Management of Cross-Cultural Interface: Sapura Energy Report

This report examines the management of the cross-cultural interface in international business, focusing on the case of Sapura Energy, a Malaysian oil and gas company operating globally. The report begins with an introduction to international business and globalization, followed by a literature review that explores cultural dimensions and models, including Hofstede's and Trompenaars' frameworks. The discussion and analysis section delves into the impact of cultural differences on Sapura Energy's operations in various countries, highlighting the importance of effective communication and conflict resolution strategies. The report concludes with recommendations for managing cross-cultural challenges and fostering a positive work environment within the company. This report emphasizes the significance of understanding cultural nuances to ensure success in international business ventures.

Management of the
Cross- cultural Interface

Table of Contents
INTRODUCTION ..........................................................................................................................1
LITERATURE REVIEW ...........................................................................................................1
DISCUSSION AND ANALYSIS ..............................................................................................7
CONCLUSIONS ........................................................................................................................8
RECOMMENDATIONS ...........................................................................................................9
CONCLUSION .............................................................................................................................10
REFERENCES .............................................................................................................................11

INTRODUCTION
International business is defined as the trade of services, goods, capital , technology
around the world. This consists of transactions between different countries which includes
transfer of economic resources like skills, capital, people for the purpose of international
production of services and goods including insurance, banking, construction and finance. In the
following report, a Malaysian company which is operating globally is considered naming Sapura
Energy (Ollier-Malaterre, and Foucreault, 2017). This company is also known as SapuraKencana
Petroleum Berhad that is a oil and gas company located in Seri kembangan, Selangor. This
company is doing business at global level in various countries like Australia, China, Middle East,
United States of America and Western Africa. The Sapura Energy company's operations includes
exploration, production, development, abandonment, decommissioning and rejuvenation. This
company was formed by the merger of two companies Kencana and SapuraCrest. This company
offers oil and gas operations and maintenance services. The different services offered by this
company are subsea services, geotechnical, geosurvey, brownfield rejuvenation and topside
maintenance. This report will analyse the different factors that affects the business of company in
global markets. There is discussion on different theories on doing business in cross cultural
environment. At last this report has conclusion on how cross cultural proficiency is necessary for
international business ventures.
LITERATURE REVIEW
Globalisation is defined as the integration of market in global economy. This is a process
where integration takes place between different regions and countries. This is the free movement
of services, goods and people across the world in an integrated manner. According to
(Marcinkowska, and Et.Al , 2014) …. , There are many factors that are considered when
business of company is expanded at global level. The most important element that affects the
business in different countries is culture. Culture is defined as mental programming of thinking
and mind that creates difference between members of a group or category of individuals from
another. Culture is a collective phenomenon that is same for people who are living in a similar
environment. Culture can be differentiated by human resource and personality of a person.
Hofstede and Trompenaars are two people who have suggested conclusions and designed model
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on the basis of their research on multinational organisations and companies. They made
conclusions on the basis of interviews and questionnaires taken from employees and leaders of
different companies.
Hofstede's layer of culture
According to this model, Hofstede stated that there are individuals who are working in a
company belongs to different background and they have different thinking and mindset. The
culture of organisations is diversified and people have to adopt culture of organisations for doing
projects and work of the company successfully. Individuals who are working on the company are
carrying different level of culture (Kaynak. and Herbig, 2014). According to Hofstede, there are
following types of culture in the organisation. These are mentioned below-
A national level – This is for individuals who are migrating from one place to another
throughout lifetime.
A regional or ethnic affiliation level – These are people who belong to different culture
and regions. People who work in an organisation have different traits and they speak different
language, eat different food and have different habits.
A Gender level – This depends on gender of person. There are some countries which are
not safe for women to work.
A Generation level – This is a generation level that separates generation of family on the
basis of different levels i.e. from grandparents and children.
A Corporate level – This depends on the basis of organisational level and it depends on
the manner in which employees are socialized in the company.
A social class level - This is related with the educational opportunities of a person in
profession or occupation.
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Illustration 1: Hofstede level of culture

(Source: Hofstede level of Culture, 2019)
Understanding cultural differences
Cultural diversity includes different models that classify people on the basis of culture.
