Developing an International Entry Strategy

September 2001

C. A. Hope and A. P. MÏhlemann are from Bradford University Management Centre, Bradford, West Yorkshire BD9 4JL, UK.

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The impact of culture on best-practice production/ operations management C. A. Hope and A. P. MÏhlemann

Significant work has been completed in arriving at what have been put forward as `best practices'foravarietyoffacetsofproduction/operationsmanagement(POM).Organizations arebecomingglobalintheiroperations.Inthisenvironment,thereisadesiretolearnfromthis `proven' best practice and to use the generic ideas, concepts and techniques `world-wide'. However, it is becoming apparent from a range of fragmented evidence that `best practices' developed and successful in one context are not necessarily directly transferable to a comparable alternative. More detailed examination suggests that national culture has a significant role to play in determining the precise nature of a best practice in POM, and how universal it might be in its application. This paper examines structures within which to view facets of POM in order to identify one that will facilitate exploration of cultural issues. There follows an identification of what might be considered to be an appropriate range of cultural dimensionsalongwhichPOMbestpracticesmaybeconsidered.Areviewoftheevidencefrom the literature of cultural impacts on aspects of POM is presented. This is used to support the development of a generic framework to examine this interface more comprehensively.

Introduction

Markets for both products and services are becoming increasingly competitive. Organ- izations continue to strive to manufacture products and to deliver services in the most efficient and effective manner. Indeed the distinction between product and service is becoming increasingly blurred as basic product functionality becomes taken for granted and service in support of the product takes a higher profile in the customer’s eyes (Beachet al. 1997). It has been argued that it is only those organizations that can

continually improve their performance in relation to their competitors that will be able to compete successfully in international markets. Central to this is the management of the ‘conversion process’, or production/ operations management (POM) as it is more formally known. Over the years, significant work of both a practical and a theoretical nature has been completed in arriving at what have been put forward as ‘best practices’ for a variety of facets of POM. The material in the multitude of texts on the topic confirm this (see, for example: Chaseet al. 1998; Meredith and Shafer 1999; Russell and Taylor 1998;

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Slack et al. 1998; Waller 1999). Someof the resul t s i n t erms of actual i mproved performancehavebeenimpressive.

Organizationsare growing and becoming gl obal i n thei r operati ons, i nternati onal barriers are becoming far less significant, and information technology is reducing the i mpact of physi cal di stance. I n thi s environment,there is a desire to learn from this ‘proven’ bestpracticePOM andto usethe genericideas,conceptsandtechniques‘world- wide’. However,it is becomingapparentfrom a range of fragmented evidence that ‘best practices’ developed and successfulin one environment are not necessaril y directl y transf erabl e to what at f i rst si ght i s a comparablealternativesituation.For example, the framework used to great advantageto implementTotal Quality Management(TQM) within US operations,did not directly transfer to operationsbasedin Poland(Roney 1997); the approachesto organizing work adopted very effectively by an American hotel chain broke down when implemented in hotels which it ownedin China (Huyton and Ingold 1995). I n both cases, an exami nati on suggestedthat culture,in fact nationalculture, had a significant impact.

The study of the impact of culture on a variety of aspectsof the different functional areasof managementhasbeenon-goingfor a period of time, and is a topic in which there appearsto be a growing interest within the research communi ty. L ee (1999) ci tes references to the fact that ‘ it is widely recogni zed that the theories of . . . and marketing are culture bound’ (p. 76). Even marketing texts include sizeable sections covering the impact of culture (Bradley 1999; Cateoraand Ghaauri 2000). A cross- sectionalsampleof the morerecentwork with a marketingthemeis Aaker (2000),Aaker and Maheswaran (1997), Alden et al. (1999), Applbaum et al. (1996), Briley et al. (2000), Money et al. (1998), Reisinger and Turner (1999),Steenkampet al. (1999)andTavassoli (1999). This set demonstratesthe variety of perspectivesand issuesaddressed.

There is a cultural link in accounting. Usunier (1999) quotesHofstede(1991), who refers to ‘the culture of accountingsystems and presentsa series of hypothesesfor the l i nkage between cul ture and accounti ng systems’ (p. 76). In a special issue of Accounti ng, Or gani zati ons and Soci ety, Hopwood (1999) introduces a selection of papers from a conference on comparative managementaccountingthus ‘Together they providean insight into manyof the issuesand di ffi culti es at stake i n comparati ve and culturally groundedmanagementaccounting research’ (p. 378). Particularly noteworthy, within this set, in the context of culturally based studies, are the papers by Bhimani (1999),Chow et al. (1999b)andHarrisonand Mckinnon (1999). This final paperincludesa comprehensivebibliography, but claims that ‘cross cultural MCS researchis still in its infancy’ (p. 502). Again, the following papers give a flavour of the rangeof studiesin this area:Chow et al. (1995),Chow et al. (1996), Chow et al. (1999a), Soetersand Schreuder (1988).

The impact of national culture on various f acets of Human Resource Management (HRM) is well established:‘Such national differences have significant implications in terms of motivations to work, willingness to take risks, interpersonal skills, speed of decisionmakingandthe searchfor consensus’ (Hendry 1994, 106). It is this area which is closest to POM. The following works are typical: Gill and Wong (1998), Kochanet al. (1995),Kufidu and Vouzas(1998),Verbug et al . (1999); HRM /general management: Gol dman (1994), M arti n and Beaumont (1998), Ng (1998); Trigg and Trigg (1995).

It is outside the scopeof this paper to do more than point the interestedreaderin the direction of this work in associatedfunctional areas.The studiesare too diverseto arrive at all but the most generalof conclusionsfrom examining this work: there seems to be evi dence to suggest that the theory of convergencedoesnot hold at present.Where individual studies do have impact on POM

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(and this is generallyin the HR arena),they will be discussedin the later sections.

