Vitro Corning

Identify and discuss Cornings strategic predisposition toward a articulation fortuity with Vitro. Because of long histories of successful articulatio stakes and had been an advance(a) leader in foreign alliances for oer 73 years, Cornings strategy of establishing the spliff venture relationship with Vitro seems to be a ideal combination and result lead to success. However, the joint venture became subject to a series of cultural and opposite conflicts that began to undermine this vision. According to caller-out officials and external analysts, cultural differences were a principal cause of the alliances failure.Therefore, lack of fully understanding Mexico acculturation is the key predisposition of Cornings strategy. What is culture? One of the well-accepted definitions is given by Goodenough (1971), who has defined culture as a set of beliefs or standards, shared by a group of people, which help the individual decide what is, what peck be, how to feel, what to do and how to go about doing it. The main cultural clashes between two companies are discussed as follow Different decision-making style between Mexican and AmericanVitro and opposite Mexican businesses are more more hierarchical, with loyalty to fathers and patrons somehow carried over to the modern corporation. As a matter of loyalty or tradition, decisions are a lot left either to a member of the controlling family or to top executives, while middle level managers are often not asked their opinions. As a result, Corning managers who work in the joint venture were sometimes left waiting for important decisions about marketing and sales.Refers to a Corning executive If we were looking at a distribution decision, or a customer decision, we typically would adjudge a group of people in a room, they would do an assessment, figure alternatives and make a decision, and I as chief executive would never know about it. My experience on the Mexican side is that someone in the organization would ha ve a solution in mind, but then the decision had to be kicked up a few levels. Different working efficiencyThe Mexicans sometimes see the Americans as too direct, while Vitro managers, in their dogged pursuit of politeness, sometimes seemed to the Americans unwilling to acknowledge problems and faults. The Mexicans sometimes thought Corning moved too fast the Americans entangle Vitro was too slow. Other difference in culture America is a advanced state in modern society with only 227 years history, traditionalistic culture has far less important position than fashion in close Americans mind, contrarily, traditional culture plays a significant role in Mexico, most Mexican are conservative scour in large companies.For instance, Cornings offices in upstate New York are in a modern glass envelop building, while Vitros headquarters in Monterrey, often thought of as Mexicos Pittsburgh, are in a replica of a 16th century convent, with artwork, arched ceilings and passe re harvest-t ideions. To sum up, attitudes, orientations, emotions, and expressions differ strongly among people from American or Mexican. These differences are fundamentally cultural. According to Hofstedes culture dimensions, we can get the conclusion as the accede demonstrated belowAs shown in the table, although culture of both countries has masculinity characters, there is lock a large culture gap in other aspects between American and Mexican. Therefore, without fully understanding Mexicos culture leads to the failure of Cornings alliance strategy with Vitro. Cultural clashes among partners in joint ventures are not a brisk issue. Discuss why an MNC, and specifically Corning, would be interested in fully understanding the culture of a dominance before deciding on an alliance. burnish clash the cultures of the companies are not compatible and compete for dominance.The businesses of both companies suffer while attention is diverted to the contest and it may destroy the key portion of p rior success. (Jeff Jacobs 2001) Although there is evidence of increasing cultural convergence between countries around the world, cultural differences among countries will persist. It is widely recognized that cultural differences between the partners of a merger are one of the most common reasons for failure in mergers, this may happen during pre-merger negotiations or during post-merger integration.Thus, fully understanding the culture of a potential can help managers anticipate problems in negotiating mergers and prevent them from disrupting what can be an attractive and mutually beneficial market entry strategy. In this case, as an innovative leader in foreign alliances, Corning has formed approximately 50 ventures over the years. Only 9 had failed ( fade out), an impressive number considering one recent study bring that over one-half of foreign and national alliances do not succeed.With this proud record, Corning was confident of being succeed in the joint venture of Vitro, h owever, the joint venture became subject to a series of cultural and other conflicts that began to undermine this vision. Culture is about shared assumption, beliefs, values and norms. Each organization has its own culture positive from its own particular experience, its own role and the way its owners or managers get things done (Hellard, 1995). Since culture may affect the MNC in many aspect of its international development, even like Corning, which