HA - engelsk / BSc(IM)
Student: Jekaterina Oborina
Student: Anastasija Cibesova
Bachelor thesis
Supervisor: Valerie Smeets
Organizational culture versus National culture in
Mediterranean Shipping Company
Aarhus University
Business and Social Sciences
1 May 2012
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Organizational culture versus National culture in MSC
BScB(IM) 2012
Table of Contents
Introduction ....................................................................................................................................................... 4
Problem statement........................................................................................................................................ 5
Delimitations ................................................................................................................................................. 6
Method .............................................................................................................................................................. 7
Interviews and questionnaire ........................................................................................................................ 7
Analysis .......................................................................................................................................................... 9
Theoretical background ................................................................................................................................... 10
National Culture .......................................................................................................................................... 10
Foundations of organizational culture ........................................................................................................ 10
Multinational organization .......................................................................................................................... 11
National versus organizational culture........................................................................................................ 12
Geert Hofstede ............................................................................................................................................ 13
Intercultural Dimensions ......................................................................................................................... 13
Other studies in this field ........................................................................................................................ 15
Criticism of Hofstede`s study....................................................................................................................... 16
Empirical data .................................................................................................................................................. 16
Company overview ...................................................................................................................................... 18
MSC Holding ................................................................................................................................................ 23
Analysis ............................................................................................................................................................ 23
MSC organizational Culture ......................................................................................................................... 23
Data analysis ................................................................................................................................................ 43
Collectivism versus individualism ............................................................................................................ 43
Masculinity versus femininity .................................................................................................................. 46
Graph 2. Male versus Female manager ratio per county ............................................................................ 49
MSC organization culture through employee recruiting and retaining .................................................. 49
Conclusion ....................................................................................................................................................... 54
References ....................................................................................................................................................... 57
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Organizational culture versus National culture in MSC
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Links ............................................................................................................................................................. 58
Appendices ...................................................................................................................................................... 60
Appendix 1. Questionairre........................................................................................................................... 60
Appendix 2. Interview with the CEO Lars Funding ...................................................................................... 60
Appendix 3. Rate of responsiveness ............................................................................................................ 62
Appendix 4. Male versus Female manager ratio ......................................................................................... 63
Appendix 5. Summary of Hofstede`s classification ..................................................................................... 64
The results of survey................................................................................................................................ 65
Appendix 6. Qualtrics Report ...................................................................................................................... 66
Appendix 7. Summary of all responses ....................................................................................................... 69
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Organizational culture versus National culture in MSC
BScB(IM) 2012
Introduction
The business world today has become extremely globalized. Companies are
forced to operate internationally in order to compete successfully on the
market, regardless of the sphere or nature of business. Even the smaller
enterprises, which might not be global within it, are still in the network of
international customers, partners, suppliers. The modern world has enabled
faster information flow and exchange, as well as easier access to it thorough
the World Wide Web. The information on the internet is coming from the
various sources, which provides the users with a complete overview of the
current situation in the business, economical and political world.
The job market today has become very international. This is provided by
simplified migration legislations, opened borders of EU, Shengen zone and
others. Society has become more mobile; this relates to both social and
geographical mobility. People are free to travel and move their businesses- a
person from China can go for job in USA, have business partners in Australia
and go for vacation in Europe; and modern jobseekers are sending out CVs
globally. Expatriation and impatriation has become a common practice for all
multinational corporations.
In the globalization, pushed to the limits, the managers in the multinational
corporations have to be educated in international-business to understand,
estimate and foresee the challenges that multinational environment might
cause.
We see one of the main challenges for multinational company a transfer of
corporate culture and values to each individual local national office or
subsidiary. Corporate culture is a significant aspect of company`s
development, differentiating the organization in the international context.
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Organizational culture versus National culture in MSC
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Our paper is conducting a research in the shipping field. The nature of activity
of the shipping companies is pushing the freight carriers to maximize their
geographical area of service coverage- meaning to be able to operate in every
corner of the world.
We have chosen to base our research on the second largest container
operator in the world- Mediterranean Shipping Company (MSC). We see a
challenge for this company to include a large variety of different nationalities
and cultures, which have to operate in the same manner, following the
common corporate values, strategy in order to achieve a common goal.
Problem statement
Our paper will be within the scope of international business and
organizational behavior. We will analyze the chosen company- MSC from
these two perspectives. Our goal is to give an individual characteristic to every
country within MSC, according to Geert`s Hofstede study of the cultural
dimensions differentiating national features. We will describe the company
culture of Mediterranean Shipping Company - the core values, ethics, mission
and strategy, which unify all the national offices of MSC. Our research and
analysis will look at the interaction of organizational culture and national
culture through the angle of selection, recruitment, hiring and promotion of
employees. We will look at how much employees differ across basis criteria as
age, gender, education in each of the studied MSC offices, thus evaluating if
the preference of MSC for employee selection and recruiting is the same all
over.
However, the biggest challenge for our research is to characterize the
countries within MSC, which were not studied by Hofstede. We will try to
describe them relating to some of the dimensions, with accordance to the
features, which Hofstede determined for each of these dimensions.
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Organizational culture versus National culture in MSC
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Delimitations
Our study is spread only within the particular entity of MSC- MSC Scandinavia
Holding (we will describe it in more detail further on in our paper), which
includes only 16 countries mentioned below, as we were allowed to access its
employees personal data and company figures. Another limitation is that we
base our analysis only on Hofstede`s work, although in our paper we mention
all the most famous and recognized researches in this field. The conclusions
from analysis of the interaction of organizational culture and national culture
are based on the angle of our research- the recruitment, hiring and promotion
of employees.
And the most crucial limitation for our research is that the confidence level of
a country relation to one or another cultural dimension (the country, not
covered in Hofstede`s study) is not very high. The survey we used for
collecting the data does not allow us to state it strongly due to the variance in
rate of responses (varies from 38 to 71 percent) and the number of
employees across every country (from 7 employees in Kazakhstan till 70
people in Latvia). The survey which was sent out to employees and managers
had to contain minimum questions and limited options for answers, because
it was sent out and completed during the working hours of people. As our goal
was to collect the maximum amount of data from each country, this implied
that the completion of the survey had to take minimum time and effort. The
questions were mostly determined on highlighting the angle of our research:
the basic features of employees hired in MSC.
Mediterranean Shipping Company is a privately owned enterprise, which
implies that the annual reports and other financial data are unavailable for
publicity.
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Organizational culture versus National culture in MSC
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Method
In order to perform the analysis in the main thesis, we had to choose a
successful multinational company. For analysis to answer the questions stated
in our thesis, the chosen company had to fulfill several criteria. First of all, the
company had to be multinational with an office in Denmark, since this is the
field where we are active. Since our thesis is focusing on the intercultural
differences, the only differentiating feature of every office, covered by our
research, is a country of location only, status and function within MSC had to
be homogeneous, meaning that offices should not be divided into
manufacturing- service or headquarters- subsidiaries. Given the angle of our
analysis of the interaction between the organizational culture and the
national culture, which is the employee’s selection and recruitment, we
wanted to base our study on the service company, where customer
relationship management is a core competence and employees interact with
the clients on a daily basis. This is crucial factor for our angle, since the
employees in such company, with this nature of work, are the direct
representatives of the company.
We have chosen MSC, because it has fulfilled all the above mentioned
criteria, being a successful multinational organization, placed as second
largest container operator in the shipping industry worldwide. For our data
collection and analysis we have chosen MSC Scandinavia Holding, which is a
part of MSC and includes independent offices in 16 countries.
Interviews and questionnaire
For collecting the data for our research we have used both qualitative and
quantitative methods. As a quantitative method of research we have chosen
to use an online survey- Qualtrics Survey Software. We have designed an
online questionnaire consisting of 7 basic multiple choices questions (see the
Appendix 1). The questionnaire was structured non-disguised, which implies
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Organizational culture versus National culture in MSC
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that the questions were listed in pre-arranged order and the participants were
informed of the purposes of data collection. The questions were close-ended,
given that participants had to select from the fixed list of replies. We have
chosen a mail survey approach for questionnaire distribution. We sent the link
to the general e-mail address of each MSC Scandinavia Holding (MSC- SH)
office, which every employee is a part of, thus covering all 755 people working
for this company. We have chosen the mail survey, as it is the most
economically reasonable method, which involved minimum financial
resources from our side and this method has the highest geographical
coverage. This method also excludes the interviewer`s bias, thus, considering
all above mentioned advantages mail survey is the most appropriate data
collection method in our situation. The questionnaire was aimed to collect the
maximum responses across all the MSC-SH offices, therefore the questions
were not too much in depth. The questions were designed to characterize the
MSC employee across basic features: nationality, age, gender, education,
position, and years of experience. The software we have used for online data
collection has estimated the average time for completing one questionnaire,
which is 37 seconds. The timing was a very important aspect for the survey.
The time used by employees for completing our survey was constrained by
their tight working schedule. The data collected in the survey provided us with
the necessary information about the employees; however the personal
information per individual stays confidential, which was a condition that had
to be applied for the survey.
In order to find out the current situation of MSC-SH in international context
we have interviewed the CEO of MSC-SH, Mr. Lars Funding (see interview in
Appendix 2). He gave us his opinion on how MSC SH is coping with the
intercultural differences between its 16 countries and the overview of how
these challenges are influencing management of the company. We have
conducted a focus interview as a qualitative aspect of our study. We have
chosen this type of interview to interpret statistically significant findings,
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Organizational culture versus National culture in MSC
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parallel with our quantified study. We have used unstructured opened
questions for the interview to avoid giving a direction for the responses and
reveal the personal context of his answers. The opinion of Mr. Lars Funding
was very important, giving a bigger weight for our statements and
conclusions, because he is the person managing the serious issues with
intercultural communication within MSC SH and represents all 16 countries of
MSC-SH in other MSC agencies worldwide.
Analysis
The aim of the analysis was to combine the theory, empirical and qualitative
data. In our thesis, the sector is the shipping industry, the company is
represented by Mediterranean Shipping Company, and the nationalities are
the local offices representatives of MSC – SH. We have been exploring the
field of our research- MSC using the deductive method. Meaning, firstly we
have described MSC as one multinational organization, with its values, history,
corporate goals, and strategy. Afterwards followed by focus on MSC-SH as a
part of MSC and finally we have examined separately each local agency within
MSC-SH.
Since we have defined the field of our thesis and chosen the subject for
research, our goal of study has gone through various evolutionary stages.
Many materials from the theory we have studies for our thesis, failed to be
applied successfully in practice, when collecting and analyzing data. Since we
have sent out the questionnaires, we have been noticing different tendencies
in the respondent behavior across countries. We have also received a number
of feedbacks about the goals and means of our research from the regional and
country managers, as well as the department managers. The feedbacks were
different- some managers were concerned about the privacy of their
employees, some were concerned about us revealing the confidential data
about the company, some managers gave advices and showed a lot of interest
in our study. We have been taking a lot of notes during the entire work
process- after communicating with some of the MSC Denmark employees and
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Organizational culture versus National culture in MSC
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other people from the shipping industry. During this process our vision of the
problem statement and the ways of interpreting the collected data has
modified.
