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From an ethnocentric to a geocentric approach to IHRM

The case of a French multinational company
Maral Muratbekova-Touron
Institut Superieur de Gestion, Paris, France
Abstract
Purpose The purpose of this paper is to study the case of one French multinational company which has undergone a process of radical restructuring and internationalization because of acquisitions of Anglo-Saxon multinational companies. It examines how the organizational changes influenced the companys approach to the international human resource management (IHRM). Design/methodology/approach The methodology of this research is the single case study. Sources of evidences are direct participation and observation, interviews with top managers, and documentation. Findings The results show that the ethnocentric model, when French managers were placed on the top of the foreign subsidiaries, becomes non-efficient in the company which doubled its size and the geographical spread of its activities. It is argued that the forces of globalization constrained this multinational company to change from an ethnocentric approach to a geocentric approach to its IHRM. Originality/value The case demonstrates that national and organizational cultures are important contextual factors which influence the companys approach to its IHRM. The paper outlines the interconnectedness of globalization and the geocentric approach to the IHRM. Keywords France, National cultures, International business, Human resource management, Multinational companies, Ethnocentrism Paper type Case study

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Introduction Globalization processes during the past decades has led to the development of the large multinational companies expanding their activities across countries and continents. One of the main issues facing the development of the global companies has always been to find the right balance between the local autonomy between subsidiaries and the control of the corporate headquarters. The objective of this paper is to show how the acquisitions made by a multinational company influenced its approach to human resource management. This paper studies the case of one French industrial multinational company which is under an obligation to change the way in which it deals with global integration local adaptation dilemma. For the sake of confidentiality a pseudo-name of Lemma is chosen for this enterprise. The Lemma group, a world leader in its domain, has expanded rapidly over the past several years due to its growth-by-acquisition strategy. The group doubled its size, workforce, sales, and net income as a result of the acquisition of the Anglo-Saxon multinational companies in the late 1990s and in the beginning of 2000s. Thus, it added 30 new countries to its operating base. The Group underwent major restructuring in the end of the 1990s. The organization of the company by Divisions broke away from a highly centralized approach to authority and established a decentralized structure headed by the Corporate Centre. The ethnocentric model, when French managers were placed on the top of the foreign subsidiaries, becomes non-efficient in the organization which doubled its size and the geographical spread of its activities.

Cross Cultural Management: An International Journal Vol. 15 No. 4, 2008 pp. 335-352 # Emerald Group Publishing Limited 1352-7606 DOI 10.1108/13527600810914139

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Research propositions According to the scholars (Schuler et al., 2002; Sparrow et al., 2004), in order to comprehend the international human resource management (IHRM), one should avoid its contextual isolation. IHRM policies and practices are influenced by the companys structure and strategy; its institutional and cultural environments (Ngo et al., 1998; Schuler and Rogovsky, 1998; Schuler et al., 2002; Sparrow et al., 2004). National culture and the country of origin of the MNE influence HRM policies and practices (Ngo et al., 1998). Under the assumption of a strong link between national and organizational cultures developed by different scholars (Laurent, 1983; Hofstede, 1991; Adler and Bartholomew, 1992 and others), the propositions regarding the organizational culture of Lemma should be formulated taking into account dimensions proper to the French business culture. These research propositions on the Lemma culture will help to develop the proposition related to the IHRM approach. Cultural categorization studies have been largely criticized for being simplistic and methodologically limited (e.g. DIribarne, 1996-1997; McSweeney, 2002; Brock, 2005). However, some cultural dimensions proved to be useful since they are easy to communicate, they show validity, they are at the right level between generality and detail; they establish a link among individual, organizational, and societal phenomena (Aycan, 2005, p. 1085). In the absence of a better way, the scholars continue to use Hofstede dimensions to compare cultures which remain the most complete comparative empirical research with at least some dimensions found to have predictive ability (e.g. Brock, 2005). Famous research by DIribarne (1989) describes the logic of honor or the rationale of honor that reigns in French society. The principle of the logic of honor is based on status or rank. The fact of belonging to ones rank is determined by tradition rather than imposed by the group. Thus, honor is defined by tradition, neither by law nor by reason. It is tradition that defines what kind of work should be done by different social groups. Concerning the dimension of hierarchy, France is considered as a large power distance country, where there is considerable dependence of subordinates on bosses. According to Hofstedes (1991) conclusions, France has a rather high Power Distance Index. DIribarne (1989) writes about traditional existing images of French hierarchy: centralization and a respected distance between superior and subordinate. Barsoux and Lawrence (1991) assert that France has a long tradition of hierarchical rigidity, respect for authority, and centralization. According to them, French companies are highly hierarchical with the President-Directeur-General (PDG) at the head. According to Hall and Hall (1990), French managers have a reputation to be tough bosses with a tendency toward autocratic behavior. They are preoccupied with status, rank, and formality, and they are indifferent to the needs of their employees. Laurent (1986) observes that French managers perceive the organization as an authority network (p. 96): the hierarchical position gives power to its holder. Thus, mastering the power relationships is crucial for managers. Hofstedes (1991) findings concerning masculinity and femininity place France on 35/36 position (among 53 countries). Thus, France has a rather moderate feminine culture where tender, non-aggressive behavior for both women and men is appreciated. Compromise and negotiation, rather than a good fight or even physical violence, are the methods for conflict resolution. As far as uncertainty avoidance is concerned, French culture is found to be rather strongly oriented toward the high level of uncertainty avoidance (Hofstede, 1991).

