CHALLENGES FACING ORGANIZATIONS EXPANDING GLOBALLY: A CASE STUDY OF THE NATURE

CONSERVANCY (TNC), AFRICA

BY

RITAH E. MUTUI

UNITED STATES INTERNATIONAL UNIVERSITY

AFRICA

SUMMER 2014

CHALLENGES FACING ORGANIZATIONS EXPANDING GLOBALLY: A CASE STUDY OF THE NATURE

CONSERVANCY (TNC), AFRICA

BY

RITAH E. MUTUI

A Research Project Report Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the

Degree of Executive Master of Science in Organizational Development (EMOD)

UNITED STATES INTERNATIONAL UNIVERSITY AFRICA

SUMMER 2014

ii

STUDENT’S DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any

other college, institution or university other than the United States International

University in Nairobi for academic credit.

Signed: ________________________ Date: _________________________

Ritah Mutui (ID 640147)

This research project report has been presented for examination with my approval as the

appointed supervisor.

Signed: ________________________ Date: _________________________

Dr. George K’Aol

Signed: _______________________ Date: _________________________

Dean, Chandaria School of Business

iii

ABSTRACT The purpose of the study was to determine the challenges that face organizations as they

expand their operations globally. The study was guided by the following research

questions: What are the cultural challenges that affect TNC’s expansion in Africa? What

are the leadership challenges that affect TNC’s expansion in Africa? What are the

political challenges that affect TNC’s expansion in Africa?

A case study research design was used for this study. The study population was limited to

The Nature Conservancy, Africa. The study population comprised of a total of 53

members of staff based in Kenya, Tanzania and Zambia categorized into the top level

management team, the middle level managers and the general staff. A census of the entire

population was carried out. Frequency distributions and percentages were utilized in the

descriptive statistical analysis part of this study. In addition one-way analysis of variance

(ANOVA) was used to determine whether there were significant differences among the

three countries on selected variables .The findings were presented using tables and

figures.

The findings on the cultural challenges that affect TNC’s expansion in Africa were

majorly in different customs and manners among the three countries. The study showed

that language barrier was not a major challenge to TNC expansion. However, the findings

revealed that the staff members from Tanzania were more affected by language barriers

than those from Zambia and Kenya. This difference on how language barriers affect staff

from different countries was statistically significant at p value < .05 level.

The findings on the leadership challenges that affect TNC’s expansion in Africa revealed

that motivation was a challenge .The country difference was statistically significant at p

(.039) <.05 level for whether staff were frequently consulted on matters affecting their

jobs and also statistically at p (.035) <.05 level for whether staff were satisfied with other

benefit programs such as medical cover and pension that TNC provided to its employees.

The study showed that supervision was not a challenge to TNC’s expansion in Kenya and

Zambia, but it was a challenge in Tanzania. This country differences in opinion with

regard to the challenge of supervision was statistically significant at p (.048) <.05 level

for whether common goals were clearly stated.

The major finding on political challenges to TNC expansion in Africa showed that

government instability hindered TNC’s global expansion and this was statistically

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significant at p (.027) <.05 level, for whether conditions set for employing expatriates in

certain countries discouraged TNC from globalization, and statistically significant at p

(0.05) <.05 level for whether restrictive fund repatriation laws discouraged TNC from

venturing in some countries.

In conclusion, the major findings of this study have shown that each country has different

groupings of people with unique backgrounds which may present a challenge to

international organizations. Therefore managers need to develop cultural sensitivity and

be selective in choosing channels for effective communication. In order to accommodate

the needs of globally diverse employees, organizations should provide flexible plans

where individuals can choose the benefits that are best suited to their needs. A nation’s

international relations with other countries and reputational capital is significant, both

politically and economically as it affects the country’s ability not only to pursue and

achieve international political objectives but also to attract in-flow of foreign investment .

The study recommends that organizational managers should be properly prepared for the

multinational assignments and their training should include cultural sensitivity,

understanding the importance of maintaining relationships, and impression management.

Leadership can be improved by promoting staff within the organization’s ranks who

understand the systems, appointment of senior executives from diverse nationalities and

cultural backgrounds and senior management support should be encouraged to enable

staff to perform their best. Structured negotiations either with the support of the home

nation or directly with the host nations can be used as potential solutions to political

challenges.

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ACKNOWLEDGEMENT

My appreciation goes out to my supervisor, George K’Aol (PhD) for his guidance

through the whole project.

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DEDICATION

This work is dedicated to my husband (Felix), my daughter (Natasha), my sisters (Edith

and Faith) and to the Almighty God.

vii

TABLE OF CONTENTS

STUDENT’S DECLARATION ........................................................................................ ii

ABSTRACT .......................................................................................................................iii

ACKNOWLEDGEMENT ................................................................................................. v

DEDICATION................................................................................................................... vi

LIST OF ABBREVIATIONS .......................................................................................... ix

LIST OF TABLES ............................................................................................................. x

LIST OF FIGURES .......................................................................................................... xi

CHAPTER ONE ............................................................................................................... xi

1.0 INTRODUCTION................................................................................................... 1

1.1 Background of the Problem................................................................................... 1

1.2 Statement of the Problem ...................................................................................... 3

1.3 Purpose of the Study ............................................................................................. 6

1.4 Research Questions ............................................................................................... 6

1.5 Importance of the Study ........................................................................................ 6

1.6 Scope of the Study................................................................................................. 6

1.7 Definition of Terms ............................................................................................... 7

1.8 Chapter Summary .................................................................................................. 7

CHAPTER TWO ............................................................................................................... 9

2.0 LITERATURE REVIEW ...................................................................................... 9

2.1 Introduction ........................................................................................................... 9

2.2 Cultural Challenges Affecting Global Expansion ................................................. 9

2.3 Leadership Challenges Affecting Global Expansion .......................................... 15

2.4 Political Challenges Affecting Global Expansion ............................................... 19

2.5 Chapter Summary ................................................................................................ 23

CHAPTER THREE ......................................................................................................... 24

3.0 RESEARCH METHODOLOGY ........................................................................ 24

3.1 Introduction ......................................................................................................... 24

3.2 Research Design .................................................................................................. 24

3.3 Population and Sampling Design ........................................................................ 24

3.4 Data Collection Methods ..................................................................................... 26

3.5 Research Procedures ........................................................................................... 26

3.6 Data Analysis Methods ....................................................................................... 26

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3.7 Chapter Summary ................................................................................................ 27

CHAPTER FOUR ............................................................................................................ 28

4.0 RESULTS AND FINDINGS ................................................................................ 28

4.1 Introduction ......................................................................................................... 28

4.2 Demographic Characteristics of the Respondents ............................................... 28

4.3 Cultural Challenges Affecting Global Expansion ............................................... 31

4.4 Leadership Challenges ........................................................................................ 38

4.5 Political Challenges ............................................................................................. 46

4.6 Chapter Summary ................................................................................................ 53

CHAPTER FIVE ............................................................................................................. 54

5.0 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS ................. 54

5.1 Introduction ........................................................................................................ 54

5.2 Summary ............................................................................................................. 54

5.3 Discussion ........................................................................................................... 56

5.4 Conclusions ......................................................................................................... 63

5.5 Recommendations .............................................................................................. 64

REFERENCES…………………………………………………………………………66

APPENDICES…………………………………………………………………………..74

Appendix A: Cover Letter

Appendix B: Questionnaire

ix

LIST OF ABBREVIATIONS

CRPG Collaboratory Research on Global Projects

NGOs Non-Governmental Organizations

TNC The Nature Conservancy

USA United States of America

WRF World Economic Forum

x

LIST OF TABLES

Table 3.1: Sample Size Distribution………………………...………… ......…..………25

Table 4.1: Language Barrier.………………...……………….…………... ……….…..31

Table 4.2: One-Way Analysis of Variance on Language Barrier by Country…..….. …33

Table 4.3: Different Values and Attitudes……………………………. ...……………. 33

Table 4.4: One-Way Analysis of Variance on Values/Attitudes by Country….….. …..34

Table 4.5: Different Education Systems………………...…………..………………….35

Table 4.6: One-Way Analysis of Variance on Education Systems by Country………..36

Table 4.7: Different Customs and Manners……………………………...………...…...37

Table 4.8: One-Way Analysis of Variance on Customs and Manners by Country….…38

Table 4.9: Supervision/Direction Setting…………..………………...…….………….. 38

Table 4.10: One-Way Analysis of Variance on Customs and Manners by Country….....39

