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Collection « Les sciences sociales contemporaines »

Successful Companies in the Developing World. Managing in Synergy with Cultures. (2007)
Preface


Une édition électronique réalisée à partir du livre de Philippe d’Iribarne, avec la participation d’Alain Henry, Successful Companies in the Developing World. Managing in Synergy with Cultures. Translation: Gill Gladstone, Jon Graham and Eleanor O’Keeffe. Paris: Agence Française de Développement, 2007, 248 pp.

[15]

Preface

The publication of an English-language edition of Le Tiers-Monde qui réussit [1] is an opportunity to take another look at the lines of approach that led up to this work, in order to take stock of what has been achieved and what lies ahead. Four cases of fruitful encounter between the particularities of a culture and original management methods are examined in depth. Each encounter produced a successful outcome that stands in sharp contract with what is typical of the country where each company involved was established : Mexico, Morocco, Cameroon and Argentina. Certainly business success is always precarious, as evidenced by the "excellent companies" hailed with enthusiasm in the 1980s. Even though the four success stories presented here are somewhat dated, they nonetheless remain extremely instructive. Their analysis helps further our understanding of three overarching questions : the influence of culture on development, the adaptation of management practices to cultural diversity, and the theory of culture. If these issues are dealt with concurrently, it is because treating them separately—especially development and management—is highly artificial, although it is still unfortunately often the case.

Cultures and development

The research I have been conducting since the early 1980s on the role culture plays in the functioning of business organisations and of economies originally focused [16] on the long-standing and ill-answered question of what influence culture has on management. At the outset, I was convinced that, to fully understand this influence, it was necessary to adopt a renewed approach, plunge into shop-floor life and analyse as exactly and minutely as possible how individual and collective work was carried out. The guiding idea was to look at all the stages in the causal chain that lead various cultures to produce efficiently, from the level of work methods through to the technical operations of production units. I had not, however, challenged the idea prevailing in the literature (such as Weber, McClelland or Fukuyama), which held that there was a kind of necessary (mechanical) linkage between cultural traits and a country's capacity to foster high-performing business organisations and hence a flourishing economy. One fundamental, and unexpected, finding of this research was that this sort of idea should be put aside and that adapting business management to a cultural context is an essential mediating mechanism in the relations between culture and productive efficiency.

Although management techniques (decentralisation procedures, control and evaluation, decision-making processes, various aspects of quality policy, etc.) seemingly deal first and foremost with objects, they are in one way or another never completely disassociated from the way individuals live together. The reputedly universal management methods, as taught in MBA programmes and disseminated all over the planet by consultants, are largely grounded in a specifically American conception of how people live together. In the old industrial countries, management practices were adapted to the diversity of local contexts through trial and error and over time, even though their underlying principles were barely theorised. [2] This is much less the case in developing countries and, as a result, the methods that the experts, management [17] consultants, international organisation representatives or executives trained abroad try to impose there are above all those methods with "universal" scope. When the transplant takes badly and the results obtained are mediocre, the usual course of action is to encourage managers to apply "best practices" firmly and effectively. [3] And so begins a vicious circle : the less successful the approaches one is trying to impose, the more vigorous the insistence to have them applied.

Faced with this state of affairs, three hypotheses can be envisaged :

  • hypothesis 1 : the developing countries will never really be able to escape their present situation unless they finally manage to establish those "best practices" that have already proved their worth in the developed countries. Given the cultural resistance to this path, a far-reaching cultural change is needed to ensure success ;

  • hypothesis 2 (which is becoming increasingly prevalent concerning sub-Saharan Africa) : this kind of cultural change is so difficult to bring about that certain zones of the planet are condemned by their culture to lasting under-development ; or

  • hypothesis 3 : to promote development, a management approach adapted to the local norms of living and working together must be crafted and applied in each cultural context. In certain regions, extensive innovations in the management field are required to achieve this.

The major contribution of these four cases is that they provide robust evidence underpinning the third hypothesis. They show that, in the four countries concerned, local forms of co-operation (such as the family of brothers in Mexico, or the religious brotherhood in Morocco) do indeed exist, enabling collective actions to be undertaken [18] with a high degree of efficiency. They also show that these co-operative forms normally involve aspects of social life other than those affecting the economy, but that they can potentially be mobilised by business organisations provided that an appropriate management approach is called into play. Correlatively, ways of managing, which may sometimes seem very unfamiliar to Europeans or Americans, do exist that enable the typical excesses of the countries' business organisations to be countered. In the Mexican and Moroccan cases, it even appears that using admittedly non-classical avenues allows levels of efficiency to be attained that could well be the envy of a good many companies in the industrialised world. There seems to be no reason why what is true of the countries studied, amongst which we find a sub-Saharan country, should not hold good elsewhere.

