Impact of Culture on International Business: Shell

Shell is one of the largest global companies, which operates in a diverse range of political, social and cultural environments. As the result, the company is to adapt its business model to the different cultures and enable members of multi – cultural teams to achieve engagement and improved performance. Although company’s global expansion provides a wide range of advantages associated with improved financial results, diverse cultural backgrounds may become the source of cultural conflicts. The cultural issues faced by Shell arise from differences in ecological policies and understanding of business derived from traditions and habits in various cultures.

One of the cultural conflicts faces by Shell is associated with its business in Nigeria. The company operates the joint ventures in the country and manages most of the Nigerian onshore oil infrastructure. The conflicts were primarily provoked by company’s negative public image due to its role in the environmental degradation of the Niger Delta. In addition, the company was accused of waging ecological war against Nigerian citizens.

Despite the wide range of political, social and ecological issues faced by Shell in Nigeria, it also has to tackle the cultural problems. Shell, a Dutch – English company, chosen Nigeria as a business location, as the country was the former colony of the British Empire. However, although it was British colony, most ethnic and linguistic groups in Nigeria were against British presence in the country. As the result, some ethnic groups were against Shell’s presence fearing new British expansion in the country.

In addition, cultural issues faced by the company included the problems with native Ogonisland. The land was used by the company for its operations, however, it did not reinvest revenues in maintaining the land. As the result, ethic groups inhabiting the land formed the Movement for Survival of Ogoni People (MOSOP). The Movement demanded the company to reinvest its profits to improve the environment of Ogiland. The natives accused company of damaging farmlands and destroying freshly planted corps. The Movement’s demonstrations were resulted in extreme violence and sabotage of Shell facilities. The cultural conflicts in Nigeria were provoked by negative image of the company in the society.

As a leading global organization, Shell employs people from a wide range of cultural backgrounds. The differences in employees’ communication styles and decision – making preferences provoke misunderstanding in the company’s teams. Shell has been present in Australia since 1901 and it develops and supplies approximately one third of Australia’s petroleum. However, the cultural conflicts in the team prevented the company from improved financial and operational performance. To tackle the problems, the team required an engaging learning framework in order to improve team interactions.

To address the issues, the managers involved individualized assessment and feedback of their MBTI profiles, as well as experimental workshops aimed at improving team interactions and managing diversity conflicts. According to the leader of the intervention, “The exercise raised some profoundly useful realizations for a number of staff around their perspective versus that of another culture. The cultural exercise also broke the ice, enabling …
Posted by: Sam Lemos

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