Table 4.11: Motivation…………………………………………………………………...40

Table 4.12: One-Way Analysis of Variance on Motivation by Country………….……..41

Table 4.13: Creating Teams…………………………………………………………….. 41

Table 4.14: One-Way Analysis of Variance on Creating Teams by Country……… …42

Table 4.15: Information Management……………………………………………………43

Table 4.16: One-Way Analysis of Variance on Information Management by Country…44

Table 4.17: Encouraging of Creativity/Innovation………………………………………44

Table 4.18: One-Way Analysis of Variance on Creativity/Innovation by Country……...45

Table 4.19: Nationalization Policies……………………………………………………..46

Table 4.20: One-Way Analysis of Variance on Nationalization Policies by Country…..47

Table 4.21: Government Instability………………………………………………...……48

Table 4.22: One-Way Analysis of Variance on Government Stability by Country……..49

Table 4.23: International Relations………………………………………………………50

Table 4.24: One-Way Analysis of Variance on International Relations by Country……51

Table 4.25: Government Bureaucracies………………………………………………….52

Table 4.26: One-Way Analysis of Government Bureaucracies by Country…………….53

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LIST OF FIGURES

Figure 4.1: Country of operation ……………………………………………….…….28

Figure 4.2: Department ……………………………………………………………….29

Figure 4.3: Gender of the respondents………………………………….…….……….29

Figure 4.4: Age of the respondents…………………………………….……….……..30

Figure 4.5: Management position……………………………………………………..30

Figure 4.6: Years worked for TNC……………………………………………………31

Figure 4.7: Country versus Language Barrier…………………………………………32

Figure 4.8: Country versus Different Values and Attitude…………………………...34

Figure 4.9: Country versus Education System……………….……………………….35

Figure 4.10: Country versus Customs and Manners………………………………..…..37

Figure 4.11: Country versus Supervision……………………………………..………...39

Figure 4.12: Country versus Motivation………………………………..………………40

Figure 4.13: Country versus Creating of Teams…………………………..……………42

Figure 4.14: Country versus Information Management……………………..………….43

Figure 4.15: Country versus Creativity/ Innovation………………………………..…..45

Figure 4.16: Country versus Nationalization Policies……………………………..……47

Figure 4.17: Country versus Government Instability…………………………….…….48

Figure 4.18: Country versus International Relations…………………………….……..50

Figure 4.19: Country versus Government Bureaucracies……………………..………..52

1

CHAPTER ONE

1.0 INTRODUCTION

1.1 Background of the Problem

The challenges of globalization comes with liberalization of markets, intense competition,

decline of domestic job opportunities and revenues, economic volatility of the integrated

markets, cyclical crises, and non-tariff barriers to trade, spread of pandemics, and new

security issues (Alon & Higgins, 2005).Hence the success of a firm lies in focusing its

strategic capabilities on the functions that are the sources of its core competence. The

other challenges that arise from globalization come in the form of inexperience, lack of

resources and capabilities, the market dominance of well-established rivals, and consumer

loyalty to existing brands (Cazurra & Genc, 2008). Some of the other difficulties may be

listed as differences in cultural, political, geographic, and economic factors (Ghemawat,

2008) as well as barriers to trade; complex and costly knowledge transfer; and insufficient

economies of scale (Ghemawat & Ghadar, 2000).

The term globalization has been viewed differently by several scholars in the past

decades. Bhagwati (2004) defines globalization as a process by which regional

economies, societies, and cultures have become integrated through a global network of

communication, transportation, and trade. Al-Rodhan and Stoudmann (2006) say that

globalization involves economic integration; the transfer of policies across borders; the

transmission of knowledge; cultural stability; the reproduction, relations, and discourses

of power; it is a global process, a concept, a revolution, and an establishment of the global

market free from sociopolitical control. Steers and Sanchez-Runde and Nardon (2010) see

globalization as an application of cross-cultural management practices.

All these definitions see globalization as an accelerating set of processes involving flows

that encompass ever-greater numbers of the world’s spaces and that lead to increasing

integration and interconnectivity among those spaces (Ritzer, 2007). In this sense, they

only see the processes of globalization as leading to increasing integration and inter-

connectivity (Bond & O’Byrne, 2014) but these come with a challenges. For example

Sheppard, Sarros and Santora (2013) posit that in a fast-moving global marketplace,

successfully managing people is a huge challenge for organizations i.e. in a global

2

competition within the flat and connected new world, decision making in organizations

has become increasingly intricate and convoluted (Kayode, 2012).

Hence globalization creates a need for collaborative leadership, which combines social

qualities, technical competencies and the fostering of frank dialogue, trust and self-worth.

Sheppard et al (2013) note that leaders in uncertain and rapidly changing conditions must

be experienced ‘‘all-rounders’’ who collaboratively encourage others to become

collectively responsible for decision making and change leadership.

On the other hand, change management which describes the process, tools and techniques

to manage the people-side of change process, to achieve the required outcomes, and to

realize the change effectively within the individual change agent, the inner team and the

wider system is the other challenge in the global expansion process (Nauheimer, 2005).

Similarly, conducting global, international, and cross-cultural business may be an

ordinary reality for most large organizations, but for startup small to medium enterprises

without global presence it may prove to be a nightmare. It is challenging for them to

manage on a daily basis because of the need for situation-specific attention, on one hand,

and the desire for standardization on the other (Hâllgren & Söderholm, 2010).

Despite the studies focusing on challenges of globalization, World Economic Forum

[WEF] (2014) recognizes an accelerating change in the 21st century which continuously

boosters productivity, create new opportunities and challenges. It particularly stresses on

the disruptions on the online environment and continuous turbulences in economies,

environment, geopolitical, societies and technology in general. This calls for a continuous

review of the prevailing conditions as regards the challenges that affect organizations that

expands globally (WEF, 2014). This is critical for international organizations as it will

assist in coming up with the most relevant and effective ways of managing the actual

prevailing challenges. This premises the study to find out the prevailing challenges that

affect TNC as it expands into African countries.

The Nature Conservancy (TNC) is a global Non-governmental organization with its

world office based in the United States founded in 1951. TNC works to preserve the

animals, plants and natural communities that represent the diversity of life on Earth—by

protecting the lands and waters they need to survive (TNC, 2014). TNC has provided

employment opportunities to locals and international staff in its offices located all over

3

the world. Its operations continue to grow with the expansion to all continents in the

world.

TNC is governed as a single, tax-exempt organization by a worldwide, volunteer Board of

Directors and is managed from its worldwide office in Arlington, Virginia USA and

because the Conservancy is organized as a single organization rather than as separate

local legal entities, ultimate responsibility for the operation of The Nature Conservancy

lies with its Board of Directors. Although the Board of Directors cannot delegate its broad

legal and fiduciary responsibilities, it does delegate responsibility for day-to-day

operations to the president and chief executive officer, who in turn delegates

responsibilities to his or her executive team (Connect, 2013).

TNC world office provides global expertise and the branch offices provide local

understanding. With nearly four thousand staff, TNC works in all fifty states in United

States and more than thirty countries across the globe (TNC, 2014). In Africa, TNC

started its operations in 2004 with Tanzania office as the regional office. The Kenya

office started operations in 2006 and the regional office moved to Nairobi. The global

TNC management has faulted the African region for not delivering results fast enough

(Connect, 2013).

TNC was chosen for this study because of the massive expansion it has gone through to

launch operations in Africa, Australia, Asia & Pacific Islands, Caribbean, Central

America, North America, South America and Europe working with different local and

international organizations to address the global challenges, global priorities. On the other

hand, no published studies have been done to clearly show the challenges currently

influencing the global activities of this organization in Africa.

This study therefore focused on highlighting the challenges that affect the expansion

prospects of TNC in Africa.

1.2 Statement of the Problem

The new age of globalization presents many challenges to international organizations.

Hence when aiming to win business or establish operations in an environment of

relentless pace of globalization especially in the third world and the growing economies,

managers who wish to operate effectively must demonstrate a clear understanding of the

4

prevailing challenges and a wide range of cross-cultural competencies in order to respond

to the challenges presented (Hurn, 2013).

Although earlier studies have been done on specific and overall challenges facing global

projects all over the world over period of time (Aarseth & Andersen, 2013),World

Economic Forum recognizes an accelerating change in the 21st century which calls for a

continuous review of the prevailing conditions as regards the challenges that affect

organizations that expands globally (WEF, 2014).

Despite the fact that several studies have been done to try and create an understanding of

the challenges that face Non-Governmental Organizations (NGOs) that are expanding

globally, there still lacks a mass of empirical evidence on the challenges that face

conservancy based NGOs especially TNC, Africa. Hossain and Sengupta (2009) while

studying the challenges of global expansion focused only on BRAC which is a non-

governmental organization of a Bangladeshi origin. The study focused only on finding the

challenges facing the organization’s microfinance programme’s expansion in limited

countries of Afghanistan, Liberia, Sierra Leone, Southern Sudan, Tanzania, Uganda, and

Pakistan. The findings may not precisely capture the challenges faced by TNC which is

an American organization focusing on nature conservancy in Kenya, Tanzania and

Zambia. For example Wang (2006) points out that there is an increased anti-Americanism

sentiment across the globe which may affect the perception towards organizations with

American roots.