Different individuals differ on the basis of characteristics like environment, personality, society,
family, collective programming, education and language which affects thinking process and
behaviour. When people are doing business together or working in company then to avoid
frustrations and conflict situations, it is important to respect every cultural background. The
cultural dimensions of Hofstede model was developed by Geert Hofstede and it is a framework
that is used for analysing differences in culture over countries and to know the way in which
business is executed around the world. This framework is used by Sapura energy for
distinguishing various national culture and dimension of culture and effect of business setting.
Hofstede model of culture
The Hofstede cultural model was was given by Geert Hofstede in the year 1980 and the main
objective of this model is to analyse culture of different people. The cultural dimensions given
by Hofested are mentioned below-
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(Source: Hofstede culture model, 2018)
Power distance - According to this dimension, the extent for members who are less
powerful in business are accepted and the distribution of power is also expected which is
distributed unequally.
Uncertainty Avoidance - This is the dimension which describes the extent to which
people of the society are not at ease with uncertainty and ambiguity.
Collective versus Individualism – The main objective of this is to analyse the preference
of people and how they react (Helmreich, and Merritt, 2017). This index is used for exploring
the degree to which individuals in a society are grouped. Conflicts are a part of any group and if
there is good relation among people, then there will be no conflict or fight. This relies on beliefs
and truths that dedicate an individual. Society imposes few regulations in environment.
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Illustration 2: Hofstede's National Cultures

Femininity versus Masculinity – According to this dimension, masculinity is defined as
the preference in society for heroism, achievement, rewards, assertiveness for success. This
represents a desire for modesty, cooperation, caring for weak and quality of life. In context of
feminine society, they show more caring views than men. On the other hand, in masculine
societies, women are more assertive and competitive. There is still gap between female and male
values.
Long term orientation in life to a short term orientation – This dimension is related to
connection between past and future challenges. The lower degree of index indicates that
traditions are honoured and valued. Whereas, the societies with higher degree reflects adaptation
and circumstantial and pragmatic problem solving (Furusawa, and Brewster, 2015). Companies
with poor economy are short term oriented and long term oriented countries develop effectively.
Indulge versus restraint – This dimension is defined as the degree of freedom in which
societal norms are given to citizens for fulfilling the desires of humans. Indulgence is defined as
a society which allows free gratification of human desires that are related to having fun. The
counterpart is defined as society which controls gratification of demands and regulates through
some social norms.
Trompenaars – the basis of cultural differences in relationship with individuals
According to Trompenaars......, culture is defined as the way in which individuals solve
problems and different cultures uses different way of solving particular problems. The different
dimensions defined in this model are mentioned below-
Universalism versus particularism - This defines how people judge behaviour and
attitude of colleagues. Individuals from universalistic culture mainly focus on regulations and
these are more precise when contracts are defined. This helps in defining the global standards of
company's policies and practices of human resource (Flatten, T., Adams, D. and Brettel, M.,
2015). In countries where there is particularistic national cultures then the major objective is on
relationships and contracts can be achieved by satisfying new requirements in particular
situations and local variations of the organisation and policies of human resources are created for
adapting different requirements.
Individualism versus collectivism – This dimension differentiates countries according to
the balance between interests of individuals and groups.. The team members with who have
individualist mindset then improvements to the groups are achieved by meeting goals and
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objectives. The team members from communitarian cultures wants improvement in individual
capacities towards prosperity of groups.
Neutral versus emotional – The individuals from neutral cultures attracts self possessed
conducts and control feelings that can be exploded while working in a stressful period. When the
company is working with neutral countries and stakeholders then individuals starts avoiding
expressive, enthusiastic and warm behaviours. People from different cultures use all forms of
smiling, gesturing, body language for opening feelings and emotions and animated expressions.
Specific versus diffuse – Trompenaars have researched on the differences how
individuals engage colleagues in a particular area. In this, people are classified on the basis of
two groups- people from specific oriented cultures who are able to keep private and business
issues separate. In diffuse oriented countries, the level of authority at work reflects social areas
and individuals working in the company are able to adopt a subordinated attitude for meeting
managers after working hours.
Achievement versus ascription - According to Trompenaars, this dimension is similar to
Hofstede's concept of power distance. Individuals from achievement orineted countries show
respect for colleagues that is based on past achievements and explanation of knowledge.
Individuals from ascription oriented cultures, employees respect their superiors and leaders.