It means that French culture is characterized by the existence of many rules regulating the duties and rights of workers. Hofstedes findings concerning the dimension of masculinity/femininity and uncertainty avoidance are contested by DIribarne (1996-1997). The questionnaire characteristics and the way it is interpreted are criticized by the partisan of ethnographic research. France could be considered as a particularistic (comparing to Anglo-Saxon) culture where task prevails over relationships. There is a specific network of graduates from the Grandes Ecoles which plays a significant role in the government and business structure of France. People at the top levels are mostly people of this elite group of graduates who maintain school ties after graduation (Hall and Hall, 1990). Roussillon and Bournois (2002, p. 52) argue in the same vein: The French social system is characterized by the importance that it attaches to its elite. . . Therefore, when speaking about French culture, one has to keep in mind its particularistic nature. Personal contacts are extremely important in doing business. In addition, Hall and Hall (1990), in their comparative study of French, German, and American cultures, mention the importance of not only professional, but social connections also: they point out that it is possible to find a general director of a company who obtained his position through marriage or connections. DIribarne (1989) highlights the fact that informal relations hold a significant place in French management practice. It is very important for people to have contacts. To achieve a high level of professional cooperation, one needs positive relations. The importance of connections extends to the close long-term relationships between salespeople and their customers, for example (Hall and Hall, 1990). In comparison with the German and American business cultures, France is considered as high-context (Hall and Hall, 1990). It is a high-context culture because information does not flow freely; subordinates often do not have all the necessary information from their bosses. Implicit rather than explicit communication is valued in French organizations (Hall and Hall, 1990). DIribarne (1991) also emphasizes this characteristic of French organizations by referring to their opacity. As stated by the scholar, the life of French enterprises is concerned by a significant difference between official and officious (DIribarne, 1991, p. 100). Franck (2000), in his comparison of American and French styles of management, states that the way meetings are conducted is linked to the context creation and information exchange for French managers. And they are the place of concrete confrontation and decision taking for Americans. Thus, French business culture can be considered as a high-context culture. Thus, the main features of the French business culture, which are examined and confirmed by different scholars, are:
.

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high respect for authority (Laurent, 1986; Hall and Hall, 1990; Barsoux and Lawrence, 1991; Hofstede, 1991); particularism (DIribarne, 1989; Hall and Hall, 1990; Roussillon and Bournois, 2002); and high-context (Hall and Hall, 1990; DIribarne, 1991).

Before the acquisition of two Anglo-Saxon companies, the organizational culture of Lemma, which was strongly influenced by the French national culture, could be described as particularistic and high-context, with a high respect for authority. In this perspective, the following research propositions are formulated as following.

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P1a.

