Management concepts & principles
1 like1,186 views
This document summarizes key differences in business culture and management styles between the USA, Germany, France, and England. In the USA, business structures are varied but tend to view the company as an independent entity where employees come and go. The CEO holds great sway and accountability is vertical. In Germany, power is shared among senior managers through a collegiate approach, while below that roles are tightly defined. In France, the CEO (PDG) holds great power and companies follow a strict hierarchy. In England, the board of directors holds real power and key decisions are made at that level.
Management concepts & principles
- 1. Transferring From USA to France, England and West Germany PRESENTED BY: DIVYA MALIK SRI PARNIKA BATRA PRERNA SANOTRA
- 2. & Ethics
- 3. USA Individualistic in approach. Managers are accountable for the decisions made within their areas of responsibility. Although important decisions might be discussed in open forum, the ultimate responsibility for the consequences of the decision lies with the boss — support or seeming consensus will evaporate when things go wrong.
- 4. The up side of this accountability is, of course, the American dream that outstanding success will inevitably bring outstanding rewards. American managers are more likely to disregard the opinions of subordinates than managers in other, more consensus or compromise- oriented cultures. This can obviously lead to frustrations, which can sometimes seem to boil over in meeting situations. Titles can be very confusing within American organisations with a bewildering array of enormously important-sounding job descriptors on offer (Executive Vice-President etc.). Titles, in any case, tend to be a poor reflection of the relative importance of an individual within a company. Importance is linked to power, which could be determined by a number of factors such as head-count responsibility, profitability of sector or strategic importance to the organisation at that point in time.
- 5. A distinction is often made between management style (around organisation and process) and leadership style (more strategic and inspirational.) Great leadership is expected at the top of an organisation ratrher than competent management but it can be difficult to define what 'great leadership' actually is.
- 6. Germany Managers in Germany are expected to be technically capable in their respective areas and to show strong, clear leadership. Although disagreement with a superior will rarely be seen in public this does not mean that Germans are 'Yes' men. Subordinates tend to respect the technical abilities of their superiors and this will impact on their willingness to implement instructions. (The interesting corollary of this is that when less technically proficient non-Germans are asked to manage a team of Germans, the non-German can sometimes be seen as lacking the key prerequisite for developing the team's respect.) Responsibility is expected to be delegated by the manager to the member of the team who is technically competent to carry out a particular task. The team member then expects to be left to perform the task without undue interference or supervision. Thus instructions need to be clear, precise and above all unambiguous. People from cultures where managers are expected to develop a closer, more intimate ambience can see the German manager-subordinate relationship as distant and cold. The higher up the organisation people rise the more a sense of the 'dignity of the position' becomes apparent. Socialising tends to be at peer group level rather than up and down a hierarchy.
- 7. France Most senior management in most French companies were educated at the Grandes Ecoles which are the elite schools of France. These colleges champion an intellectual rigour in their students, which is rarely matched elsewhere in the world. This produces a highly educated management population, which approaches leadership with an unusual degree of academic precision. 'Intellectualism' is something to be cherished rather than sneered at and a comment once attributed to French management was that 'this idea seems alright in practice but will it work in theory?' Thus, management is an intellectual task to be mastered and thought about in terms of detailed analysis, the complete mastery of complex concepts and information and the eventual application of rational decisions. More pragmatic issues of buy- in, motivating staff etc. (in the Anglo-Saxon understanding of these terms) are not as prominent in French management thinking. Decisions, once taken at senior levels, will be passed down the chain to lower management for implementation. This directive approach can be seen, especially by those from a consensus oriented, non-hierarchical background, as being overly authoritative and lacking in the necessary team-building elements.
- 8. England British managers tend more towards generalisation than specialisation. The proposition that the manager needs to be the most technically competent person would receive little support in the UK. Therefore, pure academic education is afforded much less respect than in other countries (notably Germany and France) and the emphasis is on relevant experience and a 'hands-on', pragmatic approach. Titles such as doctor or professor are rarely used outside academic circles and can even be seen a sign of affectation.
