National Culture Influence on Organizational Structure, Leadership and Business Strategy: A Comparative Study of Honda and Daimler AMG

This essay compares the influence of national culture on the organizational structure, leadership approach and business strategy of Honda and Daimler AMG. It analyzes the similarities and differences between the two organizations and how their national cultures affect their behavior and decision-making processes.

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Introduction
Global cooperation transforms the way organizations and societies implement
knowledge, innovate as well as create values and ideologies. This plays a decisive role in all
spheres of social life along with the various aspects of management. Furthermore, global
cooperation results to the emergence of innovative forms of business which promotes
transparency and acknowledges cooperation with clients and stakeholders in order to develop
innovation (Alfermann et al. 2013). It further exerts the power of global cooperation and
develops the role of a multinational corporation by employing the means of contemporary and
sincere global business enterprise. Culture comprises in collective programming of the mind
which causes divergences among the individuals of one group or community from the other. As
individuals belong to various social categories, organizations must keep in consideration the
facets of national culture and the implications on organizational structure (Büschgens et al.,
2013). The following essay will focus on the way national culture influence the organizational
culture, leadership approach and business strategy of Honda based in Japan and Daimler AMG, a
German multinational company owned by Mercedes Benz and Mercedes-AMG.
Organizational Structure of Honda And Daimler AMG Influenced by National Culture
Owing to the fact, that cultures tend to vary in their receptivity to transitions, certain
cultures tend to have gradual transformations and can possess immense resistance of change
even to the extent of attempting to mitigate external forces of change based on their reliance
towards traditional behaviour. Though other cultures embrace significant transitions, however at
significant events certain fundamental segments of the populace endeavour to reinstate
traditional values, ideologies and behavioural patterns and further perceive such advancements as
forms of threats. Regardless to this, it has been noted that other cultures reveal utmost
ambivalence to transition and at the same time tend to embrace, resist as well as show
apprehension towards it (Trevor,Marshall and Cao 2013). At this juncture, one must note the
spirit of collective understanding, collaboration and harmony which subsists in the organizational
culture of Honda that permeates all the other actions as well as the set of standards and values of
effective partnership. However, a significant way to comprehend a role of culture to change is its
process of orientation towards time.

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Similarities and differences between the two organizations
It has further been identified that national culture has a prominent impact on the
behavioural patterns of employee base whereby the decisiveness of national cultural diversity has
been recognized on the association of managers and subordinates in the automobile industry of
both Japan and Germany. Modern observers reveal the exceptional good services of both Honda
and Daimler AMG for its cliental base, the two organizations tend to vary in their opinions and
principles related to the extent of services they should be serving to their clients (Chhokar et al.
2013). While the employee base of Honda tend to reveal propensity in providing great degree of
satisfaction to their clients and further establish stronger associations, the Daimler AMG
workforce reveal greater inclination in corresponding the expenditure rates of client satisfaction
in comparison to the benefits. However, the rationale of the divergence those German and
Japanese employees have been used to various anticipations from the cliental base of both these
organizations (Jacobs et al. 2013).
Leadership Structure of Honda and Daimler AMG Influenced by National Culture
It is significant to note that institutional theoretical aspects identifies the formal norms
about the organizational structure including norms and values for embarking structural formation
as entities of national culture. However, Hofstede has identified four critical dimensions related
to national culture by shedding light on uncertainty avoidance, individualism or collectivism,
masculinity or femininity and power distance (Flores et al. 2014). The dimension of Hofstede’s
power distance reflects the inequality among the individuals of the society and further exhibits
the attitude of the culture towards such degree of disparities amongst the members of the society.
Similarities and differences between the two organizations
In the opinion of Hofstede, Germany being a nation consisting high degree of
decentralization and underpinned by well-established middle class segment, the country is not
positioned among the lower rank of power distant nations whereas Honda, being established in
Japan tend to demonstrate a considerable level of awareness to their hierarchical positioning in
any significant social background and tends to act in accordance (McVeigh et al. 2013).
However, it has been recognized that few foreigners employed in Honda have encountered
certain degree of hierarchical power because of the immensely unhurried decision making

