MIT Sloan Management Review

success in building a strong culture with other units. Other overseas subsidiaries are often lost while corporate headquarters is struggling to lead and reshape the company.

Disoriented Culture. A disoriented culture, while not common, can be a characteristic of a multinational company experiencing turmoil and upheaval, perhaps due to radical changes in the business environment, intense global competition, major organizational restructuring, or successive mergers or acquisitions. Here neither corporate headquarters nor subsidiaries have a sense of mission and strategic direction. Core values, even if defined and espoused by top management, exert little influence on operations and behaviors in any part of the company. Employees often lose faith in management and are baffled by where the company may be headed and how it will adapt to industry changes.

Global Culture. A company with a strong global culture has a set of core values and practices that are shared worldwide. These values often reflect an evolving amalgamation of values and practices drawn from the company’s global network of operations. They constitute the cornerstone of strong global culture and serve as a yardstick that guides operations and actions worldwide. Having common values, however, does not mean that local differences are ignored. In fact, failing to adapt core values to local realities may hinder the company’s success. Respect and trust in local knowledge are often key. These allow companies to localize the company’s core values in a way that evolves into effective local practices. In this respect, core values can be seen as parameters within which local interpretations and translations can take place.

Cultural Hubs in MNCs
Our research suggests that the Global pat-
tern of culture is the exception. Creating a
global corporate culture requires breaking
away from a headquarters-centric mindset,
drawing upon cultural capabilities that exist
across the global operations and incorporat-
ing diverse cultural values and practices.
Global culture cannot emanate from a single
corporate center nor can it be disseminated
by a single group such as the HR function.
Therefore, companies should identify and
establish multiple cultural hubs around the
globe, thereby incorporating a diverse set of
organizational entities and employees into
the process of creating and maintaining a
strong global organizational culture.

Orly Levy is an affiliated research fellow of IMD in Lausanne, Switzerland. Sully Taylor is a professor of international management and director of international programs at the School of Business Administration at Portland State University in Portland, Oregon. Nakiye A. Boyacigiller is dean of the faculty of management at Sabanci University in Istanbul, Turkey. This article contains material based upon work supported by National Science Foundation Grant No. 0080703. The opinions, findings, conclusions and recommendations expressed in this material are those of the authors and do not necessarily reflect the views of the National Science Foundation. Comment on this article or contact the authors at smrfeedback@mit.edu.