Case Studies Report: Cross Cultural Communication

Caitlyn Ong_INB20007


INB20007 Global Business Cultures
September 30
2015
Individual Report. Written by Caitlyn Ong. 4320085.
France



Executive Summary
This report analyses the sociocultural and religious issues in France and its impact on the French business environment. Issues like the autocratic management style, strict secularism policy, and risk of terrorist attacks, language barrier, frequent protests as well as the ethnocentric consumer culture will be included in this report. Firstly, an overview of France that includes a brief of France union memberships, the country's history and recent events to show the root of French culture and behaviours. The analysis will mainly explain the impacts on the tourism industry, examples of American brands penetrating the French market and the nation's economy. Lastly, this report will end with a reflection and conclusion.


Table of Content

Content
Page
Overview of France
1
Issues in France
Management Style
Secularism
Terrorist Attacks
The French Language
Culture of strikers
Strong French Consumer Culture
3
5
6
7
8
9
Reflection
10
Conclusion

List of References
11



Overview of France
France, the second largest country in Europe with a size of 632 833.6km2 with Paris as its capital has a diverse landscape of mountains like Mont Blanc. It is the largest country in the European Union (EU) with a population of 65 856 609 people and GDP of € 2.132 trillion in 2014 (European Union 2015). According to Coleman p. 1 (2015), France is also a member of the North Atlantic Treaty Organization (NATO), the Organization for Security and Cooperation in Europe (OSCE) as well as a permanent member of the United Nations Security Council.
In the late 1780s, French Revolution marks the end of the French monarchy and established the First Republic but left the nation bankrupt from building the Versailles palace and engaging in wars. French Revolution started the ideology of equal rights. In 1799, Napoleon Bonaparte overthrew the French government and consolidated a new constitution. During the early 1800s, Napoleon crowns himself emperor and brought great success in conquering most of central Europe. Unfortunately, Napoleon was defeated in 1815 and monarchy was re-established (France timeline 2012). In 1848, the Second Republic was established again by Louis-Napoleon, Napoleon III in Second Empire. Shortly, Second Empire fell after the France loss in the Franco-Prussian War following the formation of the Third Republic which lasted until 1940.
During World War I, France and the United Kingdom along with American troops allied to fight against Germany which killed 1.3 million Frenchmen and left many wounded (History.com 2009). After WWI, Germany signed the Peace Treaty of Versailles and agreed to reparations. However, this resulted in the fall of Germany's economy which led to the breakout of WWII by Adolf Hitler. France fell and established government-in-exile in London led by General De Gaulle while the Rise of French Resistance grew.
In 1946, socialist Felix Gouin replaced De Gaulle as provisional president. Meanwhile, economic reconstruction marks the Fourth Republic and the beginning of the process of independence in many of France's colonies. France joins West Germany and other European nations in the European Coal and Steel Community (ECSC) which became the European Economic Community (EEC) in 1957 (History.com 2012).
De Gaulle returns to power to help solve the Algerian crisis and founded the Fifth Republic in 1958. In the legislative election in 1986, "cohabitation" was formed with a left-wing president and a right-wing prime minister, Jacques Chirac. In 1993, France signed Maastricht Treaty establishing the European Union (Wilkinson 2015). Subsequently, France was condemned for conducting a series of nuclear test in the Pacific in 1995.
In 2000, Jacques Chirac, current president at the time, was involved in a corruption scandal where he dismissed newspaper accusations. Furthermore, France replaced franc with Euro (France timeline 2012). A mass street demonstration by French voters broke out after Front leader Jean-Marie Le Pen lost in the national election and ended "cohabitation" (Bishop 2001). Following this event were strikes over government privatisation plans, constitution changes that allow more involvement of the people, protests by trade unions against proposed labour, pension and welfare reforms (Vinocur 2013). France has also set new restrictions on immigration to reduced low-skilled migrants from settling.


Issues in France
Management Style

Figure 1: France Leadership Style
(Source: http://www.businessinsider.my/leadership-styles-around-the-world-2013-12/#iUUyhbukrIUeP6gU.97)
French management style is often autocratic and paternalistic while opinions of middle managers and technical staff may be ignored (Lubin 2014). In an autocratic management structure, top managers make the decisions; dictate work methods and processes with little or no input from employees. The advantage of an autocratic management is that decisions can be made faster as fewer parties will be involved in the discussion. Autocracy may hinder creativity and reduce motivation as employees are not encouraged to contribute their ideas. This trend is rooted back to history where monarchy was practiced.
In my opinion, autocracy is best used for blue-collared workers especially those with low skills and qualifications such as delegating work for construction workers. On the other hand, if a hotel uses an autocratic model, its decisions only involving the higher management may not be suitable for the organization as top managers do not understand the operations of the middle and lower management.