In another study Smith and Lumba (2008) while highlighting the challenges of

internationally networked NGOs, only focused on knowledge management practices with

the scope of the study constituting comparative case studies of two centres (one in

Zambia and the other in the Netherlands) belonging to a single international network (one

world international).The study highlights important variation in diversity, gaps and

perceptions in managing knowledge between centres in the network that are based in

Europe and Africa. This is despite significant communality in knowledge management

processes and infrastructures. For conclusiveness, the highlighted variations therefore call

for more studies in other populations (outside Zambia and the Netherlands).

A study by Rehli (2011) on the other hand only looks at the challenges of international

non-governmental organizations/non-profit organizations through the lens of governance.

5

While acknowledging that the governance of International Non-Governmental

Organizations (INGOs) or Non-profit Organizations (NPOs) is very different from the

governance of private organizations or public entities because they do not have one

formal owner, such as the shareholders of for-profit enterprises, but rather multiple

owners such as donors and volunteers across the globe, he notes that the three main

governance challenges are; the power relation between the two main governance actors:

the non-profit board chair and the executive director. Two is the board nomination modes

and stakeholder representation. Three the board attributes and board composition. He

notes that all these are critical as the governance of INGOs and NPOs is linked to

organizational legitimacy, accountability, and performance. The national diversity of the

management and stakeholders’ interests in this respect pose a great challenge to those

organizations which are going global.

Despite these findings by Rehli (2011) we note that this study only focused on

international non-governmental organizations that operate within Switzerland as a

measure of keeping exogenous variables constant to be able to compare organizations

which operate under the same regulatory and economic environment. Hence it did not

cover the cross country challenges of globally expanding challenges as envisioned by the

current study.

In a study to find out what happens to non-governmental organizations as they go global,

Aldashev and Verdier (2009) dwells on the challenge of the strategic alignment between

the affiliates of global NGOs. They note that the missions of different affiliates might not

always be perfectly aligned, which create tensions and probably affect operations for

different projects. The tensions they attribute to the degree of independence of the

affiliates from the headquarter organization.

From the fore going literature review, several studies have captured various challenges

facing non-profit organizations under different geographical context and different sectors

of operations. On the other hand, no published studies have been done to show the current

challenges that affect TNC’s global expansion especially in Africa. Hence, this shows a

knowledge gap. It was therefore imperative to find out the current cultural, leadership and

political and challenges facing TNC in their global expansion approach.

6

1.3 Purpose of the Study

The purpose of this study was to determine the challenges that face organizations as they

expand their operations globally.

1.4 Research Questions

The study was guided by the following research questions

1.4.1 What are the cultural challenges that affect TNC’s expansion in Africa?

1.4.2 What are the leadership challenges that affect TNC’s expansion in Africa?

1.4.3 What are the political challenges that affect TNC’s expansion in Africa?

1.5 Importance of the Study

1.5.1 The Nature Conservancy

The findings of this study aimed to give empirical evidence on the current challenges that

affects TNC’s global expansion in Africa hence will be helpful to the organization in

informed decisions making on how to deal with the challenges.

1.5.2 Global Organizations

The findings will help other global organizations particularly the international non-

governmental organizations expanding or planning to expand their operations in Africa in

identifying the challenges paused by global and or international expansions in Africa and

strategies of management.

1.5.3 Academic Researchers

Academic researchers may need the study findings to stimulate further research in this

area of international expansion and as well use the findings as a point of academic

reference.

1.6 Scope of the Study

This study was limited to The Nature Conservancy. TNC is one of the largest global non-

government conservation organizations with its Africa headquarters in Nairobi, Kenya.

The study population comprised the top level management team, the mid-level managers

and the general staff at TNC, Africa in the three countries namely; Kenya, Tanzania and

Zambia. A census of the entire population was carried. Of all the 53 staff across all the

three countries, responses were received from 52 of them indicating 98.1% responses

7

rate. The data collection was within one week, May 17, 2014 to May 26, 2014. This study

focused on the challenges faced by the organizations as a result of global expansion to

African countries.

1.7 Definition of Terms

1.7.1 Global Organization

Global organizations are multinational entities that have operations that cut across the

world. They maintain control of operations back in the home office meaning that

operations are controlled centrally and they view the world as a single market (Aldashev

& Verdier, 2009).

1.7.2 Global Expansion

The process of becoming adept at selling products and services and or launching business

operations in international markets rather than just concentrating on domestic market

(Aldashev & Verdier, 2009).

1.7.3 Globalization

Globalization involves an ever-growing number of global projects; projects that involve

individuals, teams, and organizations from diverse cultural contexts (Collaboratory

Research on Global Projects (CRGP), 2009).

1.7.4 Organizational Challenges

Unique encounters that do not appear in intra-national projects; challenges related to

differences in work practices, legal regulations, and cultural value which are brought by

interactions among individuals, organizations, and agencies from diverse national

backgrounds and cultural contexts, which, often lead to misunderstandings, increased

transaction costs, friction between project participants, and coordination and

communication difficulties (Mahalingam & Levitt, 2007).

1.8 Chapter Summary

Chapter one presents the background information on globalization and the challenges that

affect firms as they expand globally. The chapter identified the knowledge gap and

explained the significance of the study. The chapter also provided the definitions of

8

terms. Chapter two of this study presents the literature review of the subject of

organizational global expansion and its challenges.

9

CHAPTER TWO

2.0 LITERATURE REVIEW

2.1 Introduction

The objective of this chapter is to provide a literature review of studies on the challenges

facing organizations as they expand their operations globally. This chapter is divided into

three sections according to the research questions: The first section discuss the cultural

challenges. The second section focuses on global leadership challenges whereas the third

section discusses the political challenges affecting global expansion.

2.2 Cultural Challenges Affecting Global Expansion

According to Hofstede (2005) culture can be defined as that complex whole which

includes knowledge, belief, art, law, morals, customs, and any other capabilities and

habits acquired by man as a member of society. He noted that culture operates on an

emotional not on an intellectual level therefore it is not an intellectual thing and

educational level does not impact sensitivities. There is, however, a personality factor.

People who operate most successfully in an international environment are undoubtedly

more open minded to new ideas and feel less threatened by ideas that are different from

theirs. Their jobs bring both frustration and satisfaction – frustration when they don’t

succeed, and considerable satisfaction when they do manage to conclude good business

with people who come from a very different background (Hofstede, 2005).

Adler (2002) relates cross-cultural to the understanding and improvement of the

interaction of co-workers, managers, executives, clients, suppliers and alliance partners

from countries and cultures around the world. A number of authors, including Ochieng

and Price (2010); Marrewijk (2010) agree that the situation is made considerably more

complex for multicultural project teams that are widely separated geographically and that

have dissimilar organizational and regional cultures.

Okoro (2012) posit that corporate cultures of global businesses impact how managers deal

with the competitive environment, especially with basic communication etiquette. He

explains that in preparing managers for multinational assignments, their training should

include cultural sensitivity, understanding the importance of maintaining business

relationships, and impression management. They should be informed about the

complexities in international culture and human resources management. This is due to the

10

fact that as businesses globalize, there continues to be a compelling need for cross-

cultural awareness, knowledge of business etiquette, culture-specific management styles,

and intercultural exchanges, as managers find themselves faced with multiple challenges

emanating from domestic cultural issues and traditional systems.

The cultural challenges that affect organizations that expand globally range from

language barriers to different values and attitudes; different education systems; different

manners and customs.

2.2.1 Language Barriers

One of the challenges business faces globally is that of communications (Al-Hyari, Al-

Weshah & Alnsour, 2012). The increasing globalization implies further distribution of

operations, product, processes and trade across national, cultural and linguistic

boundaries. Language boundaries may occur within the constituent parts of an

international business and between the business and its environment or market. While

English may be the language of international business for transactions between business

people, it is questionable whether it is so in every part of the world (Vielba &Edelshain,

1997).

Vielba and Edelshain (1997) points out that growth of international activity also means

that language boundaries increasingly are to be found within organizations. He continues

that language is associated intimately with culture which is recognized as a key

determinant of organizational behavior. The cultures of an organization and the quality of

its internal communications have both been identified as critical success factors in a

competitive world.

Communication is largely language-dependent and the quality of one is related directly

the degree of development of the other. Furthermore, neither language nor culture is

neutral or value-free. Language may also reinforce barriers between managers and lower

level employees in the international company where senior staff are brought in from

abroad and do not speak the local language. Language is not only embedded in culture but

symbolizes power and national identity (Vielba & Edelshain 1997). Loss of hegemony in

multicultural nation states and powerful regional undercurrents are leading to linguistic

fragmentation in many parts of the developed world. Such fragmentation creates tensions

11

between support for minority languages and an economic thrust towards globally

significant languages.