L i ttl e attempt has been made at a comprehensive systematic analysis of the overall impact of nationalculture on POM in general . I ndeed, i n di scussi ng l i terature sourcesfor cross-culturalbusinessresearch, Usunier (1998) lists (Table 3.1, p. 101) six categoriesof academicjournals. Under the heading of ‘marketing’ there are 19 titles, under ‘ international business’ four titles, under ‘ accounti ng’ f our ti tl es, under ‘ organization, HRM and management’ 21 titles, under‘cross-culturalandgeneral’seven titles, and under ‘general managementand miscellaneous’seventitles. Only within this last category are there two journals, which could be regardedasprimarily reportingPOM research.It is also, perhaps,of significance that POM was not identified as an areain its own right within the analysisof journals.

This paper examines various structures within which to view the facets of POM in order to identify one that will facilitate exploration of cultural issues.This is followed by the i denti f i cati on of what mi ght be considered to be an appropriate range of cultural dimensionsalong which POM best practicesmay be considered.A review of the evidencefrom theliteratureof cultural impacts on aspectsof POM is presented.This is usedto support the devel opment of a generi c framework to examine this interface more comprehensively. Some general conclusions concerningresearchin this areaare made.

POM: A Framework for Best Practices

At a broad level, there is generalagreement that production/operationsmanagementis ‘the managementof the transformationprocessby which a variety of inputs are convertedinto a desiredoutput’. This can be confirmed from any of the POM texts mentioned in the introduction, from texts which focus on service operations (e.g. Fitzsimmons and Fitzsimmons 1994; Hope and Mühlemann 1997) and from those in associatedareas,

e.g. services marketing (Baron and Harris 1995; Bateson1995). However, at the next l evel of detai l , l ooki ng at the broad ‘ responsi bi l i ti es’ of POM, there i s l ess agreement on a general structure as the following examplessuggest:

(i) 5Ps: people, plants, processes, parts, planning(Chaseet al. 1998)

(ii) 5Ps:product,plant, process,people,pro- gramme(Mühlemannet al. 1992)

(iii) design, planning and control, improve- ment, strategy(Slack et al. 1998)

(iv) operatingsystems,arrangementof facili- ties, work and work systems, capacity management,operationsscheduling,ma- terials management,control of operating systems(Wild 1995)

(v) strategy,planning the product, decisions about the process, planning and sched- uling resources,materials management (Waters1996)

(vi) strategyof productivesystems, designing productive systems,operatingproductive systems(Russelland Taylor 1998)

(vii) strategic decisions and operations, de- sign in operationsmanagement,planning organizing and control, analytical tech- niques(Waller 1999).

Clearly, whil e there are some common themesrunning through the abovestructures, thereis a lack of total consistencyin approach. Pulling togethersomeof the threadswithin a di agrammati c structure, Fi gure 1 (based primarily on Slack et al. 1998) presentsan overview.

Interestingly,at the nextlevel of detail there is more agreementin content. In total, 20 individual aspectshave been identified. An attemptwas madeto selectaspectsthat were at a comparablelevel of detail and to avoid extensiveoverlap. However, inevitably there could be somedebateconcerningthe precise nature of some of these aspects.These 20 aspectshave been grouped into six broad areas:(i) product/servicedesign,(ii) product/ service process design, (iii) planning of operations (iv) facilities management and

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planning, (v) operationsstrategy,(vi) people issuesin POM. Theseare shown in Table 1 (the symboly will be explainedlater). As with the individual aspects,it is not claimed that thesesix groupingsare in any senseunique, nor that an aspectcan only ‘belong’ to one grouping. Indeed, it could be argued that quality managementcould be included under productand serviceprocessdesign.

It is interesting to note that, while there havebeensomelimited studiesof the impact of different national cultureson the use of a variety of specific manufacturingtechniques (e.g. Huyton and Ingold 1995; Roney 1997), few have attempteda more broad analysis basedarounda more comprehensiveset. An exceptionis the work reportedby Lawrence andYeh (1994),who carriedout a studyof the influence of Mexican culture on the use of Japanese manuf acturi ng techni ques i n Mexico. Of significancehere is the structure which they adopted to model the Japanese

manufacturingtechniques.This was basedon the work of Chanet al. (1990),whichhadat its centrethe 5Psof productionof Lockyer et al. (1988) al so used i n the l ater edi ti on (Mühlemann et al. 1992). However, within this framework,considerationis only given to whatthey call ‘manufacturingtechniques’that map onto what are identified as the five key Japanesemanagementphilosophies.So, while at a broadlevel, thereis agreementwith what is proposedhere,at a detailedlevel, Lawrence and Yeh (1994) adopt a somewhatnarrower focus in only examiningaspectslinked to the Japanesestyle. Additionally, considerationis only given to manufacturing environments. The ‘ sof t i ssues’ wi thi n the di sti ncti ve characteristics of service industries (Hope andMühlemann1997)suggestthat the impact of nationalculturein this type of environment is likely to be more significant.

The frameworkproposedin Table 1 will be takenasthe startingpoint in classifyingissues

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Figure 1. Aspects of POM.

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which are likely to be most influenced by (national) culture when examined from the perspectiveof bestpractice.However,before developingthis, it is necessaryto look at the variouscultural dimensions.

Cultural Dimensions

There are a variety of definitions of culture. The most appropriate for the work being carriedout hereis that dueto Hofstede(1997), who carried out much of his researchin a commercial context, ‘ the coll ective pro- gramming of the mind which distinguishes the members of one group or category of people from another’ (p. 4). Societieshave developedsetsof commonbeliefs,valuesand ways of interactingwhich allow them to live togetherharmoniously.Theseways of living arelearnedbehavioursandarepassedon from

generationto generation.There are different levels or types of culture (sharedbeliefs and values)that are commonto nations/societies, to religions, to genders,to generations,to industries,to organizations,the list goes on. The cultures are sometimeslikened to the layers of an onion, with those closestto the centre having existed the longest. Theseare the strongest.Thus the culture in which an individual has been immersedsince birth is li kely to have a stronger effect than the organi zati onal cul ture exerted i n the workplaceof the individual (Hofstede1991).