Theoretical background
National Culture
Various studies exist on the subject of culture. Today hundreds of definitions
exist to explain this term. Culture is what differentiates members of one social
group from anther, what is passed from older generation to younger
generation and what shapes the way they perceive the world. This is
expressed through their behaviors and values. Anthropologists Kroeben and
Klucholm have come up with the most optimal and generally accepted
definition: “ Culture consists of patterns, explicit and implicit, of behavior
acquired and transmitted by symbols, constituting the distinctive achievement
of human groups, including their embodiment in artifacts; the essential core
of culture consists of traditional (i.e., historically derived and selected) ideas
and especially their attached values; culture systems may, on the one hand,
be considered as products of actions, on the other, as conditioning elements
of future action.”(Nancy J. Adler, Allison Gundersen 2010: 18)
Foundations of organizational culture
Organizational culture can be defined as “the collective programming of the
mind that distinguishes the members of one organization from another”
(Hofstede & Hofstede 2005: 282-283). It is “the set of shared, taken for
granted implicit assumptions that a group holds and that determines how it
perceives, thinks about and reacts to its various environments.”
Organizational culture has three important characteristics: it is passed on to
new employees through the process of socialization, influences the behavior
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Organizational culture versus National culture in MSC
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at work, and operates at two levels, which vary in terms of outward visibility
and resistance to change (Organizational Behavior, Aarhus School of Business,
2011: 425). The socialization process is the process of person learning the
values, norms and behaviors, which allow him to be a member of that
organization and is the main mechanism of embedding the organizational
culture.
On the visible level the culture is represented by artefacts- the physical
manifestations of an organizational culture, for example: dress-code,
observable rituals and ceremonies, decorations, logos. On the less visible level
of culture are the organizational values and believes. They are persistent
characteristics, resistant to changes (Organizational Behavior, Aarhus School
of Business, 2011: 426).
Organizational culture has four main functions: firstly, gives its` members an
organizational identity: to distinguish the members of particular organizations
from the others. Secondly, to facilitate collective commitment, meaning to
encourage common goals and make employees proud of belonging to the
organization. Another function is to promote social system stability; this
proves employees with security and comfort within the organization, through
the effective management of changes and conflicts. Finally, the fourth
function is- shaping behavior by helping members to make sense of their
surroundings, meaning that organization helps employees to understand why
it does what it does and how it is going to accomplish the long-term goals
(Organizational Behavior, Aarhus School of Business, 2011: 429-431).
Multinational organization
Multinational companies are enterprises which operate in more than one
country. Given the international workforce, suppliers and customers, they
have to face the global competition and take into account world`s economical
and political situation, meaning that they have to act as a global player as well
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Organizational culture versus National culture in MSC
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as have local responsibilities at the same time. This position brings a lot of
advantages (less dependence on the economy or political situation of one
single country; differentiated marked position; use of synergies- diverse
visions and therefore solutions of a single problem) but also implies the
challenge to combine many different nationalities and cultures under one roof
(Sabine Scheffknecht 2007: 73).
National versus organizational culture
The difference of national and organizational cultures is rooted in their
different mix of values and practices. National cultures are part of the
personality, which is built during the first ten years of our lives, in the family
and in the living environment, at school, and it contains most of our basic
values. Organizational cultures are acquired when we enter a workplace as
adults, with our values firmly in place, and organization values consist mainly
of the organization’s practices- they are more superficial (Hofstede &
Hofstede 2005: 284).
Neither managers nor researches know for sure the answer to what extent
does the organizational culture influence national culture- enhances or
diminished the national effect. However, unambiguous conclusion is that
employees maintain or enhance their culturally specific ways of working when
employed in the multinational organization. There are various hypothesis of
why this is the case. It might be driven by the pressure from the foreignowned company to form a single organizational culture, which brings out
employees resistance. Perhaps our ethnic culture is so deeply ingrained in us
by the time we reach adulthood that a company’s organizational culture
cannot erase it. (Nancy J. Adler, Allison Gundersen 2010: 65).
“Effective shared practices are the reason that multinational corporations can
function at all. Employing multinational personnel, they cannot assume
common values. They coordinate and control their operations through
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Organizational culture versus National culture in MSC
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worldwide practices inspired by their national origin but that can be learned
by employees from a variety of other national origins” (Hofstede & Hofstede
2005: 286).
Geert Hofstede
Geert Hofstede (1928)- a Dutch professor of social sciences, who interpreted a
summary of factors, which determine cultural characteristics of different
nationalities, based on research conducted in 1960-1970. The study was
conducted within IBM, in its 60 international offices. The research has been
conducted by means of questionnaires, collected from 116 thousand IBM
employees. Each questionnaire contained 150 questions, which revealed how
and to which extent do the cultural differences affect structure and the
environment of organization. Hofstede was the one who managed to measure
cultural and cultural differences, not just give them verbal description.
Hofstede recognized 5 independent dimensions, which explain and systemize
intercultural differences. These dimensions are Individualism versus
Collectivism, Power Distance, Uncertainty Avoidance, Masculinity versus
Femininity, Long versus Short term orientation.
Intercultural Dimensions
Individualism vs. Collectivism
Individualism implies loose knit society, where people take care and look after
primarily after themselves and their immediate families, considering
themselves as separate individuals. Collectivism is characterized by tight social
network, where people consider themselves as a part of a group and
distinguish their group from another group. All members of the group have
common goals and expect social protection and security from each other in
exchange to loyalty. Members of collectivistic society place more importance
of fitting in and saving face, whereas in individualistic societies people
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Organizational culture versus National culture in MSC
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emphasize individual self- respect. (Nancy J. Adler, Allison Gundersen 2010:
52-53)
Power Distance
Power distance reflects the extent to which less powerful members of
organizations accept an unequal distribution of power. (Nancy J. Adler, Allison
Gundersen 2010: 54) Such inequality exists in every culture and organization,
however it differs from culture to culture how less powerful members agree
to tolerate this fact.
Uncertainty Avoidance
Uncertainty avoidance – reflects the extent to which people in society feel
threatened by ambiguity and therefore tries to avoid ambiguous situations by
providing greater certainty and predictability. Organizations reduce
uncertainty by establishing more formal rules, rejecting innovative ideas and
behavior, and providing their employees with greater career stability. For
example in countries with high uncertainty avoidance companies offer a lifetime employment, whereas in countries with low uncertainty avoidance high
job mobility is usual. (Nancy J. Adler, Allison Gundersen 2010: 55)
Masculinity vs. Femininity
This dimension also characterized as career success and Quality of life
oriented societies. Career success societies emphasize assertiveness and the
acquisition of money and things (materialism), while not showing particular
concern for people. By contrast, quality-of-life societies emphasize
relationships among people, concern for others, and overall quality of life.
Societies that stress career success usually define more strictly women’s and
men’s roles than do quality-of-life societies (for example, women should take
care of home and children, while men working to provide family). (Nancy J.
Adler, Allison Gundersen 2010: 57)
Long-term vs. Short-term Orientation
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Organizational culture versus National culture in MSC
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This dimension was discovered later by Hofstede in cooperation with his Hong
Kong colleague Michael Bond and was meant to explain the extreme
economic growth in 1990 of the “Asia`s Four Tigers”- Hong Kong, Singapore,
South Korea and Taiwan. Also known as Confucian Dynamism, it measures
employees’ devotion to the work ethic and their respect for tradition. (Nancy
J. Adler, Allison Gundersen 2010: 59)
Other studies in this field
In line with Hofstede there were other scientists, who made a significant
contribution to the field of intercultural differences and their affect on
organizations.
Fons Trompenaars – Dutch author and consultant in field of cross cultural
communication. He identified five culture dimensions: universalism versus
particularism, individualism versus communitarianism, neutral versus
emotionalism, specific versus diffuse and achievement versus ascription.
Edward T. Hall and his wife Mildrerd Reed Hall, who extended a cultural
model with another important dimensions. Firstly, low versus high context
culture, where high context cultures have many “unwritten rules” and low
context cultures use more explicit and direct communications style. This
dimension explains the importance of non verbal signals and modes explicit
messages. This provides an insight on the interaction between cultures and
explains misunderstanding, which occurs in communication (Hall 2011).
Secondly, dimensions of Time (monochromic versus polychromic) and Space
(high territoriality versus low territoriality) were added.
“The GLOBE (Global Leadership and Organizational Behavior Effectiveness)
study of 62 Societies”- a research program, conducted in 1991 by Robert J.
House of the Wharton School of Business, University of Pennsylvania. The
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Organizational culture versus National culture in MSC
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study has clustered 60 out of 62 countries according to their cultural
similarities and has established 9 intercultural dimensions: Performance
Orientation, Uncertainty Avoidance, Humane Orientation, Institutional
Collectivism, In-Group Collectivism, Assertiveness, Gender Egalitarianism,
Future Orientation and Power Distance. (Michael H. Hoppe 2007: 1)
Criticism of Hofstede`s study
The problem of Hofsetede`s research is the possibility of bias of statistical
data, which was collected only from the employees of IBM; the company
which might have very strong organizational culture. This may influence the
data pool in a way that employees were hired with the same qualifications,
skills and education, which eliminate or diminish the cultural difference affect.
Another issue with using Hofstede`s intercultural dimensions as a theoretical
base for our own research, is that fact of 50 years time difference. Hofstede`s
dimensions were developed in 1960. Since then many significant political,
social and economical changes have occurred. They have changed people`s
way of thinking and behaving, as well as many organizations have entered
intercultural phase and adapted to it successfully.
Empirical data
We have chosen to conduct our research in shipping industry. As our paper is
in the scope of international business and organizational behavior in
international context, we found shipping industry to be the most appropriate
for this research. Shipping companies, due to the nature of business, are
forced to operate in various parts of the world and own local offices
worldwide, as well as dealing daily with foreign customers and suppliers.
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Organizational culture versus National culture in MSC
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Shipping
industry
carries
about
90%
of
international
trade
(http://www.marisec.org/shippingfacts/worldtrade/index.php). It is the blood
of the world`s economy. Without shipping export/ import of the raw
materials, affordable food and manufactured goods would be impossible.
Shipping industry today is challenged, as well as given many opportunities by
growing globalization, international trade, more flexible tax regimes and
mobile workforce. This expands the possibilities to develop and grow, but also
sharpens the competition.
