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Closing Case Question: Do you think requiring everyone in a multinational firm (MNC) to carry around a card with the firm’s core values on it can change a company’s culture? Why or why not?

Closing Case Question: Do you think requiring everyone in a multinational firm (MNC) to carry around a card with the firm’s core values on it can change a company’s culture? Why or why not?

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
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Closing Case Question: Do you think requiring everyone in a multinational firm (MNC) to carry around a card with the firm’s core values on it can change a company’s culture? Why or why not?

Trying to Change the Corporate Culture of a Multinational Enterprise: General Semiconductor Closing Case W The first step Ostertag took toward changing General Semiconductor's corporate culture was to replace nearly every member of the company's senior management team. Job insecurity rapidly spread throughout the ranks. "I realized we needed to do something to develop a sense of teamwork," says Ostertag suggesting that laying people off was not enough. "We needed to develop a culture of mutual respect that fostered cooperation and innovation." hen Ronald Ostertag took over the management of General Semiconduc- tor, he realized quickly that he would have to change the $500 million com- pany's culture for the firm to survive. However, changing General Semiconductor's culture was a significant challenge because the New York-based manufacturer of electronics parts had 60,000 workers around the world who spoke five different languages. Only 200 of those workers were employed in the United States. Its facilities outside the United States were in China, France, Germany, Ireland, and Taiwan. After taking over as CEO, Ostertag decided to sched- ule a team-building meeting in which the new management team would decide on the company's guid- ing principles. "Our task," he says in retrospect, "was to put down on paper what our core values were and then make sure everyone was on the same page." A cohesive mission statement and a list of eight company values, which are called General Semiconductor's "culture points," came out of that meeting and were centered around goals like "quality," "integrity," "good customer service," and "on-time delivery." Soon, everyone in the company knew the culture points and even carried them around on small cards. "They knew when they saw me coming, whether it was in the factory in Taiwan or Ireland or here, that I might come up to anyone and ask them to rattle off four or five of those val- ues," says Ostertag. "I didn't mean it as a test, but more to show that that is what everyone here is striving for." Unfortunately, Ostertag's changes did not occur quickly enough for General Semiconductor to fend off a hostile takeover. Believing that more improvements could be made and greater value extracted from General Semiconductor, Vishay Intertechnology purchased the company in 2001. Today, General Semiconductor is a subsidiary of the Pennsylvania-based firm. Vishay Inter- technology has grown considerably and broadened its product line through acquisitions. It also has a global presence with manufacturing facilities in six Asian coun- tries, including China; Europe; Israel; and the United States; and sales offices in many other countries around the globe. Vishay uses the international expertise in developing new technologies. This is exemplified in the continued success of the subsidiary now named Vishay General Semiconductor LLC which had two patents issued in May. These new technologies were developed by researchers working in the unit's R&D labs in Tianjin, China and Taipei, Taiwan. Questions 1. In your opinion, what actions taken by Ostertag stood the most chance of changing General Semiconductor's culture? 2. Do you think requiring everyone in a multinational firm to carry around a card with the firm's core val- ues on it can change a company's culture? Why or why not? 3. In your opinion, was Ostertag managing the cross- cultural operations effectively in the process of try- ing to change the firm's culture? Explain. 4. Did Ostertag appear to have a global mind-set? Why or why not? Sources: S. Chin, "Vishay Finally Gets General Semi," EBN, August 6, 2001, lc; C. L. Cole, "Optimas 2001-Global Outlook Eight Values Bring Unity to a Worldwide Company," Workforce, March 2001, 44-45; Company Web site, http://www.vishay.com. accessed May 20, 2010; "Patent No. 7,719,096 Issued on May 18, Assigned to Vishay General Semiconductor for Semiconductor Device, Manufacturing Method," U.S. Federal News Service, May 20, 2010, http://www.highbeam.com; "Patent No. D616,387 Issued on May 25, Assigned to Vishay General Semiconductor, Ornamental Design for Bridge Rectifier Package," U.S. Federal News Service, May 26, 2010, http://www.highbeam.com.
Transcribed Image Text:Trying to Change the Corporate Culture of a Multinational Enterprise: General Semiconductor Closing Case W The first step Ostertag took toward changing General Semiconductor's corporate culture was to replace nearly every member of the company's senior management team. Job insecurity rapidly spread throughout the ranks. "I realized we needed to do something to develop a sense of teamwork," says Ostertag suggesting that laying people off was not enough. "We needed to develop a culture of mutual respect that fostered cooperation and innovation." hen Ronald Ostertag took over the management of General Semiconduc- tor, he realized quickly that he would have to change the $500 million com- pany's culture for the firm to survive. However, changing General Semiconductor's culture was a significant challenge because the New York-based manufacturer of electronics parts had 60,000 workers around the world who spoke five different languages. Only 200 of those workers were employed in the United States. Its facilities outside the United States were in China, France, Germany, Ireland, and Taiwan. After taking over as CEO, Ostertag decided to sched- ule a team-building meeting in which the new management team would decide on the company's guid- ing principles. "Our task," he says in retrospect, "was to put down on paper what our core values were and then make sure everyone was on the same page." A cohesive mission statement and a list of eight company values, which are called General Semiconductor's "culture points," came out of that meeting and were centered around goals like "quality," "integrity," "good customer service," and "on-time delivery." Soon, everyone in the company knew the culture points and even carried them around on small cards. "They knew when they saw me coming, whether it was in the factory in Taiwan or Ireland or here, that I might come up to anyone and ask them to rattle off four or five of those val- ues," says Ostertag. "I didn't mean it as a test, but more to show that that is what everyone here is striving for." Unfortunately, Ostertag's changes did not occur quickly enough for General Semiconductor to fend off a hostile takeover. Believing that more improvements could be made and greater value extracted from General Semiconductor, Vishay Intertechnology purchased the company in 2001. Today, General Semiconductor is a subsidiary of the Pennsylvania-based firm. Vishay Inter- technology has grown considerably and broadened its product line through acquisitions. It also has a global presence with manufacturing facilities in six Asian coun- tries, including China; Europe; Israel; and the United States; and sales offices in many other countries around the globe. Vishay uses the international expertise in developing new technologies. This is exemplified in the continued success of the subsidiary now named Vishay General Semiconductor LLC which had two patents issued in May. These new technologies were developed by researchers working in the unit's R&D labs in Tianjin, China and Taipei, Taiwan. Questions 1. In your opinion, what actions taken by Ostertag stood the most chance of changing General Semiconductor's culture? 2. Do you think requiring everyone in a multinational firm to carry around a card with the firm's core val- ues on it can change a company's culture? Why or why not? 3. In your opinion, was Ostertag managing the cross- cultural operations effectively in the process of try- ing to change the firm's culture? Explain. 4. Did Ostertag appear to have a global mind-set? Why or why not? Sources: S. Chin, "Vishay Finally Gets General Semi," EBN, August 6, 2001, lc; C. L. Cole, "Optimas 2001-Global Outlook Eight Values Bring Unity to a Worldwide Company," Workforce, March 2001, 44-45; Company Web site, http://www.vishay.com. accessed May 20, 2010; "Patent No. 7,719,096 Issued on May 18, Assigned to Vishay General Semiconductor for Semiconductor Device, Manufacturing Method," U.S. Federal News Service, May 20, 2010, http://www.highbeam.com; "Patent No. D616,387 Issued on May 25, Assigned to Vishay General Semiconductor, Ornamental Design for Bridge Rectifier Package," U.S. Federal News Service, May 26, 2010, http://www.highbeam.com.
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