Intercultural Management Analysis of Blue Ridge Fast Food Restaurant Joint Venture

This case study analyzes the joint venture between Blue Ridge fast food restaurant company in Spain and Terralumen, S.A. The study highlights the cultural differences, MBI analysis, cultural scenario map, and recommendations for a business solution. The major players involved in the joint venture are Yannis Costas, Mikael Sodergran, and Carlos Martin. The goal is to prevent the dissolution of the joint venture and regain the previous status of the company. The study recommends effective communication, negotiation, and conflict resolution skills to overcome cultural differences and ensure successful joint venture working.

IBA304
Intercultural Management Analysis
(Template)
BY:
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CONTENTS
Summary.........................................................................................3
MBI Analysis....................................................................................3
EXCELL Cultural SCENARIO MAP................................................4
Recommendations for a Business Solution....................................5
References......................................................................................5
Appendix A – Cultural observations................................................5
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SUMMARY
1. Case
The case study is about the joint venture or partnership between the Blue Ridge fast
food restaurant company in Spain that is owned by Delta Foods and the family owned
agricultural company named Terralumen, S.A. The company named Blue Ridge fast food
restaurant gained huge brand exposure and due to which, higher revenue has been
generated and it is considered as one of most influential factors behind the success of the
organisation after managing business as a joint venture. There have been issues taken
place over the rates of growth in the future and there were conflicts regarding the lack of
realistic growth targets (Stahl et al., 2010). The managing director of the company, Yannis
Costas, was allocated with inappropriate tasks to design a dissolution strategy and
implement that, which was further one of the major issues that emerged.
2. Key Business/Management Issues
Though the managing director of Blue Ridge tried his best to encourage the superiors,
still he was assigned with the task of dissolving the organisation and prevent the joint
venture to work furthermore, which resulted in the downfall of business. The issues have
took place due to present tension over the future rates of growth and irrelevant growth
targets that were set, which were agreed by few and opposed by few (Kaasa, Vadi &
Varblane, 2014). These are major business management issues that have emerged during
the joint venture between Blue Ridge and Terralumen.
3. Goal
The goal of the organisation is to evaluate the most suitable and effective approach of
preventing the dissolution of the joint venture, furthermore regain the previous status of
the company to sustain in the competitive business environment with ease and
effectiveness.
3 Key Players
The major players associated with the joint venture between Blue Ridges and Terralumen
are Yannis Costas, Mikael Sodergran and Carlos Martin. The company president for
Terralumen was Carlos Martin and the Mikael Sodergran was appointed as a managerial
position of Delta Foods. Yannis Costas was the Managing Director of Blue Ridge fast
food restaurant in Spain (Ramsey & Lorenz, 2016).
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MBI ANALYSIS
Cultural Models and Dimensions selected for MBI
From the case study that presented about the dissolution of the joint venture arising
from the different cultural issues, it could be understood that there are various cultural
models and dimensions selected for MBI and these are mostly presented by the three
major players . Mcnett (2009) stated that due to cultural differences, there were also issues
that emerged though it is found that the American and Greek cultural model are combined
by Yannis Costas, American cultural model by Sodergan and the Spanish cultural model
presented by Carlos Martin, all of which, represented the various dimensions of culture to
represent the roles, responsibilities and duties of the major players towards others and how
the joint venture could bring fruitful results all throughout (Mcnett, 2009). The major
cultural models are Hofstede’s five cultural dimensions, Trompenaars’ seven Value
Orientations, Kluckhohn & Strodtbeck’s 6 Values Orientation and Hall's 3 Cultural
Factors (Miska, Stahl & Mendenhall, 2013).
The Hofstede’s cultural dimension model includes the various components
including the Power Distance, Individualism vs Collectivism, Masculinity vs Femininity,
Uncertainty Avoidance and Long term vs short term orientation.
The Hall’s three cultural factors are based on space, context and time, which are
associated with the relationships established with people, managing cohesion among
groups (Lane & Maznevski, 2014). Enhancing the level of commitment and managing
both verbal and non-verbal communication with fulfilment of needs for space along with
management of proper time frame all throughout.
Mapping
From the case study, it can be seen that the organisations are present in different
places and so the cultures are also different. The Spanish culture was adopted by Blue
Ridge, which focus mainly on maintaining a good social status to manage successful
business performance. The major weakness of the culture is that it is based on subjective
nature and thus the actions undertaken to manage business are visible (Cseh et al., 2013).
The culture emphasizing on maintaining a good social status could undermine the
organisational performance while the subjective nature could often lead to hindrance
during joint venture working appropriately. The people in Spain are not punctual much,
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which might be a daunting task while talking about business and joint venture
management while attending a business meeting (Vaiman & Brewster, 2015).