According
to
Bloomberg
(http://www.bloomberg.com/news/2011-01-
10/freight-rates-poised-to-tumble-as-35-mile-line-of-ships-passes-coaldemand.html), 2011 was a very tough year for shipping industry. The freight
rates have hit the bottom since 2002. This is tightly connected with the world
economy recession, which caused a decline in global trade. Freight rates are
the indicators of the “economic health”, therefore even thought today we
believe that the recession is over, and economy grows, freight is still in
negative figures. This period for shipping industry is causing much lower
turnovers in terms of money and TEUs, which caused fatal consequences for
smaller companies and created a very sharp competition on the freight
carrier`s market.
According to AXA- Alphaliner TOP 100 2011, the top ten biggest container
operators are as follows.
Rank
1
2
3
4
5
6
7
8
9
10
Operator
A.P.M- Maersk
MSC
CMA CGM Group
COSCO Cntr L.
Hapag-Lloyd
APL
Evergreen Line
CSCL
Hanjin Shipping
MOL
TEU
Share
2.518,522
15.9%
2.097,828
13.2%
1.343,835
8.5%
646,310
4.1%
643,667
4.1%
617,424
3.9%
614,278
3.9%
533,867
3.4%
468,562
3.0%
435,469
2.7%
Existing fleet/ Orderbook
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Organizational culture versus National culture in MSC
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Picture1.
AXC-
Alphaliner
TOP
100
Container
Operators
2011
(http://www.marisec.org/shippingfacts/worldtrade/top-ten-container-operators.php)
Company overview
MSC – Mediterranean Shipping Company was based in 1970 by Captain G.
Aponte, which started when he bought his first ship, Patricia, followed my
Rafaela and began a shipping line operating between Mediterranean and
Somalia. In 1977 the company has significantly expanded through purchasing
of second-hand ships and was operating services in Northern Europe, Africa
and Indian Ocean and by the end of 1980 MSC operated ships to North
America and Australia. In 1989 MSC has expanded through opening a branch
of the main business- the cruise liner business. The name of the branch is MSC
Cruises.
Today, MSC provides cargo movement through dedicated transshipment
hubs, performs swift connections and efficient on-carriage services. MSC is a
privately owned shipping line with the headquarters located in Geneva,
Switzerland. MSC has 421 local offices in 145 countries which employs 50000
professionals. MSC has become a second largest freight carrier in the world in
terms of container slot capacity and in number of container vessels operating.
MSC operates in 6 continents, calling 335 ports through 200 direct and
combined weekly liner services. Remarkably, MSC has grown through years
with organic growth, not thought mergers and acquisitions.
MSC has also invested in crew training, shipyards, container workshops, ship
planning centers and dangerous cargo management centers, which control
the proper stowage of hazardous cargo worldwide through a very
sophisticated
MSC
computer
(http://www.mscgva.ch/about_us/agents.html)
systems.
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Organizational culture versus National culture in MSC
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In order to show MSC`s position on the market we chose to use the SWOT
(Strength-Weaknesses-Opportunities-Threats) analysis of the main players in
the global shipping industry arena.
1.
A.P. Moller-Maersk
(Article: Business Monitor International Ltd.: Japan Shipping Report, Q2, 2011,
p. 46-51)
A.P.M. Maersk is a highly diversified group with a significant presence in the
shipping sector- accounts for around 15 percent of total global TEU capacity1.
The company was formed in 1904 in Denmark and since then has become the
biggest and the world`s most recognized shipping conglomerates. The group
employs approximately 110000 people in 130 countries, and is also active in
gas and oil sectors.
Strengths:
-
The world`s largest container shipping line, with a biggest market share than
any other carrier. Expanding fleet allows catching up the trade volumes.
-
Maersk Line is a part of A.P.M Maersk – a large diversified group active within
the gas and oil and terminal-operating sectors, which gives a lot of power to
the company as the actor in shipping industry and enables to lobby.
Weaknesses:
-
A large fleet is causing constantly a risk of overcapacity.
-
Its presents in oil and gas sectors declines the hedging options of the
company, since it is over -relying on the sector as a whole. It can be dangerous
if, for example, the oil prices affect directly the bunker prices.
Opportunities:
-
The company is planning to design and built 18000 TEU vessels
Treats:
-
Company trades is DKK, therefore is sensitive to the DKK/USD exchange rate
fluctuations
1
20-foot equivalent unit
The correlation of oil and bunker prices threatens profits.
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Organizational culture versus National culture in MSC
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2.
Mediterranean Shipping Company
(Article: Business Monitor International Ltd.: Japan Shipping Report, Q2, 2011,
p. 53-55)
Strengths:
-
MSC is the second largest container shipper in the world, covering the direct
port calls better than any of its competitors
-
The long-term strategy for future development - ordering the largest vessel
ever classified by Germanischer Lloyd2 and expansion of the Panama Canal.
-
Company is not averse to chartering, which permits MSC to expand fleet
Weaknesses:
-
Large fleet is a risk of overcapacity
Opportunities:
-
Well positioned to capture the future volumes, as the global trade is
expanding
-
Recent partnership with CMA-CGM for fleet sharing. The partnership includes
the sharing of some shipping lines and creating new ones for MSC together
with CMA- CGM, which would expand MSC port coverage and increase
flexibility.
Threats:
-
By scrapping some if its fleet, company becomes reliant on the chartering, if it
wants to retain the market share. This can become expensive when charter
rates increase.
3.
CMA- CGM
(Article: Business Monitor International Ltd.: Japan Shipping Report, Q2, 2011,
p. 56-63)
2
GL- Assurance, consulting and classification for the maritime and energy industries (http://www.gl-group.com/en/index.php)
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Organizational culture versus National culture in MSC
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Is the world`s third largest shipping line. Compagnie Genarale Maritime (CGM)
was formed in 1977 with the merger of the Messageries Maritimes (MessMar)
and the Compagnie Generale Transatlantique (Transat). Compagnie Maritme
Affretement (CMA) was founded the following year, 1978. The group has a
special focus on the reefer cargo and also operates in the tourist industry,
through its subsidiary Croiseres et Tourisme.
Strengths:
-
Third largest shipping line in the world, has acquired a number of diversified
subsidiaries, enabling to expand to various markets across the globe.
-
CMA-CGM`s multi-modal divisions provides the customer with am integrated
door-to-door service.
Weaknesses:
-
Large fleet is a risk of over- capacity
-
The firm is not as diverse as the competitors
Opportunities:
-
Partnership with MSC is a deal with a big potential for CMA. Sharing routs and
fleet can expand the business fields for both companies.
Threats:
-
The company must ensure that it does not place the importance of increase of
market share over the recovery.
4.
COSCO
(Article: Business Monitor International Ltd.: Japan Shipping Report, Q2, 2011,
p. 79-83)
China Ocean Shipping Company (COSCO) dates back to 1961. Group was
originally engaged in transport solutions but did not become a shipping
company until 1993. In 2005, the company issued an initial public offering and
now trades on stock exchange. Today COSCO has a strong presence in all
major cargo shipping sectors, including container shipping, dry and liquid bulk,
as well as terminal and logistics operations and shipbuilding.
22
Organizational culture versus National culture in MSC
BScB(IM) 2012
Strengths:
-
Highly diversified, this supports sustained growth and stability
-
Strong relationships with Bank of China, which supported COSCO with a
source of credit since 1960s
Weaknesses:
-
Huge orderbook of fleet, which might result in excess capacity and
significant financial obligations.
Opportunities:
-
Growing demand for raw materials in China can secure COSCO with ling term
demand for dry bulk shipping services.
Threats:
-
Overcapacity remains risk
5.
HAPAG-LLOYD
(Article: Business Monitor International Ltd.: Japan Shipping Report, Q2, 2011,
p. 68-71)
Hapag Lloyd has a 160 year history dating back to the foundation of German
lines
Hamburg-Amerikanische-Packetfahrt-Acttien-Gesellschaft
and
Norddeutscher Lloyd (NDL). The two lines merged in 1970 to form HapagLloyd. In 1997, the line became a subsidiary of German tourism giant TUI AG,
which purchased 100 percent of shares in Hapag-Lloyd in 2002.
Strengths:
-
The company has expertise in the transportation of dangerous goods, the
shipment of special cargo and stowage
-
The company has a huge global presence and shares in two terminals : The
Montreal Gateway Terminal and the Container- Terminal Altenwerder GmbH.
Weaknesses:
-
Today Hapag-Lloyd operates only in container market
-
Company had to rely on the state aid to carry it through the downturn
Opportunities:
23
Organizational culture versus National culture in MSC
BScB(IM) 2012
-
The company is set to join the mega-vessel club with four vessels with a
capacity of 13200 TEUs each on order
-
In association with Grand Alliance carriers enables it to enter into vesselsharing agreements or jointly operated services with ease.
Threats:
-
Overcapacity risk
-
Hapag- Lloyd trades in EUR, which might negatively influence the profits due
to the volatility of the EUR/ USD exchange rate.
MSC Holding
MSC`s international strategy is to optimize the workflow in a way that the
company’s strategic centers are running 24/7. Therefore the documentation
centers are placed in Hong Kong (responsible for the Far and East), in Denmark
(Central and Eastern Europe) and in Caribbean (USA, South America).
Our scope of research is the European entity- MSC Scandinavia Holding. It
includes 16 countries and the headquarters are located in Copenhagen. The
16 countries work in the same Shipping Business Application software. The
export documentation, finance and IT support of all 16 courtiers are handled
in Riga, Latvia. All 16 countries after comparing them across 6 Hofstede`s
intercultural dimensions show to be significantly different in a way people
perceive the world and work ethics. This means that the common corporate
values have been applied in different local conditions. This also affects the
way each country should be managed and led. The same management style
can’t be applied to Russia and Sweden, for example.
Analysis
MSC organizational Culture
Every company and organization shares some common features which help
them to stand out among the other players on the field. This is what
24
Organizational culture versus National culture in MSC
BScB(IM) 2012
organizational culture serves for. Organizational culture gives the sense of
belonging to the employees of the organization. Especially a multinational
company has to embed an organizational culture in every agency, since the
employees are spread all over the world. Therefore it is important that they
feel united over distance and still belonging to the same entity and following
common goals. There are 11 mechanisms known for accomplishing this
(Aarhus School of Business, Organizational Behavior, 2011: p. 434):
-
Formal statement of organizational philosophy, mission, vision, values and
materials used for recruiting, selection, socialization
-
The design of physical space, work environment and buildings
-
Slogans, language, acronyms and sayings,
-
Deliberate role modeling, training programs , teaching and coaching by
managers and supervisors,
-
Explicit rewards, status symbols and promotion criteria
-
Stories, legends and myths about the key people of events
-
The organizational activities, processes or outcomes that leaders pay
attention to, measure and control,
-
Leader actions to critical incidents and organizational crises
-
The workflow and organizational structure
-
Organizational systems and procedures
-
Organizational goals and the associated criteria used for employee
recruitment, selection, development, promotion, lay-offs, retirement.