- 9. Much more emphasis is placed on the man-management skills needed to produce the best results from the team. A manager is expected to have the interpersonal skills to meld a team together and it is this ability as a 'fixer' which is highly regarded. Modern managers often want to appear as a primus inter pares, cultivating a close, often humorous and overtly soft relationship with subordinates. This seeming closeness should not, however, be mistaken for weakness on the part of the boss - when difficult decisions need to be taken, they will be taken. The British find it difficult to be direct and British managers often give instructions to subordinates in a very indirect way, preferring to request assistance than to be explicit. This use of language can be very confusing for the non-British (see 'Communication Styles' later.)
- 10. Back ground to business
- 11. USA As the US tries to drag itself out of the economic malaise triggered by the fall of Lehman Brothers in 2008, it finds itself at defining moment inits history. How can the country maintain its pre-eminence politically in the face of growing pressure from China and India? How can it leverage its intellectual capital so that it continues to be the entrepeneurial world hub and centre of innovation and excellence. US-business ideas and approaches are being scrutinised as never before - the the country ready for the challenge of what many see as the 'Asian' century? Fo a century or more the US has led the way in banking and finance, high-tech, computing and pharmaceuticals. US business methodologies have led growth and innovation in a way rerely seen in the history of the world and an understanding of how things work in the States is essential for anybody who works internationally. More than any other industrialised country, the United States has adopted what could be labelled a 'scientific' approach to business. Every aspect of commercial life is studied and analysed and this scientific approach is both respected and acted upon. Far more resource is available in the US for the study of the methodology of business than in any other country and most new management theory and doctrines have their origins in the States. In the States everything is quantified and assessed. All processes, even down to such issues as HR and Training are analysed in a detailed manner and the results of this analysis carry weight with decision makers. This 'scientific' approach - the constant search for better, more effective methods - has led to a business environment typified by the presence of change as a constant factor. The most common response to a changing environment is realignment of the organisation and this, in turn, has produced a work force in a state of constant flux. People leave, are fired or made redundant and then reappear in another organisation. This sense of employee mobility should not, however, be equated with a lack of loyalty to the employer for whom you are currently working. Whilst working for the company you put everything into the job and are totally committed.
- 12. Germany The fact that Germany has survived the post 2008 recession well is a testimony to the underlying strength of the German economy and, more interestingly, the strength of its much-vaunted manufacturing base. Interestingly, unemployment rates in Germany are now lower than they were pre-2008 an exports are considerably higher. For a number of years people were warning that the German model was unsustainable - both labour an social costs were said to be way too high - and that the country would need to make radical policy changes to withstand the growing competion from low-wage economies such as China and India. Yest, despite these challenges and despite the cost of the post 'cold-war' integration of the former East Germany, the country's economy seems in rude health. It is, therefore, worth reassessing the German business model to see what can be learnt from it - especially as post war German success was achieved without too much attention being given to the 'science' of business management which had been the vogue in the U.K. and even more so in the U.S.A. In Germany, much greater attention has been paid to academic, technical education and its value to business in general. Therefore, companies tend to be run by technical experts rather than lawyers and accountants and this is reflected in the high regard in which engineers are held by other Germans. Diligence and competence are characteristics which are held in high esteem by colleagues and are seen as the key indicators of performance. Appraisal systems based on the softer competencies as favoured by many U.K. and U.S. firms are still not common in traditional German companies.
- 13. France France finds itself at a difficult crossroads as the cold economic climate post-2008 challenges the viability of the country's traditional social models. With unemployement running around the 10% mark and many people calling for even further pro-market reforms, the modernisers find themselves at odds with tradional vested interests - and these vested interests have been historically highly influencing in shaping both internal policy and approach to business. It could be said that two particular elements play a greater role in approach to business in France than in any other industrialised economy (other than possibly Japan). These two essential ingredients are the role of the government and the importance of a certain type of education. The French government has played a central and vital role in the shaping and direction of French companies ever since the end of the Second World War. Indeed the government, even in the late eighties, was actively fostering the development of a number of 'national champion' companies which would be large enough to face up to global competition. One of the interesting aspects of these interventionist policies is that they have been largely accepted by mainstream business, which has worked hand in hand with senior civil servants in the ministries. This level of co-operation between the government and industry has been aided by the influence of the French education system, which pushes the brightest pupils through a system of elite schools known as the Grandes Ecoles. Graduates of the Grandes Ecoles tend to enter either large commercial organisations or the civil service and this educational brotherhood has created an affinity of thinking across the senior echelons of French business society. It has even been said that the best way to become a PDG (CEO) of a major French company is through a senior position in an important ministry. France remains the 5th largest economy in the world and boasts world leading organisations in banking and finance, aeronautics and many hi-tech fields.
