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International Cross Culture & Diversity Management (EDL 412)-Semester IV
Case Study
An AGFA case study
This case study looks at how AGFA, a leading player, is taking full advantage of the digital revolution. The company is using the new technology as:
• an engine for growing its business
• a means of providing its customers with better product possibilities and with greater flexibility and choice.
Agfa
Agfa is a leading name in the imaging industry. The Agfa-Gevaert Group de-velops, produces and distributes an extensive range of analogue and digital imaging systems. Agfa has divided its operations into three segments.
Agfa’s operations involve a high level of innovation. The company’s willingness and ability to work at the leading edge of technology help to make it a leader in its field. For Agfa to remain a market leader, its managers must concern themselves with the future and ask themselves:
• Where is the industry heading?
• What are our competitors likely to do next?
• Where do we go from here?
With imaging, the answers currently are:
• The industry is heading towards greater use of digital imaging.
• Our competitors will invest in research and development aimed at enhancing quality at affordable prices.
• We look to get there first, with better products to sell to customers who are prepared for using them.
This approach requires a willingness to invest heavily in new projects that maximise the benefits of new technology.
Every proposed project undergoes investment appraisal. This procedure establishes whether a particular project is worth taking forward. Managers will ask key questions about a proposal, including:
• How expensive are the initial outlay and the final total outlay likely to be?
• For how long are we likely to be spending money without any financial return?
• How long is it likely to be before we recover, from sales, all the money we have invested?
• What return can we reasonably expect from our investment in the long term?
• How big are the risks? What events over which we have little or no control could cause this project to falter or fail? How likely are they?
Risks for the imaging industry include:
• a significant rise in the cost of borrowing to finance investment
• a downturn in business activity worldwide that persuades industrial customers to postpone their own purchase of new plant and equipment
• poorer job prospects for the general public that deter private consumers from spending on the latest products.
Large scale investment
Agfa must consider these factors as it contemplates large scale investment in new digitally based technologies.
During 2000 Agfa invested around 224 million Euros (equivalent to 4% of its sales revenue) in research and development. Part of this involved working with external partners eg universities and leading research centres.
Much of the work reflected the need to move forward in:
• developing the transition from analogue to digital solutions
• meeting a wider variety of customer needs
• helping Agfa to create new market sectors and to enter them profitably.
• Digital technologies are changing the way in which people take, process and use images. New processes allow customers to work with images quickly and efficiently, without requiring extensive expertise and knowledge. Take, for example, the newspaper world. With newspapers, speed is vital and editors want the best pictures to go with the latest stories.
• Digital technology is transforming newspaper production. For example, sports photographers no longer have to dash back to the office to develop prints, wondering anxiously what they have captured. They know immediately the quality of the image they have and they can despatch it immediately too. As a result, the publisher soon has on sale a comprehensive local Saturday night ‘sports special’ carrying action photos of spectacular moments that occurred hundreds of miles away just a short time earlier.
• The new technology is also transforming photography for the general public. For example, crystal clear photos of a baby can now be available to proud, anxious grandparents thousands of miles away within a few minutes of an infant’s birth.
• Technological advance does have a downside, in that demand for new products affects sales of older ones. As a market, analogue photography has almost reached maturity. It is still
Today’s businesses and management are quite complex due to the globalization and to the fact that in a company there might be several people from several different backgrounds and variety cultures. But still, I would say that the most important thing in order to manage well is to Communicate and have the need for communicate well to each other and most importantly have an effective intercultural communication between co-workers. This is why the management today must ensure that they are understanding and being understood across cultural boundaries. As I was working for the clothing company in Finland which did business Italian company and ordered cloths from Italy there were several problems in communication and concepts.
The Intercultural management problem: When thinking about all the cultural differences mentioned above and acknowledge the situation; The Finnish Company ordered clothes from Italy in their strict deadlines, ordering dates and expectations that the goods will be delivered on time. The manager told to two of our employees to make sure that the orders are done and delivered. The employees contacted the persons in Italy made example were order and agreed on the deadlines, due dates of the payments and delivery dates. Everything the well. But when the delivery date came, no goods were delivered or even sent from Italy yet, even we in Finland already had promised the goods to be in the boutique for customers. The manager in Finland blamed the two employees for not doing their task well and contacted the people in Italy. getting The same chain of events happened often always something fast late from the deadline, phone meetings were late, and if there was a meeting organized in Italy or Finland, it didn’t go well.
Our Finnish manager wanted to go straight to Business and talk about the orders when the Italians wanted to have a dinner and take the time for get together first. Our manager explained to his employees how rude the Italians were because they came physically very close in the meetings and didn’t stick to the point, and was overwhelmed even from his employees that why the wanted to continue the meeting. All in the entire situation was chaotic and the cultural differences were too much for our Finnish manager. He had been used to do business only in Finland before and didn’t have a clue how different the business between two different countries can be. This situation kept on going because the Finnish manager didn’t want to change his habits and the Italians didn’t even know that something was wrong. When I started my job in this company the situation was very bad, and in the end, our manager quit his job. We got a new manager, and after that everything started to go well and the connections and communications between our employees in Italy and Finland were good.
The problems mentioned above are related to the problems when a person cannot adjust and adapt to the other cultures, and the same happens if a worker changes a country where to work, The cultural differences can be too much to handle which effects to the results of the work. The same happened here for the manager but in his own country working with people abroad. That the importance of intercultural training is crucial. In the article, it is also mentioned that working in a foreign country or with foreign cultures is a big challenge for any company.
Discussion:
At first, I would like to give some background information of Finland and Italian business habits in order to understand the problem. Emeritus Professor Geert Hofstede from Maastricht University has completed many studies concerning cross cross-culturalrences. His goal was to find an understanding and similarities between cultures. In order to do so, Hofstede came up with five different dimensions for collecting the relevant findings under mutual nominators. Italy and Finland are an example of cultures which are quite different in his scale. First I would like to mention as a theoretical background the two diagrams one from Finland and one from Italy and explain some important point from them.
From the above diagrams it’s revealed that Finland is a quite feminine country when Italy is a masculine country. The Individuality rate is about the same meaning that there is a strong importance for the opinion of an individual but as a matter of fact in Finland the Individuality for man and a woman is more equal and also the relationship between parent and a child or employer and employee is based on the mutual advantage, not on the hierarchy like it is more normal in Italy. From the diagram it’s easy to see the difference in Power distance. Italian culture is more High Power distant because, for example, the organization has its leaders and the members of it will follow them. The division of power is also quite centralized as well as centralized fairly. On the other hand, the core values in Finland are equality between people and responsibility. That refers to the point that Finland is Low Power Distant country. It is common to speak openly in a social context, and privileges and status are frowned upon. The difference between less and more powerful people high context. The factor in the diagram Uncertainty avoidance is higher in Italy and Lower in Finland; this might be related to the old traditions in Italy and to the fact that the Finns are more open to new opportunities than the Italians. All in all, I wanted to describe the cultural differences between these two countries and show that even in the daily life there are huge differences.