Attitude to time – According to Trompenaars, there are different cultures assigned which
have diverse meanings to the past, future and present. People who are in past oriented cultures
show respect for superiors or ancestors and they respect historic reviews. People from present
oriented culture enjoy the tasks and activities of present relationships (Chen, J.V. And Et. al.,
2015). Individuals from future oriented cultures enjoy discussions o potential issues and future
achievements.
Attitude to the environment – This dimension demonstrates that there are different ways
by which people of different countries are related to natural environment changes. The
shareholders of internal oriented cultures are more flexible and can compromise. People who
follow this culture value harmony and focuses on colleagues and these people can adopt changes
effectively.
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DISCUSSION AND ANALYSIS
Sapura Energy is the largest operator and owner of the world. It offers tender rigs and it
maintains more than 50% of the global market share. This company is known for its production
and exploration of oil and gas. The Sapura Energy Berhad is a public liability company that is
operating globally in many countries like China, Australia, Western Africa and Middle East. As
this company is operating globally, it is important fir this organisation to adopt strategies which
helps in solving cross cultural conflicts and fights that occur in this organisation. As culture is an
important factor in such multinational companies and it is important for these companies to
establish effective communication in the company. Communication across cultures is able to
identify manners, appearances, customs and beliefs that are followed by a person. A good
communication skill in global era includes analysing strength and weaknesses of the company
and making effective strategies to overcome weakness (.Beham, Drobnič, and Präg, 2014.).
Cultural difference is defined as an iceberg and it is important for effective leaders to evaluate
the culture and beliefs of individuals so that they can handle them easily and effectively. The
way in which Sapura Energy manages cultural difference problems are listed below-
 Communicate respect
 Be non-judgemental
 Personalise knowledge and perceptions
 Practise role flexibility
 Demonstrate reciprocal concern
 Tolerate ambiguity
Another way by which Sepura Energy can reduce cross cultural conflicts and problems is
facilitating friendship in organisation. There is a culture in organisation where there should be an
effective and good relation among employees and employers. It is important for Sepura Energy
to apply activities that will help to increase bond among employees. When there are cases in
which people with different cultures work in the same company, then it is necessity for the
company to apply strategies which can enhance relationship and healthy bond among employees
for avoiding cross cultural issues that occur in the company.
The other way that can be used by Seputa Energy for solving cross cultural issues is to
adopt strength of different cultures and integrating them for commercial practise (Parboteeah,
Seriki, and Hoegl, 2014). This can be explained with an example, Singaporean business people
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explained that if a company has plenty of natural resources, but it does not how to market these
and trade to other countries then it is useless. Thus it is important to manage capital markets and
trades for managing business.
Other strategies used in the business environment of Sepura Energy is approaches to
social organisation. These include 'rule of man” or code of behaviour. This has helped this
company to become successful in Asian and North American markets by adopting positive
culture at workplace. This can be done by company through building social strength inherent
with aspect of different rationalism – commercial law, bureaucratic transparency and policy
predictability. The biggest challenge for multinational companies is to adapt effective strategies
and build good relations among employees of the company. This will helps in avoiding conflicts
and fights and people from different culture can come together and work effectively.
CONCLUSIONS
From the above discussions and analysis, it can be concluded that in multinational
companies there are many cases of fights and conflicts that occur due to difference in culture.
The multinational company like Sepura Energy have a great opportunity for working in different
cultures for making the product and services that are accessible for a wider community (Al Saifi,
2015). There are following ways by which this company can manage the cross cultural issues are
given below-
Misunderstanding the norms – When in a company there are people who speak same
language then it is easy to communicate with employees but when there are people who are from
different culture and working together then, it is not easy to communicate with others. This limits
the efficiency of employees.
Changing you to change others – It is the duty of companies to implement this kind of
culture in the company. The organisations must be able to spread this message to whole
organisation that change is necessary and one must change himself and then expect other person
to change. This can be explained with and example, if there is an employee working in China but
he is not an Indian guy and they are having some issues then they both must behave properly and
manage their work without involving into fights.
A cross cultural program includes various benefits and this is important for the
companies for having a positive culture at workplace. Some steps of an effective cross cultural
program are listed below-
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 Examine how to look after themselves whilst changing the outcome of difficult or
complex communications.
 Practise how to be in charge of the way communication happens.
 Look at some of the things that separate cultures and create unnecessary
misunderstanding.
 Discover how they can adapt their behaviour without being in conflict with who they are.
