Schindler Case Analysis

SilvioNapoliatSchindlerIndia Case Analysis On Cross-Cultural Management Management

Submitted On 13 Feb 2012

Team Members: Lavanya P.

64

Madhumitha S.

66

Madhuri Murthy

67

Manivel K.

69

Megha Jain

71

Executive Summary The case discusses the period when Schindler, a manufacturer of elevator and escalators, first made its decision to establish a fully owned subsidiary in India under the leadership of Mr. Silvio   Napoli, a young Harvard graduate. The case highlights the difficulties faced by Mr. Napoli in setting up operations in a country which was almost a total contrast to his home country Switzerland. As an expatriate in India, Mr. Napoli had to first acquaint hi mself with the culture of  the country. His problems were augmented by India’s protectionist tariff policies, cost considerations and staff who doubts his ability to get things done his way. All these threatened to keep him from starting operations in accordance with his business plan and in turn threatened to finish off his career as well. Napoli found himself hard pressed for time to come up with a cost effective solution to make and sell core, standardized products in India.

The case also describes how Mr. Napoli started the Indian operations from the scratch, beating the cultural differences. One of his firs t steps was to create a cohesive top management team who then worked as a combined unit to propagate his ideas further. This also helped him overcome the initial resistance and reluctance for the Indians to take orders from a foreigner. It also helped create a culture within the organization that was compatible with the Indian culture

In this report, we have focused on the national context of the two countries, the difficulties posed   by the cultural differences and even the differences in management styles between the two countries. We have tried to highlight these differences and also to understand what prevented Mr.   Napoli from being able to proceed as per his plans. Finally, we have given a few recommendations that would make the journey smoother for both Schindler and Mr. Napoli.

TableofContents Overview ............................................................................................................. 1 The India Business Plan – Challenges ............................................................. 1 Elevator Market and the Condition in India .................................................. 2 Competitor Analysis .......................................................................................... 3 Strategy Analysis of Schindler.......................................................................... 3 National Context ................................................................................................ 4 National Culture ............................................................................................. 4  Business Culture ........................................................................................... 5  Institutional Culture  ...................................................................................... 6 

Schindler’s Organization Profile ..................................................................... 6 Understanding Cultural and Management Challenges faced by Napoli......6 Through Hofstede s model ........................................................................... 6  ʼ  

Through Trompenaar s model ...................................................................... 7  ʼ  

Application of the models to Schindler ....................................................... 7 

Silvio Napoli as an Italian ................................................................................. 8 The Leading Team ............................................................................................. 8 Managing Expatriate Assignments .................................................................. 9 Cultural Issues Faced ........................................................................................ 11 Is there a Solution? ............................................................................................ 12 Conclusion .......................................................................................................... 12 Exhibit 1: Market Share of Competitors in India .......................................... 13 Exhibit 2: Comparison of Hofstede’s Scores for India, Swiss and Italy .......13 References .......................................................................................................... 14

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Overview Established in 1874 in Switzerland by Robert Schindler, the company began manufacturing elevators only 15 years later in 1889. Alfred Schindler was the fourth generation to lead the company in 1987. Being young and dynamic, he transformed the company’s culture from an engineering-based manufacturing company to a customer-oriented service company. Within a decade, the worldwide revenues touched 6.6 Billion Swiss Francs (US $ 4 Billion), and was   perceived as the technology leader in elevators and its number one producer in the world. It employed 38000 people in 97 subsidiaries, but failed to have its own operations in India. Schindler did not have a very great experience in the Indian market. Although its first elevator was installed in 1925, it was not until 1958 that it entered into a long-term distribution agreement with ECE. In 1985, it terminated its agreement and entered into a technical collaboration with Mumbai based Bharat Bijlee Ltd. to manufacture, market and sell its elevators. It acquired 12% stake in this venture and supported it completely, resulting in it climbing up to the second spot in the Indian elevator market and a market share of about 10-15%. In 1995, Schindler took time off his regular schedule just to review the company’s long-term strategy. He travelled to China, Japan and several other Far-Eastern markets to explore opportunities. He spent several weeks in India and saw a huge growth potential. In 1996 when a separate joint venture talks did not materialize with Bharat Bijlee Ltd., it started considering options to establish its own operations in India. Napoli, who had spent nine months developing a detailed analysis of the market size, legal environment and competitive situation, and had made a business  plan based on his research, was put in-charge of the new subsidiary set-up.