According to Nickerson (2005), a global organization which consists of headquarters and

branch units which are spatially separated are often embedded in different language

environments. Consequently, he posits that internal organizational communication

involves crossing language boundaries and operating at the interface between several

languages including those of the home country and the host country, the corporate and

company languages.

In the context of cross multiple languages, international organizations mostly adopt

unique corporate languages which are administrative managerial tool which are derived

from the need of an international board of directors and top management in an

international organization to run global operations smoothly (Sørensen, 2005).It is seen to

provide a common ground for internal communication between organizational units that

are often embedded in different language environments. Basically, the common corporate

language is intended to increase efficiency by overcoming misunderstandings, reducing

costs, avoiding time-consuming translations and creating a sense of belonging and

cohesion within the firm (Sørensen, 2005).

2.2.2 Different Values and Attitudes

Up to date, researchers have found significant differences across countries in people’s

attitudes and values. Across the globe there are varied cultural values and attitudes among

consumers and organizational employees dependent on individual cultures. For example

with respect to consumer perception on marketing, Cui, Lui, Chanthe and Joy (2012)

notes that cross-cultural differences in consumer attitude towards products affect

multinational corporations (MNCs) this is especially with standardization or

customization of their international products when they expand in markets that are at a

different stage of economic and consumerism development.

Looking at the values and attitudes of employees, Alas (2008) points out that that the

keywords concerning today’s economy include a changing environment and a divergent

work force. She notes that attitudes are important in an organisational context and values

have a motivational characteristic by influencing and directing ones choices and actions.

Values are defined in this context as the principles or standards that people use,

12

individually or collectively, to make judgements about what is important or valuable in

their lives. Values are shaped by personal beliefs and developed through study,

introspection and consultation with others and a lifetime of experience (Hofstede, 1980).

Alas (2008) notes that many studies have shown the value differences of different nations

and comparative studies of values indicate significant differences in Chinese and the USA

evaluations of value statements.

The cultural diversity in terms of values and attitudes has an important place in the

communicational problems in multinational or global businesses (Oya, 2006).For

example incomplete information about cultural values and attitudes; structure and

properties of an employee group causes wrong estimations in the period of performance

evaluation, measurement and, in general, the decision making of management (Oya,

2006).

In most global businesses difficulties are encountered in the performance evaluations of

employees because of cultural needs of showing diversity. For instance, Americans prefer

the announcement of their performance results directly to themselves, whereas Asians

generally prefer indirect ways. Thus, development of a standard performance evaluation

system applicable in all departments of most multinational or global businesses would not

be realistic (Oya, 2006).

According to Hicks-Clarke and Iles (2000) individuals who perceive that diversity is

supported and encouraged in their workplace are likely to hold positive attitudes towards

their organization, their job and their career at the same time such workplaces are

characterized as having a positive atmosphere or climate for diversity, where this term is

conceived of as the extent to which human resource diversity is valued and in which

employees from diverse backgrounds feel welcomed and included.

2.2.3 Different Education Systems

In the 21st century, knowledge is widely recognised as the single most important factor in

creating and sustaining superior organisational performance and the effective creation of

knowledge depends upon knowledge transfer (formal education), knowledge sharing and

organisational learning (Li-Hua, 2007).

13

A study on the learning society in the global context (Cisco, 2010)notes that the current

existing education systems are importantly different around the world, reflecting the

distinctive challenges of different regions creating different countries need to think

differently about their route to economic success and social cohesion. The study faults

this scenario as with globalization, labour needed to manufacture a product can now be

bought from almost anywhere. Now, jobs are transferred from one side of the world to the

other with remarkable speed and consumers and researchers are able to look across the

world for the best product.

Lack of standardized education systems across the world presents a significant challenge

to international organization management as whereas in the past, education systems could

produce people who were “good enough”, or research that met local needs, globalization

demands deeper knowledge and broader skills (Cisco, 2010). Zhiwen and van der Heijden

(2008) argue that globalization and internationalization of the labour market bring

forward new requirements such as global thinking and cross-cultural communication

skills. The multinationals also need globally thinking managers and employees who have

the “savvy” to operate well with foreign counterparts.

Globalization has created more mobile international labour markets for both those with

learning credentials and those without. People with learning credentials (portable

qualifications that are valued and recognized around the world) have higher status and

more opportunities as a result. People without such learning credentials do not. They tend

to enter more informal labour markets, with lower status and lower pay. Hence

international organizations and social investors should lead governments and businesses

in a long-term process to develop legitimate, standard credentialing systems that offer the

prospect of portable qualifications that are recognized around the world (Lehner &

Wurzenberger, 2013: Cisco, 2010).

2.2.4 Different Manners and Customs

Scholars across communication disciplines have emphasized the vital role and challenges

of manners and customs in international business management context as well as in cross-

cultural communication situations, because the ability to manage a multicultural

workforce requires proper conduct of oneself at all times (Okoro, 2012). He continues to

say that in today’s hectic and competitive society, etiquette (manners) which includes a

variety of behaviours, habits, and specific aspects of nonverbal communication might be

14

taken for granted or seen as outdated concept, but it affects perceptions and decisions

people make in the global context of management. It has never been over-emphasized that

the ways a manager conducts himself/herself and interacts with colleagues have a

profound effect on a company’s goodwill or credibility. In addition to effective cross-

cultural communication and negotiation skills, knowledge of business etiquette accounts

for success of domestic and global managers.

For example in China most people are reserved much unlike in the United States. A

United States businessperson sees personal relationship as separate from business.

Friendships are quickly formed and dissolved. Hence, many view the U.S. business

relationship as shallow and short-lived, while business relationships in China are treated

as lifetime commitments (Martin &Chaney, 2011). Further Business etiquette in Great

Britain is based on a strong sense of identity and nationalism. The English businessperson

tends to be very matter-of-fact and tends to be very deadline oriented in business

negotiations and traditions and customs (etiquette) are very important to the British, as

they tend to be reserved and expect others to act accordingly. Unlike businesspersons

from the U.S., business friendships are not necessary (Martin & Chaney, 2011).

While business etiquette in Germany is based on the formal culture of Germany that

defines behavioural expectations in great detail, providing its participants with the

knowledge of what to do and when to do it. German businesspersons respect authority

and hierarchical differences. They prefer a hierarchical organizational structure because it

avoids uncertainty, where power is ensured within the organization (Carte & Fox, 2008).

Therefore overcome the challenges of cross cultural manners and customs and to

communicate effectively in international organizations requires that managers develop

cultural sensitivity, be careful in encoding their messages, thoughtful in decoding and

analyzing content and context and selective in choosing channels for transmission of

messages (Okoro, 2012). The increasing mobility of workers in global markets, expansion

of international joint ventures and strategic alliances, and the presence of global

entrepreneurs in developing nations makes cross-cultural communication competence

inevitable.

15

2.3 Leadership Challenges Affecting Global Expansion

According to Binder (2007) the transferability of management theories and practices

across national borders and different cultures represent a huge challenge and each global

organization has its own series of global leadership challenges which vary depending with

organization.

2.3.1 Motivating Multi Cultural Workforce

Linder (1998) defines motivation as an as inner force that drives individual to accomplish

personal and organizational goals. With diversity in global workforce, there is a never

ending ways of different factors that employees can be motivated. This relies on the

expectancy theory. The theory is based on four assumptions (Lunenburg, 2011). One

assumption is that people join organizations with expectations about their needs,

motivations, and past experiences. These influence how individuals react to the

organization. A second assumption is that an individual’s behaviour is a result of

conscious choice. That is, people are free to choose those behaviours suggested by their

own expectancy calculations. A third assumption is that people want different things from

the organization (e.g., good salary, job security, advancement, and challenge). A fourth

assumption is that people will choose among alternatives so as to optimize outcomes for

them personally (Lunenburg, 2011).

Hence the greater pressure being placed on human resources to motivate diverse groups

of workers often with wildly divergent values and attitudes (Greengard, 2004).As one

way of solving this challenge, White (2009) proposes that in order to accommodate the

needs of globally diverse employees, corporations may offer flexible benefits plans, also

known as cafeteria plans. He explains that with this plan individuals may choose the

benefits that are best suited to their particular needs. In addition, a cafeteria plan would

prevent benefits from being wasted on employees who have no need for them and thus of

no motivational value.

2.3.2 Creating Teams Across Diverse Workforce

According to Bergiel, J., Bergiel, B. and Balsmeier (2008) management scholars agree

with the proposition that teams are the primary unit of performance in any organization.

