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An Analysis of American and European Business Operations in Africa: Lessons Learned Based on the Dynamic Interaction of Leadership with African Culture
No full textResearch findings show that failure to manage companies in Africa cost western companies over 2 billion per year. Therefore, it is imperative that western leaders ensure the success of companies in Africa to reduce such losses. This dissertation analyzed leadership practices, cultural differences, and differing ethics of American and European leadership as they interact with African leaders within western-dominant companies in Africa. This dissertation argues that western leaders managing company operations in Africa lack cross-cultural skills. Also, these western leaders manage operations based on their beliefs and expectations without taking into account African culture and practices. Whereas cultural practices tend to be individualist in western environments, African practices are collectivist in nature, adding to the complexity in leadership style needed to manage western companies in Africa. There is also the added complexity of western leaders managing in African work environments where there is a lack of strong western-based regulatory frameworks and ethical business practices. This dissertation found that western leaders need to adopt a compromise approach to managing business operations in Africa, which can be achieved by western leaders adapting to African cultural practices and putting in place interventions to enhance cooperative relationships that lead to productivity. This research is important given the scarcity of empirical research on western leaders seeking solutions to manage their operations in Africa in the light of the deeply rooted culture that influences African leadership behaviors and western-based ethical dilemmas. Findings from this research will provide western managers with recommendations on how to manage the effects of African culture and business ethics on western business operations in Africa.
Keywords: Globalization, Africa, Western Companies, Western Leadership, Culture, Ethics WESTERN BUSINESS OPERATIONS IN AFRICA 4
Table of Contents
Abstract .......................................................................................................................................... 3
Chapter One: Introduction ............................................................................................................ 10
Purpose of Study ....................................................................................................................... 13
Problem Statement .................................................................................................................... 15
Research Question .................................................................................................................... 16
Warrant and Propositions .......................................................................................................... 18
Summary of Chapter One ......................................................................................................... 19
Organization of the Paper ......................................................................................................... 19
Chapter Two: Systematic Literature Review ................................................................................ 21
The Analytic Framework .......................................................................................................... 21
Theoretical Framework ............................................................................................................. 25
Situational Leadership Theory .............................................................................................. 26
Cultural Theories .................................................................................................................. 27
Compromise Theory ............................................................................................................. 30
Leadership and Doing Business in Africa ................................................................................ 32
Business Opportunities in Africa .......................................................................................... 32
Leadership Abilities Needed to Adapt to African Management and Cultural Practices ...... 33
Adaptation and Principles of Compromise ........................................................................... 42
Culture and Conducting Business in Africa.............................................................................. 48 WESTERN BUSINESS OPERATIONS IN AFRICA 5
Ethics and Doing Business in Africa ........................................................................................ 59
Summary of Chapter Two ......................................................................................................... 74
Chapter Three: Conceptual Framework ........................................................................................ 76
Restating the Problem ............................................................................................................... 77
Revisiting the Research Question and Propositions ................................................................. 77
The Interaction of the Three Themes ........................................................................................ 78
Western Context.................................................................................................................... 79
African Context ..................................................................................................................... 82
Conceptual Framework ............................................................................................................. 84
Alignment of Goals ............................................................................................................... 84
Situational Leadership .......................................................................................................... 87
Summary of Chapter Three ....................................................................................................... 88
Chapter Four: Methodology .......................................................................................................... 89
Evidence-Based Management Research ............................................................................... 89
Systematic Literature Review Process for this Dissertation ..................................................... 91
Inclusion/Exclusion Criteria ..................................................................................................... 93
Narrative Synthesis ............................................................................................................... 95
Subject Matter Experts .............................................................................................................. 95
Subject Matter Expert Feedback ........................................................................................... 98
Changes Made Based on Subject Matter Expert Feedback .................................................... 101 WESTERN BUSINESS OPERATIONS IN AFRICA 6
Summary of Chapter Four ...................................................................................................... 102
Chapter Five: Analysis and Discussion ...................................................................................... 103
Purpose of the Study ............................................................................................................... 103
Exploration of Research Question .......................................................................................... 104
