Charles Martin in Uganda_The Case Solution

Case SummaryUganda is a country of about 32 million people, gas English as its

official language. But many people speak only another language,

mainly Bantu or Nilotic languages of the Bugandas, langos, Acholi,

Teso and Karamojong tribes, There has been a strong separist

movement among the Bugandas. Although about two third of

Ugandans are Christians. From that perspective of a foreign company

wants to operate its business in Uganda then language for

communication is the main problem because of the different types of

language is here. For that reason a company engines many specialist

employees for speaking with different people by different languages.

On the other hand, Business in Uganda typically moves slowly. For

instance one may wait months to a phone installed. This is a country

where incomes are extremely low and there having on exorbitant

payment system

HG (Hydro Generation) is U.S.-based Company, specialist in power

plants (dams). Its values strongly built on the Christian culture. It has

built plants in 16 countries maintained an ownership in about half of

them. The Uganda project is its first anywhere in Africa. Because dam

construction involves huge amounts of capital and because many

groups oppose their construction on the grounds that they typically

displace large groups of people, HG wanted to build as many local

allies as possible for its Ugandan project in order to prevent adverse

publicity that could lead demonstrations and costly work stoppages.

Its employees have a high degree of empowerment, being fully

responsible for their actions. There is no code of conduct concerning

expatriates lifestyle, but its corporate culture was one that reflected

the lifestyle of a prosperous international company.

“Case Study on International Business” 1

Charles Martin was 29 year-old American. He was specialist in African

culture, graduating with a major in African studies and a professional

experience in Kenya, Ethiopia and Tanzania. He took a job in HG with

the purpose of being assigned to an African project after two years of

training and doing business in the U.S. He combined a home-country

corporate perspective and a deep knowledge of Uganda economic,

political and cultural aspects. He devoted of the philosophy of

integrating the African society, not drawing attention to oneself, but

learning and respecting its culture. He lived among middle-class

Ugandans and not in up-scale neighbourhoods where most

international managers live.

Charles Martin didn’t integrate himself within the expatriate’s

community. He made “extra payments” to local people to get things

moving faster. He hired staff closely related to Government officials

and participated in tribal rituals to get support from villagers affected

by the dam construction, although being employed in a company

embedded in Christian values. Some of Martin’s practices were

concerning James Green, the Vice President of Hydro Generation (HG)

such as, independent lifestyle, participation in tribal rituals, way of

achieving results, unethical practices, payments which might be

illegal under U.S. law, Martin’s distance from the expatriate

community.

The Concept of the CaseThis case shows how important it is for a foreign company to

understand and adjust to ever changing operating environments is an

integral part of operating environment. Culture refers to the learned

values, norms based on attitudes, values and believes of a group of

people. Because people simultaneously belong to different group that

have different culture. From this case we have found HG Company’s

culture and also the problems the company was faced because of


cultural differences and legal facilities. Basically all people have

culturally ingrained responses to given situation and some times

expect that people from other cultures will respond the same way as

people in their own culture do.

Again this case heave also given a concept that an international

company must be sensitive to these cultural difference in order to

predict and control its relationship and operations. Finally it should

realize that it’s accustomed way of doing business might not be the

only on best way .when doing business in abroad a company should

first determine what business practices in a foreign country differ

from those it’s used to. Management then must decide what if any

adjustment necessary to operate efficiently in the foreign company.

UgandaUganda lies on equator and surrounded by the Victoria Lake. Arab

traders came here 1840’s in search of slaves and ivory then British

came here. Uganda became independent in 1962 from Britain became

republic in the following year. First prime minister was Milton Obote.

In 1971 Obote’s government was toppled in military coup led by Idi

Amin. Amin was toppled in 1979 and Obote back in to power. At

present there is presidential form of government and Museveni is the

president of Uganda. Uganda is a country of about 32 million people,

gas English as its official language. There has been a strong separist











payment system. If any comp any involves such activities then it is

illegal under U.S law. Not only that in Uganda nepotism is a norm and

this country considered one of the more corrupt in the world because.

From the root level to Government in all sectors conniption exists.

Language and Religion

English and Kiswahili are the official languages, but Luganda is most

widely spoken in the capital city of Kampala. Many Ugandans live

among people who speak different languages, especially in rural

areas. But many people speak only another language, mainly Bantu or

Nilotic languages of the Bugandas, langos, Acholi, Teso and

Karamojong tribes, there are more than 40 ethnic groups but no

single ethnic majority. Ugandan’s Population is approximately 84%

Christian and 12% Muslim. Only 1% follows traditional religions.

