Costbuck

[pic 1][pic 2]

Table of Content

Introduction        

I.        Cultural differences between Europe and China and their significance for the HRM approach        

1)        Culture differences between Europe and China        

a.        Hofstede Model        

b.        Trompenaars’ model        

2)        Human Resources Management        

II.        Orientation of the organisation        

III.        Difficulties and selection of expatriate staff        

1)        Difficulties faced by expatriate staff        

2)        Selection of expatriate staff and preparation        

Conclusion        

Introduction

Expanding a business into an international level represents a new range of opportunities, but brings a number of challenges an factors which have to be taken in account (especially for the HRM) to have a successful strategy.

In this case, the French coffee bar chain “Costbucks”, already established in different European countries, is willing to break into the Asian market (Hong-Kong and Beijing). It may be a more difficult implantation because of the differences between Asian and European’s culture. It is important to identify those differences because they will affect the way the business and the relationships between the staff have to be managed. Once those factors are identified, it is important to decide whether the orientation of the organisation should be ethnocentric, polycentric or geocentric. Another important issue when entering a new country, is how to select and train expatriate staff who will be the first one encountering difficulties.

1. Cultural differences between Europe and China and their significance for the HRM approach

1. Culture differences between Europe and China

Identifying and understand a culture is very complex. A culture is the result of many different factors such as the history, the heritage for older, the natural environment, the “rules” of communication and many others.

Many psychologist and economist have tried to identify the factors which are part of the culture and came out with different definitions. The more famous one are Hofstede and Trompenaar whose work have influenced a new model called Global Leadership and Organisational Behaviour Effectiveness (GLOBE) model.

1. Hofstede Model

Hofstede (1980) defines the culture as “…the collective programming of the mind of members of a group which is reflected in its particular assumptions, perceptions, thought patterns, norms and values.” Whereas  

 Hofstede has identified 6 different dimensions of culture: Collectivism/Individualism, Uncertainty Avoidance, Masculinity/Femininity, Power-Distance Tolerance, Long-Term Orientation/Pragmatism and Indulgence vs Restraint.

[pic 3]

http://geert-hofstede.com

This graph compares the differences between the French, Chinese and Hong Kong’s culture, but it is important to notice that the data for China “are - partially or fully - not from Geert Hofstede but have been added through research projects of other researchers or have been derived from data representing similar countries in combination with our practitioner experience”^[1].

Even if we can’t really rely on China’s number, we can see that they are quite close to Hong Kong’s, which allows us to identify a trend. We can see that between European and Chinese culture, some dimensions such as “Power distance” and in a way “Long term orientation” are quite close. However, there is a significant difference in “Individualism”, “Uncertainty avoidance” and “Indulgence”. We can observe that there is a 15-20 point differences for the “Masculinity”, but regarding my experience, I would think that the difference is greater, especially in the business area, the key functions are always occupied by men.

From this model, we can already identify some key factors to help us implementing an efficient HRM policy. We can see that Hong Kong and East Asian countries have a Long Term Orientation, which is considered as a culture ready to adapt itself for future changes. They like to save and invest and show a lot of perseverance.

We can see that the biggest differences between France and China/Hong Kong are a very low Uncertainty Avoidance (UAI) and Individualism (IDV) compared to Europe. This very low UAI means that for Eastern Asian Countries compared to Europe (86-29), uncertainty and taking risks is culturally acceptable.

Regarding the Power Distance (PDI) which is quite close to Europe, we can assume that inequalities are acceptable among the society. The relationships with subordinate superior are polarized which may result from the old colonisation from the UK Empire.

1. Trompenaars’ model

Trompenaars’ model has been built on Hofstede’s model who has include stereotypes and the comparison of different national cultures.

[pic 4]

http://agents2change.typepad.com/

In his work, Trompenaars’ identify two types of society (Universalism and particularism):

...