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When corporate cultures clash: defining company values across borders

 

Corporate Cultures Clash

For beer conglomerate Molson Coors, merging with central European brewer StarBev took more than a change of recipe. Photograph: David Zalubowski/AP

 

Powered by Guardian.co.ukThis article titled “When corporate cultures clash: defining company values across borders” was written by Bruce Kennedy, for theguardian.com on Monday 29th September 2014 11.45 UTC

 

From ethics to etiquette, fashions to values, cultural norms vary vastly from place to place – and companies that ignore the differences do so at their own peril. But what if a company is caught between two communities – and two sets of community values? For companies that manufacture products in one country and sell them in another, balancing the ethics and moral values of two cultures can be a delicate dance of give and take, with lessons for both sides.

There’s a very real impetus for companies to make corporate social responsibility (CSR) work: developed-world customers often respond harshly to companies that they perceive as coming up short on social responsibility. As a UN Department of Economic and Social Affairs report noted, a large amount of CSR has been “driven by the concerns of investors, companies, campaign groups and consumers in the world’s richest countries”. In other words, as developed-world consumers and communities have called for greater corporate responsibility from their preferred brands, companies have responded with actions that, the report notes, have become important for reducing poverty in middle- and low-income nations.

But finding a middle ground between the values of developing-world producers and developed-world consumers is a complex process that resists a one-size-fits-all approach. The key, experts agree, is for companies to allow their actions to be shaped by local operators, both within the company and the greater community.

“Taking the risk to spend more time upfront, developing these relationships and understanding the local culture … is really worth it,” says Alison Colwell, associate director with BSR Advisory Services, a San Francisco-based nonprofit that consults with companies on CSR issues. “It saves you time and money in the long run, and those long-term relationships with the community are invaluable to your business.”

Molson Coors: exchanging ideas

North America-based Molson Coors faced a major values gap in 2012, when it acquired the Central European brewer StarBev for €2.65bn (US $3.54bn). Molson Coors’s CSR standards were grounded in the values and business environment of its host countries – Canada and the US. StarBev, on the other hand, was based in the Czech Republic, and had a different values structure. Finding a connective link between the two perspectives was a key to making the merger work.

Molson Coors, which operates a worldwide network of over 100 brands, already had mechanisms in place for translating its values across multiple cultures. The first was the concept of “Beer Print,” a tool that the company uses to assess its impact on the environment, the world and on the communities in which it operates. The second, “Our Brew,” focuses on the company’s standards of behavior.

Debbie Read, Molson Coors’s head of corporate responsibility, says that the Beer Print was a key tool when it came to explaining the company’s CSR concepts to its new employees in Central Europe. “One of the benefits that we have with our Beer Print is that it does break it down to a really base level,” she says. “We talk about what’s important to our people. We were able to go into these new countries with essentially a new concept, new language, a new way of doing things.”

Molson Coors declined to discuss specific instances in which its values butted heads with those of its StarBev workers, but noted that while Beer Print was a useful tool for communicating values, the language barrier sometimes got in the way of quick communication and quick action. “The idea of deciding on an all-company release tonight and issuing it tomorrow is a thing of the past,” she says. “We need to plan these things a bit more. It stops you being able to be quite so spur-of-the-moment.”

Coupled with the communication difficulty, Read says, the company’s new Czech holdings also had a fundamentally different work ethic. In comparison to the more spontaneous North American and UK approach to business, the former StarBev operations were more structured and ordered. “They very much want a road map about activities,” she observes. “They want to know where we’re going, what we’re doing, what the times scope are, what the metrics are.”

On the other side, while Molson Coors was bringing these values to the Czech Republic, it was also bringing some of StarBev’s values back to North America. Read notes that Molson Coors has come away from the region with some new lessons for its overall corporate culture. The central European approach, she says, “makes us pre-plan and consider how we’re going to roll things out, in a far more structured and measured way. So I think actually there’s been a two-way learning (process) there”.

 

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