The point what I would like to rise up is the importance of intercultural training and the fact that the concept of time and space are crucial to understanding that they vary a lot between countries. Edward T. Hall is an American cross- cultural researcher and anthropologist, who examined the different cultures of the world and created the concepts of high context culture, polychromic time and meaning of space. He found that these factors varied according to culture and throughout his findings, he was also able to categories countries according to these means. In the Intercultural management problem I think the main issues were Time and Space. Especially time.
Edward T. Hall is an American cross- cultural researcher and anthropologist, who examined the different cultures of the world and created the concepts of high context culture, polychromic time and meaning of space. He found that these factors varied according to culture and throughout his findings, he was also able to categorize countries according to these means. The next theory has been gathered from Edward T. Hall’s literature “The Silent Language” and “Beyond Culture”.
Conclusion:
The Intercultural management problem which I discussed above was really common I think nowadays but also very harmful for the company, employees and managers. The management of the company suffers and also the business partners etc. In fact after discussing and having some theoretical background to the topic I would say that the main reason for the problem when thinking about the theory part Hofstedes and Halls theories for example were the misunderstanding of concepts like time, space and even business etiquette and the differences. The point that the manager didn’t have enough knowledge of managing a company with international partners was most crucial part. As a solution mentioned above in the text I would recommend Intercultural training and flexibility in cultural differences for the whole company from employees to managers. My message concerning the intercultural problem here is that nowadays in our globalizing world it is the most important factor when doing international business to be aware of the countries and cultures around you.
Question 1 : Businesses and management are quite complex due to the ____
Select one:
a. Trend
b. Economy
c. globalization
d. World war
Question 2
core values in Finland are equality between people and ____.
Select one:
a. Position
b. power
c. Time
d. responsibility
Question 3
Edward T. Hall is an American cross- cultural researcher and ___
Select one:
a. Physiologist
b. anthropologist
c. both a & b
d. Social worker
Question 4
Emeritus Professor Geert Hofstede goal was to find an understanding and _____ between cultures.
Select one:
a. Dissimilarities
b. similarities
c. both a & b
d. only a
Question 5
Finland is __Power Distant country.
Select one:
a. Low
b. High
c. both a & b
d. all of the above
Question 6
Hofstede came up with___ different dimensions for collecting the relevant findings under mutual nominators.
Select one:
a. one
b. five
c. two
d. four
Question 7
In the Intercultural management problem the main issues were Time and __
Select one:
a. Space
b. value
c. money
d. none of the above
Question 8
Italian culture is _____High Power distant
Select one:
a. less
b. more
c. equal
d. both a & b
Question 9
The factor in the diagram Uncertainty avoidance is ____ in Italy and Lower in Finland
Select one:
a. lower
b. unequal
c. higher
d. more
Question 10
theory has been gathered from Edward T. Hall’s literature “The Silent Language” and _____
Select one:
a. Beyond Culture
b. Art
c. Literature
d. none of the above
10/10
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2 Module Assesment
In summer 2000 I left Switzerland for three months with the aim to take a film course in New York. Even though I was used travelling with others, this time I went alone which gave the trip a somehow adventurous flair. I had organised myself a place to live before I left home, but didn’t know at all how it would be or look like. As I arrived at the airport I took a cab to Avenue C, in the East Village of downtown Manhattan and was somehow shocked when the cabdriver stopped in front of a totally battered door in a dark street. It looked like one of this muddy gutters in the Bronx that I had seen on television. A little bit unconfident I took my luggage and went to the door. There was no doorbell therefore I knocked. The door was opened by a Peruvian man, who turned out to be Carlos, the landlord of the house. I was welcomed warmly into the spacious living room, in which at least eight young people sat, having a small party. The house turned out to be a very warm and friendly place where many international students were renting their rooms. A middle-aged actor out of engagement was living there, too. His name was Philippe, half Swiss half British, who had been living in New York already for several years.
I swiftly adapted to that house and I started to love the East Village immediately. It is a very international part of the city, a truly cross-cultural place. Most of the inhabitants come from Puerto Rico, but also a lot of African Americans and in addition, many people with an extraordinary lifestyle, artists, musicians and actors are living there. For me, who was used to very well organised and tidy Swiss mentality, it was a totally different way of life.
In the house, we cooked together many times and it was after one of these meals when Philippe, the actor, started to bring the discussion to Switzerland. Being half Swiss he was very interested in everything that concerned the country and he was happy to have me there to talk to. At the time, the big discussion in the media about Switzerland’s behaviour in the Second World War was an ongoing issue. Ed Fagan, an American reparations lawyer, had sued the Swiss banks on behalf of Holocaust victims. The Swiss banks settled the claims outside of the court, agreeing in a payout of 1,25 billion US-Dollars for the Jewish descendants. Since New York is known for having a big Jewish community and because of the numerous reports in the US-media, the issue was an ongoing discussion in the City.
Philippe started the conversation with the focus on the dubious role of the Swiss banks. He argued that the banks were to blame for the destiny of many Jewish descendants who had to start a new life in the United States without any money. In his point of view, the banks had deliberately avoided any confrontation and had wanted to hog insurable values for themselves. Since at that time the discussion in Switzerland had already turned into an overflow, I was not very much interested in a profound conversation. However, I tried to explain my point of view and made the mistake not to admit immediately the guilt of the banks. I actually wanted to make clear that there were many other factors that led to this behaviour. Of course, Philippe just wanted to make his point clear but he actually started to blame the whole Swiss society for being very greedy for money. I felt deeply offended by that and finally committed myself to the argument. But at this point a normal discussion was not possible any more. The two of us got really angry at each other. I tried to vindicate my country like a defence lawyer standing in front of a court. At one point Philippe asked why I was feeling so offended by that discussion and at that point I stopped and went angrily into my room. Laying on my bed, I still felt very insulted and sad. But after a while I started to reconsider the issue. Actually, Philippe was right asking why I felt offended, because I couldn’t find a reason myself. In fact, I didn’t agree at all with the behaviour of the Swiss banks concerning the insurable values from the time of the Second World War. What made me angry was the fact that the whole international press was picking at Switzerland like it was the only country who ever did something wrong. At the time, Switzerland had reacted already on the international critics. The Swiss government had installed the Independent Commission of Experts to bring light into the Swiss past. But this fact hadn’t made it into the headlines of the international press.
I will describe a cross-cultural encounter in which I was an observer for almost two years. This extended “critical incident” took place in Mexico City, where I had my last job at the United Nations Environmental Programme before coming to study in Switzerland. The people involved in this long-suffered story are mainly my former boss, Mr. Griffith, (I work for him as his assistant) and colleagues from different nationalities such as a Cuban Regional Director, high officers from Chile, Panama, Uruguay, Japan, Great Britain, and of course Mexico.
