Multinationals in India: Managing the Interface of Cultures

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by Sinha, Jai B. P

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Diversity Management in International Supply Chains: Strategies for Effectiveness

Write a Testimonial Few good words, go a long way, thanks! In empowering suppliers and, in turn, their suppliers, the whole process of designing and manufacturing of parts, sub-assemblies and components for the manufacturer can be a way to deal with diversity in the supply chain environment. Schilling cites the example of how Ratan Tata, the highly regarded and recently retired CEO of the Indian based Tata group of companies, wanted to create a cheap car to replace the scooter [4].

This would be a car affordable to the masses. He offered his experience of a near accident in Bangalore, India when the car in which he was traveling almost ran over the occupants of a scooter. Riding on the scooter were the father in the front seat, a young son standing in between his legs, and the mother side saddled on the back seat with an infant on her lap. The scooter skidded and toppled, and all its occupants went tumbling. Given the price constraint, Tatas had to limit the weight and the amount of materials in the car. The suppliers came up with innovative methods to achieve the objectives, such as hollow steering column and a single fuel injector for the two cylinder engine.

Innovation at the aggregate level trickled down the system, then to sub-systems, then to parts. We went to tremendous amount of iteration in the design process. Gamble found that organizational commitment may well be critical to effective supply chain management and performance [5].

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  8. In this context, Gamble studied the effect of organizational commitment with China as the host country of the MNC [5]. Because of its large and low cost manufacturing base, China is a meaningful location for testing this tenet. China also had the advantage of being located within the supply chains of man MNCs. McIntyre argues that MNCs emphasize the issues of diversity and sustainability in international supply chain management [6]. He emphasizes that MNCs should pursue strategies that are compatible with sustainable development as they exploit resources and pursue production in developing or emerging market countries.

    In this context, he describes the various practices of corporate social responsibility as a new component of the strategies of international firms, using illustrations of French MNCs. Thomas Cook in his role as the managing director of American River International and the Department of Commerce of the New York District Export Council is one of the most vocal exponents of dealing with the importance of the diverse and varying conditions of international trade [7].

    He identifies both older and newer concerns in international business and he also provides cost effective solutions and stresses the need for better education and information sharing regarding better practices on a widespread basis.

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    He emphasizes the necessity for supply chain managers to possess larger and more diverse set of skills in order to manage the cultural diversity and complex corporate responsibilities in the diverse global market s. Among the areas that serve as the cornerstone of their skill sets are negotiation skills and the knowledge of freight markets across the globe.

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    There are different levels, methods and content in education and training across the globe. This is usually based on the history of education and training in each country. In his article, Cook points out the increasing importance of supply chain managers understanding and managing the diverse approaches in education, training and information-resource gathering [8]. This mindset, emphasizing a broader perspective as well as a customizing approach, would enable him or her to better understand how various global issues would inter-relate in the larger scheme.

    Berrett cites four studies about diversity in universities [9]. The studies found that diversity in university student bodies aids in critical thinking. It helps to settle students in diverse environments. There are varying levels and attributes of growth in different regions of the world and in regions within each country. This calls for a case-by-case approach in dealing with growth as an MNC pursues the exploitation of growth opportunities.

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    The proceedings of International Conference of Logistics Engineering and Management provide a compilation of numerous studies using statistical models on many supply chain topics, e. Such analysis would help in clarifying and making sense of the processes of the complex supply chain network.

    Risk management varies from one country to another. The analysis and evaluation of risks in varying country cultures in international supply chain management are major, challenging issues. Dealing with the diversity of cultures in risk management practices across different countries requires the astute applications of skill and experiences in managers. Wakolbinger emphasizes the need for dealing with diversity in risk management in international supply chains [10].

    He analyzes the impact of strategic information acquisition and sharing on supply chain disruption risks and costs when evaluating the supply chain performance of risk-sharing contracts. We develop a model that consists of three tiers of multi-criteria decision- makers, manufacturers, retailers, and demand markets.

    Thus, risk-sharing contracts go hand in hand with information sharing, a desirable way of strengthening the hands of the players in the international supply chain. The knowledge of diverse cultures of different countries would help the manager to cope with the uncertainty and anxiety associated with effective risk management. Mathis and Cavinato provide an argument that indicates an increasing need for MNCs to improve the financial processes of the international supply chain and to institute the best practices [11].

    In the context of financing process in supply chain management, they acknowledge the diversity of financial conditions, business cultures and practices, regulations and processes. Managing diversity in the financial and banking environments of the individual countries would help the supply chain executive in containing the financial management challenge in the diverse environments. Medford provides an economic rationale to operate a global supply chain in a sustainable manner [12].

    The consequence can be that the production effects usually tend to cause marketing and financial risks that are inter-related and may even off set each other. These can have a favorable effect on the stockholders through stock price appreciation. This issue is used to illustrate how lean production practices can affect consumers, employees, and financial risk. Thus, for effective and sustainable international supply chain management, proper ethical international human resource management practices are prerequisites.

    Multinationals in India: Managing the Interface of Cultures

    The knowledge of different cultures and the skill to manage diversity among cultures would help the executive in dealing with the leadership issues. When considering the challenges of managing diversity in international supply chains, we look to the international management literature for clues for formulating effective managerial strategies to deal with diversity. Many of the challenges of managing diversity emanate from cultural differences across countries.

    It is worthwhile to review the dimensions that help define the cultural differences among countries in order to formulate effective managerial strategies for dealing with diversity. Based on the cultural dimensions that identify cultural differences across countries, the three models are presented in the three tables.

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    4. This analysis helps to determine which activities and products to in-source, and which to out-source when dealing with diversity issues. If you previously purchased this article, Log in to Readcube. Log out of Readcube. Click on an option below to access. Log out of ReadCube. We do so by investigating the extent to which foreign national culture and related local issues are incorporated into the CSR policy of 37 multinational corporations, examining strategy development and implementation across global locations.

      This research suggests that integrated internationalization strategies do not resolve global and local CSR issues. In fact, they reinforce outcomes similar to global strategies, where core issues identified by headquarters are legitimated and local issues are marginalized, an outcome that appears somewhat at odds with the spirit of local responsiveness embedded in CSR thinking.

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