Intercultural management in GTECH Corporation

Mateusz Piszczek Matrikelnummer: 44967 Major: KuWi/Erasmus

TABLE OF CONTENTS

1. Intercultural management What is management? What is culture? Problems and benefits of intercultural business

2. GTECH Corporation Intercultural practices in GTECH Corporation GTECH Corporation in Poland and world wide Local differences

1. Intercultural management
(Intercultural management is about culture and organization. People from different countries have different cultural background. What is good in one culture is not always good in other culture because the way of doing things in one culture may not be the way in other. Intercultural management is the performance of personal or institutional management actions and activities. Furthermore Intercultural Management comprise management task, targets, functions and hierarchies. To cope with the challenges of a different approach to time, different attitudes towards the tasks and relationships, the differences in approach to power and authority and the use of different communication models, managers need to be aware of cultural differences that occur. This requires gaining knowledge about team members cultures and management, because all members of a company have their cultural values and apply them I their job. They follow the strategy of the company, national unions and the nationally binding laws and contracts.)

What is management?
Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources and natural resources.1 (Management is adopted to a variety of fields, such as: Leadership in different cultures Creating and improving a corporate culture Conflict management/conflict solving strategies in different cultures Marketing strategies Improving and enhancing the employees identification with the company)

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

What is culture?
(Culture is a term that has many different inter-related meanings. Most commonly understood as the whole of the spiritual and material achievements of society. Culture specifies the characteristic patterns of behavior in a given society. It is the whole way of life. That is why understanding people from other countries is not easy. Aspects of life in one region of the globe usually are completely different than in second region. Multicultural teams are important source of misunderstanding and management dilemmas. Managers must understand the standards and values that lie behind the cultures of their employees and partners if they want to manage a team and motivate employees effectively. It is a success for group leader, when people from one cultural background, meet, interact with, understand and deal with people from other cultural background. Every culture based on their values requires a different motivation. If an employee comes from a culture where success is the measure of praise for the whole group, as in Japan, personal praise will not be motivated for him. If an employee comes from a culture where success is the measure of his individual achievements, such as in American culture, it will not be motivated by the recognition given to the whole team. In large companies, there are two parallel cultural currents. The first is the culture of a country or region in which the company operates. Next to it is functioning organizational culture. It depends on the values proclaimed by the company and its employees. Understanding the importance and significance of these two cultures, and mutual relations between them, is the first step to effective management of multicultural teams. Usually in the local branches of international companies organizational culture is weaker than the culture of a country or region. Therefore, if we manage the behavior and reactions of people, it is important to understand what values dominate in the community. Intercultural human resource management is becoming increasingly popular in Western countries, where due to a significant percentage of highly educated immigrants, owners create an efficient organizations which take advantage of the experience of workers from different countries. In Eastern Europe the topic remains somewhat dormant and ignored, which requires changes for this region of Europe.) When culture is understood as the entirety of life expressions of people, then companies are constituent parts of culture. These expressions reflect respective cultural patterns. Out of these patterns it is possible to classify human behavior in different cultures. Cultural
4

patterns, in turn, shape companies, company structures and communications. Culture as a complex phenomenon influences companies as well as their business or management activities. It has influence on companies as whole unities or in their structures, hierarchies, management and leadership styles.)

Problems and benefits of intercultural business

Intercultural business can make problems and benefits for company, which are challenges for managers. Most companies help their employees in the development of skills, negotiation skills, coping with stress and time management. However, not everyone understands the need to support staff in the development of competence to work with people from other cultures. Managing cultural differences, training programs for migrant workers and their families, management teams abroad or working with people from other cultures are conducted in Western Europe and the United States for many years. Exploiting the potential of multicultural teams is possible if managers have knowledge of intercultural communication, management, motivation of employees on particular cultures, from which the employees are. This knowledge should be possessed by both managers and employees. Training is the best tool that allow you to use past experience, acquire new knowledge and to combine these two elements, which immediately affects the improvement of the company. This knowledge should be possessed by both managers and employees. Training is the best tool that allow you to use past experience, acquire new knowledge and to combine these two elements, which immediately affects the improvement of the company.

