Managing Culture Transformation in Indian Companies

It’s hard to define culture because it is soft, elusive, complex and difficult to measure. However from business perspective, we can view culture as sum total of three elements: Behaviors (Individual or organizational), Business Outcomes of behaviors, and Drivers that influence behavioral patterns. Drivers of behavior can be classified into four types: Personal, Social, Organizational, and Models. Here, the drivers “Organizational” and “Models” can be altered to change the underlying behavior of a given culture while the other two – “Personal” and Social” generally need to be understood and worked with. This is the fundamental approach that needs to be recognized during an acquisition in order to develop and execute a practical approach to cultural integration. Therefore, Managing Cultural transformation is the process of implementing drivers that in turn change behaviors or create new or modified behaviors. Whenever an acquisition takes place, general expectation is that the overall productivity would increase however, cultural misalignment often leads to decreased productivity and lower revenues and therefore, combined entity would be of less worth than expected. For example a consensus culture based company may be good at making best decisions but at the cost of time lost.

On the other hand, a command-and-control culture based company may be good at making fast decisions but such decisions are prone to risks. Combination of such two cultures will need a strong Culture transformation strategy to foster value creation in the long run. Indian Business Culture and Management system is a product of social, economic and religious factors. Indians are conscious of social order and hierarchy and their status compared to others. Indians value strong family ties and extended family relationships which has resulted in greater significance of inter-personal relationships at work place. In 1999, Steffen Braasch coined “Adaptation and Leadership” style for managing Indian Employees. Such a leadership style combines (Authoritativeness, emotionality and empathy) and Leadership (result-orientation). Another hypothesis is that Indian Employees require “Management by Differentiation” approach which means leadership style should be practiced in a way that it is individualized for each employee. An implicit conclusion of Braasch’s research is that Indian employees prefer an authoritative paternalistic manager-leader, who, simultaneously, is adaptive and empathetic which means the manager should have strong authoritative elements, fatherly empathy and true leadership.

The leader has the right to order but also has the duty to protect and to assist. Indian employees are ready to work in all kinds of efficiency and result-oriented environments, if his cultural needs (for example, the desire to belong together “like in a big family”) are catered to. Braasch’s research also concluded that foreign managers value the Indian employees’ intentions much more than their skills while the Indian employees value the Foreign managers’ skills more than their intentions. Thus, on the management front, it would be highly desirable to improve each others’ mutual perception. This research also illustrates certain factors which make the Indian management behaviour inconsistent. Indians keep cultural values to their private sphere and use the more flexible surface part at the work place. The mindset in India has a family orientation; Even if the individual members have new ideas, they are reluctant to propose them (non-assertive). The desire to get emotional security predominates.

They are flexible to accept change at work but less likely to initiate it. Motivation is another important factor which relates to the performance of an employee in an organization. In India, the prime motivator is the ‘Boss’. A good boss is looked by subordinate, as an example for dedication to work. Money is secondary motivator. An Indian working in a foreign MNC, values the status deeply and this contributes to work motivation. But, the feelings of loyalty to the organization are established only when the values and the needs of the employee are taken care of. The ideal dual leadership style (often termed as “nurturance-task leadership style”) has greater chances of success in India because Indians have a prominent relational need; a superior’s personal interest in his subordinates’ life may have a catalytic effect and galvanize them into action; they work hard to meet their superior’s expectations, feel secure, trusted with a sense of belonging to the organization. In India, there is general dependence on those who hold power. Indians are in constant need of communication and directions from the top for the completion of their job. The process of execution is also tightly monitored though frequent follow-ups by the manager.

Thus, communication tends to be more top-downwards than bottom-upwards. The tendency is to centralize authority and decision at the top of the organization. Hence, sometimes information is perceived as power by superiors, and is distributed carefully and selectively. A 2004 research by Jai B.P. Sinha makes some remarkable suggestions : 1. There is an intense desire in Indian Employees to imbibe Foreign work-culture which can be viewed as conflict-reducing and adaptation-fostering. 2. In order to survive in Indian business world, an expatriate manager needs to follow the approach of “Management by Differentiation”. He should work to resolve the conflict between his work culture (result-orientation) and Indian work culture (relationship-orientation). 3. The Indian mindset is overly idealistic and overly pragmatic at the same time.

Therefore, working in India demands a better understanding of Indian Cultural Sensitization. A research conducted by prestigious Wharton School on senior executives of 98 of the largest India-based companies revealed that Indian higher managers take an internally focused, long term view and give priority to motivating and developing employees than short-term shareholder interests. In contrast, American executives gave more attention to regulatory concerns, the board and shareholders. Majority of Indian executives spent more time on setting strategy. They focus on creating incentives, organizational structures and culture. The study concludes that Western leaders should adapt this Indian managerial approach to their own circumstances. To conclude, defining a strategy for cultural transformation should consider and assimilate strengths of both cultures. Leaders must maintain a high standard of conduct and should be willing to integrate local people, needs and values into the organizational goals.