Probabl y the best-known research on cultural diff erences from the management perspective was carried out by Hofstede (1980). He studied the work-related values of theworkersfrom 53 nationalsubsidiariesof a large internationalcompany.He identified four dimensions:

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Table 1. A framework for issues in POM

• Product and Service Design product/service design process quality management (including statistical process control)y

value and variety management

• Product and Service Process Design production/delivery system design (macro)y

work design and measurement (micro)y

process improvement and re-engineering (including `waste elimination'/JIT)y

• Planning of Operations forecasting capacity planning (including queue management)y

operations schedulingy

project planning supply chain management (including purchasing and materials management)y

• Facilities Management and Planning equipment selection reliability measurement maintenance planning location decision makingy

layout planningy

• Operations Strategy the corporate strategy link operations strategy development and implementationy

• People Issues in POM operations and HRy

health and safetyy

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(i) individualism (focus on self and immedi- ate family) versus collectivism (concern for the extendedgroup)

(ii) large versus small power distance (expectance/acceptance of an unequal distribution of power)

(iii) strong versus weak uncertainty avoid- ance

(iv) masculinity (assertiveness, ambitious) versus femininity (non competitiveness, concernfor relationships).

A key conclusionof significancehereis ‘these scores(of workerson eachdimension)can be shown to relate to phenomenain the various societiesin which thesesubsidiariesoperate, such as: . . . management methods and objectives. . .’ (p. 13). In researchaimed at understanding cultural differences between developedanddevelopingcountries,Kanungo and Jaeger(1990) addeda fifth dimensionto these four: abstract thinking (perceptions influenced by rules and principles applied equally to all situations) versus associative thi nki ng (percepti ons i nf l uenced by the contextof the specific situation).

A second schemethat is relevant to the work here was presentedby Evans et al. (1995) and was basedon work by Kluckhohn andStrodtbeck(1961).Theyclassifycountries accordingto:

(i) human nature: the West assumes people are naturally good, the East – naturally bad

(ii) time: the West – an unending con- tinuum, the East– circular

(iii) family relationships: the West – indi- viduals, the East– collectivism

(iv) relationship between man, nature and the supernatural: the West – equality and individual rights, the East– doctrine centred on loyalty, harmony, families and hard work

(v) human activity; the West – aggressive, confrontational,the East – humble and tolerant.

In comparingthe national cultures of any pair of countries,it is possibleto attempt to extract those whi ch gi ve the cl earest distinctions. In their comparative study of the use of Japanesetechniquesin Mexico, L awrence and Yeh (1994) buil t on the literature current at the time, which included Hofstede (1980), Kluckhohn and Strodtbeck (1961) and Triandis (1972), to derive the following seven dimensionsalong which to conducttheir analysis:

(i) hierarchicalnature

(ii) individualism versuscollectivism

(iii) attitudestowardswork

(iv) time orientation

(v) approachto problemsolving

(vi) fatalism

(vii) view of humannature.

Their paper includes full descriptions and comparisonsof the positionsof Japaneseand M ex i can cul t ur es al ong t hese sev en dimensions.

M ore detai l s of these cl assi f i cati on schemes,and others due to Schein, Adler, Hal l and Trompenaars are i ncl uded i n Schneiderand Barsoux(1997).

The range of nationalities in an organ- ization can result in a dominant position on eachof the abovedimensions.For eachof the aspectsof POM identified in Table 1, these positions could potentially impact on what might be regardedas ‘best practice’. Thus a strong tendency towards uncer tai nty avoidance could indicate ‘support for’ the forecastingaspectsin planningof operations. These issues will be explored in the next section.It is, however,perhapsworth noting that cultures are not static, but changeover time. For example,LawrenceandYeh (1994) claim ‘Mexican culture appearsto be slowly changingas a result of increasedinteraction with theUS (Kras1989),andJapaneseculture appearsto be slowly changingas a result of the country’s economic prosperity (Kanter 1991)’ (p. 57).

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The Impact of the Cultural Dimensions on POM

An examinationof the impact of the various different cultural dimensionson POM could be carried out at a variety of levels of detail. The intention is to structure this section around the six key areas used in Table 1. Detailed discussionwill tend to focus on the i ndi vi dual topi cs wi thi n each of these headings,as appropriate. Where necessary, these individual topics will be examinedin evenmoredetail. In eachkey area,asfar asis possible,discussionwill initially coverreports in manufacturing,then serviceenvironments, followed by general work which applies in either situation.

A f ter an exami nati on of the cul tural dimensionsoutlined in the previous section, it is possibleto suggestthoseindividual topics that are most likely to be infl uenced by national culture. This evaluation has been completed,and these topics are markedy in Table 1. This section will attempt to justify this classification,supportingassertionswhere possible with evidence from the literature. Similar analyseshave beenreportedby other researchers. L awrence and Y eh (1994) i denti f i ed potenti al sources of conf l i ct between M exi can cul ture and Japanese management philosophies, based on their seven cul tural di mensi ons l i sted i n the previous section. However, the philosophies were very broad bases,there were only five categories,and the focus was on only two di f f erent nati onal cul tures. Hope and Mühlemann(1998a)identify potentialclashes betweenthe featuresof TQM and the cultural dimensionsof Hall and Hall (1997),Hofstede (1991)andKluckhohnandStrodtbeck(1961). However, their work had a focus on a narrower aspect of best practice in POM (quality), and looked primarily at a service context. These two papersdo, nevertheless, provide some useful insights for the broader and more detailedanalysisthat follows. Voss andBlackmon(1996)reportedthe resultsof a comparative study examining the use of

world-classmanufacturingpracticesin Britain and in Germany.Significant differenceswere found, moreover manufacturing sites with overseasparents(primarily North American and Japanese)were found to have higher l evel s of adopti on of ‘ best practi ces’ . However, the study was not i ntended explicitly to explore the impacts of national cultures.