In a study to understand how to manage diversity in an international perspective, Shena,

Chandaa, D’Nettob and Mongaa (2009) posit that through effective diversity

16

management, diverse teams which are a major characteristic of global organizations, aim

at achieving greater innovation and creativity, enabling them to outperform homogenous

teams. Shena et al (2009) while acknowledging the evidence that short-term progress is

affected by conflict and communication problems, they note that by bringing a wider

range of perspectives to problem solving, diverse teams foster speed and innovation and

produce substantially higher quality solutions over whole development cycles. Moreover,

by bringing equality to employment relations, organizations tend to attract and retain an

adequate and qualified workforce.

Diversity in the global environment has forced modern business to re-evaluate their

approach to workforce team management. Multinational organizations have even been

forced to adopt the use of technology to create teams across geographical boundaries.

Hence the emergence of a new team process called the virtual teams or virtual teaming

(Bergiel et al, 2008). They posit that since the mid-1990s, the concept of virtual teaming

has evolved and today, organizations are capable of rapidly creating teams of talented

people who can respond to the needs of their customer in the competitive and complex

global economy of thanks to the use of information technology.

Shachaf (2008) explains that the use of information and communication technology (ICT)

in a globalised environment has led to the development in organizational design with the

introduction of team‐based structures. In the new design, the virtual organization, of

which virtual teams are the building blocks, the virtual team members are often dispersed

world‐wide and uses technology to facilitate communication and the sharing of

information among team members. He continues to say that by employing global virtual

teams, organizations can combine the best expertise available for task performance

regardless of geographic location and as a result, use of global virtual teams gives

organizations access to a larger pool of skills, which can reduce development time,

increase organizational performance, lateral communication, and employee participation.

Despite this, global virtual teams face communication challenges as traditional

communication mechanisms are lost or distorted, and vocal and nonverbal

communication cues are often missed. Similarly, members in multiple time zones,

logistics are more complex and as a result, building trust among team members and

overcoming feelings of isolation and detachment becomes a challenge. Thus ICT use in

global organizations increases teamwork complexity and may impact its effectiveness.

17

Finally, the culturally heterogeneous composition of many teams adds to their complexity

as cultural biases may distort communication (Shachaf, 2008).

2.3.3 Information Management

Information defines the processed data that has been equipped with meaning. When

information is put into use it becomes knowledge which may be tacit and explicit

knowledge. Tacit knowledge, (dormant or more actively acquired for example through

experiences), resides in people’s minds, while explicit knowledge represents knowledge

that has been codified and is held in books, manuals, databases (Makani, 2008).

Hence according to Makani (2008) one of the key factors to knowledge management

success is therefore attributed to the degree to which organizational tacit knowledge can

be captured and transformed into explicit knowledge. He stresses that a global work

environment with diverse nationalities requires information and knowledge to be shared

across national and cultural boundaries. Therefore cultural diversity plays a significant

role in information and knowledge management, success or failure. This is because

knowledge management is not simply about managing information, but involves deeper

consideration of human, social and cultural factors. In this way cultural influences affect

organizational knowledge management processes both directly and indirectly as diverse

national cultures cause disparities that greatly influencing the knowledge sharing

behaviour.

Further Huang and Trauth (2007) citing Cramton (2001) who studied globally dispersed

student teams across four countries pointed out that maintaining mutual knowledge is a

central problem of dispersed collaborations. They note that one of the problems that may

lead to the failure of establishing mutual knowledge is the difficulty of understanding the

“silence” in communication. Therefore unless global managers clearly understand the

intricate of information management in a diverse environment, it would remain a major

challenge to these managers.

2.3.4 Encouraging Action Innovation

Innovation is a process where ideas are generated and transformed for implementation to

business products and services through the four stage model of idea generation, screening,

feasibility and implementation (Job & Sanghamitra 2007). It is also generally understood

simply as the introduction of a new thing or method or the embodiment, combination, or

18

synthesis of knowledge in original, relevant, valued new products, processes, or services

(Jan, 2008). Innovation can be classified as incremental innovation and radical innovation

and for this to thrive there must be innovation friendly strategy, supportive organizational

structure, top management style and support, middle management support and effective

modes of managing innovation to enhance competitive excellence of the organization. In

this context creativity is seen as the front end of the innovation process (Job &

Sanghamitra, 2007).

Agbor (2008) points out that creative and innovation in effective organizations do not

emerge by accident. They require leaders to drive and control deliberate changes in

structure, culture, and process in order to transform them into creative, innovative,

effective, and productive ones. He notes that leaders can successfully encourage

organizational creativity and innovation by designing the organization to foster an

environment that is conducive for creativity to flourish, build friendly and inclusive

working conditions for the members of the organization i.e. when the social structure of

the organization helps workers feel secure and accepted it brings out their creativity.

Consequently, organizational leaders must respect, value, and harness the richness of

ideas, backgrounds, and perspectives of every employee and allow them to use their

unique personal assets and experiences to work for the organization(Agbor,

2008).Moreover the leadership must value creativity themselves and be enthusiastic about

encouraging new developments support; must be effective in encouraging creativity by

treating organizations as living systems filled with the innovative dynamics and potential

that exists in all of the people; must stimulate innovation.

At the core of global organization is the diversity. This is because they deal with diverse

environments across numerous foreign markets (Knight & Cavusgil, 2004).The diversity

lies at the heart of an organization’s ability to innovate. Hence according to Agbor (2008)

diversity poses a major challenge to global leaders in innovation management and the

leaders must actively encourage creativity and innovation through creating a more

conducive environment for diversity to thrive. The purpose of which is to harness the

differences of the followers for a more efficient functioning of the organization. This

means that leaders must design the social structures of the organization in such a way that

all of the workers have a sense of belonging, make all members of the organization feel a

sense of worth, security, and acceptance which allows them to give much more of their

19

talents and creativity to the organization. This requires the organizational leaders to

understands, values, and makes the most of the individual differences found in every

person with a view of eliminating organizational barriers that prevent people from

contributing all their skills, ideas, and energies to the organization’s success by allowing

full commitment and contribution.

2.4 Political Challenges Affecting Global Expansion

Erramilli, (1993) posit that business is conducted in societies governed by political

ideologies which are, almost always, intertwined with economic philosophy. Political

systems dictate fundamental economic themes under their control. There are two main

political systems namely democracy (rule by majority) and totalitarianism (rule by

minority). According to Rugman (2005) political systems typically create the

infrastructure within which the economic system functions through policies and

regulations. Certain import regulations such as high tariffs or low quota limits can

encourage investment. Also governments may enact laws that ban certain types of

investment outright. Political systems thus create the necessary environments that can

promote or inhibit business and ensure sustained economic growth. Political leadership

sets policies, regulations, concessions and ensures stability & security that impact directly

on business performance (Hill & Jones, 2003).

Quinn (1991) observed that broadening political support is a critical, essential and

conscious proactive step in major strategy implementation. Implementation of strategic

decisions like internationalization looks up to politics for three reasons: It is in the realm

that managers must search to discover what purpose are deemed publicly valuable;

second, political institutions grant managers resources they need to accomplish their

operational functions and third, it is politics and law that public managers are both

theoretically and practically account

2.4.1 Threat of nationalization

According to Jakobsen (2012) many scholars seem to acknowledge that policy changes

and government intervention constitute the most important class of political risk

outcomes. He posits that the most well-known form of government intervention is

expropriations and nationalizations. He continues that nationalization is most evident

where many governments quite simply aim to secure for themselves or their nation a

20

larger share of the proceeds from the foreign investment once assets are sunk in the host

country and this can be achieved, for example by breaching contracts or demanding that

they be renegotiated; by increasing corporate taxes or royalties; by imposing bans or taxes

on trade, production, or investment; or by implementing rigid price controls on specific

industries to limiting the number of expatriates who can be posted to the foreign nations

and limiting the amount of proceeds which can be repatriated to the organizations mother

country.

In some cases there are forceful over take and even setting limits on share percentages

which must be owned by the locals. In this way, politics as the art of governing is

important in ensuring that local firms and people gain or maintain dominance in certain

market areas and promoting business. Political leadership normally ensures that local

firms gain or maintain dominance in the domestic market while simultaneously

supporting them up against opposing barriers in the foreign markets (Quinn, 1991).

2.4.2 Government/Political Stability

Political stability represents the risk level an organization will be exposed to in the

foreign market. Stable political systems; even if they are frequently changed tend to

encourage direct foreign investment but unstable political system discourages direct

investment. Koch (2001b) further notes that political leadership, of either form, and their

entrenched policies present one of the greatest challenges to internationalization of firms.