Presentation of the Findings.................................................................................................... 105
Conclusions ............................................................................................................................. 111
Leadership ........................................................................................................................... 112
Culture................................................................................................................................ 113
Ethics.................................................................................................................................. 114
Alternative perspectives ...................................................................................................... 115
Summary of Chapter Five ....................................................................................................... 116
Chapter Six: Conclusions, Implications, and Recommendations for Future Study .................... 118
Overall Research Conclusions ................................................................................................ 118
Implications for Management ................................................................................................. 120
Implications of Trends ............................................................................................................ 121
Limitations and Areas for Future Research ............................................................................ 124
Summary of Chapter Six ......................................................................................................... 126
References .................................................................................................................................. 127
Appendix A: Personal Assessment Tool..................................................................................... 139
Appendix B: UMUC Doctoral Program Executive Director’s Letter ........................................ 142 WESTERN BUSINESS OPERATIONS IN AFRICA 7
Appendix C: Dissertation Chapter Outline ................................................................................. 145
Appendix D: UMUC Subject Matter Expert Evaluation & Feedback Form .............................. 147
Appendix E: Subject Matter Expert Evaluation & Feedback Form From Professor Franklyn Manu .......................................................................................................................................... 149
Appendix F: Subject Matter Feedback Form From Dr. P. K. Nduom ........................................ 152
Appendix G: Subject Matter Feedback Form From Professor S. Adams ................................... 155
WESTERN BUSINESS OPERATIONS IN AFRICA 8
Tables
Table 1, Subject Matter Expert Panel Member Information……………………………………..94
Table 2, Summary of Subject Matter Expert Feedback………………….………………………96
WESTERN BUSINESS OPERATIONS IN AFRICA 9
Figures
Figure 1, Themes and contextual factors influencing the cooperative management of western-based operations in Africa………………………………………………….....………………..77
Figure 2, A conceptual framework of compromise leadership and alignment of goals to achieve cooperation between western and African managers…………………………………………..82
Figure 3, Five step process of EBMgt. Note: Reprinted from “Research Methods Knowledgebase” by W. Trochim & J. Donnelly, 2007. Copyright by Thomson Custom Publishing 2007…………………………………………………………………………….......89
Figure 4, Questions used as guidelines to determine inclusion/exclusion of literature in Systematic Literature Review………………………………………………………………….92 WESTERN BUSINESS OPERATIONS IN AFRICA 10
An Analysis American and European Business Operations in Africa: Lessons Learned Based on the Dynamic Interaction of Western Leadership with African Culture
Chapter One: Introduction
The extent to which business cultures of North American and European companies interact with African culture, and the resultant effects of this interaction based on differences in leadership, culture and ethics, was the focus of this research. These interactions resulted in various outcomes that provided lessons for use by North American and European companies seeking to do business in Africa. Hofstede (1980) found that people “are culturally conditioned” (p.50), and given that management theories developed in the last several decades have been based on work environments in the United States and Europe, most management theories that influence leadership development and formal leader selection processes reflect the culture of the United States and Europe. There is a vast difference between North American and European management practices and African management practices (Luiz, 2006; Trompenaars, 1993). For the purposes of this dissertation, North American and European companies were referred to as “western companies.”
This dissertation assessed the interactions between western and African leaders to determine how their management practices and cultural differences impacted business operations. The goal was to provide western leaders with a model for managing western businesses operating in Africa. Hofstede (1993), the renowned scholar on cross-cultural theories, found that national and societal cultural infrastructures develop over time. In addition, Hofstede (1993) argued that in the same way, local management practices and capabilities develop as part of the cultural infrastructure of the people. As such, managers and their practices WESTERN BUSINESS OPERATIONS IN AFRICA 11
grounded in these cultural infrastructures cannot be transported in a wholesale manner from one environment to another without taking national and societal culture into account. Hofstede (1993) postulated that “Management is not a phenomenon that can be isolated from other processes taking place in a society” (p. 89). In order for western leaders to be successful in Africa they must understand African management systems (Amoako-Agyei, 2009). In addition they must be sensitive to issues of ethnicity. Both African management systems and issues of ethnicity are rooted in cultural traditions and ideals.
There are opposing arguments as to when globalization began. Geographers, political scientists, sociologists and economists have individual interpretations of what globalization is, what it should be, and how it impacts various disciplines (Gichure, 2006). Globalization is more than industries and companies setting up operations in host countries across the globe. Prevailing beliefs are that globalization occurred due to companies and organizations taking advantage of less expensive production costs as well as larger markets.
The rise in cross-border business activities has been fueled by the need to find cheaper raw materials and labor. Research revealed that the high interest yield from investments in Africa helped to attract more western businesses to the African continent (Demas, 2011; Lemi & Asefa, 2009). For example, Foreign Direct Investments (FDI) earned an average rate of return of 29% in Africa from 1990 to 1999 (Demas, 2011). U.S. companies enjoyed a rate of return of above 10% between 1983 and 1997 when worldwide rates were much lower (Amoako-Agyei, 2009). Furthermore, the United States earned higher profits on their investment in Africa compared to other developing countries in Asia or Latin America based on a 1988 report by the United Nations Conference on Trade and Development (Lemi & Asefa, 2009). Carmody and Owusu’s (2007) findings from 2005 statistics, obtained from the United States Department of WESTERN BUSINESS OPERATIONS IN AFRICA 12
Commerce, showed that United States trade with Africa grew by 37% in 2004, with higher levels of trade with Africa than Russia and the former eastern bloc combined.