Mr. Griffith came from a Caribbean-English style background and had lived in Nairobi, Kenya working at the headquarters for the same United Nations Environment Programme for more than seven years. Unexpectedly, he was appointed to accomplish a mission in Mexico City for a smaller branch office in the Latin America region without knowing a single word of Spanish, and was pulled out from his usual English way of living and thinking, and driven to a Latin American environment wholly unknown and unusual for him.
So, this cross-cultural encounter had two immediate repercussions at the personal level for Mr. Griffith but mostly at the operative and managerial level. At this last level, even though the whole United Nations system is supposed to be organized with the same rules and manuals around the world (I was aware that every local office refines the model system according to their local office logistics), it was very difficult for Mr. Griffith to understand and adapt to this local culture where the organization operates. The most critical aspect for him was the fact to understand the easy-going Latin personality and moreover the concept of time. It is also important to mention that he had two deal with different forces or mentalities such as the one from the Cuban Director, resembling a more dictatorial managerial style; then the one from the officers at his same level with a more American or Latin American way of thinking, together with a very bureaucratic administration.
Mr. Griffith’s responsibilities were mainly to develop, implement and finance environmental projects for the Latin American and Caribbean countries. But frequently, his work was blocked by this bureaucratic administration. Things were not as smooth as working directly in the headquarters. He felt committed to the countries to fulfill their demands, but he was not able anymore to assist them as he did in his former office while working with nations from other regions. The same happened with his colleagues; he would expect to have a faster input from them when asking for advice on certain shared issues. But at the same time, it was challenging for him to assimilate his sudden change of office, he was not willing to adapt to the other’s colleagues way of working, and wanted to keep the same rules and conditions defined in the organization and management of his former office.
He never felt integrated into the staff community at the social level, but he did not make an effort to become part of it, as the other international colleagues were already adapted in a Mexican environment. He kept on comparing and criticising our culture creating an uncomfortable environment not only for national but also for global staff, sometimes showing some ethnocentric characteristics.
He was not interested in building any social or professional relations, so this behavior created a hostile situation among the colleagues and had immediate repercussions in his everyday work as he did not feel the necessary support he needed from his colleagues in shared activities or projects. It was difficult for him to approach his colleagues to ask for their comments and advises.
Specifically, at the cultural level, he made the great mistake of not learning Spanish, even though Spanish lessons were paid for him, he was never interested in this local language or the Mexican culture. So he always depended on translations or interpretation for the meetings. It seemed like he did not want to be introduced or exposed to a new culture, and was afraid of this “foreignness.” In everyday life, he lost small but meaningful discussions or comments from his colleagues whenever English was not spoken.
Personal Interpretation
As it can be seen, this cross-cultural encounter does not describe a specific situation, but clearly, depicts a complex and problematic work situation due to cultural shock reasons.
According to what I saw in two years of working together with Mr. Griffith, I can say that his Latin American experience has been almost like a nightmare for him, but unfortunately, I consider that he was unable to use cultural diversity as a competitive tool for his international working experience.
Finally, I consider that in order to successfully interact with a foreign culture in the business world or as in this case with an international organization dealing with a multicultural staff; one should be aware of being critical enough to understand and analyze the similarities and differences between cultures which are hidden or difficult to visualise at first sight. Then, this knowledge could also be used to feel more comfortable by understanding the behaviors of the foreign partner, and at the same time showing respect for the host society could also create a solid basis for the beginning of effective intercultural communication.
Question 1: Case is based on Cross culture encounter which took place in __
Select one:
a. Mexico
b. America
c. Norway
d. Spain
Question 2
cross-cultural encounter does not describe a ____situation
Select one:
a. Common
b. Unique
c. specific
d. none of the above
Question 3
Ed Fagan, an American reparations lawyer, had sued the Swiss banks on behalf of ______victims.
Select one:
a. American
b. Child
c. Holocaust
d. none of the above
Question 4
Mr. Griffith came from a ____-English style background and had lived in Nairobi
Select one:
a. Caribbean
b. European
c. Russian
d. Indonesian
Question 5
Mr. Griffith’s responsibilities were mainly to develop, implement and finance environmental projects for the Latin American and___countries
Select one:
a. European
b. Caribbean
c. Only b
d. Both a & b
Question 6
New York is known for having a big ___community
Select one:
a. Jewish
b. American
c. Italian
d. Iranian
Question 7
one should be aware of being critical enough to understand and analyze the similarities and differences between ______which are hidden or difficult to visualise at first sight.
Select one:
a. Norms
b. Ethics
c. values
d. cultures
Question 8
Philippe started the conversation with the focus on the dubious role of the _____
Select one:
a. American Government
b. Swiss banks
c. Both a & b
d. all of the above
Question 9
Swiss banks concerning the _____values from the time of the Second World War.
Select one:
a. Assurable
b. core
c. national
d. Insurable
Question 10
The Swiss government had installed the Independent___ of Experts to bring light into the Swiss past
Select one:
a. Board
b. Panel
c. Both a & b
d. Commission
10/10
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3rd Module Assessment
Introduction
The topic treated in this paper came to my mind talking with my friend Ciro. He is a Swiss event manager working for an important international hotel chain. After working in Switzerland for over ten years with great success, his company moved him to Egypt, as responsible for events in their resort on the red sea. No specific instruction was given to him regarding how to manage the intercultural differences he would necessarily encounter. And indeed he did. His new boss was Swiss, but all of his subordinates and most of his peers, Egyptians.
One of the first things that struck him in his new work environment was how his Egyptian peers treated their subordinates. Orders were given in a very unfriendly manner, and if the work was not completed in an adequate way they would shout and threaten the neglectful.
Ciro was well known in Switzerland for being a very gentle and polite boss, his subordinates most appreciated his relational qualities, the way he treated them as equals and how he always took into consideration their ideas and remarks.
He talked about his perplexities with his Swiss ethnocentric boss, who simply replied: “Egyptians are lazy if you don’t treat them this way they will not work”. Unhappy with this answer, Ciro decided to try out his usual egalitarian management style in Egypt. He then held his first meeting with his direct reports and asked them to express the ideas they had about possible events to organise in the next future, but everybody kept silent. When he finally came up with a banal idea, everybody supported it without further discussion. This meeting model repeated itself, again and again, nobody ever seems to have initiative.
Despite his discouragement, Ciro had friendly manners with his subordinates and once he dispatched the work he didn’t continuously check it up, convinced that personal responsibility would be sufficient.
He soon realised that work wasn’t completed, that his friendly manners were interpreted as weakness and that he was the one expected to have ideas, as he was the boss. Ciro finally understood the importance and the extent of cultural differences existing between Egypt and Switzerland.
