2. Charles Martin in Uganda
Contents
I. Case Background....................................................................................................... 3
II. Statement of the Problem......................................... Error! Bookmark not defined.
III. Alternatives............................................................................................................... 5
IV. Recommended Solution.......................................................................................... 6
V. Answers to the case questions .......................................................................…..6-8
VI. Learnings.................................................................................................................. 8
3. Charles Martin in Uganda
I. Case Background
Hydro Generation (HG) is a U.S. based company that specializes in power
plant. It has built power plants in 16 countries where they maintained an
ownership in about half of them. The company has targeted a construction
of large dam in Uganda Africa. HG put Charles Martin in this project to
facilitate the preliminary construction and in case up to the construction
phase to get an operating structure and facility start-up activities that
includes obtaining licenses, installing telephones and utilities and securing
the initial staff that would hire the full range of local personnel. But Vice
president James Green pondered whether to continue employing Martin
for the construction phase of the project. In particular, Green was
concerned about Martin’s lifestyle, some of his business practices, and his
participation in Ugandan tribal rituals. Green worried that Martin’s
practices were counter to both HG’s corporate culture and methods of
operating elsewhere, that some of his actions bordered on the unethical,
and that some might be illegal under U.S. law.
Characters in the case
Lawrence Lovell
HG’s founder and CEO
A devout Christian and very influential in shaping the company’s
management culture
Believed that business activities should embody strong Christian values
and that subordinates should be given full responsibility in making and
implementing decisions but they should be held accountable for their
results.
James Green
HG’s vice president
Concerned about business practices and lifestyle
4. Charles Martin in Uganda
Charles Martin
26 yrs. old
Knowledgeable in developmental issue wherein he was able at disarming
critics of the power plant
Joined University of Wisconsin-Madison taking a course about Africa’s
pre-colonial history
After graduation he joined Peace Corps and served in Kenya
He believed in the creed – “Don’t draw attention to yourself, and above all,
learn and respect the culture”.
Earned an MBA at the University of Maryland
Took job at HG
Duties
Working with Ugandan governmental authorities in the capital, Kampala and
with villagers in the area where the dam was to be built to gain support and
necessary permissions for the construction
Establish an office and hiring people who would be responsible for local
purchases, clearance of incoming goods through customs, immigration
permissions for foreigners coming in to work on the project, logistics materials
going from the airport in Kampala to the dam site and keeping records of
supplies and expenditures
Help foreign visitors mainly engineers become accommodated and oriented
when visiting Uganda
II. Statement of the Problem
The problem to be examined is on how to use the different ways to
approach a company internationally by comparing language problem,
cross cultural problem, religion problem and hiring practice without
compromising the company’s reputation.
5. Charles Martin in Uganda
III. Alternatives
Culture includes norms based on learned attitudes, values and beliefs. Almost
everyone agrees that there are cross-country differences, but they as to what
they are.
In deciding whether to try to bring change home-or-host-country operations,
an international company should consider how important the changes is to
each party, the COST and BENEFIT to company of each alternative, the use
of opinion leadersthat can help speed up the acceptance of change and may
emerge in unexpected places, and the use of the timing of change.Good
business change falls flat because they are ill-timed. A culture’s attitude and
needs may change slowly or rapidly, so keeping abreast of these changes
helps in determining timing.
International Business must evaluate sure business practices to ensure that
they take into account national norms in their behavioral characteristics. They
should look for the following:
Language Barrier – Although it was mentioned in the case that English is
the official language it has to be consider the language used by most of
the indigenous people, the language of Bantu and Nilotic.
Religious Concern - Uganda is also a multi religious country which
means the company will have to hire employees fit to work from any
religion and should know how to respect to those belonging to all other
religions in order to avoid discrimination of workforce.
Local Business Practices – Nepotism is a norm
Behavioral Practices affecting business - Attitude and values affect
business behavior, from what products to sell to how to organize, finance,
manage, and control operations.
Economy – Uganda agriculture employs 80% of the workforce. Coffee
and fish are the largest export. Foreign investment has slowly returned
after the reign of the brutal corrupt dictator Idi Amin (1971 – 1979). They
are also a lower income country where in 4 out of 10 people live or less
than a dollar a day.
6. Charles Martin in Uganda
Political – People are involved in corruption. One of the most corrupt
countries.