One salient question, in view of the debates on the linkages between culture and development, relates to the conditions under which satisfactory co-operation is obtainable within human groups other than small kinship or friendship groups. Do societies influenced by particularist cultures inevitably fall prey to nepotism and corruption ? Or, at the very least, is their economic development not irremediably impeded by the fact that transaction costs become extremely high as soon as one steps outside of small communities ? Would it then be necessary, as states North's thesis, for these societies to undergo a kind of cultural revolution that would lay the ground for satisfactory co-operation between individuals who share no special bond ? This would mean setting up a system of contractual relations in tandem with the strict enforcement of property rights. Yet, the cases in point do not involve small communities, but rather groupings of several thousand people. In each case, one effectively observes that the excesses linked to the strength of particularist relationships had very adverse consequences on the companies' former functioning. However, these excesses have been successfully countered thanks to appropriate management approaches. Moreover, now this has been achieved, the particularist relations, which still remain, have been harnessed in support of what is often referred [19] to as a strong corporate culture and, consequently, of a more efficient mode of functioning than that obtained through purely contractual relations between individuals who share no special ties.

Here, of course, our sphere of reference goes no further than business organisations, and does not include whole societies. Yet, as we shall see later, there is no lack of reasons for thinking that forms of efficient co-operation for the first hold a wealth of lessons for the second.

Cultures and management

The cases studied help further the debates on the degree of embededness of management, the more or less universal nature of best practices, and the questions raised by the transfer of management methods particularly to foreign-based subsidiaries of multinational corporations. All these debates centre on the articulation between universal management principles and the necessary adaptations to the diversity of cultural contexts.

In the four cases analysed, traditional local practices were effectively abandoned in favour of new management techniques drawing on foreign examplars that foster more efficient business management : a human resources policy in Mexico, a quality policy in Morocco, a procedure-based system in Cameroon, and corporate ethics in Argentina. In each case, new practices helped bring the company's functioning more into line with the respect of universal values such as transparency, equity and honesty. In the four cases, respect for these values encouraged more trusting, and thus more co-operative relations between the companies' employees, not only between superiors and subordinates but also among peers. All of these outcomes would argue in favour of the universalist thesis.

[20]

Yet, at the same time, in the four cases, it was through management practices specially tailored to the local context, and which may seem strange or even quite shocking to the outside eye, that these universal values became tangible. Thus, for example, the paths taken towards greater transparency in the Moroccan and Cameroonian companies are very different from each other on many points. The holy man in the Moroccan case derives from a tradition that has no equivalent in Cameroon, and the procedural hypertrophy in the Cameroonian case is embedded in a tradition that is without equivalent in Morocco. Similarly, the way in which a certain hierarchical equality was reached differs sharply between Mexico and Morocco, as the reference forms of equality in the two countries are not the same. On the one hand, there is a social equality within mutual aid relationships and, on the other, a religious and moral equality within the common respect of shared rituals, despite the persistence of a strong social inequality. All these elements would argue in favour of a differential thesis.

Does this mean that neither thesis is completely convincing, although each holds a part of the truth ? If we analyse each case in depth, this allows us to go a step further and understand how the elements of truth present in each intertwine. In fact, what is valid in each is not situated at the same level of abstraction. As long as abstract vocabulary, such as trust, transparency, co-operation, honesty, etc., is used, the universalist thesis holds good. The world over, a high level of co-operation is a guarantee of efficiency. However, when take a closer look at the concrete aspects, examine the procedures more specifically, or show greater interest in the precise ways of living and working together, the differential thesis wins the day. One serious limit in the most common approaches to management is that they do not distinguish between these two levels and are thus not aware of what moving from one level to the other implies. The four cases analysed here show how this limit can be overcome.

[21]

What is a culture ?

Finally, this book also involves the theory of culture.

Research into the diversity of national cultures is dominated by an attitude scale approach enabling each culture to be characterised in quantifiable terms, and this construct holds a virtually hegemonic place in the English language literature. Yet, as the present cases well show, this form of representation is inadequate, since within a single society very different attitudes are likely to prevail in the various spheres of social life. Moreover, far from being of secondary importance, taking this heterogeneity into account is vital when implementing efficient management practices.