Ciro’s experience is not an isolated case, and lack of awareness of cultural differences have caused serious issues when not addressed correctly. Malcolm Gladwell, in his book “Outliers: The Story of Success”. (2008) gives an intercultural interpretation of the repeated crashes of Korean Air in the 1990s. Boeing and Airbus design aeroplanes where pilots and co-pilots are meant to act as equals in the cabin, but Korean culture doesn’t permit co-pilots to correct errors done by hierarchically superior pilots, and if an irreverent co-pilot dared criticise a pilot, he probably wouldn’t be heard. According to Malcolm Gladwell, cultural difference in Korean culture is at the origin of the repeated air crashes and losses of hundreds of lives. Korean Air finally figured out the nature of their problem and fixed it.
On the other hand, in the academic field, there is a great deal of research done on intercultural management and debates are intense. Geert Hofstede has been one of the most influential researchers in this field. In the early 1980’s he conducted a study on how values in the workplace are influenced by culture. His study was first conducted in IBM covering 70 countries. Subsequent researchers have covered other multinational firms and countries.
Hofstede (1980) developed a model that identifies four primary dimensions to assist in differentiating cultures: power distance, individualism/collectivism, uncertainty avoidance, and masculinity/femininity. According to Hofstede (1991), culture refers to the collective programming of the mind, which distinguishes the members of one group or category of people from another. Each dimension is based on a continuum, so those actual situations are not just polarised between high and low but may be anywhere in between.
Actually, Hofstede’s dimensions validate our examples. Power distance is defined as “the extent to which the less powerful members of organisations and institutions accept and expect that power is distributed unequally. This represents inequality but defined from below, not from above. It suggests that a society’s level of inequality is endorsed by the followers as much as by the leaders.”(Hofstede, 1980). Ciro comes from Switzerland, where the power distance indicator is very low, 34, while Egypt stands at the other end of the rule, scoring 80. This difference in power distance is a possible and plausible explanation of the difficulties encountered by Ciro in his new job. South Korea’s power distance indicator stands in between, rating 60 but it comes with a very high uncertainty avoidance index: 85, indicating the society’s low level of tolerance for uncertainty. When these two dimensions are combined, it creates a situation where leaders have virtually ultimate power and authority, and the rules, laws and regulations developed by those in power reinforce their own leadership and control. It is, therefore, understandable that the situation in the cockpit between pilot and co-pilot was not at all egalitarian, as the designer of the aeroplanes supposed it was.
Numerous subsequent studies have used one or more of Hofstede’s dimensions to measure cultural distance and other researchers such as Cameron & Quinn (1983) or Trompenaars (1993) have developed different models. More recently the extensive GLOBE study (2004) determined how leadership values are culturally contingent.
Another influential researcher in intercultural management is Nancy Adler (1991). She asks whether organisational culture can moderate or even erase the influence of national culture. Her researches demonstrate that organisational culture, on the contrary, magnifies national cultures, making the latter’s impact on work behaviours more pronounced. Adler’s observations support the conclusion that national culture outweighs organisational culture.
All these studies tend to demonstrate that in international business, relations between colleges, with competitors and with clients are highly dependent on cultural values.
Nevertheless, despite the effects of cross-cultural differences on international business are widely acknowledged, international firms continue to experience costly failures when venturing overseas. Indeed, according to academic and non-academic literature, companies are struggling to succeed in the global multicultural environment. A high number of failures have been documented in areas such as international joint ventures, mergers and acquisitions (Rottig, 2007; Arikan, 2004) and expatriate assignments (Hill, 2001; Storti, 2001;). In many cases, a lack of intercultural competence appears to be the prime cause of the failure.
Discussion
Keiretsu News (2006) reports that “There is a startling high failure rate for newly acquired or merged businesses. Within 18 months of closing, 80% of large cap, 50% of small cap, and 80% of micro cap transactions fail to meet stakeholder objectives. Separately, Mergerstat.com spent two years tracking results from the 8,224 domestic transactions conducted in 2001. The study estimates that a staggering $560 billion of business value was destroyed due to M&A failure.”. Doug MacDonald (2005) points out that failures in mergers and acquisitions and joint ventures rate somewhere between 40 and 80%.
Daniel Rotting conducted a study aimed to identify key difficulties that may cause such high failure rates of cross-border mergers and acquisitions, and developed a typology of strategies to facilitate the management of these problems His study indicates that cultural distance alone cannot define international acquisition performance. He argues that the consequences of culture on international acquisition performance are of a more complex nature and that “it is not cultural distance per se, but the ineffective management of cultural differences that may be the main reason for the high failure rates of international acquisitions.” (Rotting, 2007, p2.).
Apud, Lenartowicz and Johnson (2003) conducted a three-stage study to establish the extent of academic research in cross-cultural issues in international business; the degree to which top business schools incorporate these issues in undergraduate and graduate business programs; and the awareness of and responsiveness to these issues by practitioners. They found a low level of intercultural competence among business practitioners and consultants and an apparent failure in the dissemination of existing intercultural knowledge in business schools and by corporate in-house and external trainers.
In addition, until a few years ago it was widely acknowledged that intercultural competence was necessary for expatriates leaving their homeland and facing new situations abroad. Recent articles in the business literature suggest that in today’s hypercompetitive global marketplace intercultural competence should be spread out to all levels of the organisations. Martha Frase’s puts it in these words: “Increasingly, companies will find that to grow, they will have to expand into international markets and be able to function effectively in cultures that may be little-known to them. Such companies will have to elevate their familiarity with other customs and languages, and their newfound cross-cultural awareness will have to permeate not only corporate ranks but all the levels below down to the employees who carry on the enterprise day after day, dealing with counterparts in other countries without even visiting those places.” (Frase, M., 2007)
From current academic and non-academic literature, it is clear that many multinational firms fail in their overseas assignments due to intercultural communication problems: academic and business authors have identified a lack of intercultural competence as a key factor in the failure of international business. This paper intends to identify possible solutions to improve intercultural competencies in international business, but in order to pursue, we first need to clarify the concepts of culture and intercultural competence.
Culture is often seen as a shared meaning system. Researchers such as Hofstede and Trompenaars have built their models on a classic concept of culture, where culture is seen as homogeneous inside a nation and stable. As pointed out by Søderberg and Holden (2002), “culture is seen as something that members of a community (e.g. an organisation or a nation) “have” or “belong to”. In such a picture, cultural differences are inevitably seen as sources of conflict, problems and misunderstandings.
This limited view of individuals belonging preeminently to a given culture, where people are classified according to a single criterion and thus have a single dimension, is nevertheless criticised by numerous researchers in the intercultural communication field. Amartya Sen (2006), for instance, proposes a more complete model, where individuals belong simultaneously to numerous groups, such as « Woman », « vegetarian », « lawyer », « lover of jazz » and « heterosexual ». Identity is multidimensional and cannot be reduced to a single aspect. We are different in different ways and we are capable of interacting in a variety of ways. For Amartya Sen, our identity is not defined by destiny, given by birth, nationality or religion. On the contrary, each person is free to compose his own identity according to multiple dimensions. Belonging to a community may determine an essential part of this identity, but it may not define ultimately a person.
