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Managing Cultural Diversity Czech Republic

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MC401 CROSS CULTURAL MANAGEMENT
GROUP PROJECT EVALUATION, 1st SEMESTER 2011 - 12

Tutorial group : i

Country studied : Czech Republic

Group members : 1. Martin Aurélie 2. Camille Pennel 3. Quentin Ohl 4. Lucas Gautier 5. Adrien Champas

Faculty tutor : Lily Ming LI
Mark : _______
( Like all marks, subject to validation by an exam board )

Due Date : 7 nov. 2011, 5PM
Received on time ? yes / no

Content (80%) Mark ______ 1. Cultural analysis and examples- integration of cultural theories- depth of knowledge and understanding- use of quality example- originality 2. Implications, recommendations - Coherent structure & arguments - Relevant & specific recommendations - Business orientation, appropriate for Expatriate | Comments | Style (20%) Mark ______ 1. Quality of writing 2. Layout and lengh 3. Correct referencing | | Other Comments |

ESC RENNES SCHOOL OF BUSINESS – PGE2

INTRODUCTION

Czech Republic needs to be viewed as a transitional economy which is in the process of moving from a state-controlled, centrally planned economy to one which is embracing a more Anglo-style capitalist model. Although it could be strongly argued that the Czech Republic has moved faster and more successfully in this direction than some of its neighbors, this does not mean that the transition is complete.
In the study of the behavior of the Czech in business, we must take into account the specific past of this country. The Czech approach is necessarily different in France and the Czech Republic.

For example, one key issue within the Czech business environment is the different attitudes to business issues which you can expect to find in people from different generations. Older employees (40 – 45+) are influenced by the Soviet-style systems they were brought up to see as the norm.
On contrary, the liberalization of the Czech economy and the arrival in the European Union really changed the behavior of Czech in business. The younger generations, however, who have been educated and come into the workplace after the changes, are much more likely to be influenced by western business models and thinking. When doing business in the Czech Republic, you need to know who you are going to do business with, and understand his past before you can make any conclusions on how they might address various business issues.
So, in this report, we will try to understand how Czech make business and what the differences are with French people in order to promote a French Integrative who comes to work there.

CULTURAL DIFFERENCES BETWEEN FRANCE AND CZECH REPUBLIC – FACTS

Our analysis highlights a couple of key concepts to know about the Czech Republic, also explained thanks to a theory basis. First of all, we focused on applying the Hofstede Method and the Trompenaar’s Framework. These methods are cultural dimension frameworks based on the national culture of a country, and we know how to use it efficiently thanks to the managing cultural diversity course. Hence, we will explain the frameworks before using it. The Hofstede Method is working with several level of culture, such as the power distance, the uncertainty avoidance, the individualism and the collectivism, the masculinity and the feminity, and the long term or short term orientation. All theses level of culture are measured by a percentage relating the degree of each level. Hence, we can observe the spirit of the population. We write here the main ideas, sometimes also completed by remarks or examples. The Hofstede Framework – applied to Czech Republic Areas | High power distance (57%) | Formality StatusStructuresHierarchy | « vykani » : a greeting in order to talk to another person and using a professional or academic formula. Surnames are not usually used. There is also a certain distance with an unknown personA handshake have to give by the oldest people or the womanDon’t be extravagant with handsBe on time and well-dressedManagers have to be considered as fair, affordable, worker, determinedBut, manager must maintain personal and individual relationships with subordinates.Private conversation between the manager and the subordinate might take place |

Traits | High Uncertainty avoidance (74%) | DecisionsRisk TakingMobility | Decisions usually take into account the ideas of the employees 2 types of leaders in Czech Republic : * Manager of communism : gives orders received by CEO and doesn’t call into question them * New leader: share the power, encourage independence of employees.Czech managers take their decisions on personal impressionsCzech people support a moderate level of tolerance for risk,When there is a change they implement thinking, planning, and evaluationRemark : This management is considered as imprudent if the company faces quick changesThe job security decreased after the communism period |

Areas | Collectivism « we » (58%) | People look out for …?Individuals | They have a consultative group processes and implement consensus seeking strategy.Remark : In a negotiation Czech manager want to establish personal relationships and build mutual trust and respect by promoting dialogue, negotiation and consensus.They seek harmony in the organization and avoid conflicts. | Masculinity | Feminine (57%) | OrientationPriorities | « Work to live » - The quality of life is usually set as a current issueThey avoid competition between employees and prefer a cooperative and friendly atmosphere. Example : When Czech managers have to take a decision, they want advices of employees and expect a consensus. |

