ORG 716 Week 5 Organizational Behavior and Globalization Example

One Quality System, Three Countries: Culture, Behavior and Practice Transfer at a Global Device Maker

[Student Name]

University of Phoenix

ORG/716: Organizational Theory and Design

Week 5 Assignment

[Instructor Name]

[Date]

Lakehead Medical Components, its sites, employees and figures are composites written for a model paper.

Lakehead Medical Components, the invented parts maker examined since Week 1, employs about 900 people in Minnesota, 1,000 in Tijuana and 500 in Penang. Its customers expect identical quality from every site, and its corporate quality system applies everywhere. But last year, an attempt to spread Penang's self-managed cells to the other sites produced three different results. This paper uses research on culture, institutions and practice transfer to explain why and to recommend how the company should operate across borders.

The Experiment

Penang's cells give teams of eight operators responsibility for a family of parts, with daily problem-solving meetings, visual boards and team bonuses. After Penang's quality and productivity results became the company's best, corporate leaders asked Tijuana and St. Paul to adopt cells on two lines each. After six months, Tijuana's cells followed the routines precisely: meetings held, boards updated, but few problems raised by operators, who brought issues to supervisors instead. St. Paul's cells met resistance: experienced operators objected to team bonuses replacing individual incentives, and two cells reverted to old practices.

Cultural Dimension Research

Hofstede (2001) identified dimensions on which national cultures differ, including power distance, how far people accept that authority is unevenly held; the pull between individual and group interests; uncertainty avoidance; and others. On his indices, Mexico scores high on power distance and low on individualism, the United States low on power distance and very high on individualism and Malaysia very high on power distance and low on individualism. The GLOBE project (House et al., 2004) measured both cultural practices and values across 62 societies and examined their links to leadership expectations.

These scores offer partial explanations. St. Paul's resistance to team bonuses fits a highly individualistic culture. Tijuana's deference to supervisors fits high power distance. But Penang, with the highest power distance score of the three, has the most active operator problem-solving, which national culture alone does not explain.

The site with the highest power distance score has the most outspoken operators, a warning against reading behavior off national averages.

The Limits of Cultural Scores

Taras et al. (2010) pooled three decades of research built on Hofstede's framework and found that cultural values related to a range of organizational outcomes, but that relationships were modest for many individual-level outcomes and that values varied considerably within countries. Culture, in other words, is one influence among many. At Penang, the site's young, technically educated workforce, many with diplomas from local polytechnics, and a manager who built the culture from the start, as Week 4 described, may matter more than national averages.

Institutional Differences

Institutions also differ. In Tijuana, the maquiladora labor market has high turnover, about 60 percent a year, which makes investing in operators' problem-solving skills less attractive and leaves supervisors as the stable experts. Mexican labor law and union agreements shape bonus structures. In St. Paul, a long-tenured workforce with an incentive system written into practice for three decades creates expectations that are hard to change. In Penang, government-supported technical training and an industrial cluster of electronics and device firms supply operators familiar with cell practices.

Practice Transfer

Kostova (1999) proposed that the success of transferring a strategic practice from a parent to a subsidiary depends on the institutional profile of the receiving country, its regulatory, cognitive and normative elements; on the organizational culture of the receiving unit; and on relationships between the units, such as trust and identification. She distinguished implementation, following the practice's formal rules, from internalization, employees attaching value to it. Tijuana implemented cells without internalizing them. St. Paul neither implemented nor internalized fully, because the practice clashed with existing incentives and identity. The transfer to both sites also flowed from a newer, smaller site to older, larger ones, which may have weakened identification and trust.

Evidence After Six Months

Data from the six months of the experiment support this reading. At Penang, operators raised an average of 14 problems per cell each month. Tijuana's cells raised three, nearly all through supervisors, and St. Paul's two remaining cells raised five. Quality results improved modestly in Tijuana's cells and not at all in St. Paul's. Exit interviews in Tijuana suggested that operators valued the training but left for small wage gains elsewhere, consistent with the institutional account.

Global Integration and Local Responsiveness

Bartlett and Ghoshal (1989) described multinational firms balancing global integration, to gain efficiency and consistency, with local responsiveness, to fit national conditions, and argued for a transnational model that combines both with worldwide learning. For Lakehead, the quality system must be globally integrated: customers and regulators require it. Work organization practices such as cells can be locally adapted, provided they meet common quality outcomes. Learning should flow in all directions, including from Penang to headquarters.

The Direction of Transfer

Research on practice transfer has mostly studied practices moving from headquarters to subsidiaries. Lakehead's case runs the other way: a practice developed at the newest, smallest, most distant site was pushed to the original plant. St. Paul's long-serving operators and managers did not see Penang as a source of expertise; some saw the request as a judgment on their own work. This reverse transfer raises questions about status and identity that Kostova's relational factors only partly address. Framing the cells as Lakehead practice, developed at Penang with corporate support, and inviting St. Paul operators to adapt them, may reduce that resistance.

Leading Across Cultures

Leaders' behavior can widen or narrow cultural gaps. In Tijuana, operators expect supervisors to lead problem-solving, so asking operators to raise problems directly may at first feel inappropriate. A supervisor who opens each cell meeting by naming a problem she saw and asking operators how to fix it models the new behavior within familiar expectations. In St. Paul, where operators expect autonomy, leaders can frame cells as giving teams more control over their work rather than less. GLOBE's finding that leadership expectations vary by culture supports adapting leaders' approach while keeping the same goal.

Recommendations

Standardize the quality system and core measures across sites; adapt how work is organized to reach them.

Tijuana: build problem-solving gradually, starting with supervisors leading cell meetings and inviting operator input, and address turnover with a retention bonus for operators trained in problem-solving.

St. Paul: blend team and individual incentives during a two-year transition and involve experienced operators in designing the cells.

Exchanges: send operator teams between sites for two-week visits to build relationships and trust, the conditions Kostova links to internalization.

Measure internalization, not just implementation: track operator-raised problems and survey operators' views of the practice.

Conclusion

Lakehead's attempt to spread self-managed cells shows how globalization shapes organizational behavior. Cultural dimensions explain part of the different responses, but within-country variation and institutional differences matter as much, and practice transfer depends on how receiving units adopt and value a practice. A transnational approach, standardizing quality while adapting work design and building learning across sites, fits the company's position.

References

Bartlett, C. A., & Ghoshal, S. (1989). Managing across borders: The transnational solution. Harvard Business School Press.

Hofstede, G. (2001). Culture's consequences: Comparing values, behaviors, institutions, and organizations across nations (2nd ed.). Sage.

House, R. J., Hanges, P. J., Javidan, M., Dorfman, P. W., & Gupta, V. (Eds.). (2004). Culture, leadership, and organizations: The GLOBE study of 62 societies. Sage.

Kostova, T. (1999). Transnational transfer of strategic organizational practices: A contextual perspective. Academy of Management Review, 24(2), 308-324. https://doi.org/10.5465/amr.1999.1893938

Taras, V., Kirkman, B. L., & Steel, P. (2010). Examining the impact of Culture's consequences: A three-decade, multilevel, meta-analytic review of Hofstede's cultural value dimensions. Journal of Applied Psychology, 95(3), 405-439. https://doi.org/10.1037/a0018938