Problems
Adapting to a multicultural Human Resources monoculture seems to be a big problem. Ignoring cultural bonds and the value of the employee or doing business without any changes inside the company result as unchanged sense of dominance, the lack of psychological comfort, which amounts to nothing more than a drop in employee productivity, and also the organization in the long run. In functioning of a multicultural organization we due to many problems that did not exist in homogeneity company: different approach to time, different attitude to the tasks and relationships, the differences in approach to power and authority and the use of different models of communication. In some cultures, time is very limited and respected resource. Culture of different regions
5

differently perceive the problem of working time - resting at other times, it happens more often they do not keep appointments to the minute and you should be aware that this is not due to a lack of respect, but it instilled a model of behavior. Approach to time has a significant impact on the manner and mode of work on projects, conduct meetings, etc. The time management should pay attention to how time affects the employee in the native and acquired environment. Managers have to be aware of differences in culture, in which the employee previously functioned. Approach to power and authority is also a big problem. Workers from different nationalities present different approach relative to the hierarchy of the company. Team members from egalitarian cultures expect others demonstrate their achievements and competencies, not a function of the organizational hierarchy. However, people from hierarchical cultures accept the status resulting from the company hierarchy and obey him without discussion. Similar differences can be observed relative to the tasks and relationships. For example, in Asian countries, building trust and good relationship is more important than the task. Both internally and in relations with business partners. However, in other cultures people are mainly focused on completing the task. For those that will be difficult to understand that lunch lasts 3 hours, most of which is dedicated to conversations about holidays, social life and weather. In turn, those focused on building relationships may feel offended if their business partner without a moment's admission goes to the heart of the matter. Another issue is communication, because communication difficulties create barriers to effective team work, restrict the sharing of information, but also because they lead to conflicts between people. There are two basic models of communication: direct and indirect. In Western culture prevails direct model of communication and information are transmitted directly to the recipient. In other cultures, more than the direct form of communication counts its presentation - tone of voice, body language, gaze. This is the indirect model, in which negotiators have to draw conclusions regarding partner priorities.

Benefits
Despite initial difficulties in managing a multicultural team, benefits of employment of workers from various countries far outweigh the problems. Proper selection of employees in a intercultural organization leads to a much greater respect between employees who are beginning to see colleagues in terms of culture, and any differences are not regarded by
6

them as something bad, but as something what they have to accept and respect. Awareness of cultural differences is needed to overcome problems arising from different approaches to time, tasks, authority and communication of our employees. The existence of corporate multiculturalism helps balance the organizational emotions. Representatives of the emotional cultures after a long contact with peaceful cultures can soothe their behavior and vice versa. Despite initial communication problems, the occurrence of the phenomenon of balancing integrates organization and may lead to the creation of institutions much more monolithic than the organization of homogeneity. The employment of educated workers from different cultural backgrounds also allows for the development of the organization in terms of change management. What in one culture turns out to be an insurmountable problem, the second has been resolved much earlier and there is nothing in the way to implement it in a different culture. International team manager should ask the members what kind of work style they prefer, what atmosphere in the company is friendly to them, how they want to communicate, whether they prefer a rigid or flexible working hours. Such questions help to prevent conflicts before they arise. It is necessary to understand the diversity of situations, when such occurs, and to overcome fear, which makes it difficult to introduce it into general use. Different cultures can rise organization to a higher level. Companies should not be afraid of interculturalism, but thoroughly analyze and take the best.

2. GTECH Corporation
GTECH Corporation is an international company that is part of Lottomatica Group. Lottomatica is one of the worlds largest commercial lottery operators and a market leader in the Italian gaming industry. The organization specializes in the production and distribution of modern lottery systems around the world. GTECH Corporation for 30 years offers its customers comprehensive services such as delivery, installation and maintenance of innovative lottery system, terminals, and telecommunications network. The company also conducts marketing support, hotline support and sales training. Lottomatica is publicly traded on the Italian Stock Exchange and has 2.3 billion in revenue and 7,700 employees in approximately 60 countries. GTECH and Lottomatica operate under Gruppo Lottomatica,