Population

Uganda has 31 million people, and 47% are age 15 or younger. (Texas

is 3 times the size of Uganda with 22 million people.). The HIV/AIDS

infection rate is 5% today due in large part to the Government’s


political commitment to HIV prevention and care. Uganda is currently

the only country to reduce its HIV/AIDS rate by double digits. In

comparison, the HIV/AIDS infection rate in Washington DC is

estimated between 3-5%. Uganda has 250,000 refugees from Sudan,

the Congo, and Rwanda.

Economy

Agriculture employs 80% of the work force. Coffee and fish is the

largest export. Foreign investment has slowly returned after the reign

of brutal corrupt dictator Idi Amin (1971-1979). Uganda is a lower

income country where 4 out of ten people live on less than a dollar a

day.

Hydro-GenerationHG (Hydro Generation) is U.S.-based Company, specialist in power

plants (dams). Its values strongly built on the Christian culture. It has

built plants in 16 countries maintained an ownership in about half of

them. The Uganda project is its first anywhere in Africa. Because dam

construction involves huge amounts of capital and because many

groups oppose their construction on the grounds that they typically

displace large groups of people, HG wanted to build as many local

allies as possible for its Ugandan project in order to prevent adverse

publicity that could lead demonstrations and costly work stoppages.

Its employees have a high degree of empowerment, being fully

responsible for their actions. There is no code of conduct concerning

expatriates lifestyle, but its corporate culture was one that reflected

the lifestyle of a prosperous international company.


Charles MartinCharles Martin was 29 year-old American. He was specialist in African

culture, graduating with a major in African studies and a professional

experience in Kenya, Ethiopia and Tanzania. He took a job in HG with

the purpose of being assigned to an African project after two years of

training and doing business in the U.S. He combined a home-country

corporate perspective and a deep knowledge of Uganda economic,

political and cultural aspects. He devoted of the philosophy of

integrating the African society, not drawing attention to oneself, but

learning and respecting its culture. He was working with Ugandan

governmental authorities and with villagers to gain support and

necessary permissions for the dam’s construction. He was

establishing an office and hiring people who would be responsible for

local purchases, clearance of incoming goods through customs,

immigration permissions, and logistics of materials. He was helping

foreigner visitors become accommodated and oriented when visiting

Uganda.

Charles Martin’s AssignmentsHe gained support and necessary permissions from the Ugandan

governmental authorities and affected villagers for the dam

construction and builds an operating structure and facility, with

people responsible for local purchases and hiring, customs,

immigration affairs, logistics of materials and record keeping. He

helped foreign visitors and HG expatriates to become accommodated

and oriented when visiting/arriving at Uganda.

Charles Martin’s Practices


He lived among middle-class Ugandans and not in up-scale

neighbourhoods where most international managers live. He didn’t

integrate himself within the expatriate’s community. He made “extra

payments” to local people to get things moving faster. He hired staff

closely related to Government officials and participated in tribal

rituals to get support from villagers affected by the dam construction,

although being employed in a company embedded in Christian values.

Problems with Charles MartinSome of Martin’s practices were concerning James Green, the Vice

President of Hydro Generation (HG) such as,

Independent lifestyle,

Participation in tribal rituals,

Way of achieving results,

Unethical practices,

Payments which might be illegal under U.S. law,

Martin’s distance from the expatriate community.


Company and Management OrientationWhether and how much a company and its managers adapt to foreign

cultures depends not only on the conditions within the foreign

cultures but also on the attitude of the companies and their managers.

This can be explained by the following three such attitudes or

orientations- Polycentrism, Ethnocentrism, and Geocentrism,

Polycentrism

In polycentric organizations, control is decentralized so that managers

feel free to conduct business in what he thinks. In other words,

business units in different countries have a significant degree of

autonomy from the home office and act very many like local

companies. Because many discussions of international business focus

on the unique problems that companies have experienced abroad, it is

understandable that many companies develop a polycentric

orientation. Polycentrism may be, however, an overly cautious

response to cultural variety. A company that is too polycentric may

shy away from certain countries or may avoid transferring home-

country practices or resources that may, in fact, work well abroad.


When practices do not work abroad, management may point to the

unique foreign environment. If the foreign environment is not the

cause, the company might erroneously take a more polycentric

orientation.

In intercultural competence the term polycentrism is understood as

attitude and openness towards other cultures, opinions and ways of

life: when intercultural actions and correlations are interpreted not

only with the background of own cultural experiences, but when the

independence of other cultures is recognized and appreciated and

when cultural values are relativized and seen in the whole context.