Product and Service Design

Quality at its simplest is defined as meeting the requirementsof the customer,in termsof the productand/orthe serviceasdesignedand delivered(Muhlemannet al. 1992), henceits inclusion under this subsection.However, as wi th several of the aspects, thi s has implicati ons for other themes, including process desi gn and peopl e i ssues. For convenience,most key discussionsof quality will be in this section.

Of the variousaspectsof POM viewedfrom a cultural perspective,quality managementis that which seems to have received most attention. This has ranged from general considerations of most features (TQM in Turnell and Washbourne1991), to a specific aspectoften alongsidea much broaderrange of ‘non-quality’ issues (‘empowerment’ in Morden 1995). Some of this work will be reviewedhere.

Katz et al. (1998) examinedthe impact of nationalcultureon TQM implementationfrom a somewhat‘theoretical’ perspective.Their study involved looking at the positionsof the USA, Japanand Hungary on Hofstede’sfour cul tural di mensi ons of power di stance, indivi dualism, uncertainty avoidance and masculinity. They made some suggestions concerningthe impact of a country’s position on these dimensions on aspects of TQM. Finally, based on this analysis, they drew some specific conclusions concerning each country’s resistanceto the adoption of what they called four specific TQM principles. Examplesof theseincluded ‘developing long term relationshipswith suppliersrather than

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awardi ng busi ness on pri ce al one’ and ‘ breaking down barriers between depart- ments’ . While their work provides some interesting insights into potential impacts, it takes a rather limited view of TQ and lacks empirical underpinning.

Roney (1997) looked at the problem that arosein Valvex, a Polish valve manufacturer when they tried to implement TQM. She suggestedthere are a numberof assumptions relating to culture which underlie the TQM philosophy,for example:(i) poweris assigned through achievement– ‘what you do’; (ii) deterministic – individuals have personal power over their own destiny.This conflicted with the culture of the workers who saw: (i) power as being assignedthroughascription– ‘ who you are and who you know’ ; (ii) fatalistic – individuals do not havethe power to changethings so why try? She concluded that bef ore i mpl ementi ng management practices,there is a need to understandthe cultural settingandevaluatethe differencesto consider what, if any, adaptationswill be needed.

Shih and Gurnani (1997) carried out an empirical studybasedon their observationsof the implementation of TQM in factories within a rangeof industrial sectors(including el ectroni cs, garments and automobi l es) locatedin Hong Kong, Brazil, Japanand the USA. They ai med to provide a cl earer understandi ng of what they cal l ed the culture-technicalaspectsof quality manage- ment systems.A focus of their work was an examinationof the successof Japanese-style qual i ty management programmes i n the factories outside Japan. They claimed that ‘Certainly, culture playsa key role in shaping all quality managementactivities, . . ., but equally important are the organisationaland technical components . . .’ (p. 16). They discussedwhat they called ‘myths’ associated wi th expl ai ni ng the success of these programmesinside, comparedwith outside, Japan. Exampl es i ncl uded manageri al practices, Japanese team worki ng spi ri t, company loyalty and lifetime employment.

The contribution of Shih and Gurnani is in identifying key systemfactors– thosethatwill work in any cultural setting, and cultural factors – thosethat needadaptationfor each county’s cultural setting. The componentsof Japanese TQM considered include use of slogans, use of technical tools, design for quality, waste elimination and small group working. However, the cultural factors are identified in a somewhatunstructuredmanner (‘ sl ogans are seen as a hi ghl y cul ture- dependentfactor’, p. 20; participationin small group activities was also discussedin very loose cultural terms in comparing Japanese performance). National cultural differences are not addressedin a particularly systematic way, although the influence of Confucius (China,Japan)is mentionedin outlining some of the causesfor failure.

Goldman (1994) discussedsome of the problemsfaced by Nippon from Japanwhen they entereda joint venture with Raleigh in the USA. He pointed out that ‘it is folly to procl ai m that a gi ven phi l osophy of management, such as TQM, can override long-term cultural differences. . .’ (p. 4) and also to the necessityof directing attentionof cross-cultural managementto ‘the specific beliefs, attitudes,and valuesof eachnational culture engagedin international venture’ (p. 8).

Turnell and Washbourne(1991) discussed an ‘Australian TQM Model’ and pointed out characteristicsof Australiansthat inhibit the successfulimplementation of TQM, which included attitudessuch as ‘She’ll be alright, mate’ , ambi val ence about excel l ence, a ‘larriken’ or rebelliousapproachto authority anda focuson materialismandthe shortterm. They pointed to a strong self-interest,which t ended t o de- emphasi ze l ong- t er m investments. Clearly they are all culture- relatedissues.

Huyton andIngold (1995)investigatedwhy problemsarosefor the Ritz Carlton Hotel in Hong Kong while in the USA, in 1992, the hotel chain had been awardedthe Malcolm BaldrigeAward for Quality. They identified a

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clashof cultureasthe main cause.Methodsof operation,generally acceptedin the USA as ‘best practice’, did not work in this cultural setting. For example,two barriers which cut acrossfundamentalprerequisitesof the TQM philosophy was the unwillingness to share information as ‘‘knowledge is power’’ and ‘‘ ‘face’ – don’t work too closelywith others– they will get to know you’’.

Oneof the major difficulties experiencedin a service situation is the measurementof quality. Service quality is frequently defined as the di ff erence between a customer’ s percepti on and thei r expectati on of the service. Parasuraman et al. (1985, 1988, 1991, 1994) have extensivelyresearchedthis area and identified a range of appropriate di mensi ons across whi ch to make thi s measurement (f or exampl e rel i abi l i ty, assurance,responsiveness).This work led to a measurement instrument: SERVQUAL . A l t hough t here i s sti l l some debate surroundingthis, of interest here is a study reported by A rmstrong et al . (1997) examining differencesin the expectationsof hotel guests across cultures. They used an adapt ed v er si on of t he SERV QUA L questionnairewith samplesfrom groups of A si an, European and what they cal l ed ‘ Engl i sh Heri tage’ cul tures. Stati sti cal analysis indicated that between the groups, expectations were si gni ficantly different. Moreover, there were also somesignificance differences in service quality measurements betweendifferent cultural groups.The reasons for thesedifferenceswerenot discussedin any detail.