which is majority owned by De Agostini, which belongs to a century-old publishing, media, and financial services group.2 The company's mission is to maximize the capacity and efficiency of transactions processed and deliver superior performance and added value to our customers in the lottery industry, gaming venues and commercial services sectors. The three main values of the company are: Innovation - From the beginning the company used the latest technology. This helps satisfy customer requirements, and create opportunities for them. Performance - GTECH takes care of the credibility and reliability. Their networks and systems are the most secure and fastest in the world. The company employs only welltrained workers. Integrity - The company sets standards of quality and integrity above what is expected. GTECH's commitment to the highest standards of ethics and integrity in business. GTECH can be called a multicultural corporation, because works in an international environment and offers services and products to customers from all over the world. Employees are evaluated by centrally planned systems of evaluation, while wages and benefits are always determined locally, according to the standards prevailing in the country. Conducting this policy by GTECH very well fit the company's offer to local needs and capabilities of workers. More than 90 countries on six continents use the services of lottery made by GTECH Corporation. Such a wide international activity is a challenge both logistical and managerial, which must be met. Lotteries in countries such as Poland, the USA, Germany, China, Canada, Great Britain, Belgium, Belarus, Finland, Chile or even Taiwan every day contain a transaction on a massive scale through GTECH technology and infrastructure. GTECH Corporation has special Code of Conduct, because they want to do the right things for the right reasons. The Code of Conduct summarizes the principles and values that guide decisions they make. The Code of Conduct requires all GTECH employees to conduct GTECH's business consistent with these values and principles, and in accordance with applicable laws. The Code of Conduct applies to all GTECH employees around the world, and
2

http://www.gtech.com/about_gtech/default.asp?persist=B3952766353847729F8F305137D00E2B

we expect our representatives, consultants, and contractors to be guided by the Code of Conduct, as well.3

Intercultural practices in GTECH Corporation

Every person is different, we differ in terms of culture, we have other business behavior, other law, other habits. In companies that operate in global markets, most rules, requirements and procedures are centrally imposed. GTECH Corporation uses its own management system, devoid of rigid and universal corporate rules. To a large extent, changes in the central procedures remain in the hands of the Human Resources department and other managers in local organization. The company strives to be the most flexible. Trying to use the best local opportunities, customs and laws GTECH works well in every market. In the local branches the most important is to hire local workers but also skilled and experienced representatives of other nationalities. The international team has a lot to teach about the acceptance of various behaviors and openness to other cultures. However, the business standards apply to everyone, no matter what country they come from and what language they use. Like any self-respecting company, GTECH Corporation, tries to check satisfaction of their employee. In the seven most popular languages for the company, employees are asked specific questions, which are the same for every country. These studies are not intended to detect cultural differences but those arising from the work in intercultural environment. The evaluation systems used in the GTECH have to ensure equal treatment to employees. Hence, the same evaluation criteria apply in all countries, allowing for objective results. GTECH centrally manages the bonus system, which is defined specifically for all employees. Corporate Headquarters decide on the goal of the company, employee evaluations and system-building responsibilities.

GTECH Corporation in Poland and world wide

GTECH Corporation employs approximately 6,000 employees worldwide, 400 of them are from Poland. The company estimated that the Polish branch - Technology Center, formed more than half of the solutions offered by GTECH. Currently, several projects are implement
3

