Calderón Burgoa Dafne
López Ayala Mariana
The Floundering Expatriate case study provides the right example of problems associated with the global marketplace and when businesses and their leaders transcend physical and cultural boundaries and they fail to adapt to cultural specifics. We consider that this report will allows making an analysis that contains discussion on culture and communication issues along with globalization.
This case takes place in 1995 and talks about the events of a globalization effort by Argos International, a holdings company based in the United States. The key players or main actors of this case are: The CEO and chairman of this holdings company, Bill Loun; Bert Donaldson, who was a rising corporate star in Detroit who was supposed to be perfect person to help facilitate communication between recently acquired divisions in Europe; Frank Waterhouse, the CEO of Argos Diesel Europe ; Ursula Lindt , Waterhouse’s executive assistant and Bettina Schweri, Ursula Lindt’s childhood friend, and responsible for organizing Donaldson’s programs.
The CEO of Argos, Bill Loun believed that he had found someone in Detroit (Bert Donaldson) that would be the perfect person to help facilitate communication between recently acquired divisions in Europe. Bert Donaldson’s resume was impressive. He was a professor of American Studies in Cairo, Egypt for 5 years and while in the United States, Bert made major improvements to the organizational structure by implementing cross-functional teams, achieved considerable cost reductions, and much more. In addition, Bert was charismatic, a hard worker, and very sharp, a proven leader within the U.S. organization. Loun recognized that they really needed someone just like Donaldson in Zurich.
At the same time, Frank Waterhouse really believed that with Donaldson’s arrival in Europe, both of them could climb the corporate ladder and achieve all the goals that Waterhouse had worked so hard to acquire The problem started when just the opposite occurred, with Bert Donaldson’s arrival, the corporate environment became tense and dysfunctional, and there was obvious friction between Bert, the expatriate, and the local, European divisional leadership. Bert recognized the problem, but didn’t have an immediate solution. Many people from the European staff members attempted to inform Waterhouse about Donaldson’s cross-cultural unawareness like Ursula Lindt who tried to inform Waterhouse of the large number of complaints she had received regarding Donaldson’s inability to adapt or recognize the need to adapt to local culture. Although direct attempts to converse with Waterhouse failed, Waterhouse did finally recognize Donaldson’s failure to culturally adapt. Waterhouse sent a letter back to CEO Bill Loun in the United States questioning Donaldson’s ability to successfully adapt and manage, but Loun simply replied by saying him that he just couldn’t send him back and that it was his bottom line responsibility. On the other side, Schweri, who spoke five different languages and was extremely familiar with local culture was not taking in real account by Donaldson who just saw her like a “secretary” instead of taking advantage of her knowledge. We consider that Donaldson failed to recognize the need for cultural adaptation, training, and awareness and the importance of utilizing local resources to assist with cultural issues.
We consider that here are 3 major issues at the heart of the problems of the company. These are culture, communication and leadership and motivation, but first of all we could say that one of the main mistakes in the case is that the CEO of Argos International, Loun assigned Donaldson as the guy that Europe needed ,without any formal cross-cultural training on the assumption that his Cairo experience was “international”.
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