Ethnocentrism

Ethnocentrism is the belief that one’s own culture is superior to

others. In international business, it describes a company or individual

so imbued with the belief that what worked at home should work

abroad that it ignores environmental differences. Ethnocentrism takes

three general forms,

Managers overlook important cultural factors abroad because

they have become accustomed to certain cause-and-effect

relationships in the home country.

Management recognizes the environmental differences but still

focuses on achieving home-country rather than foreign or


http://en.wikipedia.org/wiki/Intercultural_competence

http://en.wikipedia.org/wiki/Culture

worldwide objectives. The result may be diminished long-term

competitiveness because the company does not perform as well

as its competitors and because opposition to its practices

abroad.

Management recognizes differences but assumes that the

introduction of its new products or ways to produce and sell

them is both necessary and easy to achieve when it is really a

complex process. Ethnocentrism is not entirely bad. Much of

what works at home will work abroad. However, excessive

ethnocentrism may cause costly business failures.

Geocentrism

Geocentrism is between the extremes of polycentrism and

ethnocentrisms are business practices that are neither the home

operations nor the host-country company’s but a hybrid of the two.

When the host-country environment is substantially different from

home, the international company must decide whether to persuade

people in that country to accept something new (in which case, the

company would be acting as a change agent) or to make changes in

the company itself. Geocentrism is when a company bassets

operations on an informed knowledge of home- and host-country

needs, capabilities, and constraints. This is the preferred approach to

business dealings with another culture because it increases

introduction of innovations and decreases the likelihood of their

failures.

Discussion on Questions


Question 1: Describe Ugandan cultural attributes that might

affect operations of a foreign company operating there?

Answer:

Uganda is a country in central Africa with a population of about 25

million people. Uganda is ethnologically diverse, with at least 40

languages in usage. Luganda is the most common language. English is

the official language of Uganda, even though only a relatively small

proportion of the population speaks it. Access to economic and

political power is almost impossible without having mastered that

language. The East African Swahili is relatively widespread as a trade

language and was made an official national language of Uganda in

September 2005. Luganda, a language widespread in central Uganda,

has been the official language in education for central Uganda for a

long time.

Two thirds of Ugandan’s are Christians who are mainly divided

between Roman Catholics and Anglicans. There are also a large

number of Muslims and also people following animistic religions.

Attributes that might affect the operations of a foreign company

trying to operate in Uganda.

Language Barrier

Uganda is a country which has a multi ethnic, multi religious and

multi language background. Even though it is stated that English is

the official language as mentioned above many people speak

indigenous languages such as Bantu and Nilotic. Hence resulting in a

risk to the operations of the company by not being able to

communicate with the locals, thus resulting in a language barrier.

Religious Concerns


Uganda is also a multi religious country with people practicing many

religions. This would mean the company will have to hire employees

fit to work from any religion and also respect those belonging to all

religious groups in order to avoid discrimination of the workforce.

Violent Political History, Political Instability and

Nepotism

Uganda is a country of about 25 million people, gas English as its

official language. But many people speak only another language,

mainly Bantu or Nilotic languages of the Bugandas, langos, Acholi,

Teso and Karamojong tribes, There has been a strong separist










payment system.

If any company involves such activities then it is illegal under U.S law.

Not only that in Uganda nepotism is a norm and this country

considered one of the more corrupt in the world because. From the

root level to Government in all sectors conniption exists. Here the

main problems in Uganda for a foreign company have shown as like

some key points, we find out whishes.

Different types of communication language


Higher and lower class discrimination

Nepotism is a norm for employment staffs

Restructuring of rules and international law

People are involve with corruption

Lack of the legal opportunity

People of Uganda's are too much devout to their religion and beliefs and culture

Question-2: Would you describe Green’s and Martin’s attitudes

as being ethnocentric, polycentric or geocentric? What factors

do you think have influenced their attitudes?

Answer:

HG’s corporate philosophy embraces the idea that although secular,

HG’s business activities should embody strong Christian values.

Further, subordinates should be given full responsibility in making

and implementing decisions, but they should also be held accountable

for their results. By choosing to live in a middle-class Ugandan

neighborhood while shunning the expatriate community, by paying

extra for service, by hiring recommended relatives, and by paying fees

and participating in tribal ceremonies, Martin exhibited a more

polycentric (autonomous) attitude, while Green seemed to be more

geocentric in his approach. While Martin was more concerned about

his effectiveness with respect to his assignment in Uganda, Green was

more concerned with corporate-level issues.