Figure 2: Hostede Model of Six Dimensions - France
(Source: http://geert-hofstede.com/france.html)
According to The Hostede Centre (n.d.), France power distance is fairly high. French are raised to be respectful and relatively dependent on parents and superiors. French have a high respect for authority and hierarchy similar to Asian cultures where employees respect and listen to superiors. This can also be traced back to when people were separated by status and power.

A survey conducted to study the experience of non-French Managers in a French Management environment showed that 67 per cent of the respondents used the word "hierarchy" to describe French management (French management style slated by foreigners2015). Likewise, words like "authoritarianism" and "arrogance" was also used to describe French management. Besides, 78 per cent note that workers emphasize on the significance of performance-based work which pushes employees to realize their full potential.
Figure 2 illustrates that French are more feminine and are long term oriented. Thus, they value relationships and a quality of life. The French practices a 35-hour work week after legislation was passed in 2000 to reduce working hours from 39 to 35 hours per week (Business Culture.org 2014). It is the shortest working hour in Europe. Furthermore, French people enjoy a 2-hour lunch break which they usually spend this time with family. A survey has shown that French management are loyal, have good ethics and well balanced work-life ratio (French management style slated by foreigners2015). This is important for employers to be aware of the lunch break trends and working hours to minimize employees dissatisfaction.
Secularism
France follows a strict form of secularism implemented in 1905, called laïcité, which was intended to keep religion out of public life but recent controversy of banning the full-face Islamic veil sparked protest against this law (Why the French are so strict about Islamic head coverings 2014). According to Shackle (2013), a Muslim mother was told she could not join her daughter in a school trip unless she removes her headscarf. This is a big issue as France comprise of about 5 million Muslims. Similarly, other religious symbols such as crucifixes and turbans are best not worn in public.
Typically, the freedom of religion as in other countries like the United States allows for everyone to express their beliefs openly but in France, they practice freedom 'from' religion (Estrin 2015). The French feel that expressing ones belief in wearing religious symbols publicly is a way of 'showing off'. According to Deacon (2015), French government is also planning to change public school menus to vegetarian that aim to support secularism laws. This has driven religious students out of public schools.
It is suggested that we should avoid wearing any religious symbol in France as it might offend French cultures and beliefs. This can also help minimize any conflicts with the law and the French community. Besides, we should avoiding talking about religion especially during business meetings with French associates and in France as our intentions may be misunderstood. Muslim corporations may find it difficult to enter French market as Muslims will have to go through a drastic culture and legal factors in relation to recent terrorist threats. Food choices will also be an issue as there no halal certification.


Terrorist Attacks
Since 2012, there has been shooting, Al-Qaeda bank siege, jihadist recruiters arrested and other jihadists attacks (Khan 2015) Moreover, a publication of Charlie Hebdo's cartoon of Prophet Mohammed angered Muslims all around the world that resulted in a terrorist attack at the Paris office (Levs, Payne & Pearson 2015). The most recent killing at the Hyper Cacher supermarket has also increased the fear of locals and tourist (Rédaction 2015). These events will impact the economic area, production, stock exchange, tourism, foreign direct investments (FDI) and also societal impacts. Additionally, security cost to strengthen defence against terrorism, prevention and protection will likely increase.
Figure 3: Direct Contribution of Travel & Tourism to GDP
(Source: http://www.wttc.org/-/media/files/reports/economic%20impact%20research/country%20reports/france2014.pdf)
According to Figure 3, the growth in tourism dropped in the year of 2013 as many terrorist attacks happened in 2012 (Turner 2014). This let tourists feeling unsafe and avoids France as a holiday destination. This will result in a reduction on France GDP.
These incidents will harm businesses and endanger safety of employees. Employees will be more hesitant to handle projects and go for business trips in France. Government will need to provide insurance to companies for any terrorism attack on infrastructure and also compensate media companies to rethink the cover pages. Likewise, companies will need to provide insurance to employees especially those who are travelling to France for business trips. In the United Kingdom, these insurance and funds are already protecting corporations against these risks, both companies and employees (Gray & Stacey 2015).
Marketing must be done very carefully with extensive research to avoid any misinterpretations that will cause uproar like the Charlie Hebdo case. Business operations particularly logistic activities like transportation and production may be badly affect by terrorism attack as infrastructure, roads and railways may be damaged and disrupt the business flow as well as productivity.
The French Language
The French are very proud of their language and usually speaks in French even though they could speak fluent English because they regard the language as a symbol of France itself (Jones 2011). Therefore, business people should learn French or some French phrases before going to France to discuss a business deal. In a marketing context, marketers must translate and do a reverse translation to prevent any mistranslation as it may anger French customers. For example, Colgate launched toothpaste in France named "Cue" without realizing that it's also the name of a French pornographic magazine (James 2014).
In the tourism industry, non-French speaking tourist may find it difficult to understand French people. Thus, this may be interpreted as rude, arrogant and unhelpful. Tourist may also feel unwelcomed. It is critical for France to improve itself as a travel destination and boost France GDP. Several surveys have found that French is one of the world's most unwelcoming places to travel (Gardner 2014). The French government has urged their people to be friendlier to tourist to help boost the country's economy.


