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The Influence of Organisational Culture Versus National Culture

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The Influence Of

Organisational Culture

Versus

National Culture

Within The Global

Group of Companies

Author: Paul RB Kelly

Date: 12th March 2004

Course: Organisational Behaviour

Table of Contents:

Executive Summary Page 3

Company Background Page 4

Research Analysis Page 6

Recommendations Page 13

References Page 15

Appendix (Survey questionnaire attached as a separate document)

Executive Summary:

Research (1) indicates that national culture has a greater impact on employees than does their organisation's culture and this report examines both cultures within VOLE Inc. a seventeen month old company with the ambition to establish a worldwide presence within three years. At the moment VOLE is small enough to debate and address these issues but diverse enough with operations across four continents in fourteen countries to already be experiencing the strains of cultural differences, particularly between the Far East where the company has its roots and the recently opened markets of Western Europe and the United States.

It will hopefully lead to the formulation of some agreed corporate communication policies as these will become increasingly difficult to put together and implement as global expansion delivers a veritable Tower of Babel to the organisation if it achieves its rapid growth predictions.

Company Background:

VOLE Worldwide Inc commenced trading in November 2002 and offers the world's first managed Voice over Internet Protocol (VOIP) communications network. Providing a videophone package similar to a mobile/cell phone plan, VOLE manages the service which includes provision of a videophone for free use, while the customer just talks. For an affordable flat-price monthly fee, the customer enjoys unlimited video-talk time in addition to full videophone support.

The company was founded in Singapore, where the unique VOLGATE software that powers the VOIP network was developed and where VOLE Worldwide has its headquarters. It has a strong Singaporean heritage evidenced by the head office management team being exclusively from the Far East region, although the CEO personally has substantial work experience in the United States. Far Eastern shareholders in the company are currently in the majority, with one significant European investor, but as the company grows and expands its shareholder base through venture capital investment, there is likely to be a more international spread of investors.

Growth was initially concentrated regionally with individual VOLE trading companies being set up in Malaysia, Thailand, The Philippines and Indonesia. In November 2003, VOLE UK was formed, probably a little earlier than originally planned in the global rollout, and very quickly a number of European territories have also commenced trading in Germany, Spain, Portugal, Ireland, Austria Hungary and Ukraine. Major efforts are currently being made to move forward in the USA with the first company VOLE Company just started trading in Florida, where the rollout will be on a State by State basis.

Customer growth will be viral in nature as the primary offering to the corporate sector is the reduction in telephony charges so it is likely that a new customer in Thailand will, for instance, generate a new customer in that organisations UK or other international subsidiary. The financial model for the company's growth cements this viral relationship by transferring 25% of the revenue base from the sale producing country to those countries which will require a local install and support for the global subsidiary's of the original client.

Trading companies are now located on four different continents, and with a primary objective of working together for each company's mutual benefit, it will be necessary, as the organisation grows across the world, for each VOLE company to understand each other better. Each company will face language, ethnic and custom differences that may often make what is being said and what is being heard two very different things. As more colleagues come on board as JV partners, and VOLE continues to expand its cultural diversity, this must be professionally managed and dealt with to enable an early awareness of the problems that will undoubtedly arise through a period of rapid growth.

It was therefore decided to commission a survey of the current senior management of the individual VOLE global trading companies, as well as head office personnel, to attempt to identify areas of difference that might require attention and response from management. Nineteen participants were selected, who answered a web based survey anonymously, and eighteen responded. Head office based in Singapore provided one third of the participants, the balance from the current global JV companies. The survey is attached as an appendix to this report.

Research Analysis:

1) I like the buzz and stimulation from taking risks.

Average Score: 3.87 / 5

The answers here indicate a reasonable degree of entrepreneurialism throughout the companies surveyed. This is important for the development of VOLE JV Companies, as it requires the ability not only to manage a start up business but also one offering clients new technology, an added pressure in achieving success.

2) I prefer senior executives who provide comprehensive and logical explanations for their decisions.

Average Score: 4.13 / 5

A very positive indication of a strong desire for clear, open and informative leadership which may well be a result of an element of insecurity amongst the JV companies selling the new VOLE technology and not having enough information to feel comfortable with the

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