The Mediterranean Shipping Company, as a multinational organization, puts a
lot of emphasis on organizational culture, as a factor differentiating each MSC
local agency worldwide. It has a strong power in terms of uniting and
motivating the employees. MSC organizational culture can be characterized as
external control culture type. MSC is operating in the industry, where
competition is very sharp, goal achievement is highly valued (the company
states its goals very clearly to the employees), and a battle for the market
25
Organizational culture versus National culture in MSC
BScB(IM) 2012
share is constantly present between the main actors in the shipping field. The
organization formulated a clear mission combining economic and noneconomic objectives, which inspire, motivate and give direction to all
organization members. “Realizing the dream” and “beating the competition”
is a common inspiring theme. MSC organizational culture is built upon six core
values, which are highlighted on the intra and extranet of the company, and
which managers refer to when conducting status meeting with the staff.
These core values are: Trust, Responsibility, Common Sense, Enthusiasm,
Teamwork, Results.
Responsibility encourages employees to be responsible for whatever action
and decision they make. Every person in MSC is in charge of his own tasks and
actions. Employees are responsible for taking care of their customers and
serve them in the best possible way. Customer focus is extremely important.
This core value implies not only the individual responsibility, but also social
responsibility- meaning eliminating corrupt and unethical behavior, which
might harm the community, its people and environment.
Common Sense implies using logic in all situations, in order to solve them in
the best interest of the company. Common sense dominates over the
structures and manuals, which will never be a replacement for taking
responsibility and acting thoughtfully.
Trust is a firm belief in honesty, integrity and reliability. Mutual trust within
the company creates a foundation for effective communication and
motivation, which is a base for all good relationships and a favorable working
environment.
Teamwork is co-operative effort by MSC employees to achieve a common
goal. Working together as a team by putting the interests of the company and
customers before the personal ones, is known for bringing the best results.
26
Organizational culture versus National culture in MSC
BScB(IM) 2012
Enthusiasm must be present in the daily work of every MSC employee. This is
a crucial condition for creating a fruitful working environment and achieving
the best results.
Good results are what keeps the company alive and is a logical outcome when
all above mentioned values are successfully incorporated in company`s
workflow.
MSC is incorporating the organizational culture through the artifacts- the
characteristic symbols of the company- like the logos, yellow color, which is
used in design and decoration of the office buildings (the color of MSC
containers). The company is arranging various events and teaching programs
for the employees. These are in the form of sport events arranged for the
neighbor countries, which have a lot of in common business in commercial
aspect, celebration of New Years Eves and other holydays. The educational
meetings are arranged for the key employees and management to share
knowledge and experience of handling common customers, issues, and dayto – day operations as well as just to meet in person and create bonds.
The MSC organizational culture is being kept and embedded in MSC
Scandinavia Holding as well. However, as a joined entity it is sharing much
more in common due to its purpose, functionality and structure. As
mentioned above, from the organizational structure point of view, they share
common operational software and internal server, common documentation
and financial centers in Riga, and headquarters in Copenhagen. MSC SH
human resource department arranges annually meetings and interviews with
staff. They conduct an annual motivation survey, where employees disclose
their opinions about management and daily routine. After submitting the
entire results HR manager analyses the employee’s engagement rates and
finds long and short term solutions for improvement. Another annual
procedure is EDD- Employee Development Discussion. The discussion is held
between the manager and his/her employees individually in the end of the
27
Organizational culture versus National culture in MSC
BScB(IM) 2012
year. This procedure consists of several steps: firstly, both manager and
employee fill in a form, where answer questions about the general
atmosphere in the office and in the department, the achievement of the past
year and objectives for the coming period. The discussion reveals both
interpersonal relationships and professional issues. The EDD is a chance for
employee to inform his manager about their plans for future, both personal
and professional, to express dissatisfaction, to discuss the possibilities of
promotion or changing departments, for example.
Having discussed and described the organizational culture of MSC and all the
measures taken to establish it, we will look at the cultural context – we will
measure, using Hofstede`s intercultural dimension, the cultural differences of
the 16 countries in MSC- SH (as mentioned before, we focus on this particular
entity of MSC). However we can apply Hofstede only to 10 counties, which are
Croatia, Denmark, Estonia, Finland, Hungary, Norway, Poland, Russia, Slovenia
and Sweden. We will try to give characteristics to other 6 counties, not
included in Hofstede`s study: Bosnia- Herzegovina, Belarus, Kazakhstan,
Latvia, Lithuania, Uzbekistan, in our further analysis.
The analysis of 10 countries, using Hofstede`s intercultural dimensions, will be
extended by adding the results of our own conducted research. Having
distributed the questionnaire to all employees of MC-SH 16 countries, based
on the collected responses, we will try to confirm or refute Hofsede`s results.
However, we understand, that our results might not match with Hofstede`s
classifications due to various reasons: research was made in a different
company, the questions within the survey were not too much in depth and
not revealing respondent`s personality; we also keep in mind the statistical
error due to not equal amount of people in each county`s office and not 100%
response rate. We have not scored the dimensions, as did Hofstede, however
the responses we obtained can help us to make judgments regarding some of
the dimensions. Given this, we cannot position with certainty every county
28
Organizational culture versus National culture in MSC
BScB(IM) 2012
within the dimension, we can only detect if it relates to one or another side of
it, for example, if a given country has more features of the masculine or
feminine nature.
Our research will look at the Masculinity versus Femininity dimension through
the following angle: we will measure the rate of management positions in the
office taken by women. As per Hofstede, in feminine societies, women have
equal opportunity and are equally likely to take high positions in the company
as men. This is the case for societies, where people have equal rights and the
social roles and men and women are not strictly defined as: men providing for
the family and women being responsible only for household and bringing up
children. To make the above mentioned conclusion about the respondent
culture, there should be more than one managers` position in the office of a
given country.
Another dimension we will look at is Individualism versus Collectivism. We will
base our conclusions on the responses to the questions about education (the
multiple choice answers were: high school education, college degree,
bachelor degree, master degree or other). As per Nancy Adler (p.52-54), in
individualistic societies, companies hire people based on their education and
professional skills, when in collectivistic societies, people often get hired
through contacts within the company (being a good friend or a family member
of a current employee of the company). Another criterion is the general rate
of responses on the questionnaire. In collectivistic societies, the rate of
responses will be high, because they are group-oriented and delegate the task
to the whole department, as well as it will take longer time to submit all the
answers, when in individualistic societies, the rate of responses will be low
and the answers will be submitted immediately.
29
Organizational culture versus National culture in MSC
BScB(IM) 2012
1. Croatia
Picture 2. Croatia (http://geert-hofstede.com/croatia.html)
Power Distance (PDI): Croatia scores high on this dimension (score of 73).
Meaning that in the society hierarchical order is accepted and followed.
People have defined places in the social structure, which is applicable for the
organizations, which are often centralized. Management has high authority
and power in decision making and information distribution.
Individualism versus Collectivism (IND): Croatia, with a score of 33 is
considered a collectivistic society. This means that people built strong, long
term oriented relationships. The sense of belonging is cruise for society,
where the members of the group take responsibility and care for each other.
This is reflected in the organizations. The relationships are often family-like,
where all the benefits and punishments are equally shared by the employees.
Masculinity versus Femininity (MAS): Croatia scores 40 on this dimension and
is thus considered a relatively feminine society. This implies that people value
quality of life much higher than the career achievements. Meaning that
people would prefer quality time spent with family then long working hours
with higher pay. In feminine societies equal rights and social statuses are
being provided to all its members. In organizations this implies that
30
Organizational culture versus National culture in MSC
BScB(IM) 2012
management position can be taken by both male and female and the salary
variation is not too high between management and staff. In feminine
organizations conflicts are solved by finding a compromise and a common
ground. In organizations there is a high concern for environment and
corporate social responsibility. Being better than others is not rewarded in
any way.
Uncertainty avoidance (UAI): Croatia scores 80 on this dimension and thus
has a very high preference for avoiding uncertainty. In high uncertainty
avoidance society traditions are being kept, innovations are often resisted.
People highly value security; they want to be sure about what is going to
happen tomorrow. For organizations this means that employees are retained
for long period and life time employment is possible. People like to follow
guidelines and clear instructions in their work, as well as don’t like to be in a
rush when making decisions. People rely on the bureaucracy.
Long term orientation (LTO): No scores available
2. Denmark
Picture 3.Denmark (http://geert-hofstede.com/denmark.html)
PDI: With a score of 18 points Denmark is at the very low end of this
dimension. This matches perfectly with what many foreigners in Denmark
express: Danes do not lead, they coach and employee autonomy is required.
Facts talk for themselves: Denmark has the highest out of 27 EU countries rate
of employee’s autonomy. Danes believe in social equality. In organizations
31
Organizational culture versus National culture in MSC
BScB(IM) 2012
this is translated into very horizontal structures and rather familiar
relationships between professors and students in the universities, for
example.
IDV: Denmark, with a score of 74 is an Individualistic society. This implies that
people stand for themselves and their close family members only. A short talk
is enough, with no need to built strong deep relationships. Danes are known
for very direct communication style, which altogether makes it fairy easy to
start business.
MAS: Denmark scores 16 on this dimension and is therefore considered a
feminine society. This implies that people value quality of life much higher
than the career achievements. Meaning that people would prefer quality time
spent with family then long working hours with higher pay. In feminine
societies equal rights and social statuses are being provided to all its
members. In organizations this implies that management position can be
taken by both male and female and the salary variation is not too high
between management and staff. In feminine organizations conflicts are solved
by finding a compromise and a common ground. In organizations there is a
high concern for environment and corporate social responsibility. Being better
than others is not rewarded in any way.
UAI: With a score of 23 Denmark scores low on this dimension. This means
that Danes do not need their life to be highly structured and predictable.
People are adventurous and spontaneous, accepting changes and new things
coming into their lives. Denmark has a reputation in innovation and design.
For organizations this means that employees tend to switch jobs easily looking
for new challenges and companies tent to implement innovations both
technological and methodological.
LTO: The Danes score 46, making it a short term orientation culture, though
very close to the middle. This means that society has strong wish for
possessing and to keep us with the modern trends. People don’t have a
tendency to save up for future and are oriented on achieving quick results.
32
Organizational culture versus National culture in MSC
BScB(IM) 2012
Leisure time is important. Focus in business and politics is mostly on what is
happening now, instead of in future.
3. Estonia
Picture 4.Estonia (http://geert-hofstede.com/estonia.html)
PDV: Estonia scores low on this dimension (40). In Estonia employees are
willing to have a manager, who includes them in decision making and allows
expressing opinions.
As Hofstere explained the current situation is Estonia: “Estonia has recently
passed the transition state, which means however that the older generation
and state organizations often demonstrate high PDI tendencies. The older
Soviet ways of thinking and relating to the world still remain and the bosssubordinate relationship among Estonians is sometimes more hierarchical
than the score suggests.” (http://geert-hofstede.com/estonia.html)
IDV: Estonia is an individualistic country with a score of 60. This implies that
people stand for themselves and their close family members only.