The India Business Plan – Challenges  Napoli worked to gain commitment to his business plan that had two basic elements: •

  Need to sell a focused line of standard products (different from competitors strategy of  customization)

•

Ability to outsource key manufacturing and logistics function.

Competition was quite fierce – Otis (50%), BBL (8.6%), Finland’s Kone (8.8%) and ECE (8.4%). Indian market was highly price sensitive. Service was an important factor in buying decisions.   Napoli decided on an outsourcing strategy to keep overheads low with neither in-house manufacturing nor a logistics infrastructure. This would help maintain low costs as the import duties had also been increased. He believed he could set up a local manufacturing network that would preserve Schindler’s quality reputation.

1

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Elevator Market and the Condition in India The Indian elevator market in 1998

The elevator industry in India was revived with the dawn of liberalization in India in the early 1990s. Low technology manual elevators (with unsafe manual doors) accounted for about 50% of  the total demand. Schindler didn’t have any offerings in this segment. The lower segment of the market was characterized by intense competition among the local players. Schindler had S001 to cater to this segment. The middle segment was the most intere sting arena due to India’s rapid urbanization which resulted in space constraints in metros like Mumbai and Madras   besides the fast-growing cities like Pune and Bangalore. Low and mid-rise buildings were mushrooming. The traditional builders were drifting towards sophistication and professionalism which lead to higher emphasis on better services and facilities and on higher quality, safety, and technologically superior elevators. This was a major factor in steering Schindler’s culture in India from that of an engineering-based manufacturing company to one of a customer-oriented service company. The top-end of the Indian elevator market was characterized by growing demand for top-quality, high-rise office premises as well as housing facilities, particularly from multinational companies. The major buyers of top-line elevators were the hotel and tourism industries. Although the top-end segment was small, the average value per elevator was five to six times that in the low end. Schindler had S300P to offer to this segment. The main factors that influenced elevator purchase were Service, Price, Reliability, Technology,  brand image, Delivery, Safety, Experience with suppliers, and Features in the descending order of  significance. Almost 50% of the market was captured by Schindler’s worldwide competitors, Otis, and the remaining 24% by other well known brands like Finland based Kone. India had an installed base of 40,000 elevators by the end of 1997. Schindler realized the significant growth potential of India. The residential segment which accounted for 70% of the total demand subscribed to single-speed elevators. Though the metros were to remain as the stronghold in terms of the number of elevator units sold, the demand in smaller cities were also lik ely to see a big rise due to better purchasing power and rapid urbanization. The commercial segment accounted for 20% of the market with office buildings and shopping centers requiring variable frequency elevators. The  balance was accounted for by hotels (4%) and others (6%). The market saw a steady growth of 17% in units and 27% by value till the slump in real-estate surfaced in 1996 which brought down the CAGR to 10%. Mumbai and Delhi accounted for 60% of the total Indian elevator market. The Indian market was biased towards the simplest products (Single-speed elevators: 65%). However, a marked shift towards two-speed or higher-technology products was bound to occur. The Indian market was also highly price-sensitive. Elevators were bound to become commodity  products and price pressures were bound to attenuate. 2

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Competitor Analysis Indian market had four main players in the elevator industry – Otis, BBL, Kone & ECE. Otis led the market with 50% market share (Exhibit 1). It was said that all buildings above 15 floors had Otis elevator installed. They had 70 service centers across the country and a national service centre in Mumbai. They held 85% market share in the high end hotel & commercial segment. Schindler would have to come up with a very formidable strategy to gain market share from Otis. The challenges that Schindler would face would be in the area of proving their credibility over the established players. Moreover the outsourcing strategy described by Mr. Silvio which also includes outsourcing of the installation processes would make the customer feel insecure and question the authenticity of the quality promise. The servicing of the elevators brought in major revenues for the company (80%). But the service standards were pretty steep. Clients like five star hotels would demand an on-site engineer. Hospitals and commercial buildings would demand a quick response (2 hrs) to resolve technical issues. Schindler would have to develop a strong service network to compete with Otis which already had 70 service centers that were fully staffed. Moreover market surveys clearly showed that  buying decision of a client would be centered, not just on the cost but also the service & financial terms. Thus providing a good service would be one of the pillars for establishing a strong reputation in the Indian market.