The Lemma organizational culture is characterized by a high respect for authority. P1b. The Lemma organizational culture is a particularistic culture. P1c. The Lemma organizational culture is a high-context culture. Setting up the context of the organizational culture of Lemma makes it possible to develop the research proposition regarding the companys IHRM approach and the way in which it deals with global integration the local adaptation dilemma. According to Ferner and Quintanilla (1998), French enterprises underwent major restructuring in the 1990s because of globalization processes. As the companys strategy and structure influence its approach to IHRM (Dowling and Schuler, 1990), the restructured multinational enterprises are under an obligation to change their approach to their IHRM. It is claimed that the acquisitions of two Anglo-Saxon multinational companies influenced the organization and structure of the Lemma group, and therefore its IHRM approach. Taking into consideration high-context and the particularistic nature of the Lemma culture postulated above, the socialization methods of the company correspond to the ethnocentric approach to its IHRM. Before the acquisitions Lemma had a highly centralized organization with French managers occupying the key positions of the company. It is argued that this ethnocentric approach does not correspond to its modified needs anymore. In view of the significant increase in size, the company will not have enough expatriates to staff foreign subsidiaries. The reorganization into divisions changes the orientation: the global integration favored in the ethnocentric approach has to be balanced by local responsiveness. Another consequence of the acquisitions regards the origins of integrated companies. According to Bartlett and Ghoshal (1989), the Anglo-Saxon enterprises prefer formalization as a process to manage global integration the local adaptation dilemma. The formal systems and policies play the role of the common language shared by all managers. The scholars also argue that European companies favor socialization as a way of coordination (Bartlett and Ghoshal, 1989). Socialization is based on the managers understanding of the companys objectives and solid personal relationships. It was assumed above that Lemma has particularistic and high-context culture, which is in concordance with the arguments of Bartlett and Ghoshal (1989). Therefore, it is hypothesized that by integrating the Anglo-Saxon companies, Lemma faces the necessity of choosing more formalized procedures and rules that are legitimate in all subsidiaries. Thus, Lemma deals with the dilemma of how to think globally and act locally. A geocentric approach to IHRM is considered to be the best way to deal with global integration local adaptation dilemma by different scholars (Bartlett and Ghoshal, 1988; Adler and Bartholomew, 1992; Kamoche, 1996). According to Caligiuri and Stroh (1995), this approach makes it possible to balance between the conflicting priorities of global integration and local responsiveness. Thus, it is argued that the acquisitions of Anglo-Saxon companies by Lemma necessitate the choice of a geocentric approach to its IHRM in order to manage the dilemma. This discussion leads to the development of the following proposition. P2. The forces of globalization (the acquisitions) constrain Lemma to change from an ethnocentric approach to a geocentric approach to its IHRM.

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Methodology The methodology of this research is based on the single case study (Yin, 1993). The most important source of evidence for this research is direct participation and observation. I served as a part-time employee of Lemma for three years. While working for the group, any member of the organization has his/her own perception of the management culture. This close proximity could be considered as a shortcoming or a bias for the researcher; however, it allowed me to have a deeper understanding of the processes occurring in the organization. Working for Lemma also allowed me to follow its rituals, traditions, and everyday habits. Participating in informal organizational events and talking to employees is the informal aspect of direct observation. And the most important part is the job itself: my everyday tasks regarded different HR projects. Interviews, which are another significant source of case study evidence of this research, were conducted with the help of an adaptation of the critical incident technique developed by Flanagan (1954). Critical incidents are characteristics of the Lemma organizational culture considered as typical or fundamental by the interviewed managers. In other words, a critical incident is an event or behavior described by managers that helps to define the cultural dimensions of the Group. Where applicable, critical incidents are categorized into the existing cultural dimensions developed by Adler (1986), Hall and Hall (1990), Hofstede (1991), Trompenaars and Hampden-Turner (1998), and others. All items are inserted in table, which lists each category (cultural dimension). By defining the largest critical incident categories, the method allows determining the key cultural dimensions of Lemma. The levels of frequency of critical incidents emerging or the sizes of each category are classified following the quarterly percent interval. The intervals and their coding are presented in Table I. In total, 24 semi-structured interviews were conducted with managers of Lemma, which were chosen from the list of 700 top managers. In addition, one interview was conducted with an external consultant who contributed to the development of the competency-based leadership model at Lemma. Interviews lasted from 40 min to 2 h. The interviews were conducted in French and English. I have tried to provide diversity regarding the functional positions and nationalities of managers taking into account geographical constraints that reduced the possibility to speak to managers locating in countries other than France and who could not come to Paris for the interviews. Nevertheless, three interviews were conducted by telephone with the managers working for business units locating in Turkey, Chili, and Greece.