Relationships have functional purpose. Communication style is very direct,
which altogether makes it fairly easy to start business.
MAS: At a score of 30, Estonia is a feminine country. This implies that people
value quality of life much higher than the career achievements. Meaning that
people would prefer quality time spent with family then long working hours
with higher pay. In feminine societies equal rights and social statuses are
being provided to all its members. In organizations this implies that
33
Organizational culture versus National culture in MSC
BScB(IM) 2012
management position can be taken by both male and female and the salary
variation is not too high between management and staff. In feminine
organizations conflicts are solved by finding a compromise and a common
ground. In organizations there is a high concern for environment and
corporate social responsibility. Being better than others is not rewarded in
any way.
UAI: With a score of 60, Estonia has a high preference for avoiding
uncertainty. In high uncertainty avoidance society traditions are being kept,
innovations are often resisted. People highly value security; they want to be
sure about what is going to happen tomorrow. For organizations this means
that employees are retained for long period and life time employment is
possible. People like to follow guidelines and clear instructions in their work,
as well as don’t like to be in a rush when making decisions. People rely on the
bureaucracy.
LTO: No scores available
4. Finland
Picture 5. Finland (http://geert-hofstede.com/finland.html)
PDI: Finland scores low on this dimension (score of 33). This means that the
society is equal; hierarchy is used for convenience only. In organization this
means that employees can approach their managers easily. Employees are
included in decision making process. The structure of organizations is
horizontal.
34
Organizational culture versus National culture in MSC
BScB(IM) 2012
IDV: Finland, with a score of 63 is an Individualistic society. This implies that
people stand for themselves and their close family members only.
Relationships have functional purpose. Communication style is very direct,
which altogether makes it fairly easy to start business.
MAS: Finland scores 26 on this dimension and is thus considered a feminine
society. This implies that people value quality of life much higher than the
career achievements. Meaning that people would prefer quality time spent
with family then long working hours with higher pay. In feminine societies
equal rights and social statuses are being provided to all its members. In
organizations this implies that management position can be taken by both
male and female and the salary variation is not too high between
management and staff. In feminine organizations conflicts are solved by
finding a compromise and a common ground. In organizations there is a high
concern for environment and corporate social responsibility. Being better
than others is not rewarded in any way.
UAI: Finland scores 59 on this dimension and thus has a medium high
preference for avoiding uncertainty. In high uncertainty avoidance society
traditions are being kept, innovations are often resisted. People highly value
security; they want to be sure about what is going to happen tomorrow. For
organizations this means that employees are retained for long period and life
time employment is possible. People like to follow guidelines and clear
instructions in their work, as well as don’t like to be in a rush when making
decisions. People rely on the bureaucracy.
LTO: The Finns score 45, making it a short term orientation culture. This
means that society has strong wish for possessing and to keep us with the
modern trends. People don’t have a tendency to save up for future and are
oriented on achieving quick results. Leisure time is important. Focus in
business and politics is mostly on what is happening now, instead of in future.
35
Organizational culture versus National culture in MSC
BScB(IM) 2012
5. Hungary
Picture 6.Hungry (http://geert-hofstede.com/hungary.html)
PDI: Hungary scores low on this dimension (score of 46). This means that the
society is equal; hierarchy is used for convenience only. In organization this
means that employees can approach their managers easily. Employees are
included in decision making process. The structure of organizations is
horizontal.
IDV: Hungary, with a score of 80 is an Individualistic society. This implies that
people stand for themselves and their close family members only.
Relationships have functional purpose. Communication style is very direct,
which altogether makes it fairly easy to start business.
MAS: Hungary scores 88 on this dimension and is thus a masculine society.
This means that people live in order to work. The emphasis is on
achievements and career growth. In organizations within masculine societies,
manager is supposed to be decisive, high focus is on equity, fighting
competition and results. When conflicts arise, they are usually solved by
fighting them out.
UAI: Hungary scores 82 on this dimension and thus has a preference for
avoiding uncertainty. In high uncertainty avoidance society traditions are
36
Organizational culture versus National culture in MSC
BScB(IM) 2012
being kept, innovations are often resisted. People highly value security; they
want to be sure about what is going to happen tomorrow. For organizations
this means that employees are retained for long period and life time
employment is possible. People like to follow guidelines and clear instructions
in their work, as well as don’t like to be in a rush when making decisions.
People rely on the bureaucracy.
LTO: Hungary scores 50, making it a long term orientation culture. The long
term oriented culture has a focus on the future results. People tend to save
and invest. Organizations choose a long term strategy, which will bring the
most benefits to a company in a long run.
6. Norway
Picture 7. Norway (http://geert-hofstede.com/norway.html)
PDI: Norway scores low on this dimension (31). This means that the society is
equal; hierarchy is used for convenience only. In organization this means that
employees can approach their managers easily. Employees are included in
decision making process. The structure of organizations is horizontal.
IDV: Norway with a score of 69 is considered an individualistic society. This
implies that people stand for themselves and their close family members only.
Relationships have functional purpose. Communication style is very direct,
which altogether makes it fairly easy to start business.
MAS: Norway scores 8 and is thus the second most feminine society. Finland
scores 26 on this dimension and is thus considered a feminine society. This
37
Organizational culture versus National culture in MSC
BScB(IM) 2012
implies that people value quality of life much higher than the career
achievements. Meaning that people would prefer quality time spent with
family then long working hours with higher pay. In feminine societies equal
rights and social statuses are being provided to all its members. In
organizations this implies that management position can be taken by both
male and female and the salary variation is not too high between
management and staff. In feminine organizations conflicts are solved by
finding a compromise and a common ground. In organizations there is a high
concern for environment and corporate social responsibility. Being better
than others is not rewarded in any way.
UAI: Norway scores 50 and thus becomes a fairly pragmatic culture in terms
of uncertainty avoidance. This means that Norwegian society is exposed to
both ends of this dimension; thus having focus on planning and not being
afraid of taking risks at the same time.
LTO: Norway scores 44 making it more of a short term orientation culture.
This means that society has strong wish for possessing and to keep us with the
modern trends. People don’t have a tendency to save up for future and are
oriented on achieving quick results. Leisure time is important. Focus in
business and politics is mostly on what is happening now, instead of in future.
7. Poland
Picture 8. Poland (http://geert-hofstede.com/poland.html)
38
Organizational culture versus National culture in MSC
BScB(IM) 2012
PDI: At a score of 68, Poland is a hierarchical society. Meaning that in the
society hierarchical order is accepted and followed. People have defined
places in the social structure, which is applicable for the organizations, which
are often centralized. Management has high authority and power in decision
making and information distribution.
IDV: Poland, with a score of 60 is an Individualistic society. As Hofstede claims,
the high scores on PDI and IDV dimensions create a tension and contradiction
in this culture. The relationships are delicate, but very intense and fruitful
once you manage them. Managers in the organizations have to establish a
certain communication pattern- having a personal contact this everyone in
the organization, thus making everyone feel important, although not equal.
MAS: Poland scores 64 on this dimension and is thus a masculine society. This
means that people live in order to work. The emphasis is on achievements and
career growth. In organizations within masculine societies, manager is
supposed to be decisive, high focus is on equity, fighting competition and
results. When conflicts arise, they are usually solved by fighting them out.
UAI: Poland scores 92 on this dimension and thus has a very high preference
for avoiding uncertainty. In high uncertainty avoidance society traditions are
being kept, innovations are often resisted. People highly value security; they
want to be sure about what is going to happen tomorrow. For organizations
this means that employees are retained for long period and life time
employment is possible. People like to follow guidelines and clear instructions
in their work, as well as don’t like to be in a rush when making decisions.
People rely on the bureaucracy.
LTO: Poland scores 32, making it a short term orientation culture. This means
that society has strong wish for possessing and to keep us with the modern
trends. People don’t have a tendency to save up for future and are oriented
on achieving quick results. Leisure time is important. Focus in business and
politics is mostly on what is happening now, instead of in future.
39
Organizational culture versus National culture in MSC
BScB(IM) 2012
8. Russia
Picture 9. Russia (http://geert-hofstede.com/russia.html)
PDI: Russia, scoring 93, is among the 10 percent of the most power distant
societies in the world. Meaning that in the society hierarchical order is
accepted and followed. People have defined places in the social structure,
which is applicable for the organizations, which are highly centralized.
Management has high authority and power in decision making and
information distribution.
This is underlined by the fact that the largest country in the world is extremely
centralized: 2/3 of all foreign investments go into Moscow where also 80% of
all financial potential is concentrated. This causes a huge discrepancy between
social layers- creating space large difference between the rich and the poor.
This makes the status symbols very important attributes.
IDV: Russia scores 39 and thus is a collectivistic society. Family and friends are
extremely important in everyday life. The relationships are carefully built and
often last live-long. Interpersonal communication, mutual trust and respect
are core values for making business and successful negotiations. Highly
40
Organizational culture versus National culture in MSC
BScB(IM) 2012
collectivistic society is also described as particularistic, meaning that rules and
laws are perceived in the context of a particular situation. For example,
people would not witness in the court against their family member or friend,
even knowing he/she is guilty.
MAS: As per Hofstede, Russia’s relatively low score of 36 may surprise with
regard to its preference for status symbols, but these are in Russia related to
the high Power Distance. Having a closer look, we can notice, that the work
place, for example, Russians tent to talk modestly, understate their status and
achievements. It is very unpopular to brag about your successes. While the
superiority of the boss is accepted, it is not appreciated among the coworkers. In feminine societies, people value quality of life, and take care of
each other.
UAI: As per Hostede`s research, Scoring 95 Russians feel very much
threatened by ambiguous situations, as well as they have established one of
the most complex bureaucracies in the world. When applied to the business
world, people prefer to have lot f background information about each other
before starting a meetings or negotiations.
LTO: No score available
9. Slovenia
Picture 10. Slovenia (http://geert-hofstede.com/slovenia.html)
PDI: Slovenia scores high on this dimension (score of 71). Meaning that in the
society hierarchical order is accepted and followed. People have defined
41
Organizational culture versus National culture in MSC
BScB(IM) 2012
places in the social structure, which is applicable for the organizations, which
are often centralized. Management has high authority and power in decision
making and information distribution.
IDV: Slovenia, with a score of 27 is considered a collectivistic society. This
means that people built strong, long term oriented relationships. The sense of
belonging is cruise for society, where the members of the group take
responsibility and care for each other. This is reflected in the organizations.
The relationships are often family-like, where all the benefits and
punishments are equally shared by the employees.
MAS: Slovenia scores 19 on this dimension and is thus considered a feminine
society. This implies that people value quality of life much higher than the
career achievements. Meaning that people would prefer quality time spent
with family then long working hours with higher pay. In feminine societies
equal rights and social statuses are being provided to all its members. In
organizations this implies that management position can be taken by both
male and female and the salary variation is not too high between
management and staff. In feminine organizations conflicts are solved by
finding a compromise and a common ground. In organizations there is a high
concern for environment and corporate social responsibility. Being better
than others is not rewarded in any way.