Long-term orientation | Long-term (13%) | ObjectivesPromotion and career | Decisions are taken in long-term and objectives are implemented for about 5 years. Subordinates are loyal with their managers. Example : With the communist heritage of Czech Republic job security is very important for employees. They are worry about joblessness. |

In order to end the use of this Framework analysis, we can compare the Czech and the French frameworks and highlights the main differences between the two countries. DIMENSION | France | Czech Republic | Power Distance | High – 73 % | High – 74% | Uncertainty avoidance | High – 78 % | High - 74% | Individualism | High – 82% | Collectivism – 58% | Masculinity | Low – 35% | Feminine – 57% | Long-term | N/A | Long Term – 13% | The second framework that we studied in course is the Trompenaar’s framework. It is based on several questions which explain the grade of each criteria. An explanation of each term has been set up to understand the reason and the meaning of each section. You will also find a couple of examples and remarks to justify the framework
Trompenaar’s Method Universalism vs Particularism | Universalism | | The rate of acceptance rules violation is low, Czech people use to respect rules framework because they focus on rules and consider that they must be respected.Example : As a consequence, when they sign a contract they demand a respect of conditions and time conditions.However, They can display of formal structures (flexibility, improvisation) in some cases in particular with new managers.They see their visitors almost immediately or after a telephone call in the morning.Remark : Czech managers own a high degree of flexibility which can be interpreted as a sign of readiness for change processes. |

Neutral vs Affective | Neutral | | Czech managers have a high control over emotions. They really control their feelings. If they are angry or proud of their subordinates they don’t show them. All their acts are under control and avoid being physical with their colleagues contrary to american managers for instance. If there is a problem with an employee it must be resolved in private area and not behind all employees.Remark : This leadership styles to talk to their colleagues is considered as “autocratic” |

Individualism vs Collectivism | Individualism | | Despite their communist past, Czech people are relatively individualist in business. |

Specific vs Diffuse | Diffuse | | Czech managers consider that relationships are very important and especially when they join a firm. Relationships are more involving, and they use to mix private and business lives. for example they can take time to drink with their colleagues.They use an indirect and evasive style to talk with the other managers and subordinates. For example when there is a problem in company they don’t explain clearly it. They begin their conversations with common subject (weather, sport, …)Remark : they give ambiguous directions which may be difficult for subordinates to make their work and reach their objectives. Besides they focus on continuous improvement. |

Achievement vs Ascription | Ascription | | Background and family roots are important, age can be a reason of hiring in a company. They emphasize on seniority because seniors have a great experience which can be useful for a company. |

Control Orientation | External locus of Control | | Most of the Czech people have calm and serious reactions to situations and burning issues because they are patients and keep their self-control. Relationships take a huge part in company, indeed they are friends before having professional relationships. Remark : Finally they highlight their environment and take into account what happens arround them, for example in economic world or the issues in their own company. |

Time Orientation | Synchronic/Sequential | | Czech managers are relationships-oriented, their family and friends take a huge part of their life. This fact brings us to consider them as synchronic peopleHowever :We consider that they are sequential too, because they are methodical and act with patience. They respect rules and take decisions thanks to a framework. Besides they are task-oriented, even if they don’t live to work. |

We selected some examples to illustrate the Trompenaar’s framework, What do I know about working area (clothings, times, formality,…) ? What we find is that working methods and clothes depend on the company. It’s very important to be on time, organized and presentable. Women are well-dressed and have a complex make-up. The way to be dressed depends on the visitor, more he is important and more manager have to wear conformist clothes.
Formality is essential as well as the external appearance, you can’t use people’s first name at first talk, but you have to use professional title for example «Pane Profesore », «Pane Doktore », etc. - or « Pane » or « Paní » in Czech.
Time has to be respected but a delay can be given if there is a real reason with apology. Czech managers have different behavior toward time. In some cases managers assign importance to time and overall they apply communist frameworks.
How could I know the opinion of colleagues? Workers have to consider their manager like a fair and worker people. Manager must be interested in his subordinates and understand their needs and their expectations. Czechs expect to have personal and cooperating relationships with their manager.
Expatriates, who learned some words in Czech languages and make efforts to understand this complex language, are seen like courageous and earn the respect of people.

