CULTURE AND INTERNATIONAL BUSINESS

CASE STUDY: TRYING TO DO BUSINESS IN MEXICO,

GRINGO STYLE
GROUP MEMBERS:
Le Thu Huong
Phan Khanh Hoa
Nguyen Ha Anh
Nguyen Phuong Thao
Do Thi Bich Ngoc
Dinh Thi Huong
OUTLINE
1. General information
2. Case discussion:
What mistakes did Ted make in his management of SterMexicana?
Is Manuel responsible for any of the difficulties presented in the case?
What solution can correct the situation?

GENERAL INFORMATION
Ted Dorman and his family moved to Mexico for his business. Manuel has
his assistant warmly welcomed.
However, the plant did not work as efficiently as expected due to some
cultural differences between the US and Mexico.
Ted comes up with some changes in management but the methods failed

GENERAL INFORMATION
There are a lot of cultural differences between the US and Mexico














Source: http://www.grovewell.com/pub-GLOBE-dimensions.html; International Business by John B. Cullen and Praveen Parboteeah

Dimension The US Mexico
Performance Orientation High
(View formal feedback as
necessary for performance
improvement)
Low
(value societal and family
relations)
In-Group Collectivism Low High
Uncertainty Avoidance Low High
Power Distance Medium High
Individualism High Medium
1. Mistakes Ted made in his management of
SterMexicana:
In relationship with partners :

Mexican expectations How Ted acted
High Uncertainty Avoidance

Use formality in interactions
with others
Show strong resistance to
change
Called the Mexican partner by first name
Refused to recognize Manuels title
Wore informal clothes
Build a plan that made a lot of changes in the plant
operation
Build partnerships based on
common interest in social matters
Attempted to get down to business quickly
Refused to go to cultural sites with the suppliers
Stopped discussing social interests with Manuel

Mistakes Ted made in his management of
SterMexicana ( cont )
In relationship with employees:
Not influent in the local language, had to use interpreters
failed to deliver his own ideas precisely.
Lack of knowledge of Mexican law had to pay severance for
the fired workers.
Being stereotyped : Mexico is a dirt poor country and people
really need money

2. Manuels mistakes in the situation
Failed to calculate unexpected events (which might happen
during the preparation for the opening of the plant) delayed
opening lost the trust of Ted
Did not inform Ted about Mexican law with regard to worker
termination.
Did not fire his close relatives and notify Ted, and gave out
irrational explanation when found out
Failed to supervise the plan delivery of supervisors
unchanged efficiency

3. Possible solution to correct the situation
Rebuild relationship with Manuel
Cross-cultural training
Learn the language
Ask for opinion of legal advisor before making any decision