It is the stability of the political regime and economical regulations that promote

investments. The political normalization or tension within a region could highly impact

the trade across the borders (Mamaghani, 2010). Developed nations overcame these

conflicts by developing collaboration models that serve all involved. However, the

developing nations divert their internal political and economic pressure and leads to

external conflicts and confrontations. The mounting internal pressure could be due to

poverty, deficient health care, inflation, unemployment, lack of freedom of expression

and political frustration (Mamaghani, 2010). The economic divide between neighboring

countries could cause similar challenges to political regimes. This political and economic

divide will create an artificial barrier to free trade and free travel between such countries

leading to a regional economic suffering (Lederman, Olarreaga & Payton, 2010).

21

Political stability provides the necessary environment for firms to prosper and grow

through increased business confidence brought about by stable, predictable, and reliable

political processes. A political system that thrives on orderly and transparent transition of

power in governance ensures the continuity of government services, including the

maintenance of peace and order as preconditions for building a sound and stable

environment for business and investment (Fogel, 2006).

Political stability has been noted as one of the critical formal government institutions that

impact on entrepreneurship development (Puffer, 2010). A politically unstable country

can be characterized by a weak, tumultuous and often times transitory political system,

where succession of power and authority is unpredictable and marred by violence.

Political instability increases risks, transaction costs and uncertainty in doing business,

stifles entrepreneurial activities, deters entry of foreign investments and ultimately

inhibits economic growth (Roe & Siegel, 2011).

The other stability issue is with crime and theft which are a function of the capability of

the government and its agencies, such as law enforcement agencies, to maintain peace

and order in the community and to prosecute criminals in an efficient and timely manner.

The prevalence of criminal activities increases the cost of maintaining security in business

premises and can negatively impact on business performance through increased

transaction costs (Fogel, 2006). Businesses often have to resort to private means of

protection against crime and theft for their employees and property in countries where

crime and theft is out of control.

The high cost of crime has been noted as one of the major institutional deficits

undermining business confidence, growth and development and discouraging foreign

investment (Mbonyane& Ladzani, 2011; C. Rogerson &J. Rogerson, 2010).The new

global context and its related challenges and opportunities also require a fundamentally

different concept of governance, based not only on checks and balances between various

governance powers but on partnering between them and stakeholders in order to elaborate

economically, socially and ecologically sustainable solutions. It is often called

collaborative government (Zadek, 2008).

For example in developing countries, in general, lack the institutional regime, of which is

the legal system that could be weak, resulting in corruption and high-crime rates. The

type of regulations mandated by the local government impacts the enterprise either

22

directly or indirectly. The regulations were the shield for protecting local manufacturing

base (Organization for Economic Co-operation and Development (OECD), 2009).

However, unstable and/or dynamic regulatory system makes it difficult to anticipate

enterprise's future. Political pressure or demand in developing countries could institute a

new regulation in no time regardless of the consequences. If done without enough

studying and planning, a complete sector could be endangered, (Nichter & Goldmark,

2009)

2.4.3 International relations

With a traditional perspective, diplomacy – the conduct of relations between nations –was

carried out strictly through official channels and ‘‘government-to-government’’

interactions. With the increasing exchange of information and migration of people on the

global scale, the inter-governmental club model is giving way to the multi-actor model in

international relations (Wang, 2006). He notes that diplomatic communication has

subsequently expanded to ‘‘government-to-people’ contacts as well

Wang (2006) gives a standard definition of public diplomacy as a government’s process

of communicating with foreign publics in an attempt to bring about understanding for its

nation’s ideas, its institutions and culture, as well as its national goals and current

policies. Giving an example of countries engaged in national branding and anti-

Americanism sentiments across the globe, Wang (2006) indicate that a nation’s

reputational capital is significant, both politically and economically as it affects the

country’s ability not only to pursue and achieve international political objectives but also

to attract in-flow of foreign investment as well as tourism. It may also influence consumer

perceptions and purchase decisions with regard to products from certain countries of

origin.

2.4.4 Government bureaucracy

According to Papaconstantinou, Tsagkanos and Siriopoulos (2013) bureaucracy is the

structure and set of regulations in place to control activity, usually in large organizations

and government i.e. the administrative execution and enforcement of legal rules are

socially organized. Therefore it is represented by standardized procedure (rule-following)

that dictates the execution of most or all processes within an organization, formal division

23

of powers, hierarchy, and relationships. In practice the interpretation and execution of

policy can lead to informal influence.

In study to identify movement of goods, Jalali (2012) ranks bureaucracy requirements and

competition in overseas markets as the most active factors in international goods

movement barriers. Luo (2008) posit that government bureaucracy remains largely un-

improved over decades in most emerging economies consequently lowering the country

competitiveness and business performance and retarding economic growth and

entrepreneurial development. He posits that such bureaucracies increases transaction costs

and uncertainty and undercuts speed and flexibility.

Government bureaucracy is also majorly presented in form of amount of licenses and

documentation requirements for cross border operations. For example a survey by East

Africa Business Community indicated cross border business registration and licensing

procedures in East Africa as provided for by the respective national laws has caused

significant negative impacts which include the need for business people to travel to

national headquarters to apply for registration thus incurring extra costs and time loss as

these services can only be acquired from specific offices at the country headquarters

through specific and long process (EABC, 2013).Similarly, the survey has also identified

physical border controls which require additional approvals for cross border operations.

In many cases the approvals go through numerous government institutions.

2.5 Chapter Summary This chapter covered the literature review based on the three research questions. It

provides a theoretical background on the challenges facing organizations as they expand

their operations globally. This chapter is divided into three sections according to the

research questions: The first section discuss the cultural challenges. The second section

focuses on global leadership challenges whereas the third section discusses the political

challenges.

The following chapter represents the research methodology of this study.

24

CHAPTER THREE

3.0 RESEARCH METHODOLOGY

3.1 Introduction

This chapter outlines the overall research methodology for this study. The research design

is discussed, the population and sample used in the study is analyzed and data collection

method outlined. The chapter further outlines the research procedures to be applied in the

study as well as data analysis and presentation. The chapter concluded with a chapter

summary.

3.2 Research Design

A case study research design was used for this study. Research design is the conceptual

structure within which research is conducted and that it constitutes the blue print for the

collection, measurement and analysis of data (Kothari, 2007). A case study involves the

study of a unit/person or small group, a situation or a specific case. Kothari (2007)

further describes a case study as a form of qualitative analysis that involves a careful and

complete observation of a social unit which may be a person, family or institution. The

design was appropriate for this study due to its holistic approach which aims to capture all

the details of a particular individual or group as presented in real life situation. This was

necessary in analyzing and understanding how the globalization strategy adopted at TNC

which is an institution is affected by culture/leadership/politics. The case study had five

important elements; a study‘s question; its proposition, if any; its unit(s) of analysis; the

logic linking the data to the propositions; and the criteria for interpreting the findings

(Yin, 2009). The independent variables in this study included culture, leadership and

politics while the dependent variable was the global expansion initiatives.

3.3 Population and Sampling Design 3.3.1 Population

A population refers to the total collection of elements about which one wishes to make

inferences (Cooper& Schindler 2008). The population is the larger set of observations

while the smaller set is called the sample. According to TNC Human Resource Handbook

2013 the total number of employees that work for the TNC in Africa region is 53 of

25

which 31 are based in Kenya, 9 in Tanzania and13 in Zambia (TNC, 2013). The 53

formed the target population for this study.

3.3.2 Sampling Design

3.3.2.1 Sampling Frame

Sampling frame is the list of elements from which the sample is actually drawn (Kothari,

2007) or list of ultimate sampling entities, which may be people, households,

organizations or other units of analysis of which can be represented by the entire target

population or a section of it (Garson, 2012).Since for this study the total population was

small (53) no sampling was done but a population census was carried out. This included

all the 53 TNC employees working for the TNC Africa region.

3.3.2.2 Sampling Technique

Sampling is a means of selecting some part of the targeted population to represent the

entire population of interest. A sample allows for generalizations about the populations.

Census was carried out for this study. Census is where the entire population is targeted to

participate in a study (Garson, 2012). In this study all the 53 employees who work for

TNC Africa region were involved in the study. The list providing the names and contacts

of the 53 employees was derived from the TNC human resource hand book (TNC, 2013).

3.3.2.3 Sampling Size

Table 3.1: Sample Size Distribution Country Category Total Population % Sample size Actual sample size

Kenya

Senior Management 10 100% 10

Middle Management 9 100% 9

General staff 12 100% 12

Tanzania

Senior Management 2 100% 2

Middle Management 5 100% 5

General staff 2 100% 2

Zambia

Senior Management 3 100% 3

Middle Management 7 100% 7

General staff 3 100% 3

GRAND TOTAL 53 100% 53

26

3.4 Data Collection Methods

The data collection method which was used in this research was a structured

questionnaire for primary data collection. The choice questionnaire as tool for data

collection was its ability to be able to collect large volumes of information and a large

population over s short period of time (Harris &Brown, 2010).

