ORGANIZATIONAL CULTURE Organizational Culture and Leadership, 3rd Edition

THE ROLE OF LEADERSHIP IN ORGANIZATIONAL “MIDLIFE” 279• The need to get closer to different customer bases and the discoverythat geographically dispersed customers often requiregenuinely different goods and services• The need to take advantage of local labor costs in some geographicalareas• The cost advantages of getting closer to where raw materials,sources of energy, or suppliers are located• The requirement by local customers that if products are to besold in a local market, they must be produced in that marketarea as well, to protect local labor and to gain knowledge ofrelevant manufacturing technologyThe cultural consequences, however, are often unanticipatedbecause the geographical units inevitably adopt some of the asumptionsof the host culture in which they operate. Subsidiaries or salesunits that operate in different countries are inevitably influenced bythe cultures of those countries, even if they are staffed primarily byemployees and managers from the home country. If local nationalsare hired, this influence of course becomes even greater. The processof local influence becomes most salient where business ethicsare involved, as when giving money to suppliers or local governmentofficials in one country is defined as a bribe or kickback anddeemed illegal and unethical, while in another country the sameact is not only legal but considered an essential and normal part ofdoing business.The selection of people to run geographically dispersed units isitself a culturally related decision. If the organization’s leadershipfeels strongly about perpetuating and extending its core assumptions,it tends to send senior managers from the home country intothe regions, or if it selects local managers, it tends to put themthrough an intensive socialization process. For example, I remembermeeting in Singapore an Australian who had just been namedhead of Hewlett-Packard’s local plant there. Though he had beenhired in Australia and was to spend most of his career in Singapore,