultural knowledge with basic skills of a manager

1. Self-awareness

Indicators of France are based on Hofstede’s research (2010) and are available online and will be

discussed in the next section. The most significant values of Trompenaar’s model are presented in the

following table:

Parameter Value=1 Value=5 Score France

Time focus

Time orientation

Space

Power

Structure

Competition

Communication

Action

Monochromic

past

private

equality

individualism

co-operative

low-context

being

polychromic

future

public

hierarchy

collectivism

competitive

high-context

doing

4

3

1

2

2

3

1

4

Table 6. Self-awareness: France

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Table 7. Self-awareness: France

2. Cross-cultural understanding

Parameter Value=1 Value=5 Score

Kazakhstan

Score France

Time focus

Time orientation

Space

Power

Structure

Competition

Communication

Action

Monochromic

past

private

equality

individualism

co-operative

low-context

being

polychromic

future

public

hierarchy

collectivism

competitive

high-context

doing

5

2

4

5

4

3

4

2

4

3

1

2

2

3

1

4

Table 8. Cross-cultural understanding: France and Kazakhstan

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Table 8. Cross-cultural understanding: France and Kazakhstan

The cultural profiles of both countries consist of the parameters that are crucial to management. All those

variables are influencing manager’s functions. As it can be seen from the graph above, the cultural

indicators of the two countries are not very different. In fact, the biggest gap can be seen in the

way the power is distributed in the society and in the context of communication. We can see that

the two cultures have similar indicators of time focus and time orientation. For example, time focus

demonstrates what kind of behaviour can be expected when dealing with projects, deadlines and time

management in general. Time orientation shows the attitude to future and the connection with the past,

this can be important to implementation of long-term strategies, and we can see that the two cultures are

similar in this index. Space shows the extent to which individuals separate their personal life from work,

and we can see that French people do compartmentalise their work and private lives. This means that the

employees in Kazakhstan may expect to see the manager spend a lot of personal time at work. Power

distance demonstrates that the French people treat the employees like equals, while in Kazakhstan this

may look like the manager is giving too much power to the employees. France has a more individualist

society, while Kazakhstan – more collectivist, which means that the employees in Kazakhstan probably

would enjoy team work. Both Kazakhstan and France have the same indicators of competitiveness.

Kazakhstan and France belong to high context a culture, which means that there may be fewer barriers to

cross-cultural communication and overcoming them will take less time and effort.

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3. Adapting Professional Skills

Based on the facts from cultural profile of Kazakhstan from the previous chapter and Hofstede’s findings

on France (2010), we can make the following conclusions:

• Power distance index in Kazakhstan in high, while in France it is low.

• Individualism predominates in France, while in Kazakhstan predominates collectivism

• Masculinity index in Kazakhstan is much higher than in France

• Uncertainty Avoidance Index in France is high, while in Kazakhstan it is low

• Long/short-term orientation. Short-term orientation in France, long-term orientation in

Kazakhstan

Now I would like to show how these dimension and their analysis can help choosing the right managerial

practices.

Planning – Long/short-term orientation can be used to identify the approach to long-term and

short-term strategies on a corporate level and to decide whether the team or the employee with

long-term orientation is capable or accomplishing short-term target.

Leading - Power distance shows us what leadership style can be chosen. Taking into

consideration that in France the power distance is medium and in Kazakhstan it is very high, the

preferable leadership style would be not participative but rather paternalistic or autocratic

because that is what the employees are expecting from the manager. Choosing this leadership

style the manager will have to gain respect through setting SMART objectives and making

autocratic decisions.

Co-ordinating – Uncertainty avoidance demonstrates the degree of control and rules needed over the employees. In the country like Kazakhstan, where uncertainty avoidance is low, it would be

more appropriate to apply hard HRM, which greatly differs from France.

Organizing – Individualism/collectivism indicators can assist in decision whether the employees

would work more efficiently in a team or individually, it also helps to appraise the results of their

25



work. In Kazakhstan, the French manager would probably be right to organize teams within

departments to improve the performance.

Given the cultural profile and situation in Kazakhstan, Jean has chosen to use Herzberg and

Maslow motivational theory as well as several other techniques for increasing employee

motivation. These techniques included building free swimming pool for the workers, library and

providing them with free tickets to gym. Also, Jean was a good leader of his team and has always

joined them for parties and holidays, which also contributed to the communication between him

and employees and increased their motivation because in Kazakhstan having a dinner with a

manager is considered to be a sign of respect from the side of manager.

