On the Rocky Road to Strong Global Culture

It’s not easy to build a strong organizational culture worldwide — but “cultural hubs” beyond headquarters can help.

Image courtesy of Nestle.

For more than a decade, multinational companies (MNCs) have been encouraged to create a strong global corporate culture through shared core values and practices. Building a global culture is hailed as a robust and flexible approach to dealing with the complexity and rapid changes these companies face. Indeed, several recent surveys of global executives have all identified the ability to maintain a common corporate culture as one of their greatest challenges and a top concern. However, our research suggests that a strong global culture is the exception rather than the rule. As companies expand globally, corporate culture often lags behind; it frequently remains too headquarters-centric to pull together far-flung operations, or it disintegrates under the turmoil of globalization.

We have studied organizational culture in global companies for 12 years, interviewing 250 executives at 10 multinational corporations, and we have found that few companies succeed at building an organizational culture that is globally integrated, yet flexible enough to accommodate local variations. (See “About the Research.”) Based on our research and that of others, we have identified at least two key barriers. One barrier is a headquarters-centric mindset: Companies often approach the process of developing a global culture as a one-way process dominated by corporate headquarters, exemplified by common terms such as “cultural transfer” “and “culture dissemination.” Also, core values often originate at corporate headquarters and fail to reflect and incorporate diverse cultural influences. This approach breeds skepticism about global culture among overseas employees, who may perceive headquarters’ core values as ethnocentric and parochial.

About the Research >>

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2 Comments On: On the Rocky Road to Strong Global Culture

  • Martin Price | June 30, 2010

    Behaviours and values, held in common, are indeed more necessary than ever in the enterprises of today. It follows that an MNC must seek ways to enable coherence and collaboration in their communities. But little will happen through prescription. Changes to behaviours and values occur when people learn that this is necessary to undertake their work successfully.
    Removing the prompts and props that enable obsolete practices and providing appropriate tools, structures, roles and incentives will pave the route for people to learn what is useful in the work regimes of the ‘designer’ organisation.
    We speak of learning by doing; this is the only way for such tranformation in a free society.

  • Ayse Oge | August 4, 2010

    Global leaders need to strike a balance between their vision that embraces the culture of binding everyone together within the organization and the process of respecting and encouraging local and market-sensitive cultures to achieve long-term success. Effective strategy could be:
    . Develop a strong team based on celebrating differences.
    .Create the best set of values to build trust and understanding.
    .Identify specific cultural preferences.
    .Shift from a variety of different cultures to one with local presence that symbolizes different values.
    .Put together stellar quality standards that are aimed at manufacturing and creating premium products.

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