Mexico provides a good illustration of this phenomenon. In the research that takes Geert Hofstede's attitude scaling as a benchmark, Mexico has a particularly high score on the Power Distance index (ranking second out of thirty-nine in decreasing PD order). [4]4 Yet, as our Mexican case shows, this distance cannot be considered as a general trait of Mexican society, even if we restrict our scope to business enterprises. It is true that, when talking about their company's past or other firms, the company employees evoked a high power distance, with superiors inhabiting another world almost of "doses", "tyrano", "intocable". Yet in the company's present-day environment very different relationships come to bear. The classic signs marking the distances between the different echelons are systematically suppressed. Thus, although a very hierarchical functioning holds sway in Mexican companies, there is nothing inevitable about it. In Mexican society, other forms of co-operation also exist, which obey rather a non-hierarchical logic and which companies can also draw on using a suitably adapted management approach.

[22]

Another conception of culture built around the notions of 'shared meaning' and the 'social construction of reality' is also very widespread. Thus, for Geertz, "Parsons, following not only Weber but a line of thought stretching back at least to Vico, has elaborated a concept of culture as a system of symbols by which man confers significance upon his own experience. Symbol systems, man-created, shared, conventional, ordered, and indeed learned, provide human beings with a meaningful framework for orienting themselves to one another, to the world around them, and to themselves. At once a product and a determinant of social interaction, they are to the process of social life as a computer's program is to its operations, the genetic helix to the development of the organism, the blueprint to the construction of the bridge, the score to the performance of the symphony, or, to choose a humbler analogy, the recipe to the baking of the cake—so the symbol system is the information source that, to some measurable extent, gives shape, direction, particularity, and point to an ongoing flow of activity". [5]

This concept poses no problem if reference is being made to a culture that is specific to a small tight-knit community. On the other hand, it is difficult to envisage a culture that is common to an entire modern nation-state because, within the same national society, one encounters rival definitions of reality and highly diverse types of behaviour. One line of thought, moreover, casts doubt on whether the notion of national culture is really pertinent. [6] The four cases analysed, which highlight behaviour types that deeply diverge from those that seem to characterise their surrounding societies, confirm that the metaphors of the 'computer's program' and the 'recipe for baking the cake' are inadequate. Yet, at the same time, they tend to point up, as does the whole research program they depend on, interpretative frameworks which are rooted in a [23] society 's history and shared by individuals with different behaviours and conflicting values.

Apprehending these frameworks represents a critical step towards understanding a culture, and not only in developing countries. Let's take the example of the United States and examine the meaning of a situation where an employee negotiates his work contract with his employer, with no outside interference. Throughout American history, this situation has been, and still is to a certain extent, interpreted in two diametrically opposing ways. A strong American tradition holds that the possibility to form a contractual relationship, with no interference from political power, is the cornerstone of liberty, and that the absence of state intervention in the sphere of private affairs is a fundamental characteristic of a free society. Thus, at the end of the 19th century, the fact that freedom of work was identified with contractual freedom prompted a series of decisions in State courts and the Federal Court. These decisions "struck down state laws regulating economic enterprise as an interference with the right of the free laborer to choose his employment and working conditions and of the entrepreneur to utilize his property as he saw fit". [7] In parallel, however, this vision came under strong criticism. In the 19th century, a good many voices rose up in protest against wage slavery. Labour organisations challenged the assumption that meaningful freedom was able to exist in a situation of extreme economic inequality. [8] On both sides of these opposing standpoints, the reference upheld is the ideal image of a freely negotiated contract. To this extent, there is a recognisable cultural unity and continuity. At the same time, the concrete situations associated with this ideal image reveal substantial divergences.

[24]

In a study concurrent to the writing of this book, our Moroccan case served as the groundwork for exploring, on the one hand, the relationships between a common culture that escapes the control of its actors and, on the other, the diverse strategic choices that the actors make. [9] One sees that culture offers a model of a tight-knit community, which defines the normal ways of acting within such a community, as well as criteria for recognising if one actually forms part of it. Yet, if the corresponding image exists in the surrounding society, there is no fatality implying that this image be seen by the members of a company's personnel as applying to the whole that they form. It is largely up to the management, by its speech and example, to define the nature of the human group formed by the company (the category that it belongs to), a close-knit community or, inversely, an area of perpetual conflict. When doing so, it defines the nature of the relationships that serve as reference marks and thus as the accepted norms. This role of management is particularly visible when the outcome is that the company appears to embody a different social form than what is typical of other companies (which is true of our Moroccan case). It is less visible, but still present, when a more ordinary way of functioning is involved. In all cases, there is no question of cultural inevitability.