Culture of strikers

Figure 4: France unemployment rate from 2006 until second quarter of 2015
(Source: http://www.tradingeconomics.com/france/unemployment-rate)
The French have a culture of complaining which contributes to the protest culture. These manifestations often lead to some small concessions by the government (Rodgers 2014). Since the late 19th, institutional reforms have allowed more participation in the democratic process and permitted more labour representation. As a result, people began to protest more, and thus labour movements, student movements and several sectorial movements, such as regionalist or agricultural movements, were at the heart of the protest culture (Explaining France's Protest Culture 2013).
French statutory powers allow joint management, with business representatives, of the country's health and social-security system, and as employee representatives in the workplace. Under French law, elected union delegates represent all employees in firms on both works councils and separate health-and-safety councils. This offers trade unions some autonomy on the company's management even in the private sector, which contributes to workers' real strength of their voice (Why French trade unions are so strong 2014).


Recently, major reasons for the protest consist of government public spending cuts, the increase of unemployment and restrictions as well as prices on French agriculture products. According to Figure 4, the statistics knows the increase of unemployment rate which is currently 10.4% (Trading Economics 2015). Thousands of workers throughout the nation march as a protest against the austerity plans in Paris (Love & Bon 2015). This protest forced the closing of the Eiffel Tower, cancelling of flights and closing of public school. This will disrupt the tourism industry and harm businesses such as souvenir shops which are aim at tourists.
Businesses like McDonalds and Disney have faced protest related to the United States restrictions on French agricultural products. For instance, a McDonald's in Milau, France was bulldozed as a protest against U.S. trade restrictions on French dairy products (Fancourt, Lewis & Majka 2012).
Strong French Consumer Culture
France is known to have a strong national identity and often rejects globalization movements. This creates a big problem for corporations especially US corporations as French perceive US culture to be inferior. Companies must know how to adopt local trends and culture into their product and management to satisfy both French customers and employees.
For instance, Disney Paris initial launch in Paris failed when they did not understand French customers' preferences, lifestyle and habits (Hills 2000). Disney initially branded their new Paris theme park the same as the theme parks in the US which critics called it an assault on French culture and boycott the opening of the theme park. Other errors in its operations, staffing and forecasting contributed to Disney's initial profit lost.
On the other hand, McDonald's adapted to local trends and changed its product offerings according to French meal habits like opening the first McSalad and sourcing most of their beef from local suppliers. This helped boost McDonald's campaign with effort to strengthen French agribusiness (Fancourt, Lewis & Majka 2012).


