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Cross Cultural Issues

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Introduction This report would hereby review the expansion of Volkswagen's operations in India in order to gain a competitive advantage through the efficiency of cost effectiveness and quality labor pool. Due to rapid technology advancement the global marketplace expands. Foreign ideals and culture are easily spread and adapted by indigenous people in all corners of the globe, through "Globalisation". Industrial globalization has taken its grip and businesses are going across the cultural boundaries. The convergence enhances the communication level between cultures. On the other hand, with globalization cultural differences are also highlighted. Overview of Volkswagen and Management Volkswagen Germany is the largest car manufacturer in Europe and is renowned for quality cars at affordable prices. In order to maintain its competitive advantage in the car manufacturing industry it has decided to expand its operations in Pune India. The investment will be worth 560 million euros so it is imperative that careful thought is given to ensure success of this venture. Volkswagen would need to critically analyze India's Culture as they are entering a foreign market. This would provide the company with the possible problems that they would need to address through the cultural differences analysis .With this information Volkswagen's management can use this as a proactive tool to address the problems before they even occur within the company that can adversely affect the operations and the overall success of the organisation. What is Culture? A single definition of culture is not enough because the concept is far too complex. The word culture has many different meanings Edger Schein ( ) ...read more.


Now, the offices operate with less staff providing ample of opportunities to do major work and handle responsibilities to the staff members. Though the class divisions that had been embedded in the society is getting extinct as people are accepting EQUALITY FOR ALL the way of their life. India's Long Term Orientation (LTO) Dimension rank is 61, with the world average at 48. A higher LTO score can be indicative of a culture that is perseverant and parsimonious. The economy growing at the rate of over 8% per annum and the agriculture production being excellent in the last few years has created a lot of wealth for rural as well as urban India. The average Indian is on the spending spree viz the entry of five low frill airlines has assisted more than 500,000 first... Table: Cross-cultural Implications - India and the West Western Non-Western 1. Christianity concerned with absolute moral values, differences between good and evil, and redemption of the soul. 1. Non-Western religions focus on virtue. Buddhism and Confucianism providing an ethical code of behavior. 2. Society is built on legalistic contractual relationships. 2. Society is built on direct personal relationships. 4.Behavior controlled by rules, punishments and rewards 4. Behavior controlled by group adaptation. Departures from the group norm are accompanied by feelings of shame. 5. Attribution groups are important (family, class, occupation 5. Frame groups are important (village, neighborhood, company, region, and nation). 6. Weak hierarchical structure. 6. Strong hierarchical structure. 7. Important values are freedom and personal conscience. 7. Important values are security and obedience 8.Need for self-assertion 8. Need for coordination 9.Contractual relationships based on rights and duties 9. ...read more.


all in all , they abide by the laws and law breaking is frowned upon Individualism vs. Collectivism Strong Collectivism -depend more on groups to determine what they should do and emphasize loyalty to the group. They are more likely to cooperate with others to avoid risks and reduce responsibilities. - individualism is viewed rather negatively in Asia. Germans are based on the individualistic- putting the interest of individualistic views rather group.- decisions are more in self-interest, independence and has lack of tolerance for others' viewpoints and low-context communication Cooperation Contracts are unimportant. Attention is placed on relationships than contracts Focuses on formality/ structured, contracts is important; no interest to kinship ties/relations, relating to their attitude to work. The Germans "work by the book " Conflict Resolution -use indirect ways to avoid direct and open conflict. -use authority to suppress it, or settle things in private. Negotiation and compromise Conflict Resolution does not consider saving face and would use authority to implement disciplinary actions. Conflict -German working in a group once completed his assigned task would not assist the entire team in order to meet the group's objective. Productivity may not be at its highest in terms of group work. The table above shows the cultural dimensions applied to the cross cultural dimensions .With this analysis Volkswagen would be able to identify the possible problems that would arise from the merging of these two vastly different cultures. Through inter-cultural management of German and India, Volkswagen needs to consider several issues like communication, HRM techniques, religion issues, motivation and After the cultural analysis between Germany and India ,It can be seen that there would be several problems that would arise that would hinder the Volkswagen's future growth and success. ...read more.

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