UAI: Slovenia scores 88 on this dimension and thus has a very high preference
for avoiding uncertainty. In high uncertainty avoidance society traditions are
being kept, innovations are often resisted. People highly value security; they
want to be sure about what is going to happen tomorrow. For organizations
this means that employees are retained for long period and life time
employment is possible. People like to follow guidelines and clear instructions
in their work, as well as don’t like to be in a rush when making decisions.
People rely on the bureaucracy.
LTO: No scores available
42
Organizational culture versus National culture in MSC
BScB(IM) 2012
10. Sweden
Picture 11. Sweden (http://geert-hofstede.com/sweden.html)
PDI: Sweden scores low on this dimension (score of 31). This means that the
society is equal; hierarchy is used for convenience only. In organization this
means that employees can approach their managers easily. Employees are
included in decision making process. The structure of organizations is
horizontal.
IDV: Sweden, with a score of 71 is an Individualistic society. This implies that
people stand for themselves and their close family members only.
Relationships have functional purpose. Communication style is very direct,
which altogether makes it fairly easy to start business.
MAS: Sweden scores 5 on this dimension and is therefore the most feminine
society. This implies that people value quality of life much higher than the
career achievements. Meaning that people would prefer quality time spent
with family then long working hours with higher pay. In feminine societies
equal rights and social statuses are being provided to all its members. In
organizations this implies that management position can be taken by both
43
Organizational culture versus National culture in MSC
BScB(IM) 2012
male and female and the salary variation is not too high between
management and staff. In feminine organizations conflicts are solved by
finding a compromise and a common ground. In organizations there is a high
concern for environment and corporate social responsibility. Being better
than others is not rewarded in any way.
UAI: Sweden scores 29 on this dimension and thus has a low preference for
avoiding uncertainty. . This means that Swedes do not need their life to be
highly structured and predictable. People are adventurous and spontaneous,
accepting changes and new things coming into their lives. For organizations
this means that employees tend to switch jobs easily looking for new
challenges and companies tent to implement innovations both technological
and methodological.
LTO: The Swedes score 20, making it a short term orientation culture. This
means that society has strong wish for possessing and to keep us with the
modern trends. People don’t have a tendency to save up for future and are
oriented on achieving quick results. Leisure time is important. Focus in
business and politics is mostly on what is happening now, instead of in future.
Data analysis
Having described and categorized 10 out of 16 counties in MSC- SH using
Hofstede`s methods and theory, we will look into the data, which we have
submitted from the employees of the company. We will look at the way MSC
establishes a common corporate culture through the organizational goal and
associated criteria used for employee recruitment and selection; characterize
within two cultural dimensions- Collectivism versus Individualism and
Masculinity versus Femininity each country, including the ones, not covered
by Hofstede; and comparing our results with Hofstede`s results for countries
included in his research.
Collectivism versus individualism
44
Organizational culture versus National culture in MSC
BScB(IM) 2012
As per Nancy Adler (2010) and article of Timothy Johnson “Respondent
Cultural Orientations and survey participation: the effect of Individualism and
Collectivism”, this dimension affects directly the non-response rate of the
surveys. Members of individualistic societies are often not willing to
participate in surveys (Adler, 2010). The reason for low responsiveness is the
little personal benefit that can be extracted from completing surveys, as it is
mostly seen as being time-consuming and irrelevant for the individual. On the
other hand, collectivist societies have higher rate of response, as this process
emphasizes cooperation and personal sacrifice (of time) for greater social
good. In our study we have used this indicator of Individualistic versus
Collectivistic dimension, to evaluate, according to it, the real life casecounties within MSC Scandinavia Holding. We have sent out a survey to 755
employees in 16 countries- which are all MSC Scandinavia Holding staff. The
overall responses we have obtained are 261, which is 35 percent (see
Appendix 3). We have submitted the response amount per country and
compared with the number of employees in each office to calculate the
response rate. We have illustrated the results in the Graph 1 below. The graph
shows, that none of the countries has completed the survey with 100 percent
rate of responsiveness; however, the highest result stands for MSC Denmark,
where 47 out of 64 people completed the questionnaire. The lowest response
rate belongs to MSC Croatia, where only 1 out of 17 people filled in the
survey. The rates of responses of other countries vary from 71 to 14 percent.
We do not state strongly which dimension each of the countries belongs to, as
this single parameter does not provide sufficient evidence; however, we have
chosen to use the 50 percent as a cutting line; the countries with rate of
response below 50 percent are more likely to be individualistic, and countries
above 50 percent are more likely to be collectivistic.
To be more specific, according to the assumption made above, we define
Croatia, Finland, Russia, Poland and Slovenia as individualistic countries. Such
results are dramatically different from what we expected. Out of ten
45
Organizational culture versus National culture in MSC
BScB(IM) 2012
countries, studied by G. Hofstede, only 3 were classified as collectivisticRussia, Croatia and Slovenia; and these were the countries, with the lowest
response rates, whereas we have expected much higher involvement of
people in these MSC- SH offices. However, the results for Finland and Poland
confirmed Hofstede`s classification.
Further on, we suggest that the following countries are more individualistic
then collectivistic: Belarus, Hungary, and Estonia. The rate of responsiveness
in these offices is higher than 30 percent, but still below 50 percent cutting
line. Thus Estonia and Hungary matching Hofstede`s description.
Furthermore, the results of our survey showed that Kazakhstan and Denmark
act as collectivistic cultures, performing the highest rate of responsiveness out
of all offices. Remaining Bosnia- Herzegovina, Latvia, Lithuania, Norway,
Sweden and Uzbekistan we characterize as being more collectivistic than
individualistic, as the rates of responsiveness range in the percentage interval
from 52 to 57.
Thus we conclude, that our results for Scandinavian countries- Denmark,
Norway and Sweden deviate from Hofstede`s results. Surprisingly, employees
in these offices showed enthusiasm to participate in our research.
Collectivism, Y
100%
90%
80%
60%
50%
Individualism
Denmark, 73%
70%
40%
Bosnia- Herzegovina,
57%
Belarus, 38%
Kazakhstan, 71%
Latvia, 53% Norway, 56%
Hungary, 47% Lithuania, 52%
Estonia, 38%
30%
Slovenia, 27%
20%
10%
0%
Sweden, 55%
Uzbekistan, 56%
Finland, 14%
Croatia, 6%
Country, X
Poland, 19%
Russia, 16%
46
Organizational culture versus National culture in MSC
BScB(IM) 2012
Graph 1. Rates of responsiveness per country.
Masculinity versus femininity
According to Hofstede and Hofstede 2005, Masculinity versus Femininity
dimension has significant influence on the business world and organizational
structure in terms of female`s chances and opportunities in career and the
probability of them climbing up the hierarchical ladder in the company. We
have analyzed MSC- SH countries from the perspective of male and female
management ratio in the company`s local offices. We have combined two
questions from the survey to achieve the results, which we have submitted in
Graph 2. It represents the percentage ratio of men and women in each
country (see Appendix 4). The presence of females on the managing positions
in the company indicates that the male and female roles in the society are not
strictly defined, meaning that women are encouraged to have higher
education and have as many growth and carrier opportunities as men. This
can be observed in feminine societies, which value equality of its` members
and quality of life.
Some of the results shown in the Graph 2 were expected, whereas, some
were surprising. Unfortunately we do not have any data on this subject for
Croatia and Uzbekistan, as none of the managers from these countries have
completed the survey. We also cannot make any judgments about the
countries with one male manager. The fact that the manager is male does not
imply that a female did not have the same chance of getting this position; it
might have been a coincidence, meaning that, this evidence is insufficient to
claim, that the given culture is more likely to be masculine. Such countries are
Belarus and Bosnia- Herzegovina.
47
Organizational culture versus National culture in MSC
BScB(IM) 2012
The results were surprising for Scandinavian countries: Sweden and Denmark,
which, as per Hofstede, are the world`s most feminine cultures, in our
research appeared to have a big superiority of males over females in the
managing positions in the company. The ratios are 5:2 for Sweden and 14:2
for Denmark respectively. Another surprising country is Russia. Hofstede
argued that, even though Russia seems to be a masculine society, due to a
very hierarchical structure of organizations and society itself, it is a feminine
culture. Strict hierarchy is a cause of extremely high power distance in this
country and not due to the masculine nature. However, the results of our
survey show that in Russian organizations, managing positions are still
principally occupied by males- the ratio is 8:2 respectively. The survey results
for Slovenia also revealed the preference for male managers in given
company- 3:1 ratio of male versus female managers respectively, thus
conflicting with Hofstede`s description of Slovenia as feminine country.
Our study has confirmed Hofstede`s classification of Poland and Hungary as
masculine cultures as we can observe a strong preference for male managers
with male versus female ratio as 2:0 and 3:0 respectively. Another country,
which shows to be more masculine, according to our results for this
dimension, is Lithuania. The male and female manager ratio is 2:1 respectively
(giving the percentage gap of 34).
On the other hand, as strongly feminine cultures in our research appeared to
be Estonia, Finland and Kazakhstan with male versus female managers ratios
of 2:4, 0:1 and 2:2 respectively; thus our results for Estonia and Finland
matched Hofstede`s classification of these countries as feminine. The results
for Kazakhstan might seem unexpected for many people, as the stereotype
about Eastern countries usually defines them as having very traditional roles
for genders in society. However, we, according to the analysis from the
conducted survey, suggest that Kazakhstan is more likely to have a feminine
nature of the society.
48
Organizational culture versus National culture in MSC
BScB(IM) 2012
Another group of countries, which we examined, seem to have alike patterns
of male and female distribution on managing positions- they are Norway and
Latvia. In the MSC offices in these countries both males and females represent
managing positions in the company with insignificant prevalence of men. We
suggest that these 3 countries are more likely to be feminine. Even though,
the percentage gap exists, it is considered to be rather small (14 percent in
Latvia and 20 percent in Norway), given that, according to Forbes, statistics
for labor force in general and for women in management particularly, still
does not show the 50:50 ratio of men and women engagement in the job
market, especially inequality, in favor of men, is observable on the higher top
management
positions
and
in
the
board
of
directors
(http://www.forbes.com/2011/02/18/women-business-management-forbeswoman-leadership-corporate-boards.html).