One area where a reasonableamount of work hastakenplaceis relatedto the reasons for the successor failure in quality circles. The findings of Dale (1986), Hill (1991) and Isaac(1989)in this areacould all be linked to cultural influences. However, in examining TQM adoption, Yong and Wilkinson (1999) put forward an alternativeview. They claim that ‘Although cultural differenceswere first blamed for their failures (quality control ci r cl es and stati sti cal pr ocess qual i ty),

management practitioners and academi cs eventually came to the conclusion that the failures did not boil down to the Eastern culture or any other peculiarly Japanese characteristics,but to a misunderstandingof the phi l osophi cal ori entati on underl yi ng Japanesemanagement’(p. 143). They go to suggestthat the confusionover exactly what TQ actually entails contributes to this. Xu (1999)adoptsa very broadstancein exploring the significanceof the ‘title’ TQM, andbrings somedetailedinsights to how this confusion in understandingmight havearisen.

Product and Service Process Design

McGaugheyand De Cieri (1999) considered t he conv er gence–di v er gence debat e, suggestingconvergencein term of macro- level variables, but divergence at a micro level. They notedthe suggestionby Ralstonet al. (1997)of a ‘cross-bred’form of values‘in between’ the two parent cultures resulting from crossvergence. They argued that the drivers for this form are national culture ( nor mal l y suppor t i ng di v er gence of ‘practices’) and economicideology (normally supportingconvergence).They reportedon an example of the integration of macro- and micro-level variables in an Australian paint manufacturingplant. At a macro level, there was a need to introduce cellular methods involving teamworking and to encourageco- operation(rather than the usual competition) within and betweengroups.At a micro level, basedon Hofstede’sdata,Australia is second only to the US in terms of individualism. Managementhoped to introduce a financial reward system that would encourage this desiredco-operation(collectivism). This was achievedby a combinationof basicwage,plus overall team-based component related to overall productivity improvement, plus an individual performanceelement.

At a macro level, the ‘Euro Disney’ theme park development is an example of how national cultural differences can have a significant impact on the transferability of a

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successfulservice delivery systemfrom one situationto a second.It is claimedthat ‘Tokyo Disney’ was successful, and performance statistics support this. In part, this was attributed to the acceptanceby the Japanese workforceof the needfor uniformity andrigid control of processesand the environmentto ‘optimize output’ (Trigg and Trigg 1995). Euro Disney,initially at least,haddifficulties. The French national culture strongly resists foreign influences that could be seen as diluting the French way of life. Trigg and T r i gg cl ai m t hat ‘ al t hough D i sney [Corporation] incorporated some European characteristicsandfacilities into Euro Disney, and attempted to work wi thi n French legislative programmes, the attempts have been percei ved at best as naı̈ve and superficial’ (p. 21). Although in general French management and the workf orce support quality and excellence in services, the imposition of approachesand systemsto deliver thesewere seenby them as American arrogance.Frenchapplicantsfor postsdid not have the attitudes for team working which were necessary to fi t into Disney’s team culture (Trigg and Trigg 1995).

Morden (1995) commentedon the seven valuedilemmasproposedby Hampden-Turner and Trompenaars (1994), noti ng that management’s understanding of them and the vari ous sol uti ons to them f aci l i tate recognition of the impact of national culture on the different approaches to processes within the organization.Selectingtwo as an illustration, it can be seenthat in discussing ‘universalism versus particularism’ (making r ul es and managi ng ex cept i ons) , he commentedon the need for an enterpriseto have systems that provide a structure for organizing work. However, this has to be viewed within the context of an environment that will requireflexibility to react to change and to innovate. Looking at ‘constructing versus deconstructi ng’ (anal ysi ng versus integrating), he observedthat while Anglo- Saxonsocietiestend to analyseprocessesinto their components,Eastern societies tend to

seek patterns through integration. In an abstract sense,it can be seen that how a nation’sculturefavoursa particularresolution to thesetwo ‘dilemmas’ will impact on their ‘preferred’ designfor an operationssystem.

Planning of Operations

Wilhelm (1994),reportingon the influenceof M exi can cul ture on the uses of US managementtheory in Mexico, noted that ‘time is a relative conceptand deadlinesare flexible . . . Almost all planningis short range and,asa resultthe averageMexicanexecutive is accustomedto dealingwith crisis situations’ (p. 15). He attributed this to the present orientationof Mexican culture (Hall and Hall 1987). This was confirmed by Lawrenceand Yeh (1994) reportingthe Mexican executives in Kolland’s (1991) study as ‘living for the presentandnot worrying aboutor planningfor the future’ (p. 55). This cultural influence on the attitude to time was also noted by BalsmeierandHeck (1994),who claimedthat ‘In Latin America,Africa or the Middle East, arriving half an hour late would be considered early’ (p. 18).

Whybark and Vastag (1993) report on a world-wide surveyinto the variousaspectsof productionplanningandcontrol.This includes one paper (Chikan and Whybark) which i nvol ves a cross-nati onal compari son of production–inventorymanagementpractices including Western (Europe), Eastern(Korea and China) and mixed (Hungary) cases. Differencesare reported,some of which are attributedto the cultural differencesbetween Eastand West.

Morden (1995), in discussing time as a ‘sequence’versustime as‘synchronization’in the contextof nationalculture and the culture of the organization,suggestedthat ‘Japanese and German companiesare able to take a longer-termview of their businessthan many of their British or American competitors’(p. 11). He went on to refer to the examplegiven by Hampden-Turnerand Tromenaars(1994), of the Toyota kanban system illustrating a

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flexible systemexploiting synchronizationor co-ordinationof activitiesratherthanfocusing on the overall speedin the completion of a sequenceof activities.

