The effects of culture on managers decision making: a case study of Mexico and Germany

University essay from Luleå/Business Administration and Social Sciences

Abstract: The purpose of this study was to provide a better understanding on how
decision making in Germany and Mexico could be described and how culture
affect this decision making. The reason for choosing these to countries was
that according to previous found results by the renowned Geert Hofstede
these two countries were supposed to be quite the opposite to one another.
Therefore the study also compared the similarities and the differences
between the cases in the countries. Based on the research questions
stated a literature review was conducted upon which a frame of reference
was built. Qualitative multiple case studies was used to be able to cross
reference the results. To gain a deeper understanding of issues directly
related to the research questions interviews was the main source of data
collection. The previous mentioned frame of reference then served as a
foundation for the interview guide. The interviews in Mexico were conducted
at FEMSA and in Germany at Siemens and a Steel Company. The findings from
the case studies regarding decision making indicates the following: Both
Mexico and Germany uses a rational decision making process, to some extent,
when making decisions. When a decision follows the rational decision making
model it does not exclude non-rational decision making. Despite the group
being involved in many decisions both in Mexico and Germany someone at top
level still make the final decision. Neither country likes to take risky
decisions, which could be connected to the fact that the cases in
particular are all producing companies. Both long term and short term
decision are made in both countries which is logic because in most
companies there is a strategic plan (long term) but also decisions has to
be made on a day to day basis. Thus this is not necessarily due to cultural
preference, but how business in general has to be planned. Regarding
decision making and culture the following findings were indicated from the
case studies: There is less of a difference between the two countries
decision making based on countries than initially anticipated. The type of
business indicates more how decisions are made rather than the impact of
national culture. In producing companies such as those researched,
naturally there is a need to have a stepwise rational decision making
process to minimize risk, this however does not have to do with
national culture. Culture can still affect areas of business other than
decision making, such as for example the way employees are expected to be
treated when it comes to working hours, conditions and expected rewards.