Strategy Analysis of Schindler Ø

Schindler's manufacturing cost structures were compatible with customization, not commoditization

Silvio said that was one of the biggest challenges he faced as getting transfer costs for elevators to a   price point internally where building elevators made sense. The case study details the very slow ramp for sales -- Silvio says this was a great lesson learned as a young manager. Ø

Exchange rates and unforeseen duties further frustrated market development efforts

Making the transferred sub-assemblies even more expensive was the fact that there were exchange rate fluctuations favoring Indian currencies, and the duties that were increased from 22 to 56  percent for non-core goods during the first summer of Silvio's efforts. The transfer pricing and the lack of technical cooperation from the European plants are crippling the organization. Both of these problems need Silvio's immediate attention. The business plan's main objective was to develop a unique competitive advantage by outsourcing the manufacturing to local companies. This would allow Schindler India to avoid the excessively high import duties and transfer pricing while keeping overhead cost extremely low. Silvio needs to take the lack of 

3

Silvio Napoli at Schindler India: Cross-Cultural Analysis

honoring transfer pricing and supplying technical information to Mr. Schindler. Mr. Schindler can use his influence to insure Silvio can meet the very aggressive time frame that has been established. Ø

Creating a sourcing function in India took longer than expected

To overcome the duties and equalize the exchange rates, Silvio and his recruited management team started sourcing efforts in India. These efforts took more time than expected. Ø

Cultural differences were immediate and costly

This sounds like common sense, but Silvio said its one thing to say it, and quite another to live it. From reading the case study its clear that Schindler manufacturing sees high customization driving higher gross margins, and that this new Swatch strategy is a definite threat to their approach to  business. Ø

Don't confuse tactical wins with strategic victories in foreign markets

Within six months Silvio had opened offices in New Delhi and Mumbai, hired five Indian managers, each one very skilled in local elevator markets, and begun to aggressively implement the  business plan for the subsidiary. Still, no new business was won. Tactically the execution had been  perfect, yet strategically the swatch strategy was not winning any deals. Bottom line: Silvio should sit down with his management team and re-evaluate the business plan. One area of concern is centered on the intended market place. Silvio's business model requires high levels of growth, even within the first year. The business plan also laid out a business model that had never been attempted in the Indian Elevator market. Lastly, neither the business plan nor Silvio allowed flexibility. Flexibility is generally required in a highly competitive market. Each of these items are obstacles that need to be conquered prior to experiencing growth. Most of these items are in direct conflict with a target of high growth in a short time period.

National Context National Culture Switzerland Switzerland is dominated by two cultures: French speaking and German speaking •

•

•

The French speaking segment follows a hierarchical structure with top floors reserved for the executives. This aspect is also illustrated in the case with Napoli occupying the highest floor  in Schindler, Switzerland Position held in the hierarchy is given more importance than age. This factor is again illustrated in the case where it is seen that an aged veteran in Schindler is scared of Napoli  because of the position he holds

•

Culture is more achievement oriented

•

Inner-directed 4

Silvio Napoli at Schindler India: Cross-Cultural Analysis

•

Believe in controlling outcomes and their own environment (output controlled)

•

Universalistic culture

•

Low context

•

Averse to risk taking

•

Highly decentralized

India •

Follows an emotional culture

•

Mix of various organizational profiles

•

Size of one’s office space indicates their position

•

Culture is ascription oriented

•

Indians tend to be more sensitive towards organizational power and relationships

•

Particularistic culture

•

High context

Business Culture Switzerland Extremely time conscious. Punctuality is of prime essence •

•

Strong rule-by-law

•

Task-driven

•

Extremely monochromic

•

Orderliness is valued

•

Any interruption in business working is taken very seriously

•

Managers are expected to be pragmatic and unpretentious in decision making

•

•

•

Being reserved, objective and level headed are some of the key characteristics of Swiss  business nationals Decision-making process is somewhat protracted Desire is mainly to seek agreement down the hierarchy and seeks non-confrontational, collective approach at senior management level. It is important in Switzerland for the bulk of  the people to feel involved in the process

India •

Adherence to time and deadlines is slack 

•

People driven

•

Trust between parties is important

•

Indians go with the flow

•

Maintaining harmony is given importance

•

Flexible attitude characterized by willingness to compromise and customize 5

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Institutional Culture Switzerland Technical competency and academic qualifications are highly respected •

•

Decisions are made following a collegiate model, where decisions evolve amongst peers over  a period of time rather than emanating from one, dynamic, charismatic 'mover and shaker'