Ford (1994), reporti ng on the much- analysedEuro Disney project, noted that the organization had problems with adjusting staffing levels at their French park because of rigid labourschedules.Similar systemshad not causedproblemsat the Americanparentin Florida. Trigg and Trigg (1995) in a more comprehensiveanalysis of the same project noted that ‘ tempers often flare with the f r ust r at i on of v er y l ong queues as Mediterraneanvisitors, less used to orderly lines, jump the queuesand upsetthe queuing sensitivitiesof the British visitors’ (p. 21).

Even shorter-term schedul i ng can be influenced by national culture. Work is f requentl y pri ori ti zed i n order to gai n efficiencies or appear to be fair to waiting customers.Hickson and Pugh(1995) reported that in India, evenwith their bureaucraticstyle organization,schedulingrules may be broken as employeesdo not operateimpersonally.A family membermay be served‘out of turn’ – selectionbasedon who you know ratherthan the requi red cri teri on f or ef f i ci ency or fairness.

Total l i f eti me costs or total cost of ownershipareoften usedasoneof the criteria in best-practicepurchasingsituations.These are taken to be a quantification of all of the f act or s i nv ol v ed ( i ncl udi ng del i v er y reliability, after sales) and can be used to guide purchasingdecisions in relation to a supplier (see for example, Saunders1994). However, i n some cul tures, l oyal ty to extended family groups or sections of the communi ty can di ctate wi th whom an organizationdeals.

Facilities Management and Planning

A tti tudes towards personal space are influencedby culture. For example,Wilhelm (1994), i n di scussi ng the use of US managementtechniquesin Mexico, notedthat

the amountof personalspacerequiredis less in Mexico than in the US. Clearly, this can have an i mpact i n a range of aspects associatedwith POM, including the soft issues such as per sonal i nt er act i ons w i t h management(proximity andphysicalcontact). Another key areais likely to be in the layout of facilities. While this is important in a manufacturingcontext, it becomesan even more significant issue in a service context when the customer is part of the process becausethe organizationhasless‘control and influence’ over this group,comparedwith the workforce.

Balsmeierand Heck (1994) commentedon the spaciousnessof Westernoffices compared wi th those i n Japan. Gol dman (1994) compared the i mpact of personal space considerationsin servicesand manufacturing in both the US and Japan.He reported the difficulties experiencedwith Nippon Inc.’s plans for their US partner, Raleigh Ltd. In attempting to implement TQM, the now f ami l i ar ‘ U’ -shaped work-stati ons were introduced to support team working. The reaction was that ‘US workers resisted the forced togethernessas being too close for comfort’ (p. 7). Performancewill be affected if individuals feel that their spaceis being encroachedupon ‘don’t crowd me or you’ll hurt my productivity . . .’ (p. 7). It could be argued that such attitudes towards personal spaceare in part developedas a consequence of populationdensity.However,cultural traits are influencedby the environmentin which a group of individuals are broughtup.

Teare(1993) describedthe US-basedHyatt international hotel group’s approach in its Japanesehotels:‘there arevariationsin layout of the bathroomto reflect a Japanesestyle . . . Hyatt is recognizedin every other country in which it operatesas a companywhich usesa familiar cultural framework as the basis for pl anni ng and provi di ng a hi gh-qual i ty product’ (p. 68). He went on to claim that, becausethe senior managementteam at the head of f i ce represented ei ght di f f erent nati onal i ti es wi th the same di versi ty

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throughoutthe rest of the organization,new policiesandprocedurescould be evaluatedfor thei r cul tural i mpl i cati ons. Thus i t was possible ‘to devise policy which is flexible enoughto fit with different cultures’ (p. 69).

Operations Strategy

Increasingly, organizations are adopting a strategy of movi ng f rom nati onal to i nternati onal to gl obal operati ons. The transitionfrom internationalto global is often characteri zed as the move f rom ‘ mul ti- domest i c’ , i n w hi ch subsi di ar i es of multinationals had a relatively high degree of autonomy in manufacturingmanagement (Porter 1986 in Fleury 1999). This move involves the alignment of manufacturing strategieswith global competitive strategies, the redefinition of organizationalstructuresto supportthe integrationof decisionmakingand communi cati on systems, resource rati on- alization throughelimination of redundancies, and the developmentof uniformly structured control systems to provi de standardi zed procedures (Fl eury 1999). Cl earl y, the effectivenessof thesestepswill be influenced by theextentto which theytakeaccountof the cultures in the nations involved. Integration, rationalization and standardizationall have significant implicationsin this context.

Nicholson (1999) carried out a study of Polish businesses.This included a series of study vi si ts and i ntervi ews desi gned to establish ‘the . . . manager’s vision of the way aheadand the meansof addressingthe problemsof achieving that vision’ (p. 542). His analysisincluded an ‘assessment’of the utility of various ‘Western methods’ in this context.He noted that ‘Some companieshad embracedWesternmethodsin name without in any way recognizingthe implications . . .’ (p. 550). However, evi dence el sewhere suggeststhat,at leastin part,therearecultural issuesat play here. The situation is further compoundedby the cultural dynamics in a nationthat is clearly going throughsignificant change.This issue was explored by Todeva

(1999),who reportedsomeempirical research on Polishcultural normswhich suggestedthat there may be differences between ‘ what people perceive and communicatein public as the national cultural norm and what they have internalized as cultural attitude and norms of behaviour’ (p. 606). Her analysis usedHofstede’scultural dimensions,and thus had significancefor this work.

