Read one paper about Hofstede or Kolhberg « Cultural constraints in management theories » « Management scientists are human ». Find an example company from your country to explain the company development.

Hofstede, « Cultural constraints in management theories »

To explain these cultural constraints in management theories, I choose the French company Renault. Renault is an historical group, strongly present in Europe. Renault has always been a vector for innovation. It is the 2nd French car manufacturer and possesses three brands: Renault, Dacia and Renault Samsung Motors.
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I/Introduction to the subject
The source of the issue takes place in the “Technocentre”, in Guyancourt (Yvelines). This building is the Renault’s neuralgic center, where all futures cars are designed and devised.
End of 2006 and beginning 2007, thee employees have committed suicide. The letters leaved revealed harder and harder working condition, harassment and a high pressure put on workers. Since then the auto builder has been sentence for “inexcusable fault” in 2011 and 2012.
Second occurrence, in January 2011, three managers have been relieved of their function in an industrial espionage affaire. The evidences used for the accusation seemed after to be false. This scandal made a lot of noise, more than the second. Confidential documents have been revealed by France Info and France Inter. Renault did pre-empt its communication in case of suicide, like there are used to.
Indeed, Renault faces for few years now a dreadful crisis on its market, due a global sales decrease. Carlos Ghosn, the actual chairman and CEO of Renault-Nissan has been put in place, considering his good performance in the Nissan’s refloated. He established the “Contrat 2009” and the “job-competitiveness” plan. A range of measure supposed to make Renault tie up again with growth or at least healthiness. But contrary to what was expected, it engendered a waterfall effect of stress and pressure applied on every step of the hierarchy. Particularly on the engineers and technicians of the “Technocentre”, whom have a lot of responsibilities on the company’s future. This situation led to a complex knot of issues that we revealed and solved in the next parts, according to our IOB courses and acknowledge.
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II/ The cultural constraints and their origins A) Organization design
Renault is based on a partitioned system and a very strict top to bottom hierarchy. This conducts to a lack of communication within the staff and a lower knowledge of what is happening among the employees.It creates uncertainty that leads to stress and conflict and creates misunderstanding and tensions between employees which affects the quality of their work. Plus, the lack of communication also exists between the top and the bottom of the corporate ladder. Superior managers don’t see the contradictions between what has to be done and what is actually done. It creates some management dysfunctions and imbalances in the tasks that have to be accomplished. Plus, it leads to a lower knowledge of what is happening among the employees.
Furthermore, we notice a bureaucratization of the system which means “a tendency to manage by adding more controls, adherence to rigid procedures, and attention to every detail for the own sake of the company“. This state brings on no flexibility for the employees who get stuck in their job. They are no longer motivated and have no job satisfaction. Hence, it reduces innovation and creativity among the staff. This strict chain of command slows down decision making. Moreover, the company practises downsizing which means that it decreases the number of employees but in the case of Renault it becomes dumbsizing since the employees work too much and are overcontrolled.
Additionally, the employees of the company have to refer to too many managers. Thus, the information is overloaded and employees are over-busied. They become counterproductive. They don’t know what tasks to prioritize and are under pressure all the time from their different superiors. This is due to a matrix organization.

B) Working condition and atmosphere
1) Pressure / Tension
The employees have to bear a huge pressure on their shoulders from the hierarchy. They work more than they should (up to 10 hours a day, they work overtime and even during the weekend). Besides, they have no professional recognition, and thus, no esteem of their work. They feel no support from the leaders and have the same feedbacks, whether they have done good work or not.
They also feel a big tension, because as there is no communication between employees and leaders, there is a lower knowledge of what is done, what is happening between the employees and so on. This leads to a rise of anxiety, and the job is more and more stressful.
Employees don’t see the input of all the efforts they put into their jobs. According to Adam’s equity theory diagram, even though workers make efforts, give time, loyalty or reliability in their jobs, if they don’t find any bonuses, perks, recognition and most of all security in their jobs, their behavior will be even worse.
To emphasize this point, a survey made in 2009 has shown that only 56% of the technicians and engineers working in Renault were satisfied of their professional situation.