•

Adhere to high quality standards

•

A direct parallel between these two points of decentralization and delegation of decisionmaking can be found in Swiss business structures. Companies exhibit great strengths on the operational side of the business

India •

Alma mater and the institution one graduates from, is given importance

Schindler’s Organization Profile Schindler is characterized by a highly bureaucratic model, wherein the hierarchy is clear, with focus on politeness and where first names are rarely used. An example to illustrate this would   be that Napoli’s office was located on the top floor of the seven-story headquarters building. The higher the floor occupied by the employee, the higher his position in the hierarchy. In this context we can also observe that even though Napoli was new to the organization, he was feared by veterans of the organization because of the power he yielded due to his position in the hierarchy.  Napoli was used to such a hierarchical model in Switzerland, that when he came to India he found it hard. This can be attributed to the fact that India as such, does not have a single organization  profile. The country is often characterized by a mix of different styles of management. Especially since Schindler was considering a start-up, the approach that would have given the organization success was a team based approach in running the start-up. It is here that the culture which Napoli was used to served as a deterrent to him running the Indian subsidiary. Napoli used to hierarchy, even though he was unaccustomed to the Indian culture and work environment took all decisions  based on the strategy designed by the Switzerland leading team.

Understanding Cultural and Management Challenges faced by Napoli Through Hofstede’s model Here we are analyzing the culture of Swiss and India using the Hofstede’s model. We consider only the French - speaking Swiss as it is relevant to the case (Exhibit 2) Switzerland as per Hofstede’s analysis has: •

High power distance (French speaking), while the German speaking segment has low power  distance 6

Silvio Napoli at Schindler India: Cross-Cultural Analysis

•

Strong uncertainty avoidance (well-oiled machine)

•

High Masculine and individualistic attributes

•

Short term orientation

While India has: •

High power distance

•

Weak uncertainty avoidance (Family tribe)

•

High Masculine and collectivistic attributes

•

Long term orientation

Through Trompenaar’s model We now use the Trompenaar’s model to analyze the cultures of these countries

Parameters Universalistic vs Particularistic

Switzerland Universalistic

Communitarianism vs Individualism Individualistic

India Particularistic Communitarian

Neutral vs Emotional

Emotional

Emotional

Specific vs Diffuse

Specific

Diffuse

Ascription vs Achievement

Achievement

Ascription

Time

Synchronous, future oriented

Sequential

Environment

Inward directed

Outward directed

Application of the models to Schindler The Swiss are very high on uncertainty avoidance and hence cannot tolerate high risks . This can be seen in the case as illustrated by the reactions displayed by the Swiss colleagues of Napoli when they felt he was taking a huge risk by undertaking the project in India. However, Italian born   Napoli unmindful of the future outcomes took up the project in India. Napoli’s Indian staff  described him as “driving very hard”, “impulsive”, and “over communicative”. All these are traits attributed to his Individualistic nature, focusing on deadlines (Future oriented) and highly inward directed. Despite his friendly relations with the managers, it can be noticed that his subordinates still hold him as a paternalistic figure and refer to him as “boss”. There seems to be a clear  divergence in his management style and the one desired by his Indian staff.

7

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Silvio Napoli as an Italian Another dimension of analysis is to look at Napoli as an Italian who graduated from US. Again using the Hofstede’s dimensions and the score of Italy (Exhibit 2), we see certain attitudes and behaviors of Napoli towards being an Italian and not a Swiss as he supposed to be. Power Distance - Italy features lowest in the power distance indicating that they are more

informal and do not give much importance to hierarchy. This is evident in Napoli’s decision (along with the top management) to have an informal, open-door policy towards employees at various levels. Individualism & Masculinity - Italy tops on both closely followed by Swiss Uncertainty Avoidance - Clearly the high uncertainty avoidance of both Italy and Swiss is

exhibited is detailed planning that is done and Napoli revisiting the plans time and again. Long-term Orientation - The short-term orientation of Napoli is exhibited as he pushes his

strategy of core, standardized product in a market that values customization. The Indian managers, on the other hand, were not willing to let the customers go and have accepted the order for a non-standard elevator.

