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National Cultures in America and China Impacting Fuyao's Management

Introduction

With the effective development of technology overtime leading to increase sharing of information and the expansion of companies to international levels, an increasing rise and need for diversity in the workplace is experienced by multinational companies and corporations. The increased collaboration between companies from different countries calls for more appreciation of cultural diversity and development of multicultural teams and workplaces. In addition, a more effective and efficient global organization requires effective coordination and communication between different employees within the workplace regardless of the difference in language and cultural backgrounds. This gave rise to the questions; how does the difference between the national culture in America and China impact Fuyao’s management practices? Can Fuyao bridge the gap between the Chinese and American cultures among their employees to foster an effective multicultural team? As such, this essay looks to develop and learn from an in-depth analysis of the differences and similarities between American and Chinese national cultures, how national cultures impact management practices as well as the prospect of multicultural teams and diversity.

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American Factory: Case Overview

The case study looks into some of the problems associated with cross cultural and global organizations. Upon the closing of the General Motors Car manufacturing industries in Dayton, Ohio in 2014, more than 2000 families and 10,000 locals lost their jobs and descended below the poverty line. Based on the case study; however, the company was reopened almost two years later by a Chinese company, which was involved in sourcing investments to rejuvenate American manufacturing factories. Fuyao Group, a private Chinese company, invested about 500 million to rejuvenate and reopen the Ohio factory to produce glasses including vehicle windshields and other types of glass. According to the case study on Netflix, (2019), the reopening led to a significant creation of employment for the local Americans within Ohio with up to 1000 people getting employed within the first year of reopening.

However, upon its reopening, Fuyao Group also imported a significant amount of Chinese experts and employees to help handle and manage production alongside American workers leading to the development of a multicultural workplace that attempted to meld the Chinese and American cultures. While this is a significant move to enhance the development of the community and also enable the Chinese to benefit from the arrangement while promoting diversity in a workplace, the wide difference between the Chinese and American cultures soon brought about significant challenges and problems(American Factory, Netflix, 2019). Majorly, there was a significant communication breakdown within the company, which slowed the decision making process and enhanced the occurrence of multiple mistakes as a result of misinterpretation and misunderstanding.

Difference in American and Chinese Culture

The American culture allows their employees to have unique individual personalities and a generally casual relationship towards work and all aspects of life. In contrast, the Chinese are more tightly knit with regards to culture and the workplace. Workplace ethics and discipline is significant for effective performance and productivity, and because the Americans were not accustomed to this culture a majority of the Chinese supervisors and leaders saw them as inefficient with low output. On the other hand Chinese employees worked significantly hard, almost all round the clock. This difference in cultures eventually led to the development of significant problems, such as, increased amount of accidents impacting losses to the company. some of the other problems experienced and the potential problems that could occur on account of cultural differences are highlighted in the table below.

The impact of Cultural differences in Multinational corporations

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Dissecting and Comparing National Cultures

American and Chinese cultures are significantly different in a wide number of ways. According to Bryant (2019) in addition to some of the evidence from the case study, some of the major differences between American and Chinese culture include: Americans are more individualistic as compared to the Chinese who put more emphasis in group and team work. While Americans enjoy freedom of speech and expression and view is as a basic right, the Chinese culture is heavy on censorship of information, media and the internet and as such the Chinese individuals do not often freely express themselves. Luo (2014) further highlights that the Chinese are extremely humble and often downplay their achievements in addition to avoiding confrontations in order to save face. Americans on the other hand are often loud and proud and frequently engage in boastful and confrontational conversations while in the workplace. All these differences in cultural set up significantly impact communication and coordination among the two people and is among the major reasons for the cultural and management problems experienced by Fuyao in Ohio.

Hofstede’s cultural dimension theory as highlighted by Browaeysand Price (2016) offers a framework for effectively distinguishing between national cultures across six major dimensions including the Power Distance index, Collectivism vs. Individualism, Uncertainty Avoidance index, Femininity vs. Masculinity, Short term vs. Long term orientation and Restraint vs. Indulgence. CFI (2015) highlights that all cultures experience these dimensions differently and adopt different solutions to any problems experienced across these dimensions. Effective awareness of these different dimensions and concepts helps minimize the ambiguousness and issues developed as a result of national cultural differences.

Hofstede’s Dimensions of National Culture

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Dissecting and comparing American and Chinese culture under these dimensions helps to identify the key cultural differences that impact productivity and effective management and thereby enhance better understanding and development of an effective workplace environment for Fuyao. Americans have a low power distance index given their adoption of flatter organization structures as compared to China which is highly hierarchical (Bryant, 2019). In addition Americans are more individualistic as compared to the Chinese who are more of collectivists given that work and success are both shared within groups and teams. Further Americans are often comfortable with uncertainty as working is not strictly supervised or chronologically ordered. This compared to the Chinese who are highly uncomfortable with uncertainty and as such require specific and timely instructions. For instance Fuyao suffered significant losses of up to $35,000 due to a prefix of a garage door by American counterparts before confirmation is granted by Fuyao’s management. Americans also focus on power rather than nurturing workers as is the case for Chinese National culture.

American vs. Chinese Cultural Values

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How National Culture Impact Management Practices

The different cultural aspects of a society or nation determine the beliefs, values and regulations by which the country’s workplaces are governed and managed. A significant difference in National cultures effectively leads to the development of multiple management barriers such as lack of effective communication and understanding as well as minimal levels of cooperation and coordination. According to Khan and Law (2018) National cultures significantly influence managerial decision making, leadership styles as well as human resource management. In addition, managerial functions such as motivation communication, organization design, reward and remuneration systems as well as employee and personnel perspectives and expectations are also significantly influenced by national cultures.