Reflection
After the analysis of several sociocultural and religious issues, it is clear that companies must be aware of cultural differences and cues before entering the French market. Firms must adapt to the autocratic management style and the strict secularity policies. Risk of terrorist attacks on infrastructure and employees must be taken into account. Likewise, for business meetings or dealings with French clients, companies should send a French-speaking employee for a higher chance of success. Otherwise, companies should provide French classes for employees to learn the language for future business dealings with French clienteles. Companies should adapt French lifestyle, preferences and cultures into their products and services for better success in the French market.
Conclusion
In conclusion, French history of monarchy and Republican political structure sets a stage for autocratic management and high power distance between employers and employees. The French value relationships and have a good work-life balance. French strict secularism policy regards religion as a taboo and should not be publicly displayed. Thus, relationships between the typical French and the French Muslim community have been unstable as banning of full-face headscarves and terrorist attacks have created a distance between the two. Moreover, French language is heavily emphasized in its culture and also business practices where businessman should be able to speak at least a few French phrases to impress French clients. Besides, protests by unions have been strong to urge government policy changes on matters such as unemployment, public spending cuts and prices on agricultural products played a vital role in institutional reforms and business in the French market. Additionally, a culture of strong national identity and anti-globalization movement of France makes it difficult for companies to penetrate the market without a thorough research on French culture. Lastly, companies' ability to adapt to the French cultures is the main factor for success in France.


List of References
Bishop, P 2001, 'Left and right in war of words to end 'cohabitation'', Telegraph, 18 July, viewed 28 September 2015, .
Business Culture.org, 2014, Work-life balance, Business Culture.org, viewed 29 September 2015, .
Coleman, DY 2015, 2015 Country Review, EBSCOhost, p. 1, viewed 28 September 2015, .
Deacon, L 2015, 'All school must go vegetarian to avoid religious offence', Breitbart, 8 September, viewed 29 September 2015, .
Estrin, D 2015, 'I never knew how differently France and America value religion', Public Radio International, 21 January, viewed 29 September 2015, .
European Union 2015, France, European Union, viewed 28 September 2015, .
'Explaining France's protest culture', 2013, Stratfor Global Intelligence, 8 November, viewed 28 September 2015, .
Fancourt, L Lewis, B & Majka, N 2012, 'Born in the USA, made in France: How McDonald's succeeds in the land of Michelin stars', Wharton Univeristy of Pennsylvania, 3 January, viewed September 2015, .
'France timeline', 2012, BBC News, 5 June, viewed 28 September 2015, .
'French management style slated by foreigners', 2015, The Local, 27 February, viewed 28 September 2015, .
Gardner, C 2014, 'The French admit they're too rude to tourists', Scotsman, 21 June, viewed 28 September 2015, .
Gray, A & Stacey, K 2015, 'UK insurance fund to review terrorism cover for business', Financial Times, 18 January, viewed 29 September 2015, .
Hill, Charles W L 2000, International Business, Competing in the Global Marketplace, New York, United States.
History.com 2009, World War I History, History.com, viewed 28 September, .
James, G 2014, '20 epic fails in global branding', Inc, 29 October, viewed 28 September 2015, .
Jones, M 2011, 'Doing business in France: 8 cultural cues that make (or break) a deal', International Business Times, 10 November, viewed 28 September 2015, .
Khan, M 2015, 'France: Timeline of terrorist attacks', International Business Times, 7 January, viewed 28 September 2015, .
Levs, J Payne, E & Pearson, M 2015, 'A timeline of the Charlie Hebdo terror attack', CNN, 10 January, viewed 28 September 2015, .
Love, B & Bon, G 2015, 'Thousands join protests, strikes against French cutbacks', Reuters, 9 April, viewed 29 September 2015, .
Lubin, G 2014, '24 charts of leadership styles around the world', Business Insider, 1 April, viewed 28 September 2015, .
Rédaction, L 2015, 'The terrorist attacks, a problem for the tourism industry in France?',TourMag, 29 January, viewed 28 September 2015, .
Rodgers, R 2014, Protest culture in France, Berkley Center, 15 December, viewed 29 September 2015, .
Shackle, S 2013, 'France's hijab ban causing tension', The National, 12 September, viewed 28 September 2015, .
The Hostede Centre, n.d., France, The Hostede Centre, viewed 28 September 2015, .
Trading Economics 2015, France unemployment rate, Trading Economics, viewed 28 September 2015, .
Turner, R 2014, Economic Impact 2014, World Travel & Tourism Council, viewed 28 September 2015, .
Vinocur, N 2013, 'French unions march in protests against pension reform', Reuters, 10 September, viewed 28 September, .
'Why the French are so strict about Islamic head coverings', 2014, The Economist, 6 July, viewed 28 September 2015, .
'Why French trade unions are so strong', 2014, The Economist, 17 March, viewed 29 September 2015, .
Wilkinson, M 2015, 'What is the EU and when was it formed?', Telegraph, 28 May, viewed 28 September 2015, .





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