The questionnaire was both open ended and closed ended. The closed ended questions

were structured in a five point Likert scale to seek the respondents’ level of opinion. The

first section of the questionnaire was designed to address the respondents’ demographic

information the second one addressed the cultural challenges, third section addressed the

leadership challenges and the fourth addressed the political challenges.

3.5 Research Procedures

The questionnaire was developed by the researcher based on the research questions. An

introductory letter from the University was obtained to facilitate data collection.

Authorization was sought from the Director of Field Programs, TNC Africa for data

collection from the employees. The questionnaire was then pre-tested using a small

sample of five selected staff in Kenya office selected randomly before the actual study to

ensure that there was clarity and understandability of the questions by the respondents.

Once the pretesting was completed, corrections arising out of this stage were made.

The questionnaire was then administered by sending copies to the respondents via email

to Zambia and Arusha offices and hand delivery to Kenya office. A cover letter detailing

the research objective and confirming anonymity of the respondent’s identity was

attached to the questionnaire before sending out the questionnaires via email. The

respondents’ addresses were identified through the employee listing at TNC the Africa

Regional office. A reminder was then sent to those who did not respondents within one

week through email. For the Kenyan region, 30 filled hard copies where collected from

the respondents. For the Tanzania and Zambia, 22 filled questionnaires were received via

email.

3.6 Data Analysis Methods

The primary data after collection was coded before analysis. Frequency distributions and

percentages were utilized in the descriptive part of this study. The analysis also included

27

one-way analysis of variance (ANOVA) to determine the relationship between various

variables and thus draw conclusions. Statistical Package for Social Sciences (SPSS) was

used as data analysis tool.The research findings were presented using tables, graphs and

percentages.

3.7 Chapter Summary

The chapter describes the methodology that was used to carrying out data analysis and

presentation in this the study. It has indicated the research design used as a case study.

The population has also been identified as the employees of The Nature Conservancy-

Africa. The chapter has indicated that no sampling was done but a population census was

carried out due to the small size of the population. The chapter has also shown the

research procedure and data analysis methods used. Chapter four of this study presents

the findings of the study.

28

CHAPTER FOUR

4.0 RESULTS AND FINDINGS

4.1 Introduction

The purpose of this study was to determine the challenges that face organizations as they

expand their operations globally. The chapter is organized in line with the research

questions. The first section, 4.1 offers an introduction. Part 4.2 the findings on the

demographic characteristics of the respondents. Part 4.3 the cultural challenges, part 4.4

the leadership challenges and part 4.5 the political challenges. Finally part 4.6 the chapter

summary.

The population comprised of all the 53 staff of TNC-Africa. A census for the entire

population was carried out. Fifty three questionnaires were sent via email of which 52

responses were received back. This gave a 98.1% response rate.

4.2 Demographic Characteristics of the Respondents

4.2.1 Country of Operation

Figure 4.1 shows that 58% of the respondents were based in Kenya while 25% were

based in Zambia and 17% in Tanzania.

Figure 4.1: Country of operation

Kenya 58% Tanzania

17%

Zambia 25%

29

4.2.2 Department

Figure 4.2 indicates that 38.5% of the respondents were from finance and operations

department, 36.6% from conservation department and 25% from water and agriculture

program.

Figure 4.2: Department

4.2.3 Gender of the Respondents

Figure 4.3 indicates that 67% of the respondents were males while females were 33%.

Figure 4.3: Gender of the respondents

4.2.4 Age

Figure 4.4 shows that 33% of the staff at TNC-Africa were aged between 31-40 years,

29% at 41-50 years, 23% aged above 50 years and 15% aged between 25 and 30 years.

38.50% 36.50%

25%

Finance andoperations

Conservation Water fund andagricultureprogramme

Male 67%

Female 33%

30

Figure 4.4: Age of the respondents

4.2.5 Management Position

Figure 4.5 indicates 42.3% of the respondents were non-management staff, 32.2% in

middle level management and 25% in top management. This shows a pyramid like

organizational structure.

Figure 4.5: Management position

4.2.6 Years Worked for TNC

Figure 4.6 shows that 32.7% of the respondents had been with the organization for

between 3-5 years, approximately 27% had been with the organization for 6-8 years, 25%

for less than 2 years and 15.4% for more than 9 years.

25-30 years 15%

31-40 years 33% 41-50 years

29%

Above 50 years 23%

25%

32.20%

42.30%

Top levelmanagement

Middle levelmanagement

Non-managementstaff

31

Figure 4.6: Years worked for TNC

4.3 Cultural Challenges Affecting Global Expansion

The study sought to find out the cultural challenges facing organizations as they expand

globally. It focused in finding out how language difference; values and attitudes

difference; education systems difference; customs and manners difference; affect global

expansion activities. The results are as shown below.

4.3.1 Language Barriers

Table 4.1 indicates that 48.1% of the respondents disagreed that they could not

communicate with other colleagues directly due to language barrier and 32% of the

respondents strongly disagreed that they failed to fully express views due to language

differences.

Table 4.1: Language Barrier

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Can’t communicate with other colleagues directly due to language barrier (LB1)

38.5 48.1 9.6 3.8 0

Miss out on important information at TNC staff functions due to language barrier (LB2)

34.6 48.1 7.7 9.6 0

Language barrier limits employee postings(LB3) 23.1 44.2 23.1 9.6 0

Fail to fully express views due to language differences (LB4) 32.7 32.7 26.9 7.7 0

25% 32.70% 26.90%

15.40%

Less than 2 years 3-5 years 6-8 years 9 years andabove

32

Figure 4.7 indicates that 58% of respondents from Zambia disagreed that language

barriers affect the organization. This compares differently with the respondents from

Tanzania where only 25% were in disgreement with 39% being neutral.This shows that

even though language barrier seems not to affect the global expansion of TNC, in

Tanzania the level of disagreement is relatively low.

Figure 4.7: Country versus Language Barrier

Analysis of variance was then carried out to find out if the difference in opinions held by

staff from different countries were statistically significant. Significance level was set at

95% where p < .05 level.

Table 4.2 indicates that the difference in opinions held by different staff members from

different countries on whether the respondents could not communicate with other

colleagues directly due to language barrier, respondents missed out on important

information at TNC staff functions due to language barrier and language barrier limited

employee postings were statistically significant at p value <.05 level.

37%

17%

33%

43%

25%

58%

14%

39%

8% 7%

19%

2%

Kenya Tanzania Zambia

Strongly dis agree Disagree Neutral Agree Strongly agree

33

Table 4.2: One-Way Analysis of Variance on Language Barrier by Country

One-Way Analysis of Variance by Country Language Source Barriers

SS df MS F P

LB1 Between Groups 4.707 2 2.354 4.442 .017* Within Groups 25.966 49 530 Total 30.673 51

LB2 Between Groups 6.123 2 3.062 4.218 .020* Within Groups 35.569 49 .726 Total 41.692 51

LB3 Between Groups 7.685 2 3.842 5.474 .007* Within Groups 34.392 49 .702 Total 42.077 51

LB4 Between Groups .653 2 .326 .349 .707 Within Groups 45.867 49 .936 Total 46.519 51

Note: LB1; LB2; LB3 *p<.05.

4.3.2 Different Values and Attitudes

Table 4.3 shows that 55.8% of the respondents were in agreement that at work they were

not judged at face value, 53.8% of the respondents agreed that they were given an

opportunity to explain themselves and 52.9 % of the respondents agreed that they were

given opportunities to do things differently.

Table 4.3: Different Values and Attitudes

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree At work am not judged at face value 9.6 21.2 3.8 55.8 9.6 I am offered an opportunity to explain what I mean at TNC 7.7 21.2 3.8 53.8 13.5

At TNC, I have the opportunity to solve problems in more than one way 0 13.7 9.8 52.9 23.5

My superior considers my feelings when handling job matters 3.8 30.8 15.4 38.5 11.5

Figure 4.8 shows that 60% of the staff from Zambia agreed that different values and

cultures don’t present a challenge to TNC’s global expansion, followed by Tanzania at

53% and lastly Kenya at 45%.

34

Figure 4.8: Country versus Different Values and Attitudes

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.4 indicated lack of statistical

significance on differences in values and attitudes in Kenya, Lusaka and Tanzania.