On the other hand, the culture in America prioritizes on management of business
operations and processes at a faster rate and enables completion of work within the
allocated time frame while the drawback could be the individualistic nature of business.
The fast business operations need effective shared decisions to be made while the focus on
individualistic behaviour could result in putting more pressure on a single individual and
create stressful situations (Mcnett, 2009).
The Greek culture considers both proper time management and believes in
managing a good social status, which can also allow the prevention of joint venture
working. Due to the making of business decisions based on the subjective context, there
might be emergence of issues associated with the lack of growth opportunities for the
business firms (Felício et al., 2013). This particular culture facilitates business
performance at a rapid rate along with management of personal contacts to ensure
successful partnership working without dissolution. More emphasis on social hierarchy
with biased decisions against classes, ethnic groups and people from different
backgrounds could create trust and loyalty among people though might hinder the
management of joint venture (Ramsey & Lorenz, 2016).
Bridging
The cultural differences are needed to be overcome and thus it is known as
bridging the gaps, which can prevent the issues associated with the business functioning
and ensure that the joint venture working do not bring any negative outcomes. To bridge
the gaps that might be related to the issues, the management of communication between
the two business organisations as well as between the employees working within the
organisations is of utmost importance for resolving the cultural issues too (Maznevski,
2013). The various stages included to bridge the gaps and ensure that the issues of cultural
differences are overcome include prepare, decentre and recentre.
The prepare stage should enable Blue Ridge company in Spain to communicate
necessary information about the cultural differences and issues arising from that with the
employees and the businesses. This would not only act as an effective way to
communicate vital information, but could even be considered as an influential factor or
motivating aspect to drive organisational behaviour and bring positive outcomes all
throughout (Osland et al., 2013).
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The decentre stage should create scopes and opportunities for management of
discussions among the parties involved in the joint venture or partnership working. Both
the parties, i.e., Blue Ridge company and Terralumen would be able to sit together and
make discussions about the issues and potential negative outcomes that might emerge,
furthermore ensure proper sending and transfer of messages and information among
people with much ease and efficiency (Adger et al., 2013).
The recentre stage is another major step followed to bridge the gaps and cultural
differences through the establishment of effective communication process, share ad
exchange vital messages and information between employees and parties involved in the
joint venture. This can be beneficial for sharing individual opinions and ideas, furthermore
mutually agree to a particular context and develop suitable guidelines, rules and
regulations required to manage business effectively and prevent dissolution to the utmost
level possible, as stated in the case study (Urbano & Alvarez, 2014).
Integrating
To resolve the difference in terms of culture and create better team performance
contributing the improvement of business performance, integration skills are necessary.
The major integration skills are communication and interpersonal skills required to
manage effective communication between employees and gain trust (Gaillard & Mercer,
2013). The skills to adopt the client culture and appreciating that is essential for
accommodating to different situations, furthermore be open by trying new things and
manage innovation all throughout. The negotiation skills are also necessary, which can
allow for agreements associated with the negotiation ethics and ensuring shared
understanding and knowledge on the culture adopted by both these two companies to
again work as a joint venture (Mak & Barker, 2013). The manager or leader must possess
conflict resolution skills to evaluate the conflicts and address proper ways to prevent any
kinds of destructive conflicts experienced.
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6

FIGURE: Value creation through MBI
(Source: Mak & Barker, 2013)
EXCELL CULTURAL SCENARIO MAP
Scenario: The case scenario demonstrates the joint venture that was on the verge of
dissolution with conflicts arising from the cultural differences. The joint venture manager
tried his best to ensure that the cultural differences issues are overcome and both the
parties work together again to manage successful joint venture working.
Social Competency: The Manager does possess good interpersonal skills and negotiation
skills to ensure that a good culture is maintained through proper agreement between the
two parties for the joint venture (Mak, Daly & Barker, 2014).
Preparation Steps: - A meeting is held where both the parties can discuss about the
conflicts and prevent the dissolution process
- Assessment of market conditions and how it can benefit while
working as a joint venture
- Carrying out necessary investments to increase the capital
structure
St
ag
e
Verbal Behaviour Non –Verbal Values Cultural
Dimensio
n
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A.
Approach
 Greeting the individuals
participating in the meeting
with welcome drinks and other
services
Maintain proper
eye contact and
present a positive
attitude and
behaviour
To make
the
manager
s and
leaders
gain
knowled
ge about
adopting
cultures
relevant
for joint
venture
working
Duties and
responsibil
ities to
benefit
others
associated
with the
joint
venture
B.
Bridging
Overcoming the cultural
differences and setting right
growth targets
Providing chances
for others to
present their ideas
and opinions and
put greater
emphasis on the
speaker (MAK et
al., 2013)
Facilitate
shared
values
manage
ment and
decision
making
Shared
decision
making
and
collective
actions
undertake
n
8

C.