Furthermore, nations are not as stable and totally separated one from another as Hofstede’s model supposes. Important internal dynamics occur, and the official culture is always in competition with alternative cultures present in the country or organisation. The competition with alternative cultures eventually alters the official culture which is therefore in constant evolution. The presence of diversity is the seed for future change, and a rigid view of culture does not correspond to reality. Besides, the notion of multicultural nations is widely amplified in our fast globalising world.
In this context, culture is not only a source of misunderstanding and conflict, but a source of competitive advantage, and intercultural competencies, are not confined to enhancing intercultural or cross-cultural awareness and negotiation skills but they are the necessary skills
to “facilitate and direct synergistic interaction and learning at interfaces, where knowledge, values and experience are transferred into multicultural domains of implementation” (Søderberg and Holden, 2002, p113).
With these concepts in mind, let us now try to identify possible solutions to the lack of effective intercultural competence in an increasingly interdependent and culturally diverse business world. Many articles indicate training as the main area of improvement, but while training is based on outdated concepts of culture, its efficiency is necessarily limited.
Apud, Lenartowicz and Johnson (2003), give an alternative explanation: failure can be ascribed to an ethnocentric perspective. Ethnocentrism affects intercultural competence, such that strong ethnocentrism inhibits effective intercultural communication. For this, they argue, “there is no quick fix available. No amount of individual training will get managers beyond the awareness and understanding stages if there is an organisational culture that fails to promote the merits of developing global expertise.”
Lowe, Moore, and Carr (2007) go further, according to them, “all knowledge contributions are captive of one privileged view, tolerant of a second marginalised view and denigrative or ignorant of a third view. In other words, all knowledge is captive of blind prejudices.”
The solution proposed in this paper includes learning of intercultural competence, avoids single- paradigm myopia and, if well managed, can be a strategic resource for success. This solution was not only inspired by current academic and business literature, but also by the initial example of Ciro, our Swiss manager in Egypt. After a few months of frustrating work, Ciro finally decided to gradually modify the structure of his group. As people left or were transferred to other units of the hotel, he hired people to form totally different backgrounds also considering the diversity of the clientele. Besides, he paid attention to gender, academic backgrounds and age brackets, ending up with a highly diverse team. At the beginning, managing this team resulted difficult because misunderstandings and discussions were frequent, but after a year the group had created its own norms and values, every individual was accepted and appreciated as a positive feature of the team. Discussions were always frequent, but with time they became more and more constructive. The team ended up being very creative and successful.
We argue in this paper that the most effective solution for building and spreading intercultural competence is the creation of multicultural project teams at all levels of organisations.
Multicultural teams provide the highest learning potential for intercultural competence. Cooperation and daily work in such teams create tacit knowledge. Diverse teams have intrinsic multiple views and as problems must be discussed until a solution is found, this forces to consider the existence of differences in mentalities and to build consensus. Intercultural learning does not consist in changing one’s own culture, but in understanding that other ways of seeing are also valid and that for effective interaction, a compromise needs to be found.
Anne Bartel-Radic (2006) investigated under what conditions people develop intercultural competencies in a business context. Her findings confirm the strong link between intercultural interaction in a global team and the acquisition of Intercultural competence, while interaction with foreign customers, for instance, does not create intercultural competence. Anne Bartel- Radic explains her results: “simply meeting people from other cultures is far from being a sufficient condition for the acquisition of intercultural competence. The acquisition of intercultural competence is encouraged by positive emotion and the desire to learn. Critical reflection on one’s own culture is also necessary, which means a profound change in mindsets occurs.” In global teams, interaction takes place in a common context, among equal team members, over a long period of time, and it is unplanned. People are forced to open their eyes, to see, to understand that the others exist and that they have competencies. Values eventually change, moving toward elements of intercultural competence, such as tolerance and an acceptance of difference.
Søderberg and Holden (2002) have similar findings, asserting that: “The key engine of learning is the multicultural team, out of whose diversity comes an eclectic set of perspectives, a set of interchangeable lenses.”
Multicultural teams, because of the different perspectives they contain and broader cognitive frame, are also better prepared for problem-solving compared to homogenous groups (Hong, L.& Page, S.E., 2002). For the same reasons, highly diverse teams possess increased creativity and flexibility.
Other researchers have tried to find a direct correlation between team heterogeneity and performance, but the relation seems to be more complicated. Earley and Mosakowski (2000) studied the effects of heterogeneity in trans-national teams through a qualitative field study. The results demonstrate that highly heterogeneous teams (where no clear sub-identities exist) are outperformed in the short term by more homogenous groups but on the long run, the high heterogeneous groups which are able to create a third culture outperform all the others. Thereby, there are two supplementary factors that play an important role: time and the capacity to create a third culture.
A common understanding is constructed over time through interaction, which makes for the group a “community of interpretation”. The third culture or hybrid team culture “consists of an emergent and simplified set of rules and actions, work capability expectations, and member perceptions that individuals within a team develop, share, and enact after mutual interactions.”(Earley and Mosakowski, 2000) This emergent shared culture offers a common sense of identity and facilitates individual and team performance, communication and learning. For this third culture to emerge, the team must have very clear goals and objectives, and these must be shared by all members of the group.
As we have seen, high diversity in business teams presents interesting advantages, but let us analyse the drawbacks of such teams. A common saying states that “too many cooks spoil the broth”, what is the truth in this saying?
Heterogeneous groups certainly are more difficult to manage that homogeneous groups, at least initially. Even language can become an issue, and understanding each other might not always be immediate. Furthermore many basic concepts, such as time or holding a meeting, will need to be clarified, while within a homogeneous group these concepts would be implicit. Roles and responsibilities need to be extremely clear because of possible different interpretations. As Marie-Therèse Claes (2009) noted, Dr. Carol Kovach researches demonstrate that cross-cultural groups represent the most effective groups, but at the same time, they also represent the less effective ones. Diversity can cause lack of cohesion, mistrust and miscommunication. Sub-groups can appear in a heterogeneous group, compromising the team’s identity and in multicultural groups conflict appears to be a logical outcome.
This fault line can eventually be turned into positive. A conflict is a particular form of interaction including destructuration and restructuration and plays an important role in gaining awareness. In this sense, conflict, going with positive conflict management, is seen as valuable and constructive.
Conclusion
Although multicultural teams are more complex to manage than homogeneous teams, they present real advantages for the acquisition of intercultural competencies. Diversity, if correctly managed, appears to be a valuable resource to face our globalised and hypercompetitive business world, and our multicultural societies turn up to be an unsuspected reservoir of talents.
Managing diversity efficiently implies the emergence of a third culture which ultimately defines the team identity and helps to manage the process. Investing in the management of multicultural teams is worthwhile. It will give multinational companies a strategic and competitive advantage, and an excellent return on investment.