http://www.gtech.com/about_gtech/compliance_program.asp

under the leadership of Polish managers, working among others with one of the largest lotteries in the world in the United Kingdom. In Warsaw, the company develops and tests the video lotteries, which are used in Italy, Switzerland and other countries. In Poland, since 1991, GTECH operates the Sports Lottery system. Polish divisions also employ foreigners. In the structures of the company, except the Polish employees, we find workers from Canada, Lithuania, Serbia, USA, Ukraine and Albania. The ability to create international teams is very important for GTECH. The company wants its employees to have contact with other cultures. This is important because the Polish are serviced clients from many continents, not only from the family area. Contact with other languages, behavior, law and approach to business is need to work at GTECH. Employees gradually learn to work in the cultural diversity and adapt to new situation. Implementation of projects is largely associated with traveling abroad, this requiring flexibility from employees. Employees gain first experiences in the Polish international teams, then they go abroad where they often work several months in a team composed of employees from around the world. The GTECH employees are very often able to come into contact with cultural diversity. For example, when a company delegates 100 people to Spain, including 15 Polish employees, who have to work, install the system or make repairs and maintenance together. They must be able to create a good team to solve tasks together, work and communicate with each other. Managers of such projects have extensive qualifications: from the characteristic for leaders and managers to the technical and information preparation. GTECH provides all its employees the opportunity to gain intercultural competence, which help dealing with clients and increase job performance. Whereas the lottery industry is strongly monopolized, there are not many customers. But the requirements and contracts are around the world. People employed by GTECH work in 90% for foreign customers. Employees are involved in designing and implementing technology solutions that allow bet money in real time. Workers also sell and mount the central system and terminals. GTECH teams provide telecommunications services, maintenance services in the terminals and marketing consultancy for the lottery. In the UK, GTECH has a marketing team to serve customers, consisting of people from different nationalities. Poland is famous for its IT professionals. In other countries GTECH employs operators, technicians and engineers.

10

Local differences
Regionalization is reflected in the local benefits offered to employees. Just as salary, local benefits are closely related to the local market, where each country has its own rules. In addition to benefits resulting from the law, company offers in each country of its activities, the benefits associated with best practices in a given place. Example would be that, in Turkey, employees receive vouchers for lunch during work, and in Poland does not have this benefit, because it is not popular. In most countries, GTECH provides medical services available not only for employees but also for their families. Nowadays, the international organizations which do not have in their package medical care, are not competitive in the labor market. One of the benefits offered by GTECH in Poland is a retirement savings program - a program involves both the employee and employer, allocating part of the salary on retirement. It is a form of pension system on favorable terms offered by the company. In Poland, company also offers life insurance and accident insurance, while in the United States company does not offer this benefit, since it is not popular. The company offers a program called "work, life, balance" designed to improve employee well-being. In company areas, we can find play rooms, where workers can relieve stress by playing table tennis or table football. Employees have the opportunity to take advantage of the sports package, which allows access to various recreational and sports resorts such as gymnasium, swimming pool, a sports club. In some countries, for example in Belgium, the basic benefit is a company car for each employee. In Poland, only high rank managers have the company car, and in the United Kingdom, no one gets a company car, because in this country cars for workers are very high taxed. The existence of such differences can lead to various problems, because we are talking about equal treatment. It is therefore necessary to explain them properly, because when it comes to salary and benefits, they are always determined locally. Employees understand why this differences appear and know that it testifies about regionalization and possibly best fit the company's offer to local needs and opportunities.

Community relations in GTECH

GTECH After School Advantage Program (The GTECH After School Advantage Program is a national community investment program, which provides non-profit community agencies and public schools with state-of11

the-art computer labs. These computer centers are designed to provide inner-city children aged five to 15 with a meaningful, yet fun, learning experience during the critical afterschool hours, in a safe environment. This initiative is meant to provide an otherwise unavailable educational experience and bridge the digital divide among at-risk children. By applying our knowledge and expertise to this type of program GTECH hopes to increase children's interest in careers in computers and provide them with the necessary tools to help them become more competitive in school and in today's job market.) Reach Out program GTECH encourages its employees to participate in social actions in the communities where they currently live and work. The company has created the "Reach Out", which gives employees the opportunity to do something good for society. Examples of a social activity Day Off for Volunteerism: Sometimes one day can make a real difference! GTECH's Day Off for Volunteerism gives employees the opportunity to take one paid workday per year to perform community service. Employees may choose to spend their paid time at a favorite charity or help out with educational projects at their child's school, for example. Dollars for Doers: GTECH also rewards its employees for taking the time to volunteer in their communities. When an employee volunteers at least 25 hours a year with any non-profit organization, GTECH will make a donation of $250 to that organization. If every employee took part, GTECH could donate up to $1.2 million. Matching Gifts: Education is GTECH's highest philanthropic priority. GTECH encourages its employees to make monetary donations to educational institutions by matching the gift. When employees

12

give $50 to $500 per year to any U.S.-based college or university, GTECH will match the donation dollar for dollar!4

http://www.gtech.com/about_gtech/reach_out.asp

13