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Interval (%) 0-24 25-49 50-74 75-100

Frequency of emerging Low Moderate High Very high

Coding The cultural dimension managers The cultural dimension the Lemma managers The cultural dimension managers The cultural dimension Lemma managers is insignificant for the Lemma is moderately significant for is significant for the Lemma

Table I.
is highly significant for the Level of critical incidents frequency

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With no surprise, ten of the interviewed managers are French as Lemma preferred to send French expatriates to foreign business units recent time. Other interviewed managers are from European countries (Belgium, Germany, Italy, and England), Canada, and theUSA. Half of the interviewed managers are from Human Resources Departments; other departments include General Management, Strategy, Finance, and Performance. For the sake of confidentiality and managers feeling of protection, anonymity of all interviews is provided. While quoting interviewed managers, only their function is mentioned in order to preserve the anonymity. Consulting company is not named for the same reasons. Divisions and corporate headquarters were referenced as divisions followed by the numbers. Table II gives some details on the profile of the interviewees. Documentation was also used as a source of case study evidence. The archival documents including the letters of the CEO, annual reports, and HR brochures were helpful to understand the HR policies and procedures developed by the organization in the past. Before going deeper into discussions about the organizational and cultural changes within the group, it would be worth describing the origins of the Lemma culture and its main characteristics prior to the major acquisitions. Organizational culture of Lemma prior to acquisitions The critical incidents regarding the cultural dimensions of Lemma were gathered during a series of interviews with the groups organizational managers. As described in
Seniority in the company Less than 3 years More than 10 years More than 10 years More than 10 years More than 10 years 5-10 years Less than 3 years More than 10 years More than 10 years More than 10 years More than 10 years 5-10 years More than 10 years Less than 3 years More than 10 yeas 3-5 years More than 10 years More than 10 years 5-10 years More than 10 years More than 10 years 3-5 years More than 10 years More than 10 years Interview method Direct Direct Direct Direct Direct Direct Direct Direct Direct Telephone Direct Direct Direct Telephone Direct Telephone Direct Direct Direct Direct Direct Direct Direct Direct Direct

Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Function HR HR General HR Director General HR General Strategy HR Country Manager Finance Marketing Consultant Country Manager General Manager Country Manager HR Performance Manager Performance Manager HR General Manager HR HR HR HR

Division Division 5 Division 5 Division 2 Group Division 2 Division 3 Division 1 Division 2 North American activities Division 1 Division 5 Division 5 Consulting company Division 1 Division 1 Division 1 Division 5 Division 2 Division 2 Division 5 Division 2 Division 1 Division 5 Division 5 Division 2

Table II. Profile of the interviewees

the methodology section of this paper, critical incidents are features of the Lemma organizational culture considered as typical or fundamental by the interviewed managers. For example, the following quotation of one of the interviewees was classified as an incident related to the particularistic nature of the Lemma culture.
It is a personal culture. Interpersonal relations are more important than organization. They look for personal arrangements; problems are solved only through direct contacts (Strategy Manager, Division 2).

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Numerous incidents described by the same manager but relating to one cultural dimension are counted as one critical incident. The critical incidents are summarized in Table III. Four categories dominance of French, consensus, Christian culture, and weak human resource management are by no means new cultural dimensions. These categories are developed during the collection of data. They are separated into distinct columns because they were judged as necessary in order to give a more complete picture of the organizational culture of Lemma prior to the acquisitions made. According to the results obtained, the cultural dimensions particularism/ universalism, femininity/masculinity, hierarchy, and high/low context have a high or very high level of frequency. In relation to the gathered data, one can describe Lemmas culture as a particularistic, feminine and high-context culture with a high respect for authority. Thus, propositions 1a, 1b, and 1c are corroborated. Another proposition concerning the femininity/masculinity dimension can be made because the size of this category is the highest among all categories (88 per cent). The critical incidents related to this dimension (humanism, respect for people, exceptional quality of relationships in the company, family relationships, etc.) will be described in the course of this paper. The absolute majority of the managers interviewed emphasized the humanistic nature of the Lemma culture. One can state that the Lemma organizational culture is a feminine culture. The proposition is therefore formulated as follows. P1d. The Lemma organizational culture is a feminine culture.

But before delving deeper into the description of these dimensions, I propose to pay closer attention to the French origins of Lemma, which are extremely important in understanding its culture. Despite the moderate level of frequency emerging for the importance of the French language and the dominance of French managers, these two issues will be briefly described in the following part of this paper in order to better comprehend the groups organizational procedures. French origins The origins of the Lemma culture are perceived as lying deeply in French culture. The French language and culture are still the key building blocks of the internal reality of Lemma. According to the Lemma managers, the Frenchness of Lemma is represented by two factors: the predominance of French among executives and the use of French as the companys official language. The first factor concerns the top management of Lemma which is dominated by French managers.
Lemma culture is still French culture. What does it mean? First of all, it means managed by French. . . (General Manager, Division 1).