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procedures of the organization. Daimler AMG being established in a German society exhibits
immense rate of individualism where a strong and sincere commitment and dedication has been
situated in the ideal of self-actualization. Furthermore, the company have a propensity to reveal
greater degree of loyalty that is based on individualistic preferences and is defined by the
agreement between employer and employee (Moran et al. 2014).
However, Honda has drawn certain similarities in this dimension which can be noted
through intense evaluation of both of the companies. Though the employee base of Honda
organization can be perceived as immensely enthusiastic while aiming to enhance the
competitive advantage of the company with the means of excellence as well as perfection in the
process of their material production, Daimler AMG demonstrates a performance level which is
immensely valued and where the ones positioned at the managerial levels play the decisive role
and focus on exhibiting assertiveness and encouragement through the organizational functioning
(Alfermann et al. 2013). Hofstede’s dimension of uncertainty avoidance analyze the leadership
approach of Daimler AMG to be positioned on the higher side, knowledge is considered as
equally vital in order to create level of conviction and certainty regarding the effective execution
of any project of the company whereby Honda has been identified to possess similar
characteristics on the level of uncertainty (Schwartz 2013).
It has been noted that, Honda being headquartered in one of the most uncertainty
avoidant nations undergo time-consuming procedures in order to thoroughly evaluate the risk
factors associated to any project which the company is dealing with. At the corporate level, the
managers of Honda depend on detailed information and statistical figures before undergoing any
decision making procedures (Moran et al. 2014). Thus, such a high degree of uncertainty
avoidance result the company to be immensely resistant to any forms of organizational
transitions (Škerlavaj, Su and Huang 2013). With the considerably low score on this dimension,
Daimler AMG, German reveals a restrained characteristic and tends to regulate the indulgence
and level of gratification of the customers’ demands and desires (Venaik and Brewer 2013). The
employees of this organization often develop insights that their roles and actions are
undemonstrative or controlled by factors associated with social norms and further develop a
sense of unconstructive attitudes towards any organizational function. Honda on the other hand,
with a low degree of indulgence reveals a propensity of exhibiting cynicism and pessimism.

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National culture influence the business strategy of Honda and Daimler AMG
Disparities in national cultures in evaluating organizational strategy and behaviour have
been identified and further associated with discrepancies in perceived environmental
indecisiveness. For instance companies belonging to the European nations such as Daimler AMG
tend to reveal lower rate of organizational strategy in comparison to the companies situated in
Japan who exhibit active as well as wide ranging informal scanner comprising of over 70% of
knowledge generated through the means of surveillance (Venaik and Brewer 2013).
Furthermore, Honda has been recognized to have comprised of highly value peripheral
perception as fundamental to determine the transitions and uncertainty towards single strategy or
any unique idea which intently focuses attention. Furthermore, it has been noted that
multinational organizations in various nations permit various levels of autonomy to the
subsidiary organizations (Moran et al. 2014). However, Honda which owns multinationals permit
restricted autonomy to their subsidiaries having strong perceptions in the significance of
retaining the effective Japanese mechanisms of functioning specifically in subsidiaries which are
associated in manufacturing related to research and development. It has been recognized that
Honda comprises a high level of realization and inclination towards the aspects of their national
culture by shedding light on group association and dedication (Alfermann et al. 2013).
Conclusion
However, in operational terms for Honda, establishing its operational domain in overseas
will lead to a reduction in the rate of flexibility because of the company’s high degree of
intricacies and adaptability of manufacturing procedures as they have their existence in Japan.
Furthermore, it has been noted that a major section of multinational companies have shown high
degree of dedication and loyalty in sustaining essential regulation and further necessitating their
subsidiaries to adhere to US practices which include their effective human resource practices.
Multinationals like Daimler AMG endow greater degree of self-sufficiency towards their
subsidiaries. The rate of cultural disparities between Daimler AMG and national business
enterprises has shown lesser inclination towards cultural disparities between Honda and regional
multinational companies whereby cultural correspondence and proximity alleviate regulatory

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concerns further permitting greater degree of self-regulation for Daimler AMG in comparison to
the subsidiaries of Honda.

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