Commenting

I have been thankful to you for
assisting me in conducting the
joint venture effectively
Acquaintance with
the managers and
leaders of the
organisations
during meetings
Obtainin
g the
response
s and
feedback
s
regardin
g the
dissoluti
on of the
joint
venture
Adopt the
culture
properly to
ensure
successful
joint
venture
manageme
nt
D.
Departure/Developing
I think proper negotiations can
foster mutual contribution for
both the parties (Ferraro &
Briody, 2013)
Eye contact and
presenting a
positive behaviour
by bringing a smile
in face
Positive
response
s of the
manager
s
Improve
the
decision
making
process
and
managing
a healthy
work
culture
FIGURE: Excel cultural scenario map (FERRARO & BRIODY, 2013)
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RECOMMENDATIONS FOR A BUSINESS SOLUTION
As the joint venture was on the verge of dissolution, Yannis Costas, who was the
Mnaging Director of Blue Ridges, tried his level best to influence the superiors and stop
the dissolution process, which could be ineffective and irrelevant for both the parties.
There are evidences, which showed that the joint venture has been profitable and it has
benefited both the companies namely Blue Ridge Restaurants Corporation and Terralumen
S.A. As stated by Mcnett (2009), the recent conflicts had arisen due to the cultural
differences, which contributed to the lack of proper future rates of growth. Mcnett (2009)
also stated that the growth targets were not effective enough, which further increased the
issues and complexities and finally resulted in making a decision by the higher authorities
to create a dissolution strategy for the organisation. To prevent such thing, it is important
to recommend some effective solutions for bringing cultural appropriateness and ensure
that the dissolution strategy does not bring any loss for both the parties (Mcnett, 2009).
Yannis Costas, being the most important individual, as found from the case study,
has experienced issues while creating the right strategies to prevent the dissolution
strategy with focus on moving away from the joint venture with Terralumen. The growth
targets are needed to be properly shared with the authorities of Terralumen and must be
reasonable and vital, which could facilitate better management of joint venture (Kaasa,
Vadi & Varblane, 2014). The growth targets must fulfil all the criteria for SMART and
ensure that both the parties make a mutual agreement and believe in continuation of
business as a joint venture with much ease and effectiveness.
Mikael Sodergran, on the other hand, was more focused on sales and generation of
more revenue in business and manage business as a single unit and not in coordination as
a joint venture. It is recommended for him to prioritise more on the management of
effective communication within the workplace to understand the clients’ needs and
requirements and adopt the client’s culture to try out new things, facilitate innovation
procedure and remain accommodating to adjust to market conditions efficiently (Vaiman
& Brewster, 2015). This should not only allow the organisation to promote appreciating
behaviours towards the cultural differences and create a working environment free from
cultural barriers, differences and discrimination based on race, religion, creed, colour,
culture or ethnicity. Mikael Dodergran is recommended to purchase Terralumen and allow
the company to work as a joint venture through management of business operations and
processes in Spain. It should be done by following the various laws, rules and regulations
and contributing to the business’ success in the long run and generate higher revenue in
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the upcoming years too (Martin & Nakayama, 2013).
As Delta Foods Corporation owned Blue Ridge, there were issues arising from
cultural differences, which created tension between Delta and Terralumen and thus the
growth targets were not much relevant and effective too. There were infrastructure issues
as well, which should be overcome and thus a hierarchical organisational structure is
recommended to ensure that a good workplace is set up. The acceptance of aggressive
targets could be recommended for working on the issues, furthermore manage the
emerging conflicts with dedication and commitment for the facilitation of joint venture
(Asante, Miike & Yin 2013).
Collaboration between the two parties is essential and thus it is recommended to
create mutual trust by resolving the cultural differences that cause barriers. The
organisation Blude Ridge, being a long time partner for the concerned organisation always
provided helping hand and supported the accumulation of generated revenue structure.
Thus, the dissolution strategy to stop the joint venture could not only create a negative
mindset among the other party, but might even degrade the business performance once it
gains revival after the dissolution (Stahl et al., 2010). It is recommended for Mikael
Sodergran to play a major role in purchasing Terralumen and start its operations in Spain
to overcome the cultural barriers and work co-ordinately to bring success.
Additional funding should be done by Delta Foods to set up right growth targets
and appreciate the efforts put forward to work together as a collective business unit. The
potential to succeed in European nations must be understood and then decisions must be
made to facilitate proper management of human resources along with dealing with both
local and foreign clients for successful global business expansion too (Bird & Mendenhall,
2016).
