University of Udine
In the last decade Central-East European countries were subject to a huge transformation from planned to market economy. In most of them this change had a strong impact creating a negative conjuncture on the local demand. Some of the economies started to grow after the slump, but some of them are still in a stalling position. The entry of foreign companies, either as joint ventures, or as 100% investments, is among the measures that may lead to recovery. As all of them must rely on local work force, totally or partially, they face the problem of intercultural management, which is becoming a central point of the managerial practices in operative FDI in Central-East European countries. The diversity of values, attitudes and approaches between expatriates, who usually cover higher organizational ranks in the international company, and locals, could be a sizeable danger to development. It could provoke international conflict situation, leading to negative business results and even to failure of international operations, there could be two types of problems: the endogenous one, i.e. the problem of intercultural diversity management within the company, and the exogenous one, regarding the relationships between company management and the local environment. There, we would like to investigate, whether the effort of recognizing and facing such kind of conflicts, can be, in the first place, managed, and, in the second place, even exploited in order to create a competitive advantage for the company. Our research will try to find out what is actually happening in the Central – East European joint ventures: do they recognize the problem, do they manage is properly, and are they able to transform in an opportunity?
KEY WORDS: international HRM, cultural differences, cross-cultural management.