2) Carlos Ghosn’s 2009 Contract
In 2005, when Carlos Ghosn became the chairman & CEO of Renault, he decided to settle a huge plan to revitalize the firm. His plan was called the Renault 2009 Contract. His main objectives were to revive the release of his products, and to launch about 25 new products by 2009, to develop a program of reduction of costs (but he did not want to dismiss any of his employees), and to become the most profitable manufacturer in Europe.
Finally, in 2009, the results are mixed. Indeed, he could not hold two of his three promises, mainly because of the economic crisis that happened in 2008. Although he succeeded in raising the profits of the company, about 6,400 European workers were fired during his plan.
His program was certainly ambitious, but maybe a little bit too much, and it led to a rise in suicides. The stress of the achievement of the objectives, the high pressure and the tension over their shoulders made the employees completely anxious, and more likely to commit suicide.

3) Individualism
There is no solidarity between the employees, as the managers make them competing between each other. Thus, one of the three of Alderfer’s theories is not achieved: the relatedness need. They don’t establish significant interpersonal relationships with each other, and then, don’t have any recognition or esteem from others.
From another point of view, McClelland’s affiliation need is also not respected, as employees don’t search for any friendly interpersonal relationships. Thus, they are less open and less likely to succeed. Employees don’t even desire to have relations, as they are all competing and will maybe be rewarded if they work better than others. They don’t identify with the group and don’t look for being appreciated by it, and have then no team spirit.
Their relations to each other are guided by a theory set by Hofstede, which is the individualism, that is a cultural emphasis on the "me" more than on the "us", and which takes a high dimension in France (about 71%).

C) Motivation loss
1) Unachievable objectives
The main reason why employees in Renault are so demotivated is that the managers are setting objectives that do not correspond to the SMART objectives. Indeed, the objectives are not specific nor attainable as the lack of communication does not allow the leaders to see exactly what their employees are doing, and have then no idea of what is really done. What is asked is not always linked to what they do and what can actually be done. In this way, they cannot set objectives that are viable. Plus, the workers in Renault are engineers, and their work cannot be measured, only objectively evaluated. But the leaders just want results and as the employees cannot give them what they ask for, they are less motivated to do their job.

2) No reward
The employees of Renault are demotivated because they receive no reward. Indeed, no promotion, no bonuses, no rises in wages or any other form of recognition is given for their work. According to Herzberg, the motivators for a good work are the achievement, the work itself, the promotion, the consideration, the responsibility and the growth. None of these factors are respected in Renault and there is no way workers can be motivated if they have nothing in return.
Vroom explains that in order to be motivated, the firm must value the outcome that is the employees must believe that great efforts will lead to higher performance, and that this performance will result in reward. This is not the case, as no matter the amount of work and how they perform it, they will not be rewarded.

D) Inappropriate management
Renault was accused many times of using unethical processes to manage and supervise its staff. Renault’s executives tend to practise moral harassment over their employees. Indeed, their management is based on bullying and blackmailing. In this manner, the hierarchy urges employees to resign or to early-retire. For this reason, employees work in fear and feel insecure. They are afraid to be demoted or even worse, to lose their job. And this leads to more absenteeism among the staff.
We also notice a real ill-being within the staff that can occur through some psychological damages such as anxiety and depression.

Plus, Renault’s management is high task focused. The workplace is very structured with specific task assignments and deadlines. This is a good thing but in Renault’s case, it is too excessive. It leads to low morale that affects the whole workforce and reduces productivity and performance given the fact that the employees are not willing to give their best. In addition, employees work in an oppressive atmosphere. This situation conducts to a high employee turnover and absenteeism. And, the employees don’t want to take risks which curbs creativity and innovation.

Finally, we notice that Renault has a management style based on making employees compete between them. This causes pressure and constant stress. It detoriates the team spirit. There’s no longer solidarity and support between the employees of the company. It does not favour a climate of cooperation and exchange and thus, it does not, once again, favour the share of ideas that increases innovation and creativity.