- 14. England As in many other industrialised countries, the last couple of decades have seen a major restructuring of British industry away from the more traditional heavy engineering and primary sectors towards the service and high-tech fields. This process has also coincided with radical shifts in approach to management and company structure. Many of the hierarchy and class issues which were so much a feature of the British industrial landscape have been replaced by more modern business models - often heavily influenced by US thinking. Ideas of 'jobs for life' have largely been overtaken by an expectation of rapid change in work patterns and prospects. Many current British managers no longer expect to spend most of their careers with one or two companies, but rather looks for progression through moving from employer to employer. One result of this could be the much talked of British short-termism associated by many continental European business people with UK companies. Generalisation, rather than specialisation, tends to typify the British approach - with less merit being placed on pure technical ability than in some other countries. Some commentators have quoted this tendency as one of the reasons for the demise of manufacturing in the UK over the last three decades. As with many other European countries, the UK (with a heavy relaince on the Banking and Finance sector) was badly hit by the financial crisis of 2008 and faces a painful journey back to growth and prosperity.
- 16. USA Business structures in the USA are incredibly varied but tend to have several characteristics in common. Firstly, the company is an entity in its own right and exists independently from its employees. Members come and go, perform necessary tasks at particular points in the life cycle of the company and then leave when no longer required for the wellbeing of the organisation. The relationship between employer and employee is a transactional one — where relationship and sentiment are a luxury which cannot be justified. Current economic conditions and the increasing influence of technology-based communication methodologies have only increased this disconnect between the employee and long-term, stable employment conditions. In a country where job-mobility and virtual working are increasing, transferable skills become the key to future success. Secondly, the CEO of an American organisation holds great sway within the company. Senior management is more embedded in the personality at the top than in some other countries, such as Germany, where senior management is collegiate in approach. Although the company will have a Board of Directors, the Board is highly unlikely to have any input on the day-to-day running of the company which is left very much in the hands of the CEO who stands or falls on results. This can be seen as a high risk, high reward approach - it can bring great success but also spectacular failure. Thirdly, accountability within the company tends to be vertical and easily observable. Americans like to know exactly where they stand, what are their responsibilities and to whom they report. If job security is weak, I'd like to understand the extent of my liability on any particular issue.
- 17. Germany Most of the power in German companies is vested in the hands of a few senior managers. Larger companies (AG & GmbH) have a Supervisory Board (Aufsichtsrat) which appoints the Management Board (Vorstand). The management board is the final decision-maker on policy matters which affect management. The members of the Vorstand have shared responsibility for the overall management of the company and this means that the chairman of a company has considerably less personal power than in certain other countries — management at the top could be said to be collegiate. However below Vorstand level, companies tend to have a strictly hierarchical approach within which individual's specific roles and responsibilities are tightly defined and compartmentalised. This results in a methodical approach to most business issues where procedures and adherence to well-defined rules are respected. This methodical approach has both good and bad points. On the plus side, everybody knows what is expected of them and has a process to help them achieve clearly identifiable goals. On the other hand, a criticism that is often levelled at German industry as a whole and at German business people individually is that they are inflexible and slow to change to new situations.
- 18. French French companies tend towards rigid hierarchy and functionality within which system the PDG (CEO) holds great sway. The PDG determines in a singular way the future direction of the company. This vision is then disseminated down the line for implementation by more junior management. Senior management, therefore, tends towards the directive, rather than the collaborative, as might be found in such countries as the Netherlands or Sweden. The power often vested in the hands of the PDG obviously adds impetus to a centralist approach, which is already discernible in many other aspects of French life. Below the PDG will be found a strict hierarchy of managers, organised along rigidly functional lines of responsibility. (All reporting lines leading eventually to the PDG.) To those from a less hierarchical background, this approach often seems to be eminently well suited for operations which are performing well and producing results. The weaknesses of the system may only become apparent when problems arise and quick responses are called for. With little buy-in having been sought lower down the line, a sense of personal responsibility could be found lacking.