IV. Recommended Solutions
To change custom is a difficult thing, so in doing business around the globe
major problemswill be face as culture collides with business operations, these
are when company implements practices that work less than intended and
company’s employees encounter distress because of an inability to accept or
adjust to foreign behavior. It is best if company strictly observe the following:
o International company must be sensitive to cultural differences in order
to predict and control its relationships and operations and it should first
determine what business practices in a foreign country differ from
those it’s used to.
o It must also adhere sufficiently to local culture lest they fail. However
companies whether local or foreign cannot always anticipate the
reactions to their practices so it is necessary to sought advice from
experts.
o One way to avoid problems that could result from a major change or
pull out/cut off of operation is to discuss a proposed change with
stakeholders in advance. By doing so, the company may learn how
strong resistance to the charge will be, stimulate stakeholders to
recognize the need for change and ease their fears of adverse
consequences resulting from the change. Such discussion may satisfy
that management has listened to some viewpoints.
V. Answers to the case questions
1) Describe Ugandan cultural attributes that might affect the
operations of a foreign company doing business there.
The population of Uganda is about 25 million. And its official language is
English. But many people can only speak an indigenous language it is
primarily Bantu language or Nilotic. Although about two-thirds of
Ugandans are Christian, there is a large number of Muslims and
adherents of various animistic religions. From this perspective, language
is a big problem for foreign companies operating in Uganda. Business in
Uganda on the other hand often moves slowly.
7. Charles Martin in Uganda
For example, it will take months installing a telephone. The Ugandan’s
income is very low, but meanwhile, it has an exorbitant payment system.
The nepotism is a norm for its employment staffs. Ugandan is also known
as a corrupt government and is also a brick wall for foreign companies. Its
citizens are too much devout to their religion, beliefs and culture.
2) How would you describe the respective attitudes of Martin and
Green: ethnocentric, polycentric, or geocentric? What factors do you
suspect of having influenced their respective attitudes?
- Looking at Charles Martin profile we can say that he possesses the
attitude of being geocentric. He bases his ideas in handling the project
operations on an informed knowledge of its organization culture along
with home and host country needs, capabilities and constraints. This is
the preferred approach to business dealings with another culture
because it increases the introduction of innovations and decreases the
likelihood of their failures. On the other hand James Green is
ethnocentric. Green overlooks the important cultural factors abroad
because they have become accustomed to certain cause and effect
relationships in the home country. He recognizes the environmental
differences but still focuses on achieving country rather than foreign or
worldwide objectives. He knows the differences but assumes that the
ways in introducing business to foreign country is easy to achieve
when it is really a complex process.
3) Who was right, Green or Martin, about Martin’s more
controversial actions in facilitating the project? How might things
have turned out if Martin had not been a member of the project
team?
- We can say that Martin’s actions were right though it is already beyond
the company’s norms and against the US law. If Martin have not done
it and had not been a member of the project team, the project would be
very hard to proceed or impossible to happen. For example, language
as mentioned before is a big problem HG should hire a translator to
make the communication run smoothly. They need to train staff that
would probably take a long period of time to study and understand the
culture, belief and behavior of Uganda to be able to plot the dos and
don’ts in doing the business project. It would be a waste of time and
money for HG and worst the project will only be on scratch.
8. Charles Martin in Uganda
4) In the next phase of the project-running the power plant-should
HG employ someone whose main function is that of liaison
between its corporate culture and the culture of its host country?
If so, is Martin the right person for the job?
- We think Martin is the right person for this project. If HG hires another
person, he will face almost the same problem. The hired person should
also realize the culture and religion of Africa, especially Uganda. And
now HG has the person suited this, he is Martin. He knew African
culture and religion well. As he worked there before, Martin also knew
how things could be well done in Africa under their culture and religion.
He seems to do some controversial actions there, but his purpose is to
help HG finish this project successfully. So Martin must be the right
person for this project. HG does not need to hire someone else in this
case.
VI. Learnings
After studying the case, we’ve found out that when doing business aboard,
company should first determine the different business practices in a
foreign country. It is alsoimportant for the foreign company to understand
and adjust to their operating countries because we believe that the
existence of cross-country differs. Operating countries environments may
vary from time to time and also their operating sites, thus; it is an integral
part to learned attitudes, values and beliefs. The concept of international
business has been clearly illustrated, the sensitivity of the cultural aspect
in order to predict and control its relationship and operation. And
management then must decide what are the necessary adjustments
needed to be able to operate efficiently in the foreign country. But all
actions should be taken in control.
