Cross-Cultural Management Challenges

This assignment analyzes the challenges faced by a female manager from Lebanon while expanding financial services for Clever Clogs International in Amsterdam. It highlights cultural differences between Lebanon and The Netherlands using Hofstede's model and discusses the manager's responsibilities in effectively leading a diverse team to deliver quality service to clients.

International
Management & Ethics
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
1. Aim of the report and current state of globalization in the finance industry...........................3
2. Macro-level facts of the Netherlands ......................................................................................4
3. Value comparison of the country the Netherlands based on the Hosfstede's work on
comparison to Lebanon................................................................................................................5
4. Critique of Hofstede's work.....................................................................................................7
5. The business and management challenges that an international manager faces......................8
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10
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Illustration Index
Illustration 1: Hofstede's Model.......................................................................................................7
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INTRODUCTION
With the increase in globalization, many business organizations are looking forward for
expanding their business activities in the international market so that they may have greater
possibilities to achieve their goals and objectives (Brayant, B., 2008). Therefore, all the major
industries are also focusing on expanding their business activities in the international market so
that they may acquire better business opportunities. Main purpose for conducting the present
report is to deliver cross-cultural training for the first international assignment so that they can
easily perform their activities. However, main aim of company such as Clever Clogs
international is to change the way of banking system so that they can easily avoid the economic
crash. Organization is currently looking for expanding their business activities that is financial
services in the Amsterdam, the Netherlands for 2 years.
Presently, the report focuses on understanding external factors as well as macro-level
facts of the Netherlands so that manager can easily carry out their business activities in other
countries and region. However, it will also carry out the comparison of both the region that are
Netherlands and Lebanon based on the Hofstede's work. Furthermore, the report will also focus
on analysing the business and management challenges that international manager of Clever
Clogs may face while rendering services in the international marketplace.
1. Aim of the report and current state of globalization in the finance industry
In order to get success in the international market, it is necessary for Clever Clog
International to focus on different factors that are associated with the globalization. Clever Clogs
International is one of the financial companies which is planning to expand its business activities
from Lebanon to Amsterdam situated in Netherlands (Bosma, 2007). For this international
assignment, they has chosen to transfer female manager as she is capable enough and has
performed exceptionally well in the past with earning two promotion in the periods. For the first
international assignment, no formal training had been carried out so now, one of the companies
has been hired to deliver cross-cultural training as well as knowledge regarding the global factors
and challenges that manager would face throughout their international assignment. However,
main aim of company such as Clever Clogs international is to change the way of banking system
so that they can easily avoid the economic crash. Organization is currently looking for expanding
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their business activities that is financial services in the Amsterdam, the Netherlands for 2 years
(Moran, 2011).
Main purpose of this report is to provide cross-cultural training to the female manager of
Clever Clogs International so that she may execute financial services in the new region that is
Amsterdam. It is also necessary for the company to provide and deliver proper information and
knowledge regarding the contemporary economic situation of country under which they are
expanding their activities. With the increase in globalization, nations keep focus on enforcing the
policies and legislation related with financial openness (Pauleen, 2003). However, with the
current state of globalization, different nations are focusing on introducing polices related with
foreign direct investment so that countries may deal with global financial aspect that would
directly raise the economy of country. It has also been analysed that due to current state of
globalization, financial industry also tends or expects to grow by 20% every year that would
strengthen the economy.
2. Macro-level facts of the Netherlands
Clever Clogs International is planning to introduce its financial services in the
international market. For this, they are sending their manager from Lebanon to Amsterdam. For
expanding financial services in the Netherlands, different macro-level facts and factors are
needed to be taken into consideration (Gomez, 2011). In case of Netherlands, different micro-
level facts are as follows:
 Political factor- The foremost macro level fact within Netherlands includes political
factor. This factor within Netherlands is quite stable and open for internationalization
with nominal intervention of the governmental agencies. However, Netherlands’s
political environment generally focuses on the effective trade investment policy that is
open in the global environment.
 Economic factor- Netherlands’s economy is heavily depended upon the foreign trade.