- 19. England The board of directors is the real power broker of a British company with all key decisions being made at this level. All plc's (quoted companies) must have at least two directors who are appointed by and accountable to the shareholders. The chairperson or the CEO leads the board. Many of the UK's larger companies have 'non-executive' directors who act as outside, impartial experts, as well as often providing links with government and the civil service. This usage of 'non-executive' directors has some parallels with the continental European two-tier system of senior management but is not as all- pervasive and 'non-execs' can be resented by the executive directors. Although traditionally hierarchical in structure, many British firms have moved towards a flatter, less bureaucratic approach. This has also resulted in a certain lack of shape, with boundaries and responsibilities being blurred. It can be difficult to get a clear picture of the structure of a British company, with even employees being unclear as to the exact remit of their jobs. As a result, job descriptions tend to be somewhat vague and imprecise with little clear guidance on specific tasks to be undertaken.
- 21. USA When asked to describe meetings in the USA, a word which Americans often use is 'aggressive'. This 'confrontational' approach, (where openly and directly debating all the relevant issues even at the expense of personal relationships is valued) is very alien to those cultures who always put diplomacy and harmony at the heart of their approach to meetings. Of course, many cultures mistakenly see this direct approach between colleagues as a sign of bitter, personal animosity — which it always invariably is not. It is endemic in the American approach to communication in meetings and is seen as a positive step towards addressing whatever the vital and pressing issues might be. Time pressured, ambitious American business executives do not have time for the vagueness, diplomacy and lack of focus which they perceive as typifying meeting situations in such diverse cultures as the UK and Japan. Meetings often include formal presentations by one or more of the participants and these presentations are a vital element in the demonstration of professional competence. Thus, presentations should not only be relevant and well researched but also delivered in a positive, enthusiastic and committed manner. The meeting and especially one in which a presentation has to be made, is seen as an opportunity to impress — important if personal success is to be achieved. Meetings are increasingly virtual with one or more participants joing from a completely separate location by either conference call all video link. These meetings can often prove less successful than face-to-face meetings due to communication dificulties (especially if some participants are non-native English speakers) and it is possible that the right skill-sets are not always in place to make the most of these difficult meeting types.
- 22. Germany As in all cultures there are various types of meetings which people will approach in different ways. On the whole though, Germans could be described as 'pre-planners' who like to attend meetings having done a considerable amount of preparation in order to help them debate their point of view with conviction. This sense of conviction, coupled with the often very direct nature of debate, can be mistaken by people from other cultures as intransigence, pedanticism and even arrogance. Some people charge that German's have always made up their minds on an issue before arriving at a meeting but this is not necesarily the case. They just want to argue their view point thoroughly and support it with well-researched data. As German companies tend towards the development of specialists, rather than generalists, meetings are often large with a designated specialist from each area involved in the matter under discussion. People are expected to contribute to the debate when discussions touch their area of expertise but are not necessarily expected to have an opinion on everything. As direct, often strong, debate is expected and encouraged in order to promote the development of the 'right' answer, meetings can sometimes seem to be quite heated. People from those cultures whose communication style is rather more diplomatic than direct can often misinterpret these discussions as overt, deliberate confrontation.
- 23. France As management style tends towards the directive, meetings can often be more for the dissemination of information of decisions previously arrived at than for the open debate of perceived difficulties. They will often be chaired by the boss and follow a set agenda as determined by the boss. In such formal meetings it would be rare to contradict the boss openly - this will have been done elsewhere, prior to the meeting in more informal lobbying sessions. If meetings sometimes appear to be a rubber-stamping exercise, it is because that is what they often are. In such an environment, it is vital to be actively involved in the pre-meeting lobbying if any influence is to be brought to bear. Meetings, which take place between peers without the presence of a senior figure, will be more open and less rigid. Open debate will often be seen in such situations and this debate can often become heated - especially when people are defending the validity of their own cherished logic. In such meetings, strong confrontations can often occur which reflect the sense of competition often found just below the surface at peer group levels in large organisations. Cartesian logic is at the heart of French thinking and this process introduces the thesis - counterthesis approach where adversarial debate around a topic is seen as very healthy. This can be seen as disagreeing for disagreeing's sake through the eyes of more consensus-minded cultures.