Question 1: A _____ is a particular form of interaction including destructuration and restructuration and plays an important role in gaining awareness.
Select one:
a. Ressolution
b. Structure
c. Both a & b
d. conflict
Question 2
Cooperation and daily work in Multi cultural teams create _____knowledge.
Select one:
a. Deep
b. tacit
c. Skilled
d. Sound
Question 3
Diverse teams have____multiple views and as problems must be discussed until a solution is found
Select one:
a. Extrinsic
b. intrinsic
c. Both a & b
d. none of the above
Question 4
Highly diverse teams possess increased creativity and _____
Select one:
a. flexibility
b. Innovation
c. Adaptability
d. Uniqueness
Question 5
multicultural teams are more complex to manage than ____ teams.
Select one:
a. homogeneous
b. Hetreogeneous
c. Both a & b
d. all of the above
Question 6
shared culture offers a common sense of identity and facilitates individual and team performance, and _____learning.
Select one:
a. Networking
b. communication
c. Technology
d. Machine
Question 7
The acquisition of___ competence is encouraged by positive emotion and the desire to learn.
Select one:
a. organizational
b. intercultural
c. cultural
d. both a & c
Question 8
The key engine of learning is the multicultural team, out of whose diversity comes an ___of perspectives, a set of interchangeable lenses
Select one:
a. bunch
b. umbrella
c. skill
d. eclectic set
Question 9
____on one’s own culture is also necessary, which means a profound change in mindsets occurs.
Select one:
a. Critical reflection
b. Reflection
c. Flexibility
d. Adaptability
Question 10
_____researches demonstrate that cross-cultural groups represent the most effective groups
Select one:
a. Drucker
b. Fayol
c. Dr. Carol Kovach
d. Dr.Keith
10/10
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4th Module Assessment
It present the inter-religious conflict related to the Temple Mountain in Jerusalem, involving Jews and Muslim. Two questions will be at stake: the sovereignty on the place, and the right of archaeological digging.
The origin or the reasons of the conflict are bounded with the name that Muslim and Jews give to that place. The Temple Mount is the Hebrew name and indicates the place where the holy Temple of Jerusalem was placed, before its disruption in 70a.C. According to Jewish the Messiah will come back and re-build the temple. No Jewish can enter the Temple Mount for two precise reasons:
(1) to enter the place of the Temple a Jewish must make a sacrifice first, but since the Temple has been destroyed and the priests class does not exist anymore (priests gave services only in the Temple of Jerusalem, the only Jewish temple), a Jewish cannot be purified and enter the area;
(2) while walking on the Temple Mount could happen that a Jewish step on the place where once there was the “Saint of Saints” room, the holiest place of the Temple where is present the Spirit of God. Stepping on it is a terrible sin. For Jewish that is the place of the Temple and the fact that nowadays there are to Mosques is only temporary.
The Name of the Place according to Muslims: the Noble Enclosure In Arab the name of the same place can be translated as the Noble Enclosure (il Nobile Recinto), and it means the enclosure containing the two mosques: Al aqsa and the Dome of the Rock (la Cupola della Roccia). For Muslims, the place is holy because Mahomet has done a night trip from Mecca to Jerusalem and according to a non Koraninc text rose to the sky and talk to angels.
For the Waaqf, the board for the administration and the custody of Islamic holy places, that place is the mount of the Mosques, furthermore, the Waaqf claims that the Jewish Temple was NOT situated there and that the Noble Enclosure is a holy place only for Muslim.
Archaeology as an Ideological Tool
These standpoints bring to continuous inter-religious tensions. Archaeology has a big role in this difficult situation. In fact, the first question arising is “What is there, under the ground?” Before starting exposing the interconnected situation of the archaeological sites in the area, it has to clarify that in Israel and in Palestine archaeology is used as an ideological tool, that is whoever digs, he/she digs to find its own evidence and to cancel the evidence of the opposite part.
Now, let us try to tackle the conflict from an archaeological point of view. Most of the archaeologists’ community assumes that that is the actual place of the Temple; however, the topography of the Ancient Jerusalem is not completely clear. The argument defended by archaeologists is that the Mount is the most plausible place for the Temple. However, to have the certainty of this the only way would be to dig and discover the ruin of the Temple.
But carry on an archaeological project is impossible because no one has the right to do it and it would cause a re-exacerbation of the Israeli- Palestinian conflict. To complicate the situation, the area of the Mount is part of Israel, but it was conquered during the war of the 6 days, therefore officially is an “occupied territory”. Therefore its statute is not defined. The block is a Jewish block, however on the mount, there is Palestinian police, people (not Muslims) can enter the Mount but not the Mosques. Although Israel retains formal sovereignty over the Temple Mount, the site is governed by an Islamic trust that allows non-Muslims to visit the compound during limited hours and prohibits Jewish or Christian worshipers from reading prayers aloud.
The international community decided that no one has the right to dig in the area, nor the Palestinian or the Israeli. However, no one respects this decision and everyone digs in secret.
An Explosive Debate
To understand the explosiveness of the situation let us think to the last straw that causes the second intifada in 2000. On September 28th, 2000 Sharon “had a walk” with 1000 policemen on the Mount. In those days there was the rumour that Muslims were digging in secret on the Mount. The Sharon’s walk had a specific meaning: stop digging because we are the owners of this land. This was the start of the second intifada.
The problem of archaeological digging is now exacerbating once more. Israeli dug already along the perimeter of the Mount there is an archaeological site around the Mount. Now a new catwalk has to be built, and the Muslims accuse the Jewish to be digging under the Mount. The tragedy is that each one when digging throws away everything belonging to the other culture.
The proposal of the Vatican
In this difficult situation, the Vatican suggested a proposal to solve the conflict, proposal that was accepted by the entire international community. The proposal suggested considering Jerusalem as an extraterritorial zone, to be ruled by the UN. According to this proposal, the archaeological work should have been carried on by a third party.
Both Israeli and Palestinian did not accept the proposal: the value at stake is the sovereignty on the area, more than the willingness of knowing what actually lay under the ground. It is at this point that the religious discourse overlaps with the political one. However, I will not try here to divide the two, since, as we have been told throughout all the master curriculum, splitting politics from religion is a characteristic of the Western culture, and it is an attitude not shared in many parts of the world, and certainly it is not shared by the Islam thought. The issue is even more complicated since the power to decide about the Mosques is not a right of the Palestinian but of Islam in general, therefore Palestinian on the particular case of holy places do not have the power of negotiating.
In regard to the state of Israel, that is a laic state, it can be said that it is a laic state of Jewish, and the Jewish identity is grounded on religion.
As I said, the proposal was not accepted by the parties and, without a previous agreement between the parties, UN blue helmets cannot be sent in a country.