Most definitions, standards, and guidelines for determining business ethical practices have been derived from western standards and practices (De Maria, 2005). Western managers perceive that western countries have higher standards for managing ethical practices and regulatory frameworks than businesses being established in developing countries. Since organizational measures are generally based on ethical standards, the measurement of organizational management indices, such as gift giving which is considered “bribe giving” and an unethical practice in western countries (Tsalikis & Nwachukwu, 1991, p. 85), are also based on standards from western countries. Therefore, the perception that Africa has a higher level of corruption than what exists in western countries arises given that the criteria used to measure corruption is based on western standards (Vogel, 1992). Business ethics in Africa differ from what are acceptable in western business environments (De Maria, 2005). Thus, standards in evaluating ethical behavior in Africa differ from what are used in western countries. Companies moving offshore to Africa must be cognizant of the ethics and morals inherent in the African work culture (Frynas, 2004; Gichure, 2006; Moon & Woolliams, 2000).
Demas (2011) contended that western managers have experienced high failure rates in establishing sound management practices in western companies operating in Africa. This is partly due to the fact that western standards are used in assessing whether business practices are ethical when managing operations in Africa. Another factor that impacts the ability of western managers to succeed in managing African operations is the lack of knowledge and experience in dealing with African norms and practices that underpin what are believed to be unethical practices by western company standards. WESTERN BUSINESS OPERATIONS IN AFRICA 13
Purpose of Study
Western companies are re-locating their operations to Africa due to: (1) the need for lower cost of raw material, (2) availability of cheap but skilled labor, (3) the rise in ready markets for the goods being produced by the western companies, and (4) favorable tax laws and corporate tax incentives (Abiaka, 1972; Amoako-Agyei, 2009). The purpose of this dissertation was to examine cross-cultural compet
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Author Under Sail The Imagination of Jack London, 1893-1902
No full textIn Author Under Sail, Jay Williams offers the first complete literary biography of Jack London as a professional writer engaged in the labor of writing. It examines the authorial imagination in London's work, the use of imagination in both his fiction and nonfiction, and the ways he defined imagination in the creative process in his business dealings with his publishers, editors, and agents. In this first volume of a two-volume biography, Williams traverses the years 1893 to 1902, from London's "Story of a Typhoon" to The People of the Abyss. The Jack London who emerges in the pages of Author Under Sail is a writer whose partnership with publishers, most notably his productive alliance with George Brett of Macmillan, was one of the most formative in American literary history. London pioneered many author models during the heyday of realism and naturalism, blurring the boundaries of these popular genres by focusing on absorption and theatricality and the representation of the seen and unseen. London created an impassioned, sincere, and extremely personal realism unlike that of other American writers of the time. Author Under Sail is a literary tour de force that reveals the full range of London as writer, creative citizen, and entrepreneur at the same time it sheds light on the maverick side of machine-age literature.Intro -- Title Page -- Copyright Page -- Dedication -- Contents -- Acknowledgments -- Introduction -- 1. Spirit Truth -- 2. From Absorption to Theatricality and Back Again -- 3. "I Will Build a New Present" -- 4. Sons as Authors -- 5. Fathers as Publishers -- 6. The Daughter as Author -- 7. Lovers as Authors -- 8. At Sea with the Family -- 9. Yellow News, Yellow Stories -- 10. The Return Home -- Notes -- Bibliography -- Index -- About Jay WilliamsIn Author Under Sail, Jay Williams offers the first complete literary biography of Jack London as a professional writer engaged in the labor of writing. It examines the authorial imagination in London's work, the use of imagination in both his fiction and nonfiction, and the ways he defined imagination in the creative process in his business dealings with his publishers, editors, and agents. In this first volume of a two-volume biography, Williams traverses the years 1893 to 1902, from London's "Story of a Typhoon" to The People of the Abyss. The Jack London who emerges in the pages of Author Under Sail is a writer whose partnership with publishers, most notably his productive alliance with George Brett of Macmillan, was one of the most formative in American literary history. London pioneered many author models during the heyday of realism and naturalism, blurring the boundaries of these popular genres by focusing on absorption and theatricality and the representation of the seen and unseen. London created an impassioned, sincere, and extremely personal realism unlike that of other American writers of the time. Author Under Sail is a literary tour de force that reveals the full range of London as writer, creative citizen, and entrepreneur at the same time it sheds light on the maverick side of machine-age literature.Description based on publisher supplied metadata and other sources.Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, YYYY. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries
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