Question 3: Who was right, Green or Martin, about the

controversial actions Martin took in the Ugandan operation?

What might have been the results if he had not taken those

actions?

Answer:

Martin was right about the controversial actions he took in the

Uganda operation. Because, HG saw the wisdom of having someone

with both a home-country corporate perspective and a knowledge of

Uganda’s economic political and cultural complexity. Charles Martin

was 29 still young by business standards had a background that

seemed well suited to the Ugandan project. After high school, he

entered the University of Wisconsin-Madison where he becomes

fascinated with African while taking a course about its pre-colonial

history. After graduating with a major in African studies, he joined the

Peace Corps and served in Kenya. His duties involved working with


the start up of small business. So he had some knowledge and

experience how to working with the start up of any business and

Uganda project for HG was first any where in Africa. Further for that

reason Martin quickly learned that by paying tips in advance to the

responsible people, he could speed completion of HG’s requirements

such as phone installed, supplies delivered on operating licenses

issued. To handle import clearances Martin hired the niece of high-

ranking custom’s officer. From the perspective of Uganda’s culture

and economic situation Martin wanted to give the exorbitant

payments and participated in the second ceremony of tribal by

respecting their believes. Not only had that he also hired a specialist

in African religions. Because Martin know that how to operate

business as a foreign company in a country, that company must gives

respect and considered their culture, norms and beliefs,

Arguments can be made for the positions of both Green and Martin.

Certainly Martin had achieved the desired results in a timely fashion.

However, Martin’s rejection of the typical expatriate lifestyle ran

counter to Green’s idea of a desirable corporate image; Green further

felt that this might create assimilation problems for future HG

expatriates assigned to the project. Tipping for services could easily

have led to the expectation of increasingly larger payments as the

project progressed. His dealings with the official caretaker of the

sacred site, who was willing to appease the spirits for increasingly

higher fees.

Further, Martin’s participation in the tribal ritual could have been

construed as a mockery of tribal customs and also have been seen as

an affront by Uganda’s Christian majority. Finally, the close

connection between HG’s local Ugandan employees and government

officials represented an invitation to corruption. Nonetheless, had

Martin chosen to ignore local customs, the project could easily have


fallen behind schedule at any point. The result if Martin had not taken

those actions would be:

HG’s business operation would move slowly

One may wait months to get a phone installed, supplies

delivered on operating licenses issued without paying tips

Without exorbitant payments and family connections hiring

people or staffs will be difficult because Nepotism is a norm in

Uganda

Without hiring a specialist in African religions and participation

in the ceremony by Martin. HG would not continue its operation

and displace the villagers where the dam will be built

Every task would not be computed on time within the total

budget


Question 4: In HG's next phase, the dam construction, should it

employ some one whose main function is to be a liaison

between HG’s corporate culture and the culture of Uganda? If

so, should Martin be the person for the job?

Answer:

If in HG's next phase, the dam construction employ some one whose

main function is to be a lesion between HG's coronate culture and the

culture of Uganda without considering the Uganda's culture then the

same problem will occurred which was occurred earlier in Charles

Martin case. Because, culture includes norms based on learn

attitudes, values and beliefs whishes are vary from one country to

another country or if in one country then one place to another place.

So Martin should be the right person for the job. Given the

importance and the size of the project, as well as the many pitfalls

that will surely be encountered along the way, it seems only logical to

employ someone who is extremely well versed in the culture of

Uganda to serve as a liaison with HG’s headquarters. Whether that

person is Martin or someone else, however, HG must establish clear

guidelines that reflect both U.S. law and corporate policy to guide the

managers of their foreign operations.


ConclusionAfter analyzing the case we can come to the following conclusion,

• The internationalization of business requires thorough research

of the other country’s culture

• There is a need for accommodation to the different standards of

doing business by the host company in the foreign country

• It is necessary to, above all, respect the other country’s cultural

beliefs,

• People working in a foreign environment should try to become

geocentric.


References International Business Environments and Operations,

John D. Daniels and Lee H. Radenbaugh, 11th Edition.

International Business, Alan H. Rugman and Richard M.

Hodgetts

http://docentes.fe.unl.pt/FE/.../

2_2_Charles_Martin_in_Uganda_G31.ppt

http://docentes.fe.unl.pt/FE/.../

2_2_Charles_Martin_in_Uganda_G23.ppt

www.mba.biu.ac.il/stfhome/bijaoui/891/case/2009/

uganda.pdf


Charles Martin in Uganda_The Case Solution

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