- 24. England One thing that can be said of meetings in the UK is that they are frequent. They are often also inconclusive, with the decision of the meeting being that another meeting should be held. The British themselves often complain about the frequency and length of meetings they must attend. In comparison with many other cultures, relatively little preparation is done for meetings (with the exception of client-facing meetings). This is because meetings are often viewed as the forum for the open debate of an issue and that, during that open debate, a route forward will be found. When the route forward is agreed, then the detailed work schedule will be implemented. Being 'over-prepared' for meetings in the UK can result in certain negative feelings towards those who have prepared in advance. "There is no point having a meeting with the Germans (for example) because they have already decided the outcome prior to the meeting." Agendas will be produced and followed loosely. If something important arises during the open debate it will not be excluded simply because it does not occur on the agenda. The British consider themselves to be punctual, but when pressed will admit to rarely arriving on time. It is now fairly common for people to arrive five to ten minutes late for meetings.
- 26. USA Communication styles in business in the States are determined by many of the approaches to business we have already described above. The desire to debate issues directly and openly leads Americans to be seen by some cultures as aggressive and even rude. Coded speech and verbosity is often seen as time wasting and in time pressured corporate USA, that is a crime. Thus, when an impasse is reached in meeting situations, the reaction is often to address it directly and 'with feeling.' This direct, robust debate can often be viewed by more harmony seeking cultures as signalling the breakdown of meaningful discussions and as the signal to try to abandon the interaction - whereas in the States it is seen positively and as a sign of definite progress. Paradoxically, on first introductions, American can seem very friendly, polite and solicitous of your well being which seems to be at odds with the verbal behaviour exhibited half an hour later in the meeting. This overt friendliness (Have nice day!, Hi, how are you doing? etc.) should be taken for what it is — part of the protocol of the language and not as an attempt at establishing a life-long friendship. Although coded speech and over-verbosity are frowned upon, the latest 'management speak' is often to the fore in business dealings which can make Americans sound extremely jargonistic — almost to the point of obscuring the real message. Americans are much more open in conversation about private affairs than many European cultures and the converse of this is that Americans will often, quite naively, ask very personal questions at an early stage in a relationship which may be perceived by some people as intrusive. ('What do you make?') Technology is incresingly relied on and email is the normal methodology of communication. Email messages are expected to be short and to the point - often ommiting both the greeting line and the closing line. Do not misinterpret this short form communication as rudeness or annoyance - its just a quick and efficient approach.
- 27. Germany Germans put truth and directness before diplomacy, believing that the fact is the important issue and that personal emotions should not deflect the truth from being spoken. This directness can be interpreted by certain cultures (U.K, Japan, Korea etc.) as rudeness. It should be noted, however, that direct speaking is seen in Germany as a sign of respect and a fundamental in the search for the correct answer to a particular problem. This directness in communication style also manifests itself in a lack of self-deprecation and coded language. A charge of arrogance is sometimes levelled at German businessmen and, although there is great pride taken in German achievements, this perceived arrogance is more a misinterpretation of direct speech. Germans will give a factual rendition of their own capabilities, which is not the same as arrogance. You can generally take a German at his word on these matters whereas certain other cultures will be far more vague in their use of language. Much is made of the lack of humour in evidence in Germany. It is certainly not true to say that Germans lack a sense of humour. As with all cultures they have a highly developed sense of humour. The differences lie in positioning and style. There is a time and a place for humour in Germany and its place is not so much during the serious business of business. The more serious a situation, the more seriousness is called for. It is also important to remember that humour does not always, or even very often travel successfully. What is funny in one culture can come across as nonsense in another. Presentations are expected to be suported with a lot more specific detail than might be felt necessary in countries such as the US or the UK. Lack of supporting detail can severly weaken the credibility of an argument.