Uzbekistan
0%
0%
29%
Sweden
71%
25%
Slovenia
75%
20%
Russia
80%
0%
Poland
40%
Norway
33%
Lithuania
43%
Latvia
Kazakhstan
Hungary
0%
Finland
0%
Croatia
Bosnia- Herzegovina
Belarus
60%
67%
57%
50%
50%
100%
100%
Estonia
14%
Denmark
100%
67%
33%
86%
0%
0%
0%
100%
0%
0%
100%
20%
40%
Fem_Manager
60%
80%
Male_Manager
100%
120%
49
Organizational culture versus National culture in MSC
BScB(IM) 2012
Graph 2. Male versus Female manager ratio per county
In conclusion for data analysis of cultural dimensions, we want to point out
and summarize the results for those six countries, which are not covered by
Hofstede (see Appendix 5):
-
Belarus: is classified as more individualistic than collectivistic culture,
with insufficient data to characterize Masculinity versus Femininity
dimension;
-
Bosnia- Herzegovina is classified as more collectivistic than
individualistic
culture,
with
insufficient
data
to
characterize
Masculinity versus Femininity dimension;
-
Kazakhstan is classified as collectivistic and feminine culture;
-
Latvia is classified as more collectivistic than individualistic culture, and
more likely to be feminine;
-
Lithuania is classified as more collectivistic than individualistic culture,
and more likely to be masculine;
-
Uzbekistan is classified as more collectivistic than individualistic
culture, with insufficient data to characterize Masculinity versus
Femininity dimension.
Our results reflect the comparison of all countries with each other from
the common picture of responses to a relevant question. We did not score
each dimension, as did Hofstede, using a common scale, therefore, we
often formulated our conclusions as “more or less likely” to be placed on
one or another side of two cultural dimensions we described.
MSC organization culture through employee recruiting and retaining
Our angle to look at MSC- SH organizational culture is aimed at mapping and
comparing the criteria for recruiting staff in each office of MSC- SH across 16
50
Organizational culture versus National culture in MSC
BScB(IM) 2012
participant countries. Our analysis will be rooted into defining the most
average pattern of characteristics of individual within MSC – SH and
comparing it to the average pattern of personal characteristics of employee in
every, out of 16 MSC- SH regional offices.
Starting with the characteristics of an average employee in MSC- SH (see
Appendix 6) we can conclude that its` representative is a
Female, which scores 54 percent out of all respondents:
Picture 12. Gender ratio
An employee of age from 20-30 years (51 percent)
Picture 13. Age groups ratio
Single (64 percent)
Picture 14. Family status ratio
With a bachelor degree (41 percent)
51
Organizational culture versus National culture in MSC
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Picture 15. Education degree ratio
Working in MSC on average 1-5 years (49 percent)
Picture 16. Years of experience in MSC ratio
Having defined the average characteristics of an MSC- SH employee, our
objective is to illustrate the dispersion of these characteristics across every
country. As our questionnaire was structured, meaning that respondents had
fixed options of answers, we were not able to calculate the numerical mean
for every answer. Therefore we chose to refer to the most popular response
option of every question from each respondent country and mapped it on the
graph below. We have compared the employees from each country across
five characteristics: gender, age, family status, education and years of working
in MSC. On the graph we have presented below, we have coded the results in
the following way: by selecting the most popular answer to every question in
the respondent countries. The question about gender had two possible
answers: 1- for male, 2- for female; question of age had six possible answers:
1- under 20 years, 2- from 20 to 30 years, 3- from 30 to 40 years, 4- from 40 to
50 years, 5- from 50 to 60 years, 6- over 60 years. The question about the
52
Organizational culture versus National culture in MSC
BScB(IM) 2012
family status suggested two possibilities: 1- married, 2- not marries. There
were five optional answers for education: 1- high school degree, 2- college
degree, 3- bachelor degree, 4- master degree, 5- other type of education
(might be a PhD degree or any kind of specialized professional education).
And, finally, the question on years of experience in MSC had 4 possible
answers: 1- from 0 to 1 year, 2- from 1 till 5 years, 3- from 5 till 10 years, 4over 10 years. According to the above mentioned coding (see Appendix 7) the
results are summarized in the graph below.
4
3.5
3
2.5
2
1.5
1
0.5
0
Gender
Age
Family status
Education
Experience in MSC
Belarus
Bosnia- Herzegovina
Croatia
Denmark
Estonia
Finland
Hungary
Kazakhstan
Latvia
Lithuania
Norway
Poland
Russia
Slovenia
Sweden
Uzbekistan
MSC Average
Graph 3. Survey results per country
In the graph every country is represented in different color in the following
sequence: MSC Average employee, Belarus, Bosnia- Herzegovina, Croatia,
Denmark, Estonia, Finland, Hungary, Kazakhstan, Latvia, Lithuania, Norway,
Poland, Russia, Slovenia, Sweden and Uzbekistan. Every question on the X axis
in the graph submits all the results per each country, thus visualizing the
dispersion of the results.
53
Organizational culture versus National culture in MSC
BScB(IM) 2012
Referring to question of gender, the results of MSC- SH, as a single unit,
showed that the number of men and women in the company is almost the
same- 46 versus 54 percent respectively. However, the countries, where men
prevail are Bosnia- Herzegovina, Croatia, Denmark, Lithuania, Norway, Poland
and Slovenia. Sweden scores 1.5 points in this question, due to the fact that
the amount of males and females in the office is the same.
As mentioned before, the most common age category in MSC-SH is the range
of 20-30 years. The results for this question appeared to be significantly
different for five countries- Croatia, Kazakhstan, Denmark, Hungary and
Slovenia, where the most common age category is 30-40 years. Three
countries scored 2.5 in this scale, meaning the age categories of 20-30 years
and 30-40 years are the most common with the same percentage- 50 and 50
percent for Bosnia- Herzegovina, 33 and 33 percent for Finland and 50 versus
50 percent for Lithuania.
The results for the question about family status are very homogeneous across
all 16 countries- majority of employees are not married. The exceptions are
Belarus and Hungary, where most of the employees are married and
Uzbekistan, where the ratio of married and single employees is 50 and 50
percent.
The question of education showed that the majority of employees in MSC- SH
have a bachelor degree- 41percent. As illustrated on the graph, four countries
deviate from the common overall average- Denmark, Hungary, Poland and
Sweden. Across the employees in Denmark the dominating education level is
a college degree- 38 percent, whereas in Hungary and Sweden- it is high
school education, that prevails- 33 percent for Hungary and 39 percent for
Sweden respectively. Statistics for education level in Poland showed
dramatically different results out of all 16 MSC- SH countries. We observe that
the education criteria for employee hiring in MSC Poland is very high- 85
percent out of 13 respondents have a Master degree, whereas other 15
54
Organizational culture versus National culture in MSC
BScB(IM) 2012
percent are bachelors, meaning that all the employees have a higher
education, which is remarkable.
Finally, the question on the employee retaining in MSC- SH- the results are
very homogeneous. The average in MSC- SH is from 1 to 5 years experience
within the company. The exceptions are Latvia and Slovenia. As per
information, provided by MSC- SH executives, Latvian office had a huge
expansion during the last year, which caused a need for new workforce,
consequently, hiring of new employees. This explains the low average results
on staying with MSC in Latvia. On the other hand, the Slovenian employees
have been working in MSC-SH for 5 to 10 years on average. This fact might
have been influenced by very high uncertainty avoidance of Slovenian culture,
which has been defined by Hofstede.
Conclusion
As globalization is expanding, multinational organizations are becoming more
similar, while the behavior of people within them is remaining culturaly
unique. According to Nancy J. Adler, many managers believe that strong
organizational culture can erase or diminish significantly the cultural
differences within the organizations. However, Hofstede in his study proved
that employees and managers bring their cultural background and ethnicity to
the workplace. National culture in his study explained more than 50 percent
of difference in attitudes and behaviors, which explained more than did
professional role, age, gender or race. The biggest difference between
national and organizational culture is that national culture is rooted in values
and is absorbed by person from very young age, thus is a given fact for
organization management, whereas organizational culture is rooted in
practices, therefore can be manageable to some extent.
55
Organizational culture versus National culture in MSC
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The objective of our thesis was to define organizational culture of MSC and
national cultures within MSC Scandinavia Holding. We have looked at the
artifact- such as MSC yellow color, logos and offices design, and at the core
values of the company- Trust, Responsibility, Common Sense, Enthusiasm,
Teamwork, Results. These core values are highly emphasized on all levels of
the company in all areas of activity- on employee and top management levels,
in internal cooperation, in communication with customers and suppliers.
According to Lars Funding, MSC Scandinavia Holding CEO, these core values
are the main mechanism for establishing a common corporate culture in all
MSC offices worldwide (see Appendix 2). From his words, given that in all
countries- both employees and managers “live by” this notion, managing
cultural differences is becoming much easier. Secondly, we have described
each country in MSC- SH based on Hofstede (data for only 10 countries out of
16 was available in his study). Parallel with that we have conducted our own
survey, which was aimed at defining the basic features of employees in MSCSH and find out if the selection of employees in this organization follow a
common trend across all countries. As according to G.Hofstede (2005) and
Nancy J. Adler (2010) pre-selection of employees play an important role in
maintaining organizations values, meaning through hiring people of certain
gender, age, nationality, and education. Another purpose of our survey was
to define, on our own, independently from Hofstede`s research, two out of
five cultural dimensions of the studied countries- Masculinity versus
Femininity and Individualism versus Collectivism, compare our results with
Hofstede`s and state them for countries, which he did not cover. According to
both Hofstede (2005) and Nancy Adler (2010) the certain factors and
behaviors of people point at belonging of the culture to one or another side of
the cultural dimension. For Individualism versus Collectivism it is the rate of
participation of people in the surveys and for Masculinity versus Femininity it
is the equality in labor force distribution, especially on management positions.
56
Organizational culture versus National culture in MSC
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The results we have obtained for the Masculinity versus Femininity dimension
have not confirmed Hofstede`s theory for Denmark, Russia, Slovenia, Sweden,
whereas Estonia, Finland, Hungary, Norway, and Poland have matched.
Furthermore the data allowed us to define Kazakhstan as feminine culture,
Lithuania as more masculine culture and Latvia as more feminine.
The results we have submitted for the Individualism versus Collectivism
dimension have not confirmed Hofstede`s theory for Croatia, Denmark,
Norway, Russia, Slovenia and Sweden. Whereas, Estonia, Finland, Hungary
and Poland matched Hofstede`s classification. Furthermore, we have classified
Belarus as more individualistic culture, Bosnia- Herzegovina, Lithuania, Latvia
and Uzbekistan as more collectivistic and Kazakhstan as collectivistic.
As for data on selection and recruitment of employees, the obtained results
did not show the expected homogeneity. People in all 16 MSC – SH countries,
given their national differences, are not the same across such parameters as
age, gender, family status and education. This means that the HR department
in MSC – SH does not have a strong preference of a certain profile, when
hiring a person. According to the CEO Lars Funding, MSC supports diversity
and delegates lot of power and freedom to the local offices. This means that
the criteria for hiring staff is dictated by the local conditions of labor market
and local particularities of shipping industry in each country. MSC does admit
and realize the complexity of managing cultural differences, however sees
more benefits in cultural diversity, therefore company enhances it, instead of
trying to diminish. As Mr. Funding mentioned, the interaction of even polar
different cultures does not lead to problems, if people within the company
follow the corporate values- base their interaction on mutual trust and stay
responsible for their actions, and perceive themselves as a part of big MSC
family.
