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Digimat Corporation Case in China Proposal Essay

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Updated: Jun 11th, 2020

Introduction

This case study revolves around John Parker, who has previously been working as a manager in Digimat, the United States-based corporation with subsidiaries in parts of Asia and Europe. John has had a successful career while at Digimat, whereby he has been posted to be in charge of subsidiaries in Australia, China and Singapore following his assignment as the Asia Pacific Sales Director. With his new assignment and his excellent academic credentials, John has been transferred to China as his career required him to spend most of his time in China. In China, he is warmly received by his subordinates. He views this as the converse of what he had earlier thought of the Chinese staff (Geert 2001).

John assumes that the way, his management style worked in America and other Asian countries where Digimat has subsidiaries, would be the same in China. John is autocratic; he notices that the Chinese teams are somehow sceptical to his leadership style and experiences too. The business environment requires close consideration of the cultures of different market segments; this is the key to success for any business (Geert 2001). John realizes that the working relationship between him and the Chinese sales teams is poor; he assumes all this and fails to put the Chinese culture into context. He uses his autocratic nature to deny the Chinese team platform for airing their views; he also fails to incorporate the Chinese culture in his leadership style. Subsequently, this leads to a demoralized working team among Chinese employees.

John believes that motivating a diversified workforce means using tangible rewards. He fails to understand the intrinsic and extrinsic motivation. According to Herzberg, “the opposite of satisfaction is not dissatisfaction” (Gummesson 2000). John doesn’t put into perspective that the Chinese teams are resisting changes? So he fails to incorporate Chinese culture into the change management process and solely relies on his experience and working success outside China. At some point, he assumes that the knowledge transfer process will not have drawbacks in China since Digimat has launched a global ERP system. He fails to understand that the ERP system was not standardized to fit in the Chinese working environment as he was informed by one of the subordinates.

John faces numerous challenges while leading the Chinese employees working in Digimat subsidiary in China. Compared to John, Jeremy Lin from Taiwan, the head of research and development of Digimat Corporation in China, has a perfect working relationship with his Chinese subordinates. His success is owed to the fact that he understands the Chinese culture and always puts it in context while working in China. John envies Jeremy’s success. Later, Jeremy introduces John to his predecessor Bob Martin from Europe, who had a successful career in China. Bob shares his experiences with John on how he can incorporate the Chinese culture in the change management process. Bob urges John to spend time in building good working relationships and in developing trust, the same way he did while he was at the helm of Digimat in China. This will, in turn, encourage open-mindedness among the Chinese subordinates and at the same time, give John an edge while leading the Chinese employees.

Key stakeholders

In this case study, there are notable key stakeholders. They are the headquarters of Digimat Corporation in the United States, the employees of Digimat Corporation, the Chinese government, the subsidiary of Digimat Corporation in China, the Chinese Community, and, finally, the Chinese trade unions such as the sales or marketing societies.

Analysis of relevant theories

This case study touches two main theories. These “theories are the motivation theories and the cultural theories” (Hofstede 2010). Along with the entire case study, the main conflicts have arisen due to the failure of recognizing the culture and motivation. Hofstede (2010) developed a cultural framework using factor analysis. In his model, he noted that there are five dimensions of culture that are open for analysis. In his cultural dimension theory, Hofstede’s notes these dimensions for analyzing cultural values. These include uncertainty-avoidance, individualism-collectivism, long-term orientation, power distance and masculinity-femininity dimensions. They form a framework for cross-culture communication. According to Hofstede (2010), culture is viewed as a source of conflict rather than synergy. Cultural differences “are a nuisance and the cause of disasters” (Hofstede 2010).

In the case study, John Parker failed to consider the cultural differences in different parts of the world. He assumed that the same way his leadership style was successful in America, Australia, and Singapore it would succeed in China. He failed to put the Chinese culture into perspective, and this, in turn, led to conflicts and sluggishness among the working teams. This was due to the fact that the aspect of culture was missing (Hofstede 2010).

Incorporating the Chinese culture in his management skills was very important for creating group cohesiveness and ensuring that the working groups worked towards a specific goal. John’s actions resulted in misunderstandings between him and the Chinese teams, and this was worsened by the fact that he was insensitive to cultural diversity (Hofstede 2010). Another aspect that John failed to incorporate was the motivation for his subordinates. He failed to understand that motivation is intrinsic and extrinsic. According to Gummesson (2000), high morale does not mean job satisfaction and the opposite of satisfaction is not discontent. Hygiene factors such as giving job titles, recognition, fair company policies and favourable working conditions are vital to the success of any venture. An employee’s morale is boosted through motivation (Springer, 2013).

This involves the use of both tangible and intangible rewards with the aim of increasing productivity. No statement in the case study indicated that John motivated his subordinates. This resulted in poor working relationships and mistrust as well. Actually, one of the employees is quoted to have preferred John’s predecessor to be at the helm of the China-based firm.

Key commercial learning as a benchmark for other organizations

This case study presents the following key information that can serve as a benchmark for other organizations venturing in a similar field. First, failure to recognize cultural differences within the different and diversified workforce is detrimental to the success of any organization (Minkov 2007). This is the cause of conflicts and often a nuisance at its best. The key to success is incorporating the culture of the market segments in an organization’s plan (Petrakis 2014). Finally, the morale of employees is boosted by motivation (Springer, 2013). It should be two-way in order to satisfy both the intrinsic and extrinsic needs. This, in turn, leads to job satisfaction and increased performance.

References

Geert, H 2001, Culture’s Consequences: comparing values, behaviors, institutions, and organizations across nations, Cambridge University Press, Cambridge. Web.

Gummesson, E 2000, Qualitative Methods in Management Research, Polity Press, Cambridge. Web.

Hofstede, G 2010, Cultures and Organizations: Software of the Mind, McGraw-Hill, New York. Web.

Minkov, M 2007, What makes us different and similar: A new interpretation of the World Values Survey and other cross-cultural data, Klasikay Stil Publishing House, Sofia. Web.

Petrakis, P 2014, Culture, Growth and Economic Policy, Pearson, Upper Saddle River, New Jersey. Web.

Springer, D 2013, Qualitative Research in Business & Management. Sage Publications, London. Web.

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