To construct a pertinent theory of national cultures and their role, it is important not to reduce action to culture, a pitfall that a certain culturalism tends to fall into—or reduce culture to action, a pitfall that a post-modern vision tends to fall into. [10]

[25]

An ongoing approach

The present work is one step within a long-term research program.

Since this book was written, our field research has been continuing, especially in Asia. A study is now in progress in a Chinese subsidiary of an industrial group with French roots, which is looking into the encounter between management practices inspired by the parent company and Chinese reference marks. This research is deepening our understanding of the ways in which this type of encounter operates. The process is a complex one and, in this case, far from completed. One, always key ingredient is that the Chinese personnel interpret what the parent company proposes in both words and actions within their own familiar categories (the opposition between the strong, just and nourishing power of the celestial bureaucracy and the functioning of interest groups, guanxi, to the benefit of their members). In addition, another process is taking place, very unevenly depending on the localities, that requires much more time. Certain ways of behaving are beginning to have an effect, such as clearly stating one's point of view in front of a respected authority, even though they are not part of the familiar norms in Chinese society and cannot therefore be accepted and applied immediately. These new ways of functioning can be seen operating within the social group thanks to the creative link-ups made between outside input and the Chinese world (in this case, represented by the classical images of highly ritualised remonstrance addressed to the emperor).

To take this research further, it would seem to me that, without leaving aside the analysis of how companies function the world over and particularly those that succeed, it is essential to investigate the questions of national governance and global economic regulation. The experience of European countries, or of those with a European-style culture (the United States, Canada), show that the same cultural traits (the same conceptions of individual autonomy and the role of authority, the same [26] forms of the sense of duty, etc.) are found in the functioning of global institutions and business organisations. The people that give life to public institutions, and those whose actions are framed by these institutions are the same, with the same culture, as the people companies bring together to co-operate on a common task. Similarly, at both levels, there exist forms of regulation that obey identical logics in tune with the same cultural traits (the central role of contractual logic in the United States and the search for consensus in the Netherlands and, in both cases, not only within business enterprises but also in the regulation of the economies). For institutional systems and for business organisations, the universal principles of good governance need to be substantialised in practices that are tailored to the diversity of cultural contexts. And there is no reason why this rule should not concern developing countries. This affects both the setting up of democratic forms of government and the efficient fight against corruption. To craft suitable practices, it is highly likely that many lessons can be learnt from observing business organisations that succeed. This is top priority for research into the developing world.

April 2007



[1] Philippe d'lribarne (2003), Le Tiers-Monde qui réussit : Nouveaux modeles, Éditions Odile Jacob, Paris.

[2] This became very apparent during a first research project comparing the functioning of factories in the United States, the Netherlands and France, all of which were technologically similar and owned by the same industrial group. Philippe d'lribarne (1989), La logique de l'honneur, Paris : Seuil.

[3] Philippe d'lribarne (1990), "Face à l'impossible décentralisation des entreprises africaines", Revue française de gestion, September.

[4] Geert Hofstede (1980), Culture's Consequences : International Differences in Work-Related Values, London : Sage.

[5] Clifford Geertz (1973), The Interpretation of Culture. Basic Books, New York, p.250.

[6] Cf. for example for management, Udo Staber (2006), "Social Capital Processes in Cross Cultural Management", International Journal of Cross Cultural Management, 6 : pp. 189-203.

[7] Eric Foner (1998), The Story of American Freedom, Norton, p. 122.

[8] Ibid, p. 126.

[9] Philippe d'lribarne (2003), "The Combination of Strategic Games and Moral Community in the Functioning of Firms". Organization Studies, 24 (8) : 1283-1308.

[10] For the state of this question as it stands on the date the present lines were written, see : Philippe d'lribarne. (2007) "National Cultures and Organizations : in Search of a Theory ; an Anthropological Perspective" Communication to the "Theorizing Culture Conference", Björkliden (Sweden), March 28th   - April 1st.



Retour au texte de l'auteur: Jean-Marc Fontan, sociologue, UQAM Dernière mise à jour de cette page le dimanche 19 mars 2017 13:34
Par Jean-Marie Tremblay, sociologue
professeur associé, Université du Québec à Chicoutimi.
 



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