GDP of Netherlands is around 800.2 Billion USD that makes it most pleasing and
approving economy for doing business.
 Social factor- Another factor that affects the services of Clever Clogs International is
social factor as individuals residing in Netherlands possess high quality of life (Brown,
2001). This region generally focuses on high skilled workforce who have received higher
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qualification. Therefore, social factor within the Netherlands is favourable and also
provides effective opportunities for all the international and national companies to sustain
in the business environment.
 Technological factor- Furthermore, technological factor within Netherlands may also
affect the business activities of Clever Clogs International. This country possesses high
degree of network within the region that supports organization in increasing the level of
communication system so that manager can easily promote and create awareness
regarding the financial services among the people and businesses of Netherlands
(Georgianna, 2007).
3. Value comparison of the country the Netherlands based on the Hosfstede's work on
comparison to Lebanon
Hofstede's work mainly focuses on enabling effective comparison in between the
Lebanon and Netherlands where company is expanding their business activities. Hofstede's
model generally includes number of factors such as-
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 Power distance: The attribute of Hofstede model generally focuses that individuals
within society are not equal. Netherlands scores 38 in power distance which means that
power is decentralized in nature and manager is appointed on the basis of experience.
However, in the Netherlands, communication is often direct. On the other hand, power
distance within the Lebanon is higher from the Netherlands which indicates that
individuals in the region are drawn in towards ranked aspects. Individualism: Another dimension is individualism that indicates the degree of society
among individuals. Netherlands has high score that is 80 and it is termed as individualist
society under which individual takes care of their own and of their family members too.
On the other hand, in Lebanon, there is collectivism society under which individual takes
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Illustration 1: Hofstede's Model
(Source: The Hofstede's Model, 2016)

care of all the relationship and takes responsibilities of all their family members (Brayant,
B., 2008). Masculinity: The masculinity dimension point that society features high competition and
success if the score is high while if the score is low then it may be termed as feminine
society where quality of life is regarded as the success. Netherlands score 14 that shows
feminine society on the other hand Lebanon scores 65 that indicates masculine society. Uncertainty avoidance: It is another dimension that depicts that future is uncertain and
never be known. Expanding activities in Netherlands score 53 that shows that there is
preference available for obviating uncertainty. In this culture, organization maintains
rigid codes and norms so that they can easily avoid the uncertainty. On the contrary,
Lebanon scores 50 that clearly indicates that company in the culture has no preference to
avoid the uncertainty (About Lebanon, 2014). Long term orientation: This dimension indicates that how organization maintains linkage
with the past through maintaining challenges of current scenario and future. Netherlands
scores 67 in this dimension that shows that company would change conditions according
to the requirement. On the other hand, Lebanon scores low that shows normative culture
that affects long term orientation.
 Indulgence: Last dimension in Hofstede's model includes Indulgence that defines degree
through which individual can control their needs and desires. Culture of Netherlands
scores 68 that depicts that people residing in the Netherlands society are willing to meet
their desires and needs (About Netherlands, 2014). While, they also have positive attitude
towards attaining their desires and impulses. On the other hand, Lebanon scores 25 that
shows that there is restraint culture within the society.
4. Critique of Hofstede's work Power distance- For expanding financial services within Netherlands, political factor is
necessary to be considered as power distance because government never interferes in the
business activities of Clever Clogs International. Individualism- However, score of individualism in Netherlands is relatively low
therefore, company must focus on social aspect or characterization so that they can meet
their goals and objectives.
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 Masculinity- In this term, score of Netherlands is very low that depicts the feminine
nature that is supportive as well as caring. Therefore, in such scenario, manager of Clever
Clogs International must focus on the social, cultural as well as technological aspect for
meeting opportunities (The Hofstede's Center, 2016). Uncertainty avoidance- For enabling business services in the Netherlands, it is essential
for Clever Clogs manager to concentrate on the political factors of the countries so that
they could overcome the uncertainty. Long term orientation- For enabling long term orientation within the Netherlands, it is
essential for the manager to focus on economic factors. Growing economy of Netherlands
is essential for the financial company to deal or sustain in the finance industry (Johnston,
2008).