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Organizational culture versus National culture in MSC
BScB(IM) 2012
References
Aarhus School of Business and Social Science (2011), “ Organizational Behavior”,
Second Custom addition
Adler, N. J. (1983) “Cross-cultural management research: The Ostrich and the
Trend”, the Academy of Management Review: 226-232
Adler, N.J and Gundersen A. (2010), “International Dimensions of
Organizational Behavior”, 5th edition, Thomson South-Western
Chapman, M. (1997), “Social Anthropology, Business Studies, and Cultural
Issues” International Studies of Management and Organization: 3-29
Dr. Chitakornkijsil P. (2010), “Intercultural Communication Challenges and
Multinational Organization Communication”: National Institute of
Development Administration (NIDA), Bangkok 10240 Thailand.
Czinkota, M. R., Ronkainen, I. A. and Moffet, M. H. (2005), “International
Business”, Mason: South Western
Hofstede, G. H. (2001), “Culture's consequences: comparing values, behaviors,
institutions, and organizations across nations”. London: Sage,
Hofstede, G. and Hofstede, G. J. (2004), “Cultures and Organizations: Software
of the Mind”. London: McGraw-Hill
Hofstede, G. H. (1994), “The business of international business is culture”,
International Business Review: 1-14
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Organizational culture versus National culture in MSC
BScB(IM) 2012
Johnson T. (2000), “Respondent Cultural Orientation and Survey Participation:
The Effect of Individualism and Collectivism”, University of Illinois at Chicago,
USA
Kostova, T. (1999), “Transnational transfer of strategic organizational
practices: A contextual perspective” Academy of Management Review: 308324
Pagell, M.; Katz, J.P. and Sheu, C. (2005), “The importance of national culture
in operations management research”, International Journal of Operations and
Production Management: 371-394
Scheffknecht S. (2011), “Multinational Enterprises- Organizational Culture VS.
National Culture”, International Journal of Management cases.
Tosi, H. L., Mero N. P. and Rizzo, J.R. (2000),” Managing Organizational
Culture” Blackwell: Oxford
Trompenaars, F. (1994), “Riding the Waves of Culture: Understanding
Diversity in Global Business”, New York: McGraw-Hill
Links
http://www.amstat.org/sections/srms/proceedings/papers/2000_161.pdf
http://www.bloomberg.com/news/2011-01-10/freight-rates-poised-totumble-as-35-mile-line-of-ships-passes-coal-demand.html
http://www.forbes.com/2011/02/18/women-business-management-forbeswoman-leadership-corporate-boards.html
59
Organizational culture versus National culture in MSC
BScB(IM) 2012
http://geert-hofstede.com/croatia.html
http://geert-hofstede.com/denmark.html
http://geert-hofstede.com/estonia.html
http://geert-hofstede.com/finland.html)
http://geert-hofstede.com/hungary.html
http://geert-hofstede.com/norway.html
http://geert-hofstede.com/poland.html
http://geert-hofstede.com/russia.html
http://geert-hofstede.com/slovenia.html
http://geert-hofstede.com/sweden.html
http://www.gl-group.com/en/index.php
http://www.inspireimagineinnovate.com/PDF/GLOBEsummary-by-Michael-HHoppe.pdf
http://www.marisec.org/shippingfacts/worldtrade/index.php
http://www.marisec.org/shippingfacts/worldtrade/top-ten-containeroperators.php
http://www.mscgva.ch/about_us/agents.html
60
Organizational culture versus National culture in MSC
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Appendices
Appendix 1. Questionairre
1. MSC Office
2. Gender
3. Age
4. Education
5. Family status
6. Manager/ employee
7. Years of work in MSC
Appendix 2. Interview with the CEO Lars Funding
1. How does MSC –SH (as being a multinational organization) handles the
challenge of cultural differences among offices on management and
employee level?
Mr. Aponte delegates a lot of power to the region meaning we can apply our
own culture as long as it is based on mutual trust and adherence to global
policies.
2. Which advantages/ disadvantages of cultural diversity can you name, in
our particular case?
Advantage: diversification more solutions to same problem, easy adjust local
market condition as we respect local cultures.
Disadvantage: mainly on communication which is difficult.
3. Which measures does MSC –SH headquarters undertake in order to
establish a common organization culture across all 16 local offices?
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Organizational culture versus National culture in MSC
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We do respect local cultures and delegate a lot of power to the countries.
In our region our management is based on our 6 core values which we all have
to live by. An important part of all holding managers are to wave the flag and
show our basic values in everything we do.
4. Can you mention any negative consequences from the misunderstandings
based on cultural differences in MSC- SH?
We base a lot on verbal agreements which can be dangerous and lead to
mistakes. Better to get everything in writing.
5. You have probably visited every MSC –SH office. Do the general
atmosphere/ spirit differ a lot in all 16 countries? Is staff mostly
homogeneous?
You see our basic values in all offices for sure. But you see cultural differences
of course.
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Organizational culture versus National culture in MSC
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Appendix 3. Rate of responsiveness
MSC Office
Belarus
BosniaHerzegovina
Croatia
Denmark
Estonia
Finland
Hungary
Kazakhstan
Latvia
Lithuania
Norway
Poland
Russia
Slovenia
Sweden
Uzbekistan
TOTAL
№ of
employees
№ of
responces
8
7
17
64
24
63
19
7
70
23
41
68
237
22
74
9
753
Rate of employees
3
38%
4
1
47
9
9
9
5
37
12
23
13
37
6
41
5
261
57%
6%
73%
38%
14%
47%
71%
53%
52%
56%
19%
16%
27%
55%
56%
35%
63
Organizational culture versus National culture in MSC
BScB(IM) 2012
Appendix 4. Male versus Female manager ratio
MSC Office
Belarus
BosniaHerzegovina
Croatia
Denmark
Estonia
Finland
Hungary
Kazakhstan
Latvia
Lithuania
Norway
Poland
Russia
Slovenia
Sweden
Uzbekistan
Male_Manager
Fem_Manager
1
0
1
0
12
2
0
3
2
4
2
3
2
8
3
5
0
0
0
2
4
1
0
2
3
1
2
0
2
1
2
0
Total
Male_Manager
Fem_Manager
1
100%
0%
1
0
14
6
1
3
4
7
3
5
2
10
4
7
0
100%
0%
86%
33%
0%
100%
50%
57%
67%
60%
100%
80%
75%
71%
0%
0%
0%
14%
67%
100%
0%
50%
43%
33%
40%
0%
20%
25%
29%
0%
64
Organizational culture versus National culture in MSC
BScB(IM) 2012
Appendix 5. Summary of Hofstede`s classification
Country/
Dimension
Power Distance
Individualism/
Collectivism
Masculinity/
Femininity
Uncertainty
avoidance
Long term
Orientation
no data
available
Croatia
high
collectivistic
feminine
high
Denmark
low
individualistic
feminine
low
Estonia
low
individualistic
feminine
Finland
low
individualistic
feminine
high
medium
high
Hungary
low
individualistic
masculine
high
long term
Norway
low
individualistic
feminine
medium
short term
Poland
high
individualistic
masculine
very high
Russia
very high
collectivistic
feminine
very high
Slovenia
high
collectivistic
feminine
very high
short term
no data
available
no data
available
Sweden
low
individualistic
feminine
low
short term
short term
no data
available
short term
65
Organizational culture versus National culture in MSC
BScB(IM) 2012
The results of survey
Country/
Dimension
Our survey
results on
individualism
Our survey
results on
masculinity
Croatia
Denmark
Estonia
Finland
Hungary
Norway
Poland
Russia
Slovenia
Sweden
Uzbekistan
Kazakhstan
Latvia
Lithuania
Bosnia
Belarus
individualist
collectivist
more individualist
individualist
more individualist
collectivist
individualist
individualist
individualist
collectivist
more collectivist
collectivist
more collectivist
more collectivist
more collectivist
more individualist
can`t define
more masculine
feminine
feminine
masculine
more feminine
masculine
masculine
more masculine
more masculine
can`t define
feminine
more feminine
more masculine
can`t define
can`t define
66
Organizational culture versus National culture in MSC
BScB(IM) 2012
Appendix 6. Qualtrics Report
Initial Report
Last Modified: 04/29/2012
1. MSC-SH office:
#
Answer
Response
%
1
Belarus
3
1%
2
BosniaHerzegovina
4
2%
3
Croatia
1
0%
4
Denmark
47
18%
5
Estonia
9
3%
6
Finland
9
3%
7
Hungary
9
3%
8
Kazakhstan
5
2%
9
Latvia
37
14%
10
Lithuania
12
5%
11
Norway
23
9%
12
Poland
13
5%
13
Russia
37
14%
14
Slovenia
6
2%
15
Sweden
41
16%
16
Uzbekistan
5
2%
261
100%
Response
%
Total
2. Gender:
#
Answer
1
Male
122
46%
2
Female
142
54%
Total
264
100%
67
Organizational culture versus National culture in MSC
BScB(IM) 2012
3. Age:
#
Answer
Response
%
1
Under 20
2
1%
2
20-30
134
50%
3
30-40
87
33%
4
40-50
29
11%
5
50-60
13
5%
6
Over 60
1
0%
266
100%
Response
%
Total
4. Position:
#
Answer
1
Employee
196
74%
2
Manager
70
26%
Total
266
100%
5. Family status:
#
Answer
Response
%
1
Married
94
36%
2
Not married
170
64%
Total
264
100%
Response
%
6. Education:
#
Answer
1
High School
43
16%
2
College degree
43
16%
3
Bachelor degree
110
41%
4
Master degree
59
22%
5
Other
11
4%
Total
266
100%
68
Organizational culture versus National culture in MSC
BScB(IM) 2012
7. Years of experience in MSC:
#
Answer
Response
%
1
0-1 year
53
20%
2
1-5 years
130
49%
3
5-10
59
22%
4
Over 10 years
23
9%
Total
265
100%
69
Organizational culture versus National culture in MSC
BScB(IM) 2012
Appendix 7. Summary of all responses
MSC Office
Belarus
BosniaHerzegovina
Croatia
Denmark
Estonia
Finland
Hungary
Kazakhstan
Latvia
Lithuania
Norway
Poland
Russia
Slovenia
Sweden
Uzbekistan
MSC Average
Gender Age
2
1
1
1
2
2
2
2
2
1
1
1
2
1
1.5
2
2
Family
status
2
2.5
3
3
2
2.5
3
3
2
2.5
2
2
2
3
2
2
2
Experience in
Education MSC
1
3
2
2
2
2
2
1
2
2
2
2
2
2
2
2
1.5
2
3
3
2
3
3
1
3
3
3
3
4
3
3
1
3
3
2
2
2
2
2
2
2.5
2
1
2
2
2
2
3
2
2
2