The Leading Team Silvio Napoli has been very careful in choosing the right people for key positions in the newly formed Indian subsidiary. Though he found them as a good fit, he did not consider various aspects before their on-boarding. Age Hierarchy - Indians give importance to the age and are quite hierarchical especially during 1998 it was more prevalent. The statement that M.K. Singh makes on him working with someone of  low age and experience can be interpreted as sarcastic as well. Focus - The focus of business differs, in general, among the Indians and Europeans. The Europeans are process-oriented whereas Indians have a tendency to be more target-oriented. When Napoli wanted the subsidiary to focus on standardized products, the Indian managers, looking at the sales lag, decided to accept orders for non-standard products. Employee Confidence - The employees of the Indian subsidiary seems to subscribe more to M.K. Singh’s way of polite and calculated management than Schindler’s aggressive and open management. Employee’s motivation is affected greatly by the leadership style and it is essential to have a leadership that they are comfortable with. Otis’ Culture - Most of the employees including few in the top management have worked in Otis which is a US based elevator company. The impact of Otis’ culture on them is another aspect to consider and Napoli has to decide how he would remove it and imbibe Schindler’s culture into them.

8

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Managing Expatriate Assignments One of the dimensions in this case that we have tried to examine is how did the organization manage Napoli’s assignment which was of great significance to the company strategy. The following analysis tries to understand how well Schindler handled the entire expatriate assignment lifecycle and whether the current business and cultural challenges being faced by Napoli was on account of shortcomings in this regard. Expatriate Selection- The first question that needs to be tackled is that how to identify the right

man for the job. Did Schindler do the right thing by selecting Napoli for this assignment? The following parameters can help us assess this decision Selection Criteria

Our Assessment

Cultural Toughness

This parameter involves how well an individual can withstand cultural shocks and adapt to the new culture. The organization assumed that since Mr. Napoli was young he will be flexible to cultural changes. However, evidence from the case points out that reality was totally different. Mr. Napoli represented a typical western style manager  driving for results and not being aware of the organizational relationships. He depended on Mr. Singh for understanding the dynamics.

Physical and Emotional Health

Silvio Napoli was young and was in good health based on the information given in the case. The inference here is that he could handle the hardships.

Age, Experience, Education

Mr. Napoli had done his MBA from Harvard and had performed well in the corporate planning function. Although he had successfully managed an important project for his organization still he did not have the real life experience for managing a complex assignment like India

Motivation for foreign assignment

Mr. Napoli was highly enthusiastic about this project and had done the whole groundwork that involved creating the business plan. When other candidates refused, Napoli was given the offer which he accepted as he was involved in the project since the beginning

Family Issues

Mr. Napoli relocated to India with his wife and two children. His wife had chosen Delhi to set up their residence while the headquarters were in Mumbai. Mr Napoli kept shuttling between the two cities which created a lot of hardship. Further, his family encountered a lot of  health issues and he never felt settled which affected his work.

9

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Selection Criteria

Our Assessment

Leadership Style

Mr. Napoli’s leadership style was centered around hard factors like deadlines, clarity in communication, directness, impatient for results etc whereas in India soft factors like managing relationships, exercising patience with people matters a lot. Hence, there was misfit   between his leadership style and the requirements of his Indian sub ordinates

Interpretation - From the above table it is clear that with regards to leadership style, cultural

toughness and experience Mr Napoli was not the ideal candidate. Further as a family man he needed greater support which was lacking and hence, a lot of time and energy was wasted by him at this front. However the organization could not find suitable candidates for this position and decided to offer it to Napoli on account of his education, age and motivation in drawing up the business plan and willingness to work on this assignment. Managing the Adjustment Process - It is clear from the case that Silvio Napoli was on his

own. He received no support from his organization with respect to managing housing, education and health requirements of his family. He spent a lot of time in arranging accommodation and schooling for his children. Further, he decided to have his third child in Italy. All this took a toll on his work life and added to the stress. Further, he had no connection with the headquarters. His boss Luc Bonnard could have been supportive during the transition. Training - Training, a significant aspect in any expatriate assignment was completely missing

here. Mr Napoli had no prior experience on working on an international assignment. Hence, it is imperative that he be trained on the cultural issues. Further he was new to India and needed to  be acquainted with the business nuances of the country. A technical element should have been introduced as he was a generalist and may not have in-depth knowledge regarding handling marketing and operations for elevators in emerging markets like India. Frequency of Updation -   Napoli’s entire strategy was based on transfer pricing and

government regulations, whose details were outdated. For any expatriate assignment to be successful, he should have kept himself tuned to the dynamic changes of the emerging market. Performance Appraisal - Mr Napoli’s business plan outlined a target of 50 units to be installed

in the first year. However it seemed unlikely that this target would be achieved as his sales team had committed to orders that required significant modification of his product as against the standardized version envisioned by him. Also a new transfer price system adopted in the company had raised costs while the budget increased the expenditure involving imports of  specific non-core goods by a whopping 24%. The assignment was a high risk career move for  Silvio Napoli and given the external factors that were impeding his performance he felt a high 10

