CORPORATE CULTURE
CORPORATE CULTURE
Any corporation has certain common values its employees share. These constitute the corporate culture and form a control mechanism that is implicit and that helps enforce the explicit bureaucratic control mechanisms that the firm has in place.24 International firms have more difficulty relying on the corporate culture for control because managers from different countries may have different norms pertaining to the management of operations and little or no exposure to the values and attitudes prevalent at corporate headquarters. Nevertheless, many firms seek to promote a worldwide corporate culture by bringing managers from different countries into closer contact with each other. Frequent transfers of managers among foreign operations develops increased knowledge of and commitment to a common set of values and objectives so that fewer procedures, less hierarchical communication, and less surveillance are needed.25 For example, the 3M Company not only brought managers together from different countries for training, it also developed training teams from different countries so that there would be a hybrid of national viewpoints. Iveco, Europe's second-largest truck manufacturer formed through a merger of Italian, French, and German companies, has concluded that a common culture cannot easily be developed with older, entrenched managers. The company is trying to combine the best from the three countries over time by hiring graduates from throughout Europe and moving them to all three countries before assignment to corporate headquarters.26
The degree of control imposed by corporate headquarters on the selection of top managers for foreign subsidiaries may dictate to a great extent how much formal control over the subsidiaries' operations the corporate personnel feel is necessary. The use of parent-country nationals in the subsidiary man-
agement, or even determining the standards of selection and training, may be perceived as a means of assuring primary loyalty to the corporate rather than the subsidiary culture.27 This may be effective even if the operations are only partially owned or when the parent requires long-range planning from the subsidiaries.28
Any corporation has certain common values its employees share. These constitute the corporate culture and form a control mechanism that is implicit and that helps enforce the explicit bureaucratic control mechanisms that the firm has in place.24 International firms have more difficulty relying on the corporate culture for control because managers from different countries may have different norms pertaining to the management of operations and little or no exposure to the values and attitudes prevalent at corporate headquarters. Nevertheless, many firms seek to promote a worldwide corporate culture by bringing managers from different countries into closer contact with each other. Frequent transfers of managers among foreign operations develops increased knowledge of and commitment to a common set of values and objectives so that fewer procedures, less hierarchical communication, and less surveillance are needed.25 For example, the 3M Company not only brought managers together from different countries for training, it also developed training teams from different countries so that there would be a hybrid of national viewpoints. Iveco, Europe's second-largest truck manufacturer formed through a merger of Italian, French, and German companies, has concluded that a common culture cannot easily be developed with older, entrenched managers. The company is trying to combine the best from the three countries over time by hiring graduates from throughout Europe and moving them to all three countries before assignment to corporate headquarters.26
The degree of control imposed by corporate headquarters on the selection of top managers for foreign subsidiaries may dictate to a great extent how much formal control over the subsidiaries' operations the corporate personnel feel is necessary. The use of parent-country nationals in the subsidiary man-
agement, or even determining the standards of selection and training, may be perceived as a means of assuring primary loyalty to the corporate rather than the subsidiary culture.27 This may be effective even if the operations are only partially owned or when the parent requires long-range planning from the subsidiaries.28
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