Chapter 4. Cross Cultural Communication and barriers to Cross Cultural

Communication

Both France and Kazakhstan are culturally diverse countries. However, compared to France,

population of Kazakhstan is more homogenous. In France you will encounter individuals

from different races, religions, and nationalities on a daily basis. In Kazakhstan, people have

a special attitude to foreigners. Because of the Iron curtain in Soviet times it was impossible

to meet someone who is not from USSR, people have always been very curious about

representatives of other cultures and countries. After the regime fell, more foreigners started

to come to Kazakhstan and people were very excited about meeting them and asking about

the life abroad. This trend is still there, having a friend who is a foreigner is considered to be

very prestigious; work at a foreign corporation or abroad is also thought to be very

impressive.

Even though the attitude in general is friendly, there are issues and barriers to effective crosscultural communication. There is often anxiety and stereotyping surrounding unfamiliar

cultures, so there is no wonder that the employees may not react in the way the manager

expects. There is no doubt that the issues in cross cultural communication need to be

addressed. In order to overcome barriers to effective cross cultural communication and not

offend a person from a different background, it is important to know how cross cultural

26



communication works and develop intercultural communicative competence. Intercultural

communicative competence is def ined by Kim (1991, pp. 259-275) as ‘…the overall internal

ability of an individual to manage key challenging features of intercultural communication:

namely cultural differences and unfamiliarity, inter-group posture, and the accompanying

experience of stress’. As it can be seen from the statement above, intercultural

communicative competence is something everyone who works abroad should know. To

develop this kind of competence it is necessary to overcome cross-cultural communication

barriers.

A number of different factors contribute to cross-cultural communication barriers. On the

corporate level, this can be inappropriate company culture or the lack of investment in cross

cultural training. Apart from that, all the components of communication, such as language,

body language, etiquette, culture and social habits can become barriers to successful cross-

cultural communication. However, in the case of Kazakhstan and France, it’s possible to

learn and adopt local etiquette, traditions and social habits. In the second chapter a lot of

useful recommendations on this topic have been given. Language problems can either relate

to misinterpreting of the language or lack of knowledge of foreign language. To overcome

this problem, the manager has to try to choose the best interpreter and to be extremely careful

when talking to people whose level of the language of communication is unknown of not so

good.

Above all, in order to develop intercultural communicative competence, it is required to

move beyond ethnocentrism and be willing to discover the new culture without being

focused solely on the values of one’s own culture. This concerns both the manager and the

employees. Ethnocentrism leads to stereotyping and stereotyping in its turn, to prejudices and

wrong conclusions about people and situations. Stereotyping is probably the biggest barrier

to cross-cultural effectiveness because it’s often the most influential and dangerous power

behind perceiving representatives of other countries. In Kazakhstan, French people are

stereotyped mostly positively: they are considered to have a good sense of humour, best

27



cuisine in the world and to be very polite and romantic. On the other hand, they are thought

to be arrogant and greedy. Kazakhstan used to be unknown country in the West, till it has

recently come under stereotyping due to the British comedian Sacha Baron Cohen's character

Borat in Ali G Show and the movie called Borat: Cultural Learnings of America for Make

Benefit Glorious Nation of Kazakhstan (2006). Borat is shown to be a backward and

misogynist person who hates all kinds of national and sexual minorities. How to deal with

this situation? Both for the manager and the employees it is crucial to develop empathy.

Empathy is the ability to identify with the feelings and behaviour of people from different

cultural backgrounds. Cultural empathy can help to scan and analyze other cultures. People

who develop cultural empathy are able to understand different cultures better than people

who don’t. When a person starts to get to know another culture, he or she begins to see how

the stereotyping is superficial and how the reality differs from preconceived notions. In order

to develop empathy the managers should communicate with his or her team. In our case, the

French manager started to accept invitations to weddings, parties and national holidays where

he got the opportunity to communicate with colleagues and discovered a lot of new facts

about Kazakh culture and found the new ways of connecting with employees.

As a result, the relationship between the French manager and Kazakh employees became

much better, and this special relationship was based on mutual respect to both cultures. This

kind of relationship can be referred to as the third-culture. Casrnir (1999) suggests that ‘third-

culture building would allow a shared system of values to emerge... Third culture is a

framework designed to ensure better adaptation... through the shared value systems and

increasing interdependence’ (Browaeys, Price, 2008, p.323). I can suppose that the third-

culture is be the result of high cultural awareness, acceptance of different values, cultural

pluralism and hard work of both parties

28



Chapter 5. Ethical Aspects of Cross Cultural Effectiveness

Ethics comes from the Greek word 'éthiké' meaning the ways and habits of a group of people.