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Number Nature allocated Language of to Dominance (importance reality manager/ of Christian of and Hierarchy Specific/ Cultural Uncertainty French) High French Consensus culture dimension avoidance Ascription truth Particularism Femininity (paternalistic) Individualism Diffuse

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Freq. % Level of frequency 14 56 High 4 16 Low 0 0 7 28 Moderate 0 0 15 60 High 22 88 Very high

Table III. Critical incidents: dimensions of the Lemma organizational culture

Weak HRM 13 9 52 36 High Moderate 7 28 Moderate 5 20 Low 7 28 Moderate

0 0

6 24 Low

While French employees represent only 12 per cent of Lemmas workforce, they occupy 45 per cent of the top management positions. And the members of executive committee (as the interviewee points out below) are almost all French.
Lemma culture is really French. Today it is even more French than ever. The best way to see it is to look at the executives. 90 per cent of them are French. . . The only way to change it is to change the executives. They have to do it by representation. For example, one-third of the group is North American. Therefore, about one third of executives should be North American (General Manager, Division 2).

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Adler and Bartholomew (1992) argue that in order for a transnational human resource system to be effective, one of its characteristics should be transnational representation. This means a multinational composition of the managers and executives of the organization: the firms portfolio of key executives and managers should be as multinational as its world-wide distribution of production, finance, sales and profits (Adler and Bartholomew, 1992, p. 55). Obviously, transnational representation is not yet the case at Lemma. The absolute majority of the Executive Committee is made up of French or French-speaking (French as native language) executives. The second aspect of Frenchness at Lemma is the use of the French language. The fact that the French language remains one of the official languages of the company communicates to all organizational members the importance accorded to the companys French origins. It also means that those managers who do not master the French language are not admitted to the highest executive positions as they are not able to participate in team decision making. This willingness to keep French language as one of the official languages of the Group is not always welcomed by new arrivals.
Two official languages cost a lot. Translation, verification of coherence it is highly costly. In addition, if you work in Paris, you have to make efforts to speak French. The organization is not international yet (General Manager, Division 5).

Thus, it is argued that the Lemma organizational culture is considered by the managers as being based in French culture. Despite the moderate level of frequency emerging regarding this issue, it is an important characteristic to be taken into consideration in trying to fully understand the Lemma culture. The following parts of this paper are devoted to the description of the cultural dimensions which are significant for the interviewed managers. Femininity This cultural dimension, related to the femininity vs masculinity dimension developed by Hofstede (1991), has the highest level of frequency of critical incidents: 88 per cent of the interviewed managers highlight the humanistic side of the organizational culture. What does this mean for them? Humanism is deciphered as respect for people at Lemma.
Respect for people is still a reality at Lemma. The quality of relationships is exceptional (HR Manager, Division 5).

The Lemma managers appreciate the human atmosphere of their group; for them it is a company where people want to work.

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At Lemma. . .it is a softer approach than in US companies. Advantages of such culture are the ability to call for help and mutual support. If you need help in different countries in different divisions, usually it is OK (General Manager, Division 3).

The organization with its exceptional humanistic culture is known for a low turnover: employees remain within the Group a long time. Some managers describe their company in words more fitting family relations.

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One enters Lemma as one used to enter a convent: one comes and never leaves Lemma. It was like this in industries also: it was the business from father to son with family attachments (Country Manager, Division 1).

Another aspect of the femininity of Lemma culture is certainly management by consensus. As stated by Hofstede (1991), the members of feminine cultures prefer a compromise to a confrontation; they prefer pleasant methods of conflict resolving. The tendency of the Lemma managers to come to a decision through consensus demonstrates the feminine nature of the organization.
We really worked by consensus before . . . we did not move without consensus (Country Manager, Division 1).

High respect for authority According to the gathered data, the hierarchy dimension is significant for Lemma managers. Fifty-six per cent of the interviewees state that the Lemma organizational culture is characterized by a high respect for authority. Managers of the company describe its culture as a culture where the distance between superior and subordinates is well maintained and authority is respected.
It is an autocratic culture. . . There is a high respect for authority. People dispute authority more in North America. Somebody who comes from North America gets a cultural shock in France. For example, if you do not understand or do not agree with a decision taken by your boss, you question it. In France, you follow . . . (General Manager, Division 2).

