Multinational company's challenges within financial management : Cultural differences between Finland and India in managing financial operations
Kelo, Roosa (2019)
Kelo, Roosa
2019
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2019053013414
https://urn.fi/URN:NBN:fi:amk-2019053013414
Tiivistelmä
The purpose of this research is to find out possible difficulties/problems/issues for Finnish companies due to cultural differences within financial management when expanding their business into Indian markets. The purpose is also to give information to Finnish employees who are moving to India as expats. The scope of this research is on difficulties between Finland and India. This research is commissioned by an anonymous Finnish security company. The research questions lay a base for the research. There are four main research questions of which three are two phased. The first phase is a question targeted to find out the possible problem and the second phase is to find out a possible solution for that problem. The fourth question is single phased. The research questions are:
1. How does cultural differences affect a company’s day-to-day business?
• What are the most efficient ways to beat these difficulties caused by these differences?
2. Does an executive have to lead employees in different cultures differently?
• What are the best ways of learning how to lead and overcome problems within cultural differences efficiently?
3. How does these difficulties affect the company’s finances? Or do they?
• How to overcome them?
4. Is there a certain way of leading, that will affect and work despite the culture?
The method in this research is qualitative semi-structured interviewing. An interview guide is created, which works as a base for all the interviews. The interview questions can be categorized in four categories; day-to-day business, cultural leading, financial operations and general. Six interviewees are chosen to participate in this research based on their current and past employments. The interviewees are asked a group of same question and in addition to those questions, depending on the interviewee’s employments, some specifically targeted questions are asked as well. The theory in this research is used to create the interview questions. The theory chapter can be divided into two sections; international finance and culture. The theory regarding culture has a big impact on this research, since the results from the interviews are emphasized on cultural matters. Hofstede’s cultural dimensions, among other things, are used to link the theory chapter with the results. Hofstede-insight is one of the most important references in this research, because of the cultural dimensions on the website. The interview results indicate that a big part of these possible difficulties within financial management are caused by misunderstandings. The biggest difficulties rise because of matters regarding India’s government, bureaucracy, hierarchy, religion, corruption, taxation, gender equality and language. Based on the research results one could say that a leader has to use different leading techniques to employees from different cultures. Another conclusion based on the results is that it’s not advisable for a Finnish company to expand to India. The ratio between cost and quality is not in place. Some of the interviewees suggest expanding to Europe instead of India. The interviewees have similar solutions to the difficulties/problems/issues that are caused by cultural differences – improve the mutual communication.
1. How does cultural differences affect a company’s day-to-day business?
• What are the most efficient ways to beat these difficulties caused by these differences?
2. Does an executive have to lead employees in different cultures differently?
• What are the best ways of learning how to lead and overcome problems within cultural differences efficiently?
3. How does these difficulties affect the company’s finances? Or do they?
• How to overcome them?
4. Is there a certain way of leading, that will affect and work despite the culture?
The method in this research is qualitative semi-structured interviewing. An interview guide is created, which works as a base for all the interviews. The interview questions can be categorized in four categories; day-to-day business, cultural leading, financial operations and general. Six interviewees are chosen to participate in this research based on their current and past employments. The interviewees are asked a group of same question and in addition to those questions, depending on the interviewee’s employments, some specifically targeted questions are asked as well. The theory in this research is used to create the interview questions. The theory chapter can be divided into two sections; international finance and culture. The theory regarding culture has a big impact on this research, since the results from the interviews are emphasized on cultural matters. Hofstede’s cultural dimensions, among other things, are used to link the theory chapter with the results. Hofstede-insight is one of the most important references in this research, because of the cultural dimensions on the website. The interview results indicate that a big part of these possible difficulties within financial management are caused by misunderstandings. The biggest difficulties rise because of matters regarding India’s government, bureaucracy, hierarchy, religion, corruption, taxation, gender equality and language. Based on the research results one could say that a leader has to use different leading techniques to employees from different cultures. Another conclusion based on the results is that it’s not advisable for a Finnish company to expand to India. The ratio between cost and quality is not in place. Some of the interviewees suggest expanding to Europe instead of India. The interviewees have similar solutions to the difficulties/problems/issues that are caused by cultural differences – improve the mutual communication.