How are decisions taken and who takes them ? There is a specific hierarchy to take decision but companies are more and more flexible and in particular in small and midlle companies. We can notice two types of managers, the new who wants a consensus with employees contrary to the other manager who gives orders without calling them into question. This can be compared to the two management style explained in the Hofstede Framework, One style is based on change and new values, the other one is more focused on communists values.
Moreover employees are in the habit of giving their opinion and submitting ideas which could be interesting for the company.
We just talked about colleague & customer relationship, but Why is it important to establish such friendly relationships with a colleague or a customer ? It’s important to have a personal relationship with a colleague or a customer before making business. People have to trust you to think about business. Czech managers can take their decisions according to personal feelings.
However managers must be aware that some employees can expect privileges. A preferential treatment must stay reasonable.
Our last question is about working efficiency. How to motivate Czech people ? Professional satisfaction is the most important factor to motivate people because they want to improve the rank of their country and be an influent area in the economic world. But a income increase can be a effective mean to have a better work by employees.

CULTURAL DIFFERENCES ANALYSE

The Czech mind is build upon a cultural heritage and a couple of traditions that should be respected by a stranger to have a good contact in business. These recommendations are also essential in daily life, especially to negotiate prices and contracts. We have seen, thanks to the Hofstede and Trompenaar’s framework that Czech habits are different from the French ones. Here comes an analyse of each main difference. We decided to interview a foreign student from the school to have an external view about our research. Pavla Jirovska, student in the first year of the Programme Grande Ecole is Czech. She spend all her childwood in Prague, The Capital of Czech Republic, and came in France at the age of 14. The interest of such a feedback on our work is to confront the academic work with a real life experience. You will find some comments in the following paragraph, relating the Czech student point of view among those three questions, related to all points explained : “do you agree with our words about your country? How can you explain such differences? Do you have any personal memory to tell about this point?”
First are explained the cultural differences, then comes the explanations.
Does the French habits can be pertinent in a Czech environment? The first point explained was about establishing a friendly atmosphere! The behaviour of the stranger is essential, and he should be patient among all. One time is for business but people like to have a first contact to know you and your behaviour. The speaking and the time necessary to “brake the glass” and to persuade your Czech partner to deal with you. For example, having a lunch is a good idea to meet your partner in an informal atmosphere. This idea is much more important than in France, where business relationship can remain formal without personal feelings. In Our country, Having a nice contact with a stranger before negotiating is better but this is not determinant to meet before.
Pavla Jirovska- “I never realized how this fact is true as I have never been involved for a real business, but I have always seen a lot of youth workers having free time or coffee on the street of my city. My father told me this is necessary to get close to people before dealing with money. Thus, I agree with your research. Business-related issue is based on personal feelings”
Does any protocol drives relationship? A difference has to be maid to answer this question. formal and informal relationships are different. Informal relationships do not show any big differences in comparison to other countries, but formal relationships are driven by punctuality, serious self presentation and company presentation. The visual contact is necessary, such as handshakes. Avoid kissing people in the formal relationships. Respect the basis of relationships with old people and women. We have seen that these protocol depend from the society.
Pavla Jirovska – “I cannot ensure you that protocol is more present than in France, but there is no doubt about the fact that Czechs respect the protocol. My French habits are the same in Czech republic and in France, however adults and old people respect a formal acting when they don’t know each other. Youth have less problems with breaking theses rules, this may be due to the opening to Europe and the progressive modernisation of the country.”
What to avoid in Czech Republic?
Some acts, ideas and facts are to avoid. A couple of them are : * Avoid refuse propositions; say rather fakes promises which will be then explained as impossible due to external circumstances. * Avoid speaking about politics, especially about the former communist regime. Debates among communism and its failure leaves Czechs a bitter memory. Avoid among all criticisms about the former political regime. * Avoid impolite acts, such as yawning, coughing, spiting in the street or while you are having a discussion, this could be seem as an injure.
In comparison to these facts, French people can easily refuse propositions; this is fully acceptable when appropriate words are used. Politics is not a taboo either, as French history didn’t left bitter memory to French people. The impolite acts are a common point to France, according to a share of common standard of presentation.
Pavla Jirovska – “The political explanation is definitely true, this is essential not to injure people by having any criticism about the former regime. This is mainly true concerning old people and adults. In a lesser extent, youth are feel less concerned about it as it’s our history but they won’t judge you among impolite but involuntary words… Impolite acts are obviously rejected, as it is the case in France. This is international politeness for me! (laughs)”
What is to promote in Czech Republic?
A few acts and ideas are important to know, and may be beneficial to apply : * Knowing a few names of the famous NHL players, to show an interest in the Czech culture. This little knowledge could help a stranger to have a friendly conversation before signing a contract. * The hand speaking, to use with caution! Czech people use to avoid it but it can be usefull if a stranger cannot speak Czech. In this case, it becomes the only way to communicate.
In comparison to these facts, French people do not have a “national sport”, as soccer is not enjoyed by everyone. The hand speaking can also be practiced if someone does not speak French, but only has a last option.
Pavla Jirovska- “The NHL game is a good basis for a discussion, I know a lot of friends or adults who are involved in supporters club, thus the strategy of learning some names of players is relevant. Stay aware of the games actuality as Czechs will asks you about it ! The hand speaking is avoided in my country, but I get use to it in France. I have no real explanation for this… sorry!”
What can be good to know about the overall Czech habits ?
Women use to be very good considered, even if they are less paid than males. The salary difference is about the same than in France, but the consideration of the “under gender” is really positive. Czechs are also less religious than any country (40% of non religious people). This difference with France could be explained thanks to the ethnical origin of the population, one of the most homogenate in Europe (95% of the people are moravs or Czechs)
Pavla Jirovska “Theses both facts are definitely true, the respect among women remains a basis of our culture, thanks to a unexplained fact for me ! Women are less considered in France and this is a shame ! About the religious explanation, I am also fully agreeing, I was very surprised by the number of religious people in France, even among my friends…”