M cL aughl i n and Fi tzsi mmons (1996) discussedthe strategieswhich organizations might adopt if they are to globalize their service operations.They use the concept of the front office/back room split in a service environmentto develop some of their ideas (the front office in a service is where the customercontact normally takes place, e.g. thedining roomin a restaurant;thebackoffice i s where acti vi ti es not requi ri ng the customers’ interaction are carried out, e.g. the kitchen; seeHope and Mühlemann1997). They claimedthat, ‘The globalizationof front room operations with its verbal customer contact still dependsheavily on the cultural adaptation of the service’ (p. 47). They i denti f y a maj or probl em f or servi ce companies‘delivering overseas’asthe choice betweenadaptingthe service(andthe delivery system)to the users’culture or relying on the servicesand systemson which the reputation was built ‘at home’. However, it could be arguedthat in their discussionof the greater possi bi l i ti es f or gl obal i zi ng back room operations especially where these can be decoupledfrom front office activities, they do not give sufficient regard to the cultural adaptati on necessary to systems and proceduresfrom the staff perspective.They conclude their paper by identifying five different global service strategies,each of which they evaluatewith respectto a number of globalization factors, one of which is cultural adaptation.In discussingthe global service strategy of multi-cultural expansion, they note that ‘cultural adaptationis a major servicedesignissue’ (p. 51).

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People Issues in POM

Human resourcemanagement(HRM) is the functionalareathathaspossiblyreceivedmost attention from the perspective of cultural impacts on best practice. Generally, the operations manager is the individual with responsibilityfor the largestnumberof people within the organization,thus there is a large measureof common interest in some of the issues considered. Hope and Mühlemann (1998b) develop this idea in the context of theTQ/HR interfacein tourismstudies.Papers reporting cultural impacts frequently focus ei ther on speci f i c aspects of HR, or comparisons in practices between specific nations. In this section, that researchwhich has specific relevancefor operationswill be reviewed.

Easterby-Smithet al. (1995) completeda broad comparisonof HR practices between Chinese and UK companies, looking for el ements that are af f ected by cul tural differences.They concludedthat ‘The main di f f erences i n HRM between the two countries, therefore, appear in the ‘softer’ areas where rel ationshi ps are important: appraisal, reward systems, the process of assessingpotential and the basic stance of uni ons t ow ar ds management . T hese differencescan be linked to known cultural factors. . .’ (p. 55). The first two areaslisted at least have important interfaces with POM. Establishingequitablereward systems,based on anassessmentof thework involvedin tasks is an important task for operations.Wasti (1998) developeda seriesof propositionsthat rel ated to the cul tural barri ers to the transferability of Japanesehuman resource practi ces to devel opi ng countri es usi ng Turkey as a case.Key HR areasconsidered that interfacedwith POM included authority relations, employee participation (linked to QC circles), performance appraisals and r ewar d sy st ems. H e concl uded wi t h suggestions for a wide range of further researchinitiatives, including extending the set of HR practicesconsidered.

Verburg et al. (1999) carried out a direct comparisonof managingHR betweenChina and the Netherlands,based on a matched sampleof industrialcompanies.Their analysis was basedon a Dutch questionnairesurvey and st r uct ur ed i nt er v i ews usi ng t he questionnairein China. They proposedand justified a set of expectationsfor comparison in the areas of personnel selection and placement, pay and rewards, performance appraisal, personnel trai ni ng, and career devel opment and promoti on. Stati sti cal anal yses were then used to ‘ test’ these expectations. They claimed that, although recentstudieshaveshowna move away from the Chinese tradition of ‘ iron rice-bowl’ pol i ci es towards HR, there were sti l l considerabledifferenceswhen comparedwith the Netherlands. Specific areas identified included career development, performance appraisalandrewards;wheredifferenceswere expectedbecauseof the role of interpersonal relationshipsin theseaspects.Areas such as trai ni ng, sel ecti on and recrui tment were expectedto be less different. Most expected differenceswere confirmed, although at the detailed level there were some interesting devi ati ons i n ‘ di recti on’ . ‘ A l though we expected that rewards would be related to position rather than performance,we found that rewardsare more relatedto performance of employeesand the resultsof the company in China than in the Netherlands’(p. 406).

Snapeet al. (1998)focusedon performance appraisal in their in-depth study of HR practices in Great Britain and Hong Kong. Parti al l y based on Hof stede’ s cul tural dimensions,they put forward a number of hypothesesrelating to likely differences in practi ces i n apprai sal between the two countries. Their conclusionswere based on an analysisof self-completedquestionnaires. While not all the hypotheseswere supported by their results, the suggestionwas that the practiceof appraisalhad beenadaptedto suit the cultural characteristicsin Hong Kong.

Galang(1999)reporteda comparativestudy on employeeattitudestowardsparticipationin

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the workplace. Based on Hofstede’s dimen- sionsof powerdistanceandindividualism,she predictedthat thosein the Philippineswill be lessdisposedtowardsparticipationin decision maki ng (vi ewed i n terms of ‘ voi ce’ – expressing a view on the decision, and ‘choice’ – actually making the decision)than Canadians.However, her analysis,basedon the applicationof a questionnairecontaininga range of decision-makingscenarios,did not supportthis assertion.Varioussuggestionsfor this were put forward, and the needfor field- work was emphasized.

Pizam et al. (1997) carried out a study of hotel managersin Hong Kong, Japan and Korea.Oneof the objectiveswasto determine whethernational culture had a greatereffect on managerial behaviour than the ‘ hotel industry’ culture.The methodologywasbased on a written questionnaire,the majority of the questions being designed to establish the extentof usageof managerialpracticesrelated to Hofstede’sfour cultural dimensions.Issues consideredof particular significanceto POM included methodsof performanceevaluation, atti tudes towards ti me i n pl anni ng and methodsof conflict resolution.Their analysis i ndi cated that there were si gni f i cant differencesbetweennationson all dimensions. They were able to concludethat, while there weresimilarities(in 24%of practicesstudied), nationalculturedid havea strongereffect than the ‘industry’ culture.

Black (1999) used Hofstede’ s cultural indices to attempt to predict the prevalence of certainlabourmarketflexibilities in various countries.He developeda rangeof hypotheses covering attitudes towards such issues as empl oyment securi ty, protecti on f or the unemployed, co-ordinated and centralized pay setting.Using dataprimarily from OECD publications, these hypotheses were tested statistically. He suggestedthat ‘While the results demonstrate only statistical associ- ations, they are suggestiveof the possibility that cultureplaysa moredeterminingrole’ (p. 592) and ‘The implicationsfor labour market policy are considerable’(p. 604).

