Early corporate citizenship initiatives were often directed at supporting community causes ranging from charitable organizations to cultural institutions like municipal symphonies and operas. Companies have been historically helpful in developing the cultural infrastructure of many communities. Whether these corporate philanthropy efforts were beneficial to the company or only to selected individuals is very subjective. However, many of these early efforts were not scrutinized for their contribution to the strategic objectives of the firm. Michael E. Porter and Mark R. Kramer have argued that a company needs to choose its social initiatives strategically. They have advanced the concept of shared value, which they define as “policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. Shared value creation focuses on identifying and expanding the connections between societal and economic programs.”
Porter and Kramer identify three approaches that apply to international marketers:
(1) delivering attractive products that are truly beneficial to society; (2) removing problems in the supply chain that are both costly and socially detrimental, such as reducing. greenhouse gasses; and (3) enabling local cluster development to help communities become more competitive.
They argue that “we need a more sophisticated form of capitalism, one imbued with a social purpose. But that purpose should arise not out of charity but out of a deeper understanding of competition and economic value creation.” The best international marketers are driven by the desire to create value and improve their competitive positions, so shared value becomes the right and smart thing to do.
This comment is based on Jo-Chun Chieh’s Dissertation written under the supervision of Prof. Michael Czinkota at the University of Birmingham, UK.
The study investigated the perspective of Taiwanese managers, thereby examining the impact of national and organizational culture differences and International Strategic Alliance (ISA) practices on ISA performance. Four findings can be concluded as follows.
1, National culture differences partly influence ISA performance, especially in the uncertainty avoidance and long-term orientation dimensions. This finding corresponds to one of the cultural functions proposed by Schneider (1989). He states that culture serves two functions, to solve external adaptation and internal integration problems. Uncertainty avoidance and long-term orientation especially impact on external adaptation. In other words, Taiwanese managers in the high-technology industry emphasize and are good t coping with opportunities and threats from the external environment, as well as being good at developing ISA strategies with foreign alliance partners. on the other hand, power distance, individualism and masculinity influence employee relationships within an organization.
2, Organizational culture differences also partly influence ISA performance, especially in professional and pragmatic (market -oriented) dimensions. Kasper (2001) associates corporate culture and market orientation, claiming that “market oriented organizations are open, employee-oriented, results-oriented, pragmatic, professional…”. This finding reflects that Taiwanese managers in the high-technology industry emphasize the importance of building objectives and obtaining new knowledge when cooperating with ISA foreign partners. Kasper (2001) also associates innovation, stating that customer contacts and customer participation in the R&D procedure are the basis of innovation. This notion implies that Taiwanese managers have high consciousness about global competition and pay attention on balancing innovation and market orientation.
Stay tuned for two more conclusions on our next Birmingham Insights on Asia.