According to the EXCELL cultural scenario map, it is also recommended to
conduct suitable verbal and non-verbal behaviours for representing the values and cultural
dimension that could promote joint venture functioning effectively. The meetings should
be held where both the parties would be engaged and proper eye contact along with
positive attitudes and behaviours should be necessary for making negotiations and finally
come to a mutual agreement (Dragoni et al., 2014). This must be agreed upon by both the
parties and create better scopes for both companies to start afresh again as an unit through
joint venture.
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REFERENCES
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climate change impacts and adaptation. Nature Climate Change, 3(2), 112.
Asante, M. K., Miike, Y., & Yin, J. (Eds.). (2013). The global intercultural communication reader.
Routledge.
Bird, A., & Mendenhall, M. E. (2016). From cross-cultural management to global leadership:
Evolution and adaptation. Journal of World Business, 51(1), 115-126.
Cseh, M., B. Davis, E., & E. Khilji, S. (2013). Developing a global mindset: Learning of global
leaders. European Journal of Training and Development, 37(5), 489-499.
Felício, J. A., Caldeirinha, V. R., Rodrigues, R., & Kyvik, O. (2013). Cross-cultural analysis of the
global mindset and the internationalization behavior of small firms. International
Entrepreneurship and Management Journal, 9(4), 641-654.
Ferraro, G. P., & Briody, E. K. (2013). The cultural dimension of global business. Upper Saddle
River: Pearson.
Gaillard, J. C., & Mercer, J. (2013). From knowledge to action: Bridging gaps in disaster risk
reduction. Progress in human geography, 37(1), 93-114.
Kaasa, A., Vadi, M., & Varblane, U. (2014). Regional cultural differences within European countries:
evidence from multi-country surveys. Management International Review, 54(6), 825-852.
Lane, H. W., & Maznevski, M. L. (2014). International management behavior: Global and
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capabilities of business and health teachers, students and curricula. Final Report. http://www.
olt. gov. au/resources-internationalisation-at-home.
MAK, A. S., BARKER, M., WOODS, P., & DALY, A. (2013). Organizational Diversity.
Mak, A. S., Daly, A., & Barker, M. C. (2014). Fostering cultural inclusiveness and learning in
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Mendenhall, M. E., Osland, J., Bird, A., Oddou, G. R., Stevens, M. J., Maznevski, M., & Stahl, G. K.
(Eds.). (2017). Global leadership: Research, practice, and development. Routledge.
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APPENDIX A – CULTURAL OBSERVATIONS
Reflection
From the assessment of the report, I have gained knowledge about various things that
are related to the intercultural business communication and how it can contribute to my
personal and professional career in the future by pursuing better growth scopes and
opportunities as well. I got acknowledged with the various issues faced during the
management of joint venture while the recommendations provided to resolve the issues have
also been understood by me. I have found that Yannis Costas firmly believed that due to lack
of knowledge and idea for Mikael Sodergran, he was not accustomed with partnership
working. It should be necessary to make him obtain knowledge and information regarding the
benefits of joint venture, which can not only promote partnership working, but will also help
in shared decision aiming and increase revenue generation, thereby benefit both the parties
involved in the joint venture. I have also understood that Sodergran has aimed at achieving
higher sales revenue rather than the achievement of continuous growth through setting the
growth targets. On the other hand, Terralumen was also aiming to leave the joint venture and
wanted the dissolution strategy to get implemented.
Though both of these companies were focused on achieving higher growth and
increased revenue generation, Delta Foods team was more focused on the implementation of
aggressive growth strategies to sustain higher chances of profitability and remain prominent
while working as a partner and owning Blue Ridge Spain. Costas firmly believed that the
dissolution strategy could not be the solution to the issue that has resulted due to the cultural
differences. There was a large gap in communication and due to this business issues kept on
emerging, thereby contributing the lack of management of partnership working effectively. I
personally believe as well that the dissolution strategy could not be effective, rather the joint
venture working should foster work coordination and bring positive results through enhanced
business performance and adopting different cultures consistently. As part of the resolution
strategy, to overcome the cultural differences and issues associated with it, negotiations must
be done by arranging meetings where both the parties could be present and discuss about
managing good interpersonal relationships and trust among the parties again. Adopting the
culture is essential for understanding the behaviours of stakeholders involved with the
businesses, furthermore create a diversified workplace where employees can work together
and the companies as a joint venture, to fill the missing gaps and ensure managing better
communication processes all throughout. There could be cultures that are group centric and
for those situations, careful consideration and negotiations are essential, according to me, for
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the facilitation of joint venture management and improved acquisition of knowledge during
the management of intercultural business relationships. I would also recommend few
measures that could resolve these issues such as conducting researches about cultural
differences and communication process to understand the culture from which both the parties
belong as well as allow for better communication skills and acquisition of knowledge. I
strongly believe that this could be achieved through training programs and relevant skills and
expertise will be obtained to excel in the multicultural business with much ease and
effectiveness.
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