comparative value priorities of chinese and new zealand

improve success rates in doing business with people in the culture. An example of the
needs for cultural knowledge in business is the events relating to the New Zealand milk
product co-op Fonterra 1 and the China milk product producer Sanlu in 2008 (Fonterra,
2008). The behaviour of the Fonterra executives and management in the series of events
concerning melamine contamination of baby formula and other products in China
indicates a basic lack of understanding of culture-bound organisational processes in
Chinese business and government, leading to serious financial and reputational loss for
Fonterra and bankruptcy for Sanlu. The problem might have been ameliorated or
avoided, as in 2004 I contacted the Chief Executive Officer and Human Resource
Manager of Fonterra and invited them to participate in this project to understand how to
manage and lead in China, but the individuals contacted at Fonterra declined. The
incentive offered was that I would teach free business and culture seminars at Fonterra.
The public reports of the interactions between Fonterra executives demonstrated a lack
of understanding of how business interactions are expected to be carried out in China.
This lack of understanding of the effects of cultural values on business and government
practices contributed to the resulting considerable financial losses to Fonterra, the
bankruptcy of Sanlu, the arrest and eventual execution of Sanlu Chinese executives, and
the illness and death of children in China.
Examples of the influence of culture abound in studies of international marketing.
Business-to-business marketing relationships have taken on a variety of names
including long-term relationships, buyer-seller partnerships, strategic alliances, joint
ventures, network organisations, fully integrated hierarchical firms, and cross-marketing
agreements (Gross and Neuman, 1989; Oliver, 1990; and Webster, 1992). The
proliferation of terms with nebulous definitions is an indication that after decades of
study, we still know little about what antecedent and contingent factors lead to a
successful international business relationship. In advertising, the same global brand may
appeal to different cultures in different countries in different ways. Advertising,
especially television advertising, is directed at the inner motivation of prospective
buyers whose minds have not been and will not be globalised. Williams, Han and Quall
(1998) showed that knowledge of cultural orientation, a significant antecedent
contingency factor that affects the social and structural bonds that exist between
1
Fonterra dairy co-operative is headquartered in New Zealand and is a large local provider and exporter
of dairy products, handling about a third of international dairy trade, with milk procurement, processing
and sales in more than 140 countries. See http://fonterra.com, and Enderwick (2009).
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