Particularism The Lemma managers consider the organizational culture of their company as being particularistic. Sixty per cent of the interviewees emphasize the importance of this dimension at Lemma. Before acquiring two Anglo-Saxon multinational companies, it was a company where managers gave their priorities to interpersonal relationships in the construction of their careers.
In the past, new arrivals were put in contact with existing staff. Thats how they learned about Lemma behavior (Country Manager, Division 1).

The interviewed managers state that everything is built on the system of networking (General Manager, Division 1). It was and still is the force of Lemma: Lemma works by creating networks of people. The high level of manager rotation across the different business units in different countries contributes to the reinforcement of the network. However, networking has its negative sides. It is extremely difficult for managers who are out of seraglio to join the organization. The following statements of the interviewed managers show a common unease among newcomers:
If you are not French and not an existing Lemma staff member, it is difficult for new arrivals to enter the circle of confidence. It is the characteristic of the French culture. It is more difficult

to fire an existing Lemma manager than somebody in foreign parts of Lemma (General Manager, Division 5). Today, homogeneity is very strong in the Group. It is close to consanguinity. Of course, they try to recruit people with different profiles; however, they do not care to make efforts to integrate them in the Group (General Manager, Division 1).

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The informal mechanisms of networking rule the selection processes. These mechanisms are implicit, difficult to identify and therefore extremely frustrating for new comers. High-context According to the gathered data, the high-context nature of the organizational culture is significant for Lemma managers. Fifty-two per cent of the interviewed managers refer to the importance of this dimension:
It is a culture based on a failure of expression (non-dit) at Lemma. Little is formalized (HR Manager, Division 5). At Lemma, we do not like formal procedures, formal organization. It is difficult to understand the organization. We need to simplify things; we should not read between lines. We should clarify a lot (Strategy Manager, Division 2).

Franck (2000) states that American managers experience great difficulties in understanding the functioning of French enterprises. For them, the relationships mechanisms and decisions processes are less transparent in France than in North America. We have seen that this affirmation may be easily generalized to individuals with Anglo-Saxon values. They would prefer to have a more formalized method of communication. While being expatriated to work at the Corporate Center in Paris, they often feel uncomfortable with this unwritten debrouillez-vous (sort it out yourself) rule that reigns at Lemma.
I spent hours in meetings without any agenda. I know from others that it was frustrating for them also. . . In American companies, it is quick to understand organization: who decides what. Lemma has a confusing structure and unnecessarily complicated and slow decision making (HR Manager, Division 3).

Thus, one can describe the Lemma culture before acquisitions as high-context, where there were failures to express things and where communication processes were implicit and not formalized. The Lemma paradigm prior to acquisitions According to Schein (1992), the essence of culture or its paradigm can only be understood if the basic cultural dimensions and their interrelationships are deciphered and explained. While analyzing the Lemma organizational culture, I have attempted to discover these basic underlying assumptions and the interrelationships that they could have. Figure 1 presents the Lemma paradigm before the acquisitions. It is not argued that this paradigm covers all subtleties of such a complex phenomenon as an organizational culture; any schematic representation of organizational culture is reductive in nature. However, it is believed that it helps us to understand the essential aspects of the Lemma culture. It is incontestable that Lemma had a remarkable organizational culture valued by the former company managers.

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Figure 1. The pre-acquisition Lemma paradigm

Changes in the Lemma organizational culture Two major acquisitions of Anglo-Saxon multinational companies have significantly influenced Lemma. The critical incidents regarding the changes in the companys culture and gathered during the interviews are summarized in the Table IV. Three categories have a high level of frequency emerging: efficiency values, formalization, and size. This level of frequency allows us to confirm the arguments developed in the theoretical part of this paper. First, it was supposed that the increase in size as a consequence of the acquisitions would induce changes in the organizational culture of Lemma, and therefore in the IHRM approach of the company. Second, it was argued that the Anglo-Saxon origin of the acquired companies would play a significant role in the choice of the IHRM and in the way in which the dilemma of global integration and local adaptation would be managed. It was supposed that Lemma, which had a high-context and particularistic culture, would be under an obligation to choose more formalized methods of management to fit the preferences of Anglo-Saxon companies. During the data collection, it was seen that another aspect of the Anglo-Saxon way of management efficiency values is an important change factor taken into consideration by Lemma managers. The other two categories presented in the table concern critical incidents on the appearance of the new profile managers and time issues. The percentage of frequency of the time category (44 per cent) being close to the threshold of 50 per cent is judged significant for Lemma managers. The category appearance of the new profile managers is explained to facilitate better comprehension of the changes occurring in the company. The results of the collected data allow a validation of P2 stating that Lemma is under the obligation to change its approach to IHRM from an ethnocentric to a geocentric one. The proposition is schematized in Figure 2. Time category is framed by a dotted line because the moderate level of frequency emerging does not allow formal deduction. However, taking into account its proximity to the high level, the category is presented in the figure.