Question 1: Argument defended by archaeologists is that the Mount is the most ___place for the Temple
Select one:
a. Holy
b. Pure
c. plausible
d. Boyh a & c
Question 2
Israeli dug already along the perimeter of the Mount there is an___ site around the Mount
Select one:
a. Old
b. beautiful
c. archaeological
d. New
Question 3
Noble Enclosure In Arab means the enclosure containing the two mosques: Al aqsa and the ____of the Rock
Select one:
a. Square
b. Rectangle
c. Dome
d. Both a & b
Question 4
On September 28th, 2000 Sharon ___ with 1000 policemen on the Mount.
Select one:
a. had a walk
b. Interacted
c. Walked
d. Both b & c
Question 5
Splitting politics from ____is a characteristic of the Western culture
Select one:
a. Culture
b. Caste
c. nationality
d. religion
Question 6
The Sharon’s walk had a specific meaning ____
Select one:
a. Stop
b. stop digging
c. Prayer
d. Almighty
Question 7
The Temple Mount is the ___name
Select one:
a. Saint
b. Hebrew
c. Both a & b
d. none of the above
Question 8
The tragedy is that each one when digging throws away everything belonging to the ____culture.
Select one:
a. other
b. Different
c. Unique
d. all of the above
Question 9
The value at stake is the___ on the area,
Select one:
a. sovereignty
b. Holy
c. New
d. Culture
Question 10
____room, the holiest place of the Temple
Select one:
a. Saint
b. Holy
c. Pure
d. Saint of Saints
10/10
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5th Module Assessment
INTER-RELIGIOUS CONFLICT
The fact that it became possible for women to become a priest was one of the biggest changes in Lutheran church for the last few decades. Nowadays there is all the time more and more parishes are accepting women as priests, but in fact, there are many problems still. In Finland, women were accepted in the year 1996, and at the moment an average of 27% of the priests are women. Even this issue has formally been accepted; it is still a topic of argumentation.
Twenty-one years after the Lutheran Church of Finland allowed women to become pastors or priests, a small but vocal group of male clergy remained opposed to their ordination, embarrassing the Church as it tries to halt declining membership.
The problem is not anymore should a woman be a priest, the problem is what we can do about the people who are against women as a priest? And what to do with the priest who does not want to work with the woman priests? Also in the media, this has been an issue, and for example, some men working as a priest have been fired for not working with a woman priest. The issue has gone so far that one priest who was a man, decided to change his gender in Eastern-Finland and got fired after returning to work as a woman. Additionally, several female pastors also filed police complaints about discrimination.
The problem seems small, but in fact, because the Scandinavian, and especially the Finnish culture is so equal the gap between church´s opinion and the way culture sees the situation is huge. There have even been people who have decided to leave the church because a woman was a priest, but still, for them, it is normal to have a woman as a president. This issue is sensitive, and inside of the religion, it has raised up a lot of problems.
When thinking about the near future, Lutheran Church will have problems, because, for the last year’s students who have graduated from being a priest, half of them have been women. So the inter-religious conflict continues should the Lutheran church loose people from the parish because some women want to be priests or should they start campaigns to support women a priest. According to the association “The Free Thinkers,” who have created a website in which people withdraw from the Church, every time the debate on women pastors comes up in the media the number of withdrawals increase. Some 100 people a day have withdrawn their church membership in recent weeks.
There is a long in equality for the Lutheran church in Scandinavia because the level of the normal equality is so high. The value positions at stake are that the church might lose members, the culture and the church will disagree and create a big conflict between opinions, and maybe for the universities to stop educating so many women to be a priest because the church might not be able to give them work. Because it has already happened that people leave their parish and change to another where there is a man priest.
MEDIA AND CHURCH
Because there is a huge gap between the ideologies of the church and the normal culture, there are nowadays groups of women priests, and they are very intensive and even aggressive sometimes. They want to keep alive the ideology that woman is not meant to be a leader, and this is again the topic what the normal society does not understand. It was expected that when time goes by, the new generation will accept the women priests and the problem will disappear, but it ever happened. The groups which do not accept women priests are active and alive still after 20 years.
Media has raised up so much the issue of women priests that it seems now that Media has increased the number of the people who are against and Media has made it easier for these people to meet and create groups. Even nowadays the churches and parishes need publicity, the publicity which they have gotten has made the situation worse. To be able to talk about this issue in media, the church has to play with the rules of media. And the Lutheran church hasn’t been able to express themselves, and meanwhile, in the media, the people against women priest have raised up discussions to get more people to their side.
SOLVING THE INTER-RELIGIOUS CONFLICT
The problem is hard to solve because most of the people living in Finland, for example, are used to equality and support even the president to be a woman. The problem is more related to the case that people who do not accept women priest do not take it because of the Bible, and this is an issue which is hard to change, their beliefs. In the case, Media would start promoting women priests and show that they do their job as well as the men it might get better. Moreover, the Media should stop interviewing the people against women priests and start supporting the women priests in order the Finnish culture and church to co-exist. Solving these problems and issues might take even a decade, but it is possible with the help of Media and for the young generations to be as equal in their religion as they are in their daily culture.
CONCLUSION
A century ago, Finland became the world’s first state to grant women full voting rights. It is one of the most gender-equal countries in the world. Finland has a woman as a president and also the world’s most female-dominated cabinet. Still, the inter-religious conflict is related to women working as a priest and pastor. The problem seems ridiculous but is in fact complicated.
All in all my opinion to solve this issue is for everyone in the Lutheran church to remember that we all have the option to choose our opinions and religions, but we have to respect the fact that Scandinavia and Finland are equal countries and our culture accepts women as priests. It is natural that everyone does not agree. If the problem will not solve shortly, maybe it would be a good idea to start establishing parishes with women priests only and other parishes with men as priests. But again this would fight with our culture of equality.
Question 1: Finland and the whole Scandinavia are extremely equal countries towards __
Select one:
a. men
b. women
c. Both a & b
d. none of the above
Question 2
Finland became the world’s first state to grant women __
Select one:
a. full voting rights
b. Voting Rights
c. half voting rights
d. Both b & c
Question 3
Finland has the world’s most ___ cabinet
Select one:
a. male dominated
b. Gender equal
c. Biased
d. female-dominated
Question 4
Groups which do not accept women priests are active and alive still after __
Select one:
a. 20 years
b. 23Years
c. 25 Years
d. 19 years
Question 5
Huge gap between the _____of the church and the normal culture
Select one:
a. Culture
b. Norms
c. Ideologies
d. Beliefs
Question 6
Inter-religious conflict is about women working in the profession of a _____
Select one:
a. Saint
b. priest
c. Both a & b
d. Only b
Question 7
The issue has gone so far that one priest who was a man, decided to change his gender in ___
Select one:
a. Eastern-Finland
b. Western-Finland
c. Northern Finland
d. Southern-Finland
Question 8
The value positions at stake are that the church might lose members the culture and the church will disagree and create a big conflict between ____
Select one:
a. perception
b. thoughts
c. opinions
d. beliefs
Question 9
women to become a priest was one of the____ in Lutheran church for the last few decades
Select one:
a. Change
b. Drastic Change
c. biggest changes
d. Challenge
Question 10
______who have created a website in which people withdraw from the Church, every time the debate on women pastors comes up in the media the number of withdrawals increase
Select one:
a. Media
b. Advertisement agencies
c. both a & b
d. The Free Thinkers
10/10
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Assignment 2
This is about a conflict which has been going on in Finland and also in Sweden. This inter-religious conflict is about women working in the profession of a priest. The Lutheran church in Scandinavia has had a conflict which got quite large in the past few years. Finland and the whole Scandinavia are extremely equal countries towards women, and the problem related to that because the church couldn’t agree on the same level than the culture of the countries. This became a conflict because the culture is so equal, but the church is not able to stay in the same level of equality. The reason I chose this topic, is because it’s quite resent conflict and also it is related to culture. Of course, there are much worse inter-religious conflicts around the world, but as Scandinavia is really peaceful, this is an inter-religious problem which we have had in the near future.