has rich foreign alliance experience, cannot ignore the effect cause by culture clash.It is unalterable principle for Corning to fully understanding the culture of its partner before it decides on an alliance. International alliances are an ideal setting within which to explore cultural differences in negotiations because they involve not only up-front negotiations over the initial structure of the relationship, but also constant and ongoing negotiation to manage what can be an inherently unstable and continuously evolving organizati onal form. If Corning and Vitro yet want to remain in the alliance, understanding and accepting the other parts culture is the precondition.According to there is large culture gap between America and Mexico, how to speciate this gap or create an agreement of new value concept is the possible solution. The specific method advised as follow 1. Managers from USA and Mexico who will work together in the alliance should meet and negotiate the detail of establishing the new company in each country before they carrying out the conflux plan. 2. Employees from both companies should learn about how to minimize the breakage of culture clash. There should be a particular training for the employees who will work together in the new merger.The skills to overcome an embarrass situation are indispensable for them. 3. In order to get used to working in a new environment with different culture, Corning and Vitro can implement a manager-exchange program before new company established. Managers par ticipated in the program will be assigned to the partner country and pursuit as probation period for the purpose of experiencing the local culture. 4. After new company established, localization is a important key to keep it operating right and performing well, which mean among employees of the new company, local residents should have larger proportion.In addition, the final decision of the new company should be made by the local manager, and manager from the other part just take the responsibility of supervision and report the current operating situation to parent company. 5. In the early long time of the alliance, executives from both companies should gather frequently to summarize the new companys performance of the previous period, exchange the information they collect from the operation of local company. Till the new companies get in into the right path, they can meet quarterly for further strategies.Discuss why both companies would continue to distribute each others produc t after the joint venture failed. What impact capacity the public statements about the failure have on the relationship? Both Corning and Vitro remain in the situation of distributing each others product even after the joint venture failed. The main reason is they still can make profit from counterparts market. We can understand it easier from the first purpose of why Corning enters into joint venture to gain access to markets that it cannot penetrate quickly enough to obtain a competitive advantage.In addition, both companies were globally oriented, and both had founding families still at their centers, Corning specialized in cookware and Vitro in tableware. Corning was accomplished at melting glass, while Vitro was expert in molding it. The companies intended to combine product lines based on where each company had technical leadership, and they began to swap technology to enhance their respective capabilities. Even though the alliance had been failed, both of them still can get competitive advantages from each other. Furthermore, if the culture clash problem can be solved or minimized, they still have opportunity to merge.Someone might consider the impact of public statement on the failure of their partnership negative. In fact, it might be a good thing there is a famous saying in China a loss may turn out to be a gain, a blessing in disguise. As we know, no companys development is plain sailing on their way to success, frustration is inescapable, what can you learn from the frustration is more important. In this case, the joint venture dissolved illustrate there is a culture gap between both companies, but not the quality of products or managing skills and something else.The failure can provide a clear orientation to Corning and Vitros further positioning, once they can acknowledge and face bravely to the failure, and analyze the reason lead to the failure, the rare experience they gain is much larger than they lost. In future operation, they will conside r more cautiously and more comprehensively before they decide to establish a new joint venture. Certainly, culture clash factors included. Reference Goodenough, Ward H. , 1971, Culture language and society , modular publications, 7, Addison- Wesley Reading MA Hellard, R. B. (1995), Project Partnering Principle and Practice Hofstede, G. 2001). Cultures consequences Comparing values, behaviors, institutions and organizations crossways nations (2nd ed. ). Jackson, T, (ed), (1995). Cross-Cultural Management, Jeff Jacobs. (2001). How Culture Affects Mergers and Acquisitions X. Zhang, Y. Wang, J. Wrathall &amp M. Berrell, 2002, International ManagementManaging in the Era of Globalization, Peoples University Press, China Available http//www62. homepage. villanova. edu/jonathan. doh/CORNINGcase. rev. doc Available http//www-edocs. unimaas. nl/files/mer95011. pdf /pre/body/hypertext markup language