Academic journal article Contemporary Management Research

Exploring Cultural Differences in Implementing International Technology Transfer in the Case of Japanese Manufacturing Subsidiaries in Vietnam

Academic journal article Contemporary Management Research

Exploring Cultural Differences in Implementing International Technology Transfer in the Case of Japanese Manufacturing Subsidiaries in Vietnam

Article excerpt

ABSTRACT

This study investigates how Japanese management practices are affected by Vietnamese culture through international technology transfer implementation at Japanese manufacturing subsidiaries located in Vietnam. The concept of technology transfer refers to the transfer of cross-cultural production management systems. Utilizing Abo's framework on Japanese management systems and Hofstede's theory of cultural dimensions, we applied a qualitative data collection approach, including multiple specific methods-in-depth interviews, group discussions, and observations-to conduct an empirical inquiry at 13 Japanese manufacturing subsidiaries in Vietnam. The obvious effects of Vietnamese culture on the current Japanese management style as it relates to internal work organization and administration were mainly observed in group consciousness, the seniority system, job classification, job rotation, training and education, quality control, and hiring policy. The Collectivism and Power Distance dimensions derived from two contradictory characteristics of Vietnamese culture-its community spirit and autonomy-are the most important aspects of those effects. It is suggested that professionals and expatriates become aware of the cultural challenges and opportunities, decide which managerial elements should be adjusted, and which aspects should be kept through technology transfer, based on a consideration of which cultural differences provide conflicts and which provide benefits. This study also offers insights to help managers flexibly adapt Japanese management to Vietnam's environment.

Keywords: Vietnam, International Technology Transfer Implementation, Cultural Difference, National Culture, Japanese Subsidiaries

INTRODUCTION

Vietnam has recently become one of the fastest growing economies in Asia. To meet this situation, the main challenge is how to catch up with and maintain the great speed of technological change in a situation where the capacity for technological investment remains insufficient. Vietnam has focused more attention on attracting direct foreign investment since initiating an economic reform process in 1986. In light of this, the Japanese have taken a long-term perspective, and invested in developing countries like Vietnam to take advantage of exports, and to increase firms' profits by enlarging the manufacturing network overseas. Moreover, due to the increasing costs of production in Japan, the incentives for direct investment and the efforts of entering into alliance networks as equity-based partnerships to expand the geographic for production activities and to deepen the supply networks already existing in the ASEAN has been attractive (Beamish, Delios, & Lecraw, 1997; Mallet, 1999). Therefore, Japanese managers have been eager to transfer the Japanese management style to developing countries, particularly Vietnam, through international technology transfer projects. Actually, Japanese management practices in Vietnam differ from the original Japanese management style, however, and the transfers have thus been modified through technology transfer. To date, the research of cross-cultural technology transfer as well as cross-cultural Japanese management practices focusing on Japanese firms in Vietnam is inadequate. This situation leads us to ask two questions. How can the Japanese management style be transferred successfully during the performance of technology transfer projects from Japan to developing countries? Why must Japanese management practices adjust to local culture?

To explore the uniqueness of the Japanese management style in the context of Vietnamese culture, this study takes a critical look at the cultural dimensions based on Hofstede's (2010) conceptual framework, used along side well-known Japanese management practices based on Abo's (1994) framework. We constructed the study according to the empirical inquiry approach by integrating multiple specific methods-in-depth interviews, group discussions, and observations-to investigate the influence of Vietnamese culture on Japanese management practices within the real-life contexts of cross-cultural technology transfer. …

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