On March 17th, 2008 Switzerland’s Elektrizitätsgesellschaft Laufenburg EGL signed a 25- year contract with the state-owned National Iranian Gas Export Company NIGEC for the delivery of 5,5 billion cubic meters of gas per year. Joachim Conrad, the member of the executive board within EGL named the deal a milestone for the natural gas business of the company. As he declared in a media release: “Natural gas from Iran is necessary to the opening of a fourth gas transportation corridor to Europe”1. The signing of the contract took place in presence of representatives of the two governments, Iranian Prime Minister Mahmoud Ahmadinejad, foreign minister Manuchehr Mottaki and Swiss foreign minister Micheline Calmy-Rey. International newspapers reported on the huge deal worth between $28 billion and $42 billion2. Iran State Television showed the meeting between Ahmadinejad and Calmy-Rey, both laughing, her wearing a Muslim veil. The contract had required a long preparation time for EGL. Early in the stage, the company asked for help from the Swiss government to accompany the negotiations.
The successful deal didn’t stay untouched for long. On the same day as international newspapers reported on the happenings, the US-department for foreign affairs made an intervention. It questioned if the deal didn’t possibly violate the UN Security Council resolutions over the Iranian uranium-enrichment program. One day later, Jewish organisations followed. As Jerusalem Post titled: “Swiss selling principles for Iranian gas”. Israeli administration officials called the business deal an “unfriendly” act towards Israel. “Iran assists extremist organisations, tramples human rights and it denies Israel its right to exist”, Israel’s Rafi Barak, director-general in charge of Israel’s Western European department, said in a meeting with Swiss ambassador Walter Haffner. Shortly after, the World Jewish Congress placed its critic as well and called the deal a “propagandistic triumph for the mullahs”. Micheline Calmy-Rey laughing and wearing a veil was interpreted as a sign of taking sides. Only two days after the contract was signed it looked like it was becoming already unstable. The US claimed the contract to examine the content according to the UN-sanctions.
In Switzerland, too, the case met with severe criticism. The Swiss conservative party SVP even placed an ad in newspapers showing the socialist politician Calmy-Rey wearing the veil, sitting in a chair under the picture of Ayatollah Khomeini, a photograph that was taken during the meeting of the two governments in Teheran. The latest accusation comes from the US-Jewish organisation Anti-Defamation League ADL. An ad that was placed in several international newspapers accuses Switzerland of supporting and financing terrorism.
In the wake of these large international critics, the gas deal, which was so carefully prepared and which is highly important for Europe’s energy supply is put in danger.
The Company
EGL is a European energy trading company, member of the Swiss AXPO Group. It trades in electricity, natural gas and energy-related financial products. Through its subsidiaries, the company is present in major European markets. Besides its trading activities, EGL holds interests in Swiss power plants and owns a gas-fired combined-cycle power plant in Italy. The gas division is relatively new for the company. It started only in 2003 to implement natural gas activities as an additional business field. Increasing demand for natural gas throughout Europe has led to this decision.
The Gas deal with Iran is not a single project within this region. EGL is the developer of the Trans Adriatic Pipeline, also known as TAP. This project consists of the building of a enormous pipeline from the Caspian and the Middle East into Western Europe. To realise this gigantic project EGL has established an equally owned joint venture with Norwegian StatoilHydro to develop, build and operate the TAP. Next to gas from Russia, the North Sea and Northern Africa TAP will open a fourth transportation corridor for gas trading. It is supposed to diversify natural Europe’s gas supply and equally minimise dependence from Russia. Many European countries will benefit from the pipeline and therefore the project is co-financed by the European Union.
Hence, the gas deal with Iran is just a first important step to guarantee gas resources for Europe. According to EGL, negotiations for the deal took a long time. Early in the stage, the Swiss government was involved since the Iranian partners belong to a state-owned company. Connections had to be built and since Switzerland’s government already had the contacts to Iranian administration circles it was only consequential, to involve high-rank Swiss officials.
Question 1: EGL has established an equally owned joint venture with ___to develop, build and operate the TAP.
Select one:
a. America
b. Norwegian StatoilHydro
c. Seilt
d. Sessro
Question 2
EGL holds interests in Swiss power plants and owns a gas-fired combined-cycle power plant in __
Select one:
a. Paris
b. Italy
c. Rome
d. UK
Question 3
EGL is a European energy trading company, member of the Swiss ____Group
Select one:
a. APXO
b. PXAO
c. AXPO
d. OPXA
Question 4
Israeli administration officials called the business deal an _____ act towards Israel
Select one:
a. Friendly
b. Unknown
c. Both a & b
d. unfriendly
Question 5
Joachim Conrad, the member of the executive board within EGL named the deal a milestone for the__ business
Select one:
a. natural gas
b. NIYH
c. CGEA
d. GINS
Question 6
Natural gas from Iran is necessary to the opening of a___ gas transportation corridor to Europe
Select one:
a. Second
b. fourth
c. First
d. Third
Question 7
The signing of the contract took place in presence of representatives of the ____governments, Iranian Prime Minister Mahmoud Ahmadinejad, foreign minister Manuchehr Mottaki and Swiss foreign minister Micheline Calmy-Rey.
Select one:
a. Three
b. One
c. Four
d. two
Question 8
The US claimed the contract to examine the content according to the_____ -sanctions.
Select one:
a. UK
b. Europe
c. UN
d. Asia
Question 9
witzerland’s Elektrizitätsgesellschaft Laufenburg EGL signed a 25- year contract with the state-owned National Iranian Gas Export Company __
Select one:
a. NIGEC
b. NIYH
c. CGEA
d. GINS
Question 10
__director-general in charge of Israel’s Western European department
Select one:
a. Israel’s Rafi Barak
b. Rafi Muhammod
c. barak Ismail
d. Israil
10/10
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