Fiat cultural clash Essays

Fiat cultural clash Essays Fiat cultural clash Essay Fiat cultural clash Essay FIAT (Fabrica Italiana Automobili Torino), was established by the Italian government in 1899, and in 1907 was bought by Giovanni Agnelli. Fiat is an automobile manufacturer, engine manufacturer, financial and industrial group based in Turin, in the Piedmont region. The company flourished under Agnellis leadership, in large part due to his innovative ideas concerning the structure of production as well as his experience in mass marketing strategies, particularly in foreign sales. After the World War II, in March 1945, the local court of the national liberation committee Comitato di Liberazione Nazionale accused Agnelli of collaboration with the Nazis and removed him from the firm. He died seven months later. It was a family owned business until September 2010 when shareholders approved a plan to split Fiats industrial business from the group. Fiat operates in 61 countries with 1,063 companies that employ 223,000 people, 111,000 of whom are outside Italy. As of 2009, Fiat is the worlds 9th largest carmaker. In order to keep that place and even grow Fiat needs to become part of the fastest growing market in the World, China. The Italian carmaker wants not only to manufacture his cars in China, but also to sell them to the Chinese. Forming a joint-venture company seemed to be the quickest and most effective way of developing good quality relations in a country such as China. Fiat made an attempt to introduce in China with a joint-venture with a local firm: Nanjing. : Unfortunately, the joint-venture failed. The aim of this assignment is to analyze the cultural reasons and differences in Fiats joint ventures and to analyse what are the cultural reasons for the failure of this business. Corporate culture- Every human society has its own shape, its own purposes, its own meanings. (Williams, 1958). Culture is the whole way of life of a people. Culture seves as a lens through which we perceive the other. Corporate culture is something that managers have to establish and run all the way through a business, with clear values and beliefs, successful business principles and operations, and a suitable emphasis on human resources and customer satisfaction. Fiats corporate culture will be strongly influenced by the Italian culture. According to Huntington: A civilization is a cultural entity. European communities will share cultural features that distinguish them from Arab or Chinese communities. Arabs, Chinese and Westerns, however, are not part of any other broader cultural entity. They constitute civilizations. Therefore Fiats culture will be influenced not only by the Italian, but also by the European culture, too. Before embarking on any important business projects, Italians feel the need to really know the people; they are going to do business with on a personnel level. According to Fung (1998), Chinese customs, religion, and health practices are rich and complex and have stood the test of time over many millennia. China has one of the four oldest civilizations in the world and a written history of 4,000 years. The Chinese are very proud of their culture and history. They value their own culture and religion, but they are open and pragmatic toward the religion and cultures of others. Chinese people in general are peaceful, hard-working, and easily contented. They follow norms of social order. For example, they respect authority figures and elders, and they are patient with their peers. The Chinese value modesty, reserved behaviour, and humility. They believe in harmony and tend to avoid confrontation. They will, however, push and sacrifice for their children. The roles of members of a Chinese family are highly interdependent ( Ong, 1993). Traditionally, the family has been the most fundamental and important unit of society among the Chinese, and this is still true. The family is also an important economic unit. In todays China, it is still very common for three generations to live under one roof. C. Lam (1992) noted that Confucian philosophy advocates the virtue of sacrificing individual needs for the good of the group.