A cross cultural program analyses various aspects like diversity of difference, references
and languages, assumptions, projection and perception, images, beliefs and traditions, avoiding
avoidance, finding common ground, spheres of influence, conflict resolution and negotiation,
dealing with misunderstandings, delegates specific situations and difficulties.
RECOMMENDATIONS
It is advisable for Sepura Energy to provide cross cultural skills Training and
development to employees. This helps in creating the importance of respecting every culture and
employee of the company. This company can also provide coaching and development programs
related to cultural issues.
Another recommendation for Sepura Energy is to provide cross cultural training
programs. The cross cultural training programs are available on web or in the form of
applications (Rajadhyaksha, Korabik, and Aycan, 2015). The program offered by this company
should focus on building experience and skills and using them in practical tools for resolving
different business issues. The program can be tailored for specific business issues and particular
countries. This program focuses on managing various type of culture of individuals and learnings
about various cultural backgrounds, beliefs, and values. In this program, it is important for the
company to make sure that these activities helps to build trust and loyalty for every culture. The
main benefits that are result of cross cultural programmes are listed below-
 better international meetings can be done effectively
 Good decision making and implementation of actions is accomplished
 Communication is improved effectively as there is both face to face interaction on web
conferencing and other media use.
 Confidence is increased for discussing and resolving differences with international
colleagues.
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CONCLUSION
From the above report, it has been concluded that globalisation and international business
has become an effective part of business nowadays and for achieving success it is very important
for the companies to implement cross cultural programs in the company. A cross cultural
program will help to reduce language barriers, conflicts, unnecessary fights, etc. in the company.
An organisation is benefited by applying cross cultural trainings and development program in its
organisation as it helps in increasing the efficiency and productivity of employees as there are no
issues and conflicts.
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REFERENCES
Books and Journals
Al Saifi, S.A., 2015. Positioning organisational culture in knowledge management
research. Journal of Knowledge Management, 19(2), pp.164-189.
Beham, B., Drobnič, S. and Präg, P., 2014. The Work–Family Interface of Service Sector
Workers: A Comparison of Work Resources and Professional Status across Five E
uropean Countries. Applied Psychology, 63(1), pp.29-61.
Chen, J.V. And Et. al., 2015. E-commerce web site loyalty: A cross cultural
comparison. Information Systems Frontiers, 17(6), pp.1283-1299.
Engelen, A., and Et. Al, 2014. Top management's transformational leader behaviors and
innovation orientation: A cross-cultural perspective in eight countries. Journal of
international Management, 20(2), pp.124-136.
Flatten, T., Adams, D. and Brettel, M., 2015. Fostering absorptive capacity through leadership:
A cross-cultural analysis. Journal of World Business, 50(3), pp.519-534.
Furusawa, M. and Brewster, C., 2015. The bi-cultural option for global talent management: The
Japanese/Brazilian Nikkeijin example. Journal of World Business, 50(1), pp.133-143.
Helmreich, R. L. and Merritt, A. C., 2017. Culture at work in aviation and medicine: National,
organizational and professional influences. Routledge.
Kaynak, E. and Herbig, P., 2014. Handbook of cross-cultural marketing. Routledge.
Marcinkowska, U .M and Et.Al , 2014. Cross-cultural variation in men's preference for sexual
dimorphism in women's faces. Biology letters, 10(4), p.20130850.
Neal, M., 2016. The culture factor: Cross-national management and the foreign venture.
Springer.
Ollier-Malaterre, A. and Foucreault, A., 2017. Cross-national work-life research: Cultural and
structural impacts for individuals and organizations. Journal of Management, 43(1),
pp.111-136.
Parboteeah, K.P., Seriki, H.T. and Hoegl, M., 2014. Ethnic diversity, corruption and ethical
climates in sub-Saharan Africa: Recognizing the significance of human resource
management. The International Journal of Human Resource Management, 25(7),
pp.979-1001.
Rajadhyaksha, U., Korabik, K. and Aycan, Z., 2015. Gender, gender-role ideology, and the
work–family interface: A cross-cultural analysis. In Gender and the work-family
experience(pp. 99-117). Springer, Cham.
Online
Hofstede culture model, 2019 available through
<https://www.researchgate.net/figure/Hofstedes-Pyramid-Model-of-Culture-8_fig5_318702471>
Hofstede's national culture, 2018 available through
<https://www.tutor2u.net/business/reference/hofstedes-national-cultures,2018>
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