RECOMMANDATIONS
( a few recommendations have already been set up among the case study, here are only the most important ones )
There are obviously some cultural differences between France and Czech Republic and a French who moved to work in this country should adapt his behaviour. Here is what we can recommend him, according to the past remarks and analysis.
He has to stay academic and classic with unknown people. Globally it is better for him to keep control over emotions and to stay neutral and patient. It can be poorly looked to be too extravagant. He has to understand that it is important to be respected for his status but to respect the others as well. If he is manager for example, the team members will show respect for him but he has to be close to them. Maintaining close relationship is really important. He can take into account the impressions of the employee but has to take the decision alone with his feeling. If it’s moderate, he can try to take some risks, he usually won’t be blamed for that.
Globally, it’s important to install a good atmosphere between the employees and to create a group spirit instead of competition between each other. If there is a problem he should talk directly in private with the person in order to establish a confident atmosphere with avoiding conflicts. However, he has to take car in the way of tackling the problem. It’s important not being too directly.
He mustn’t be afraid to mix private and professional life. For example, he can, without hesitating, have a drink with his colleagues. That’s a good thing, which is necessary. He can be friend with his colleagues in order to create efficient working conditions.
The relations between professional are close indeed, but our French must pay attention to respect the rules. It will be really poorly looked to be undisciplined, late, or impolite. ecause of the Czech history, there is still a little communist spirit in the mentality.
CONCLUSION
To conclude it’s taken for granted that move in Czech Republic is not a huge change for a French man if we compare with some other places all around the world which are deeply more disturbing. But this situation could be really difficult. Indeed as we have seen during all the long of this document many divergences exist between the French society and the Czech one and the track is to consider them negligible.
Unlike French people, Czechs are more introverted and make business in conventional ways: French have to be aware, keep control over emotions and to stay neutral and patient. It can be poorly looked to be too extravagant.
Moreover, in Czech business, you have to adapt your behaviour with different people: old generations are influenced by the Soviet-style systems whereas young generations almost use western approach in business. All in all the French expatriate who will move in Czech Republic won’t have deeply difficulties to adapted themselves if they lead our guide. A little less of extraversion, a huge respect of the hierarchy and an ability to mix private and work relations is the magic formula to succeed its integration in Czech Republic. Something which could be easy at the first seen but which is in reality an everyday work.
Last but not least we would like thanks Pavla Jirovska for their useful testimonial. If you want to contact her for more precise advices:

BIBLIOGRAPHY
BOOKS –

* JOANNIS H. et DE BARDIER V. (2005) « De la bonne pratique des relations d’affaires » in JOANNIS H. et DE BARDIER V, L’essentiel d’un Marché : LA REPUBLIQUE TCHEQUE, PARIS, Ubi France. Pages 126 to 131 * Harris, Phillip R. and Moran, Robert T. (2007). Managing cultural differences – Global Leadership Strategies for the 21st century, Butterworth-Heineman.
Remark : This book has been consulted online.

WEBSITES -

JOANNIS H. et DE BARDIER V. (2005) « De la bonne pratique des relations d’affaires » in JOANNIS H. et DE BARDIER V. De la stratégie Marketing à la Création Publicitaire, PARIS, Dunod. Pages 126 to 131…...

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