Ethics is to do with establishing norms, evaluating when a moral act is right or wrong as well as

helping one to make moral decisions when confronted with a moral dilemma. We can also say

that ethics is largely based on morality. Culture and ethics are interconnected in such a way that

it’s hard to say which factor is the most influential. Ethical vision is something very individual

and therefore highly subjective. What is very interesting is that according to Trompenaar's

research, cultures with more emphasis on human relationships and loyalty (particularists,

Kazakhstan) show lower ethical scores than those that emphasized obeying rules (universalists,

France). (Philodialogue.com).

Ethical aspects are probably the hardest thing to understand about another culture, and at the

same time without possessing the appropriate knowledge about them it’s easy to make wrong

decisions, misinterpret actions of other people and lose the respect of employees. Acceptance of

other cultures pushes the international managers to create skills that have ethical components for

managing people.

Gudykunst and Kim (1997) distinguish between two approaches:

29

http://www.philodialogue.com/10.html

http://www.philodialogue.com/10.html



– an analytical one (being committed to a specific view of what morality is) : does

not allow ethical judgements

– a normative one (i.e. knowing what should be done): allows ethical judgements on

behaviour itself and/or on the person(s) displaying the behaviour

If normative approach used, making payments to company officials to ensure that a tender is

accepted may well be regarded as unacceptable. If analytical approach taken: those paying

gratuities may see it as a ‘necessary evil’ since those expecting gratuities are seen as not knowing

any better. Gudykunst and Kim (1997) argue that we should withhold any ethical judgements

when interacting with those from another culture until we have clearly described their behaviour

and examined various interpretations (Moodle, 2011), and I suppose that this point of view could

be the most appropriate for managing across cultures.

Jean Girardet admitted that he experienced many issues that have to do with ethical aspects. As it

has been previously mentioned, in Kazakh culture family plays a very important role. Family

business is one the most common forms of entrepreneurship, and family connections are the

force that pushes the business forward. It is very common for the relatives and family members

to ask their friends and colleagues to find a job for someone’s son, brother or sister. Quite often

the influence of connections is so big that the qualities of the candidate are not even considered,

and as a result the person who does not have the required education and experience manages

other people, what eventually leads to worse performance and provokes anger in employees who

worked in the company for many years without being promoted. Jean got trapped in the same

situation, and basing his decision on the norm theory, he decided to hire incompetent employee

rather than starting with the co-worker the kind of conflict in which few people would be on hisside.

Another example of business ethics being connected with culture is the respect to the elder and

superior. The Asian tradition of respecting any decision made by the older person may seem to

30



be unreasonable to the Westerners, and this is difficult to choose between advocating the

appropriate decision and pitting the employees against oneself. Since the power distance in

Kazakh society is very high, this also created issues, misunderstanding and results in poor

communication between different levels of management.

Yet another example is bribery. Even though the Kazakh government is fighting against

corruption, it is hard to say if anything changes, because over the communist regime bribery

became some kind of a tradition. Paying and accepting a bribe is not even thought to be unethical

or immoral, it’s just the way the business is done in most ex-USSR countries. In fact, the

multinational corporations that enter the Kazakhstan market have to accept this tradition,

otherwise that will be impossible to make business. Also, the Kazakh hospitality and the tradition

to invite business partners and co-workers to national style barbeque may seem to be misleading,

it can also be considered as some kind of bribery. Transparency list on Transparency.org (2010)

demonstrates us the difference between France and Kazakhstan. France (6.8) has obviously been

more successful in eliminating corruption than Kazakhstan (2.9). For a person who comes from a

developed European country with transparency index exceeding that of the host country, that

would probably take some time to get used to the new settings and what’s more important, to

find the balance between representing the company the way it should be done and the way the

local authorities expect it to be done.

This may not be easy for the Westerner to comprehend all these cultural specificities that are to

do with local business ethics and culture, and perhaps the best way to do it is to have the local

assistant who would explain all the details and will help to avoid awkward situations.

31



CONCLUSION

This case study has shown the process of cultural and professional adaptation of the French

manager Jean Girardet to the new environment of a host country. Kazakhstan is country that is

mostly unknown in the West, and going to the place about which finding the accurate

information must be quite a challenging experience.

This work demonstrated how a person from a completely different cultural background can

prepare himself or herself and be successful in adaptation and in achieving company’s goals.

Following the process of 3 steps, namely self-awareness, cross-cultural understanding and

adapting cross-cultural skills can help to reduce stereotyping of both managers and employees,

increase cross-cultural effectiveness and eliminate cross-cultural communication barriers.

32



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