Number allocated to Appearance of new manager/change factors profile leaders Efficiency values Formalization 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Frequency % Level of frequency 8 32 Moderate 15 60 High

Size

Time

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Table IV.
15 60 High 14 11 56 44 High Moderate Critical incidents: changes in the Lemma organizational culture

Thus, acquisitions lead to three different kinds of pressure on the Lemma organizational culture: Anglo-Saxon influence formalization and efficiency values; the changed size of the company; and time problematic. They are described below in order to better understand Figure 2. Anglo-Saxon values Efficiency values As described by the interviewed managers, the Lemma culture had the traits of a heavy industry culture: long time, priorities given to cost management and strategic planning, the market and the client being secondary. The acquisitions have brought Anglo-Saxon values of short-term efficiency to Lemma. Sixty per cent of the interviewed managers indicate the appearance of new efficiency values at Lemma. The Lemma system has implicitly favored the informal mechanisms of managers selection due to a strong network. The new arrivals, the Anglo-Saxon managers, criticize such a social performance as they call it. They believe that results are not taken into account when managers promotions are being decided. This is why they claim the importance of economic performance indicators. For the outsiders, it is the only chance to break a wall protecting a strong network and to be promoted. Apparently, new points of reference become important for Lemma: result- and performance-orientations.

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Figure 2. Necessity to change the IHRM approach

Now, Lemma is changing. . . It is a more performance-oriented culture. . .the former culture has to change from just being nice and intelligent: it is not enough to run the business (HR Manager, North American activities).

These efficiency values considered by the interviewed managers as Anglo-Saxon values influence the organizational culture of the company. Another Anglo-Saxon value formalization, which also has an effect on the Lemma culture, is described further. Formalization According to the frequency percentage of critical incidents (60 per cent), the formalization matter is significant for Lemma managers. The interviewed managers recognize the necessity to formalize in order to cope with structural changes in the organization. The ancient managers understand that the companys high-context and particularistic culture, despite its highly appreciated advantages, has the significant disadvantage of being ambiguous.
Lemma is experiencing a cultural evolution. Yesterday, the way in which it functioned varied according to each small group. A disadvantage of this method is that it was vague, not clear (HR Manager, Division 5).

The willingness to formalize is clearly expressed by Lemma managers. Thus, the high level of critical incidents frequency emerging allows us to argue that the acquisitions induced the need for formalization at Lemma. Another aspect of changes generated by the acquisitions concerns the appearance of new profile managers.

Appearance of new profile managers Even though the level of frequency emerging for this category is moderate, it is necessary to describe what Lemma managers think about the changes regarding the particularistic dimension of their culture. According to 32 per cent of the interviewed managers, Lemma is making efforts to open its networks. The process of Anglo-Saxonization, meaning the process of searching for more internationalized companies from the Anglo-Saxon world (Ferner and Quintanilla, 1998), brings constraints to the way in which management used to be practiced by Lemma. To lead the internationalization process, managers who do not conform to the stereotype of the Lemma manager French engineer from a Grande Ecole are beginning to be recruited and appointed to key roles in the Corporate Center and senior posts in operations abroad. One can notice changes in staffing policies of Lemma.
Now, overall, the Lemma culture is result-oriented and performance-oriented. If you achieve results, the Group takes notes of that. I am an example of that. I worked in different countries, I changed different jobs, different businesses. This year they appointed me as CEO of a country. Lemma has been in my country for 11-12 years. This is the first time a local manager has been head. They never trusted us before, they always sent French expatriates. My case proves that Lemma is changing. The appointment of a non-French manager at the head of a business unit outside France was not possible ten years ago. Today, I am at the top and I am very glad that my qualities were recognized (Country Manager, Division 1).

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The acquisition of Anglo-Saxon multinationals brings different cultural values to the company.
With acquisitions, we have another profile of leaders. They are active: they do not ask permission to proceed. They are efficient, they show results. They come from another culture, the culture of factual demonstration (HR Manager, Division 5).