 Indulgence- Rate of indulgence is very high in the Netherlands. Therefore, management
or manager of Clever Clogs International needs to abide legal laws and policies
developed by the government.
5. The business and management challenges that an international manager faces
In order to expand financial services in the Amsterdam, Netherlands manager faces
certain problems and challenges within the region (Moran, 2011). However, it is the duty of
manager to manage culturally diverse personnel within their organization so that they should
render proper services to their clients as well as customers. Different business and management
challenges that an international manager faces are- Communication: The foremost business and management challenge that is being faced
by the female manager is related to communication as Clever Clogs International has sent
their manager from Lebanon to Amsterdam, Netherlands. There is language barrier as
female manager is being sent to the new destination (Pauleen, 2003). Manager generally
speaks French or Arabic language, therefore they must be provided training so that they
can easily communicate to their staff members and other personnel regarding their
business activities and services. For instance, Lebanon region generally focuses on
English, Arabic and French language. Hence, manager has to mainly use English in the
Amsterdam as people of this region are unaware about the Arabic and French language.
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 Negotiation: Another challenge that is being faced by the manager is related to
negotiation. Manager while rendering services in the Amsterdam may also face challenge
regarding the negotiation as they possess differences in the culture and language that
result in occurring miscommunication and misinterpretation of the language. This in turn
can affect the negotiation process of Clever Clogs International (Brown, 2001).
 Value differences: Another challenge that is being faced by the female manager of
Clever Clogs International is regarding the value and cultural differences. However,
while sending manager in new country that is Amsterdam they may carry-on their own
values and beliefs that will affect their activities. However, employees and workers who
are performing activities carry their own values and belief that lead to clash at the time of
taking effective decisions. Therefore, differences in values and beliefs among the
individuals is regarded as key challenge that is faced by the female manager at the new
location that is Netherlands. Therefore, before sending manager to the international
region, it is necessary for management to render cross cultural training so that she can
easily manage working within the Amsterdam, The Netherlands (Bosma, 2007).
CONCLUSION
From the above report, it can be concluded that with the emergence of globalization,
organization has an effective path to expand their business activities in the international market.
For this purpose, Clever Clogs international has send their female manager from Lebanon to
Amsterdam so that they may expand their activities in the international market. In order to
expand financial services in the Amsterdam, manager faces certain problems and challenges
within the region of Netherlands. It is the responsibility and duty of manager to manage
culturally diverse personnel within their organization so that they could render proper services to
their client as well as customers.
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REFERENCES
Books & Journals
Bosma, T., 2007. Effective Leadership Practices in Cross-cultural Conflict Resolution: A
Qualitative Study. ProQuest.
Brown, M. L., 2001. Exploring the relationship between learning and leadership. Leadership &
Organization Development Journal. 22(6). pp.274-280.
Georgianna, S., 2007. Self‐leadership: a cross‐cultural perspective. Journal of Managerial
Psychology. 22 (6). pp.569 – 589.
Gomez, B. M., 2011. Global Leadership, Change, Organizations, and Development. Iuniverse.
Johnston, H., 2008. International Leadership in Cross-cultural Environments: the Relationship
between National Culture and Corporate Culture as it Pertains to Work Ethic and
Corporations. ProQuest.Moran, R., 2011. Managing Cultural Differences. Routledge.
Pauleen, J. D., 2003. Leadership in a global virtual team: an action learning approach.
Leadership & Organization Development Journal. 24(3).
Online
About Lebanon. 2014. Available through: <http://geert-hofstede.com/lebanon.html>. [Accessed
on 27th January 2016].
About Netherlands. 2014. Available through: <http://geert-hofstede.com/Netherlands.html>.
[Accessed on 27th January 2016].
Brayant, B., 2008. Cross cultural leadership. [Pdf]. Available through:
<https://www.imd.org/research/challenges/upload/TC082_08_cross_cultural_leadership.pd
f>. [Accessed on 27th January 2016].
The Hofstede's Center. 2016. Available through: <http://geert-hofstede.com/netherlands.html>.
[Accessed on 27th January 2016].
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