The POM/Culture Interface

There is irrefutable evidence that national cultures influence management behaviour. Within POM it is possibleto try to establish which aspects of ‘best practice’ are most likely to be influenced by dif ferences in national cultures. Evidence to support this was collected and an initial attempt at a general i denti f i cati on was compl eted i n previoussections.A further stepis to examine the cultural dimensionsin more detail and to try to link theseto thedifferentfacetsof POM. In this initial assessment,a small groupof five experiencedresearcherswas used.Each was familiar with and had a sharedagreementand understandingof both the facetsof POM and the two sets of cultural dimensionschosen (Hofstede 1991; Kluckhohn and Strodtbeck 1961). Each individually attemptedto assess which facetwaslikely to be influencedby the position of a nation on each of the various dimensions.The assessmentsare summarized in Table2, wherethe lettersH andK areused to refer to the two different sets of cultural dimensions,and the numberscorrespondto the actual dimensionas outlined in an earlier section.The entriesin eachcolumn represent the averaging of the scores (using w�1, m�2, s�3) given by the membersof the group, and then converting these back to weak,mediumand strong.The averageindex is the overall averageof all of theseaverage scores across the ni ne di mensi ons. The measuresare rather simplistic, crude, ignore overlapbetweendimensions,andarebasedon several assumpti ons rel ati ng to addi ng, averaging and interpreting scores. Never- theless,a picture beginsto build up of areas of relative cultural sensitivity.

The areaswherethereare both consistency and diversity in views are interestingto note, and this addsfurther weight to the argument for further detailedresearch.In spite of their backgrounds,somemembersof the grouphad difficulty with some of the aspectsof POM and the impact of somecultural aspects.

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Discussion

Thereis a growinggeneralrecognitionthatthe various management practices in different functionalareasarenot universallyapplicable and frequently needadaptationif they are to be used successfullyin environmentsother than those in which they were developed. There is a range of anecdotalevidence to supportthis and,in someareas,therehasbeen the start of more systemati c research;

however, such researchis not widespread: ‘There is scarceresearchon the transferability of management practices across cultures’ (Galang1999,p. 704).

An examination of the literature would suggest that POM researchers have been rel ati vel y sl ow to exami ne the i nter- relationships between POM practices and culture, with the exceptionof a few reported case studies in this area. By contrast,there seems to have been a somewhat more

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Table 2. Analysis of suggested cultural influences

Aspects of POM Cultural dimensions Average

H1 H2 H3 H4 K1 K2 K3 K4 K5 index

Product and Service Design product/service design process m* w m* m* m* s* m* m* m* 2.1 quality management s s s m* m m s m* s 2.4 ^ statistical process control w m m* w m* m w w w 1.4 value and variety management m* w* m* w w w m* m w 1.5

Product and Service Process Design production/delivery system design (macro) m* m m* m m m m* m m* 2 work design and measurement (micro) m* m s m* s m* m* m m* 2.1 process improvement and re-engineering m* m s m* m* m* m* m m* 2.1 ^ waste elimination/just-in-time m* m s m* m* m m* m* m* 2.1

Planning of Operations forecasting m* w m w w s m w w 1.5 capacity planning w w m m* m s w m* w 1.8 ^ queue management m* w m* m m* s m* m m 2.2 operations scheduling m* m s m* m* s m* m* w 2 project planning m m s m m s m m* m 2 supply chain management m m m m m s m m* m 2.2 ^ purchasing m m m s m s s m s 2.3 ^ materials management w w m m m s w w w 1.6

Facilities Management and Planning equipment selection w w s m m m* w m m 1.8 reliability measurement w w m* w m* m* w w w 1.4 maintenance planning m m m* m m* s w m m 1.7 location decision making m* w m* m* m* w m* m m 1.7 layout planning m m m* m m* w m m m 2.1

Operations Strategy the corporate strategy link m m m* m* m* m m m* m 2.1 operations strategy development and implementation m m s s m* m* m m* m 2.3

People Issues in POM operations and HR s s s s s s* s* s s 2.8 health and safety s m* m m* m m* m* m* m* 2.2

Key: s, position on this cultural dimension likely to strongly influence `best practices' and require (significant) adaptation. m, position on this cultural dimension likely to influence `best practices' and require recognition and (possibly) adaptation w, position on this cultural dimension likely to have relatively little influence, and can be ignored. *Both extremes of w and s selected.

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systematicapproachto this in the field of HR. Thi s work coul d i ndi cate some usef ul methodological pointers for researchers in POM. The framework presentedin Table 2 could provide a useful starting point for researchdesign.

It can be seenfrom the studiesreportedin earlier sectionsthat heavyusehasbeenmade of the cultural dimensi ons of Hofstede, al though most researchers recognize the limitations andcriticismsthat havebeenmade of this work. Theseneedrevisiting in termsof their appropriatenessin a POM context.

It is interestingto notethe occasionswhena theoreticalevaluationof the likely impact of nationalcultureshasproducedhypothesesthat have not been confirmed by the subsequent (statistical)analysisof the empiricalevidence. This indicatesthe complexityof the topic, and the needfor careand rigour in the processof experimentaldesign.It suggeststhe need to combineboth cross-sectionalandlongitudinal studies.

The next step is to start the processof expl or i ng some of t he hypot hesi zed rel ati onshi ps i n Tabl e 2. I nevi tabl y, to understandtheselinks it will be necessaryto examinethe situation at the level of specific nations and aspects of best practice. A systematicapproachwill be essentialto put togetherthe piecesin the jigsaw in order to build up to see the entire picture. Given the complexity and extent of the task, it is unlikely that a clear overall picture and understandingof the inter-relationshipswill be gainedfor a considerablenumberof years, and only after extensiveresearch.

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