Thus, one can observe a tendency toward a universalistic approach in the organizational culture of Lemma. This tendency is reinforced by the increase in the companys size. Size Another important factor influencing the culture of Lemma is obviously size. A significant increase in size obliges the company to change its previous style of managing by network. Fifty-six per cent of the interviewed managers emphasize the weight of this factor in the organizational culture of Lemma. Size changes culture this comment by a HR manager (North American activities) describes the process of changes in the Group. Lemmas operational methods were adapted to a small-sized company: managing by network. However, with an important increase in the companys size, it became impossible to continue a close follow-up of managers. The particularistic nature of the Lemma culture causes difficulties with the shift to the new dimensions of the group.
Size says . . . it cannot allow informal relations of such a scale. It is impossible to follow more than one thousand people personally (HR Manager, North America). The geometry of the Group is increasing. It is not easy to develop networks. And if you have no network, you are stuck (Country Manager, Division 1).

Changes in size bring difficulties in staffing also. There is a need for more contribution from potential leaders.

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It was good when you are small and you have a fantastic management team, but if the company becomes larger, middle management has to be more involved (General Manager, Division 1).

350

Time Taking into account the particularistic and high-context nature of the Lemma culture, it is not surprising that managers needed time in order to create their network and gain the confidence of the ancient Lemma managers. Functional and geographical mobility contributed a lot to such socialization processes, which need time to be efficient.
You spend more time building relationships at Lemma than in companies of Anglo-Saxon culture. In American companies, you can be introduced to people during meetings and you may immediately discuss and take decisions without knowing people. At Lemma, you have to invest time in building a network; business comes later (HR Manager, Division 3).

With the arrival of newcomers, the time issue emerges. Managers of acquired entities should understand the groups operational methods as quickly as possible. Time becomes precious for the integration of newcomers.
Lemma was always excellent in the development of its leaders using international and functional mobility. As we know that people learn 80% of what they know on the job, moving managers from one position to another was an ideal means for their career development. But now, in the world today, we need to develop more formal training that allows people to learn faster. Of course, we will keep our former methods as well. New arrivals do not have the same notion of time as us . . . we do not have 5 or 10 years to integrate people (HR Director of the Group).

The time issue is judged as an important aspect of change regardless of the impossibility of formally validating this statement. However, as was argued before, the frequency percentage of this category (44 per cent) illustrates its relative significance. Conclusions The Lemma Group underwent a process of radical restructuring and internationalization in the last decade of the previous century. The ethnocentric model, when French managers were placed on the top of the foreign subsidiaries, became non-efficient. While increasing the size and the geographical spread of its activities, Lemma faces all the problems of internationalization. The new arrivals bring new assumptions to the organization. The Lemma organizational culture prior to the acquisitions had features associated with the French way of management: high respect for authority, high-context, and particularism. Certain cultural dimensions proper to the Anglo-Saxon business culture are of an opposing nature: low context (more explicit and formalized) and universalism. Thus, by acquiring Anglo-Saxon companies, Lemma challenges the organizational changes due to integration issues. The case of the Lemma group demonstrated that national culture influences the organizational culture of the company. It has also been explained that the organizational culture, in turn, determines the way in which IHRM is organized. Thus, the organizational culture of the multinational company is an important contextual factor influencing its IHRM approach. It has been demonstrated that the high-context and particularistic culture of Lemma prior to the acquisitions favored an ethnocentric approach to IHRM: French expatriates constituted a strong informal network. It has

been argued that the organizational culture of Lemma is experiencing changes. These change factors necessitate more formalized and standardized practices regarding leadership development, global recruitment, and uniform selection which correspond to a geocentric approach to IHRM. The case studied in this paper outlines the interconnectedness of globalization and the geocentric approach to the IHRM. It provides an empirical confirmation of the proposal that geocentric approach to IHRM is the best way to deal with the global integration local adaptation dilemma (Bartlett and Ghoshal, 1988; Adler and Bartholomew, 1992; Kamoche, 1996; Caligiuri and Stroh, 1995). However, the study has its limitations in that it was assumed and demonstrated that the origins of the acquired and acquiring companies (French and Anglo-Saxon in the present study) influence the way how the acquired company copes with the dilemma. Future research considering companies with different origins (e.g. French and Chinese; German and Japanese; Chinese and Kazakhstani) may propose different conclusions.
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