Silvio Napoli at Schindler India: Cross-Cultural Analysis

amount of stress. In addition, he had very little contact with the headquarters and was primarily on his own. As a result he faced the dilemma whether the headquarters would understand his situation or take an adverse stance which may affect his career progress.

Cultural Issues Faced •

  Napoli had faced a hard fought battle between family relocation and company start-up in India. Though he and his family had been on a ‘look and see’ visit to India, Napoli still found it difficult to build trust with ‘new faces’ and had to adapt his management approach accordingly.

•

Feasibility of the business plan: Several of Napoli’s managers were not convinced with his   business plan particularly with the strategy of selling only standard elevators. The concept of outsourcing in this industry was also new. As a result, during his visit to Italy, key managers in India signed contracts that were against the strategy of the business plan.

•

Impact of Transfer pricing on costs: The new Indian Budget had increased import duties on specific “non core goods” including elevators. This could not meet Napoli’s strategy of  containing costs to the extent he had planned for originally. Local sources for elevator  components could not meet requests coming from Schindler’s European plants. This shows  Napoli’s lack of understanding of Indian business culture.

•

Indians are very complacent when it comes to time. They always push things to the last minute. But this is not the way Napoli functions. This factor acted as a huge deterrent to Schindler India’s smooth functioning.

•

Another characteristic of Indian workers is that they over-promise but under-deliver. When it comes to projects, they invariably bite more than they can chew. This characteristic goes against the Swiss habit of precision delivery.

•

Indian top management are usually willing to customize while Napoli’s irritation of not sticking to the business plan can be attributed to the Swiss fetish for orderliness. Clubbing this along with their task oriented nature may give the reason why the Indian staff  considered Napoli to be a hard- driver, impulsive and impatient (while Singh to be friendly, easy going and patient).

•

In terms of communication, India tends to be high context while the Swiss appreciate a low context communication style which may be why Napoli was considered over  communicative.

11

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Is there a Solution? Yes, there is a solution. First, the strategy should be revisited with inputs from the top management of the Indian subsidiary and considering the cultural, economic and technological elements of India and Schindler’s target market. Once the strategy is revisited, the top management of the Indian subsidiary should be empowered to operate and take decisions on their own to a certain extent. As a VPS for Asia Operations, Napoli should focus only on the high-level regional decision making. These steps would take care of the cultural issues as most of them are bound to be addressed at the strategy formulation level when all the stakeholders are involved.

Conclusion The case brings out the nuances of culture among the countries in which a global business is set to operate. A detailed analysis on the cultural dimensions has been conducted through Hofstede and Trompenaar’s model. A brief picture of the national context is given to understand the environment that influences the issues faced by Silvio Napoli. After analyzing the backgrounds of  the countries and people involved, the cultural issues are identified and a very high-level solution has been provided.

12

Silvio Napoli at Schindler India: Cross-Cultural Analysis

Exhibit 1: Market Share of Competitors in India

Otis BBL Kone ECE Regional Players

Market Share

24%

8%

50%

9% 9%

Exhibit 2: Comparison of Hofstede’s Scores for India, Swiss and Italy 80 60 40

77

70 76

70 50

20

56

48

75

68 70

58 40

IDV

MAS

61 40 34

0 PDI

P   e r    c  e n  t     a   g  e

UAI

LTO

Hofstede’s Cultural Dimensions

India

Switzerland (French Speaking)

Italy

PDI - Power Distance Index, IDV - Individualism, MAS - Masculinity UAI - Uncertainty Avoidance, LTO - Long-term Orientation

13

Silvio Napoli at Schindler India: Cross-Cultural Analysis

References • International Management - Culture, Strategy and Behavior, 6e, by Hodgetts, Luthans and Doh, Tata McGraw Hill

• Riding the Waves of Culture - Understanding Cultural Diversity in Business, 2e, by Fons Trompenaar and Charles Hampden-Turner 

• http://geert-hofstede.com/india.html

14