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Talking Point - 2

The joint venture between Fujitsu and Siemens, called Fujitsu Siemens Computers, ultimately failed due to organizational and cultural clashes between the two companies. [1] Significant differences in communication styles, leadership approaches, and treatment of hierarchy stemmed from the individualistic German culture versus the collectivist Japanese culture. [2] These cultural differences led to issues like low employee morale, absenteeism, and lower productivity. [3] Ultimately, Fujitsu decided to end the joint venture, citing the inability to reconcile the cultural differences between the two organizations.

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56 views3 pages

Talking Point - 2

The joint venture between Fujitsu and Siemens, called Fujitsu Siemens Computers, ultimately failed due to organizational and cultural clashes between the two companies. [1] Significant differences in communication styles, leadership approaches, and treatment of hierarchy stemmed from the individualistic German culture versus the collectivist Japanese culture. [2] These cultural differences led to issues like low employee morale, absenteeism, and lower productivity. [3] Ultimately, Fujitsu decided to end the joint venture, citing the inability to reconcile the cultural differences between the two organizations.

Uploaded by

Anusree Roy
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Organizational and Cultural clash at Fujitsu – Siemens (Subsidiary)

As one example of joint ventures, Fujitsu and Siemens combined their computer divisions with 50-50
joint venture and equal number of board seats in name of Fujitsu Siemens Computers.
But Suddenly Fujitsu Siemens, with no public explanation decided to break the bond of JB for the
reason of organisation culture clash.
In Fujitsu Siemens Computers Organizational culture which is a set of values, feelings, attitudes etc.,
was taken for granted” fashion.
In order for an international operating company to succeed, employees & management must
understand the wide spectrum of organizational and cultural differences by becoming sensitive in
these respects to different cultures unlike their own.

REASONS:
1) Hofstede cultural dimension.:

Dimension GERMANY(INDIVIDUALISM) JAPAN(Collectivism)


  The German society is a truly Individualist Japanese society shows many of
one. Communication is among the most the characteristics of a
direct in the world following the ideal to collectivistic society: such as
be “honest, even if it hurts”  putting harmony of group 
  Germany Is only “I" JAPAN Is only “We"
  In individualistic approach life is more But for Japanese it was
self-centred and when it comes to strongly established hierarchy
business :it looks to act according to rules matrix, where each member has
rather than looking to building a strong sense of purpose and
relationships or sustaining harmony. boundaries.
Findings: In the case of Fujitsu and Siemens, when Fujitsu took over Siemens, “Instead
of gradually restructuring the German subsidiary, Fujitsu should have opted
for radical change by replacing the entire subsidiary management team. Then
it would have been possible to improve the speed gap and the communication
problem”

     
  LOW POWER DISTANCE HIGH POWER DISTANCE
  In a german company they values equality Due to the high-power distance
and grants rights to all levels of index in Japan, employees are
employees. So employees demand more extremely obedient and settle
from the management than what was for whatever is given by
demanded by their counter-parts (Fujitsu management. Lower hierarchy
employees) in the past. Due to low power units accept their low position
distance, unions are very common and and acknowledge the power of
even, necessary part of the working authority and willingly obey to
environment. it.
Findings: Fujitsu management and authority expected same from its new company’s
employees .And it didn’t quite match their expectations, all because of low
power distance in German (Western) culture.

  UNCERTAINTY AVOIDANCE UNCERTAINTY


AVOIDANCE
  High (65) High (65)
  this exact dimension has influenced the final decision off fujitsu to stop the
financial bleeding and pull out its investments from Fujitsu-Siemens.
Uncertainty avoidance measures the level of ambiguity and risk the party is
willing to accept, to gain possible benefits in the future.

Findings: In Japanese culture, as in German culture, high risk taking and being
“flexible” does not quite match the cultural values and behavioural traits. The
Japanese company preferred to cut the funding due to their cost caring
mindset and long-term orientation towards being wise and thoughtful of the
happenings of the future

2) Influence of Different Leadership Style/ Unconscious Biases/ Fit Values in org culture:
In today’s fast moving business environment there has been a realization that static leadership,
management and organizational paradigms can stifle economic growth.
Fit Values: how well we fit with any organizational culture. People are happy and productive in
cultures consistent with their values, and distressed and unhappy working in cultures defined by
values that differ from their own.

Findings: Fujitsu Siemens Computers employees was losing their jobs, Swings in initiative or
productivity, Poor relationships with co-workers or direct managers
Unconscious Biases: occur when we project our values onto others. Unconscious biases
affect what type of behavior we reward or punish, who we promote, how we handle conflict,
and our ability to form and maintain a cohesive team.
Findings: Fujitsu Siemens Computers:
 Undervaluing employees and not getting the most out of them.
 Causing talented employees to get frustrated and leave.(Two vice president resignation)
 Promoting unsuitable employees beyond their abilities.
 Damaging the brand reputation

Leadership Style: determine what we find rewarding and what we dislike. Consequently, our values
shape the kind of culture that we, as leaders, create for our staff and subordinates.

Findings: Fujitsu Siemens Computers:


 Low Morale
 Absenteeism,
 Lower Productivity
 Lower Customer Satisfaction.
3) Communication: Communication is one of the most critical, if not the most critical factor in
cross-cultural ground. Especially when their customs and business practices seem so
different from your own.
Findings:

 Lower Productivity
 Damaging the brand reputation

Fujitsu as a company with high context style of communication did not quite match with the
way Siemens employees who were communicating and delivering their message. Neither did
the Siemens employees like the communication techniques and interaction patterns of Fujitsu
employees. For instance, Dutch as individualists rather preferred to confront the objections
directly and did not appreciate the small talk which was considered a necessity for Fujitsu
employees.

The reasoning behind indirectness of Fujitsu employees is that high context cultures would
rather prefer to avoid conflict and “express themselves in a roundabout way”, as to reduce the
confrontations and clash of interests.

Another subtle determinant of communication style is the concept of face saving which is
being triggered and affects the reactions of people in stressful and shaming situations.
Individualistic people, who would be employees of Siemens, when it comes saving the face
and reputation, firstly think about themselves. One should not mistake it for egoism though.
The individualism may resemble or even include certain qualities of an egoistic individual but
it is completely different in a nutshell, being a cultural archetype formed by many decades of
conditioning. On the other hand, a person who is more collective-oriented will first of all
think about the image of the entire group.

Fujitsu– Siemens Joint venture: Conclusion

This joint venture is a prime example of cultural incompatibility and misunderstanding


ruining even one of the most companies on the market. We must not forget that above all, a
company is a group of people who share similar values and beliefs, working together towards
a common goal. Those people work hand-in-hand, day in and day out, for the company to
thrive and prosper, just like in a marriage, both parties need to respect, clearly understand and
know the opposite party well enough to co-exist. Unfortunately, most people see joint
ventures and acquisitions as business transactions and forget to consider the most important
factor: humans. To win in this game, people need to learn how to humanize and look beyond
the paper work and numbers. People need to realize the following: what looks good on paper
will not necessarily look the same in real life.

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