- 28. France The way in which you say something in France is almost as important as what is actually said. There is a great love of and respect for elegance in the use of language and the sophisticated presentation of ideas is raised to an art form. A sense of national pride makes it difficult to listen to the language being spoken badly (or even worse to have to read poorly constructed French!) If you speak poor French, it may these days be better to do it in English. Debate in France can often be seen as highly confrontational by those from a non-confrontational background. In France, the drawing of distinction is almost an intellectual goal - a goal which will help to move the process forward. Building on similarities is not seen as such a positive. During discussions, interruptions will often occur, with other parties in the conversation joining in and emotions can seem to be running high. This animated, somewhat theatrical style is, again, viewed as conducive to reaching the end results. The French admire the logical exposition of well defined ideas and when listening can be heard making such comments as - 'it's not logical', which is a good indication that problems lie ahead. Such a comment might be more accurately interpreted as ' I don't see the logic of your argument, therefore I can't buy it.' Written business French is extremely protocolistic and formal with an etiquette which can seem anachronistic in translation. However, it is important that anything sent in writing is rigorously checked, as the ability to produce correct written language is seen as a sign of intelligence and good education.
- 29. England The British are almost Asian in their use of diplomatic language. Almost alone in Europe, (with the possible exception of the Belgians), they strongly place diplomacy before directness in communication. Being very non-confrontational in business situations, the British equate directness with open confrontation and fear that bluntness will offend the other party. This can often lead the British to seem evasive in meeting situations when they are really searching for a way of saying something negative in a positive way. In addition to being diplomatic, the British also use language in a coded manner preferring to say unpalatable things using more acceptable, positive phrases. Thus, "I disagree" becomes "I think you have made several excellent points there but have you ever considered...." And a lack of interest in an idea is often greeted with,"Hmm, that's an interesting point." Humour is virtually all-pervasive in business situations. Indeed, the more tense and difficult a situation is, the more likely the British are to use humour. This does not imply that the British are not taking the situation seriously - it is merely that humour is used as a tension release mechanism in the UK and helps to keep situations calm, reserved and non-emotional. Never underestimate a British businessperson because he or she uses humour in a seemingly inappropriate situation. Humour is a very important and respected communication tool at all levels and in all contexts. It is better to be self-deprecating than self-promotional in the UK. People who are verbally positive about themselves and their abilities may be disbelieved and will, almost definitely, be disliked.
- 31. USA In the States, teams are groups of individuals brought together for the moment to complete a given task or project. During the period that the group is together, everybody is expected to be fully committed to the common goals and to work with dedication and purpose to ensure that those goals are achieved. It is important to show enthusiasm for the project and to show belief in the ultimate achievement of the objectives. 'Old World' cynicism is not really appreciated or understood. When the project is complete, the team will rapidly dissipate, its members moving on the next task with equanimity. To break up a team in the fluid employment environment of the USA is less traumatic than in other group-oriented cultures where identity is subsumed to the group. In the States, teams are expected to be transitory in nature.
- 32. Germany Teamwork in Germany could probably be best described as a group of individuals working to a specific leader towards a recognisable goal. Within the team, each member has a set, well-defined role which is adhered to. Lines tend not to be crossed as this could promote confusion. Team members are respected for their technical ability and functional knowledge and are allowed to peform their tasks without too much supervision (which can be seen as unnecessary intrusion.) Cross-departmental teams can often prove very difficult to manage, as people are asked to make decisions in a vacuum which might adversely affect their area of the hierarchy. Thus decisions made at cross-departmental project group level are often revisited after group members have reported back to their superiors.
- 33. France The education system fosters a sense of rivalry and competition from an early age, with peers competing to pass entrance examinations to gain entry into the elite Grandes Ecoles. A sense of team working is not encouraged in this process and does not therefore come naturally in later working life. People prefer to have definable, personal sets of objectives rather than to work in more general team roles. Thus teams are often defined as sets of specialists working on single issues for a strong leader. Teams arranged between functional lines for the purpose of promoting one particular project (as found in the USA) are often difficult to implement, with loyalties being divided between the project team and the 'home base' of the team member
- 34. England The British like decisions to be made in a team environment and a good manager will work hard to ensure 'buy-in' from his or her team. The team environment aspires to being friendly and companionable with individuals within the team being seen to be supportive and helpful of each other. If, however, something goes wrong, it is not uncommon for the team to look for an individual within the team to blame. ('Blame culture' is something that seems to permeate working life and many organisations work hard to try to change this type of mentality.) Team members often bring with them into the team a certain level of specialisation, but are expected to take a generalist view of the project and their role within the project team. Being seen as a 'good all-rounder' is definitely positive.