Significant problems are experienced by Fuyao’s management team with regards to the management of its employees and workers as a result of the existing cultural differences between the Americans and Chinese. For instance, the company incurs extensive losses including a $35,000 cost for the garage door which was fixed in the wrong position by an American company and manager (American Factory, Netflix, 2019). While the Chinese culture are slow decision makers who focus on building consensus, certainty and understanding before engaging in various business and company activities, Americans focus on speed and efficiency and often engage in different activities rapidly without establishing consensus and certainty (Bryant, 2019). As a result of this culture clash management practices at Fuyao are significantly compromised leading to multiple accidents and losses.

Different cultural practices such as individualism and short-term orientation of Americans compared to the collectivism and long-term orientation of the Chinese lead to significant problems that impact management practices. The Chinese employees often work in coordination with each other as a team and are more oriented towards listening and obeying authority, thereby most often they work quite effectively across the work hours for enhanced productivity and output. This includes habits such as short, timed breaks often taken within the work premises. However American culture provides for more freedom of individualism and self expression, as a result, Americans take their time for instance when it comes to meals and breaks and are often taking up different works and activities on their own regardless of whether adequate instructions are given or not. Consequently the eventual impact is not only low efficiency and output by the American Employees as highlighted in the case study, but also a difficulty of effectively completing some management practices by Chinese leaders such as communication, coordination and organization design.

Generally, different natural cultures indicate different beliefs and values as well as management practices. Managing practices as such impacted due to different workplace behavior, ideas and procedures which are a result of national cultures.

Multicultural Teams and Diversity

Given the significantdifference in National cultures across the globe as well as the problems and issues developed in management and other aspects of an organization or company as a result of the differences, developing multicultural teams and fostering cultural diversity is significant for future success of multinational companies such as Fuyao. According to Stahl et al. (2010), increased globalization has necessitated international business activities and the development of multinational companies that operate in multiple countries across the world. As a result of the differences in cultures and beliefs these kinds of organization experience significant and relatively new challenges that cannot be solved from a singular cultural standpoint, thereby, necessitating the need for cultural diversity and development of multicultural teams.

In addition to solving management problems such as communication barriers, motivation, collaboration and coordination that developed as a result of melding two different national cultures by Fuyao Group, developing a multicultural team and embracing cultural diversity can afford the company significant advantages and benefits. Based on Koehl (2016), a demographically diverse workforce is increasingly becoming the norm for large and small businesses alike within the global and mobile contemporary business environment. A diverse and inclusive workforce can help drive creation and execution of new products, services and business processes. Further, investing in a culturally diverse workforce contributes towards enhancing social and economic performances.

Among the major benefits of multicultural diverse teams include development of a significantly diverse cultural perspective among the workforce. This diversity subsequently inspires creativity, innovation, enhanced knowledge of the local market and insights which improve the competitive nature and profitability of a company. The diversity also encourages increased cultural sensitivity and insights which enhance the working relationship and organization among the employees and personnel (Reynolds, 2019). Multicultural teams with significant diversity also enable an organization to effectively attract and retain the best talent on account of the culturally diverse workforce which in turn enables the organization to offer a broader and more adaptable varieties of products and services. In addition culturally diverse teams are generally more productive in terms of performance and offer greater opportunities for personal growth and development. As such to ensure effective growth and development of the revamped Ohio glass factory development of a multicultural team with significant appreciation to cultural diversity is essential.

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Conclusion

For the eventual success of multinational organizations such as Fuyao Group’sGlass Company in Ohio, it is not only enough to meld two different cultures but also to ensure the development of a multicultural team which appreciates national cultural diversity. Through cross cultural training, both employees from America and China can effectively understand one another’s beliefs, attitudes and behaviors and effectively develop a compromise to enhance eventual productivity of the workforce. The employees will also be able to effectively communicate with one another and coordinate their efforts towards enhanced performance and productivity to impact profitability of the company. Appreciating cultural diversity will also enhance the sharing of ideas and knowledge both socially and professionally thereby impacting increased creativity and innovation within the company leading to enhanced profitability and success.

References

Browaeys, M. and Price, R., 2016. Understanding cross-cultural management. 3rd ed. Harlow, Essex: Pearson, pp.25-31.

Bryant, S., 2019. 10 Cultural Differences Between China and the US. [online] TMA World. Available at: [Accessed 10 March 2021].

CFI, 2015. Hofstede’s Cultural Dimensions Theory - Overview and Categories. [online] Corporate Finance Institute. Available at: [Accessed 10 March 2021].

Graham, J. and Lam, M., 2003. The Chinese Negotiation. [online] Harvard Business Review. Available at: [Accessed 27 March 2021].

Khan, M. and Law, L., 2018. The Role of National Cultures in Shaping the Corporate Management Cultures: A Three-Country Theoretical Analysis. Organizational Culture,.

Koehl, C., 2016. Managing Diversity: 10 Steps to Multicultural Team Success - Training. [online] Training. Available at: [Accessed 10 March 2021].

Luo, S., 2014. Cross-cultural differences between American and Chinese college students on self-disclosure on social media. [online] Core.ac.uk. Available at: [Accessed 10 March 2021].

Netflix (2019). American Factory. Business Documentary [online] netflix.com. Available at: [Accessed 10 March 2021].

Reynolds, K., 2019. 13 benefits and challenges of cultural diversity in the workplace | Hult International Business School. [online] Hult International Business School. Available at: [Accessed 10 March 2021].

Stahl, G., Mäkelä, K., Zander, L. and Maznevski, M., 2010. A look at the bright side of multicultural team diversity. Scandinavian Journal of Management, 26(4), pp.439-447.


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