Table 4.4: One-Way Analysis of Variance on Values/Attitudes by Country

One-Way Analysis of Variance by Country

Values/ Source Attitudes

SS df MS F P

VA1 Between Groups 2.303 2 1.152 .790 .460 Within Groups 71.466 49 1.458 Total 73.769 51

VA2 Between Groups 1.535 2 .768 .528 .593 Within Groups 71.291 49 1.455 Total 72.827 51

VA3 Between Groups 2.277 2 1.138 1.308 .280 Within Groups 41.762 48 .870 Total 44.039 50

VA4 Between Groups 1.368 2 .684 .525 .595 Within Groups 63.863 49 1.303 Total 65.231 51

Note: VA1; VA2; VA3; VA4 p<.05.

4.3.3 Different Education Systems

Table 4.5 shows that 69.2% of the respondents disagreed that TNC retrain her staff before

posting and 50% disagreed that the current staff training levels limited their posting

anywhere in the world

8% 2%

24% 25% 15%

7% 8% 12%

45% 53%

60%

16% 14% 12%

Kenya Tanzania Zambia

Strongly Disagree Disagree Neutral Agree Strongly Agree

35

Table 4.5: Different Education Systems

Statement Percentages (%) N=52

Highly disagree Disagree Neutral Agree Highly

agree TNC retrains her staff before posting to other countries 7.7 69.2 19.2 3.8 0

My training doesn’t allows me to be posted anywhere in the world 28.8 50.0 13.5 3.8 3.8

My colleagues from other countries are more skilled than me

15.4 42.3 32.7 9.6 0

I am less skilled when it comes to the latest technology 26.9 40.4 17.3 13.5 1.9

Figure 4.9 indicates that 24 % of staff from Kenya strongly disagreed that different

education systems affect TNC expansion followed by Tanzania at 17% and Zambia at 13

%.

Figure 4.9: Country versus Education System

24% 17%

13%

50% 50% 52%

15% 23%

29%

9% 6% 6% 3%

Kenya Tanzania Zambia

Strongly disgaree Disgaree Neutral Agree Strongly sgree

36

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.6 indicated lack of statistical

significance on different education systems in the three countries.

Table 4.6: One-Way Analysis of Variance on Education Systems by Country

One-Way Analysis of Variance by Country Education Source Systems

SS df MS F P

ED1 Between Groups

.710 2 .355 .899 .414

Within Groups 19.367 49 .395 Total 20.077 51

ED2 Between Groups

.478 2 .239 .247 .782

Within Groups 47.445 49 .968 Total 47.923 51

ED3 Between Groups

1.959 2 .979 1.329 .274

Within Groups 36.099 49 .737 Total 38.058 51

ED4 Between Groups

2.298 2 1.149 1.025 .366

Within Groups 54.932 49 1.121 Total 57.231 51

Note: ED1; ED2; ED3; ED4 p<.05.

Hence the findings of the ANOVA are corroborated by Figure 4.9 with country of

operation indicating that the opinion in Table 4.5 is held almost equally across the three

African states. This variation is attributed to pure chance as the p values in Table 4.6

don’t show any statistical significance. Therefore the different education systems do not

present a challenge to TNC’s global expansion.

4.3.4 Different Customs and Manners

Table 4.7 indicates that 49% of the respondents disagreed that TNC’s corporate social

responsibilities are based on the views of the locals with no respondent agreeing that they

are allowed time off to participate in cultural activities, 34.6% disagreed that TNC

promotes local cultures.

37

Table 4.7: Different Customs and Manners

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree TNC respects her employees way of life 3.8 23.1 26.9 44.2 1.9

I am allowed time off to participate in cultural activities 40.4 46.2 3.8 9.6 0

TNC promotes local cultures 23.1 34.6 19.2 17.3 5.8 TNC’s CSR is based on the views of the locals 19.6 49.0 11.8 17.8 2.0

Figure 4.10 shows a limited variation in the opinions across the three states, 47% of

respondents in Tanzania disagreed that customs and manners present a challenge to TNC

global expansion followed by Zambia at 38% and Kenya at 35 %.

Figure 4.10: Country versus Customs and Manners

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.8 indicated lack of statistical

significance on different customs and manners held by the different countries.

25%

17% 17%

35%

47%

38%

14% 11%

21% 22% 22% 23%

3% 3%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

38

Table 4.8: One-Way Analysis of Variance on Customs and Manners by Country

One-Way Analysis of Variance by Country

Customs & Source Manners

SS df MS F P

CM1 Between Groups 1.753 2 .877 .983 .381 Within Groups 43.689 49 .892 Total 45.442 51

CM2 Between Groups .943 2 .472 .571 .569 Within Groups 40.499 49 .827 Total 41.442 51

CM3 Between Groups .845 2 .422 .287 .752 Within Groups 72.136 49 1.472 Total 72.981 51

CM4 Between Groups 2.250 2 1.125 1.017 .369 Within Groups 53.083 48 1.106 Total 55.333 50

Note: CM1; CM2; CM3; CM4 *p<.05.

4.4 Leadership Challenges Affecting Global Expansion

4.4.1 Supervision/Direction Setting

Table 4.9 shows that 50% of the respondents indicated that their supervisors were always

available for a two way communication, About 36.5% of the respondents agreed that

common goals were clearly demonstrated by all leaders On the other hand, 48.1% of the

respondents disagreed that that supervisors understand employee feelings, needs and

concerns.

Table 4.9: Supervision/Direction Setting

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Supervisors are always available for a two way communication 5.8 28.8 7.7 50.0 7.7

Supervisors at all levels understands employee feelings, needs and concerns

5.8 48.1 13.5 30.8 1.9

Common goals are clearly demonstrated by all leaders 1.9 23.1 19.2 36.5 19.2

Superiors have fostered and sustained commitment to excellence

3.8 19.2 23.1 36.5 17.3

39

Figure 4.11 shows on average the four questions, those from Tanzania disagreed that

there is clearer direction setting as indicated by 44% of the respondents who were in

disagreement.

Figure 4.11: Country versus Supervision

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.10 indicated a statistical

significance at p value <.05 level for whether common goals were clearly demonstrated

by all, whether superiors fostered and sustained commitment to excellence and

supervisors did not understand employee feelings, needs and concerns..

Table 4.10: One-Way Analysis of Variance on Supervision/Direction Setting by

Country

One-Way Analysis of Variance by Country Source SS df MS F P

SD1 Between Groups 1.497 2 .749 .571 .569 Within Groups 64.253 49 1.311 Total 65.750 51

SD2 Between Groups 6.253 2 3.127 3.226 .048* Within Groups 47.497 49 .969 Total 53.750 51

SD3 Between Groups 3.956 2 1.978 1.642 .024* Within Groups 59.025 49 1.205 Total 62.981 51

SD4 Between Groups 3.669 2 1.834 1.519 .029* Within Groups 59.158 49 1.207 Total 62.827 51

Note: SD2; SD3; SD4 *p<.05.

6% 3% 2%

25%

44%

31%

13%

25%

15%

44%

17%

40%

12% 11% 12%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

40

The findings indicate that the challenge of creating clear supervision/direction setting at

TNC is faced more in Tanzania.

4.4.2 Motivating Challenge

Table 4.11 indicates 36.5% of the respondents strongly disagreed that they are happy with

their pay. It also shows that 40.4% of the respondents indicated that they are neutral on

the matter. 38.5% of the respondents indicated that they are not frequently consulted on

matters affecting their jobs and 57.7% of the respondents were not happy with carrier

advancement opportunities.

Table 4.11: Motivation

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree I am happy with my pay at TNC 36.5 9.6 40.4 13.5 0.00 I am frequently consulted on matters affecting my job 38.5 21.2 3.8 25.0 11.5

I am satisfied with other benefit programs such as medical cover and pension at TNC

44.2 36.5 3.8 13.5 1.9

I am happy at TNC because of the carrier advancement opportunities 57.7 13.5 1.9 15.4 11.5

Figure 4.12 indicates that on average the feelings expressed in Table 4.10 seem not to

apply across the three states. In Zambia 40% of the respondents strongly disagreed; 53%

of the respondents from Tanzania strongly disagreed while 43% of the respondents from

Kenya strongly disagreed.

Figure 4.12: Country versus Motivation

43% 53%

40%

21%

3%

31%

11% 17% 13%

18% 17% 13% 7% 11%

2%

Kenya Tanzania Zambia

Strongly Disagree Disagree Neutral Agree Strongly agree

41

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.12 indicated statistical

significance at P (.039) <.05 level for whether staff are frequently consulted on matters

affecting their jobs and whether staff were satisfied with other benefit programs such as

medical cover and pension at p (.035) <.05 level.

Table 4.12: One-Way Analysis of Variance on Motivation by Country

One-Way Analysis of Variance by Country Source SS df MS F P

M1 Between Groups .719 2 .359 .282 .569 Within Groups 62.358 49 1.273 Total 63.077 51

M2 Between Groups 2.864 2 1.432 .626 .039* Within Groups 112.136 49 2.288 Total 115.000 51

M3 Between Groups 2.360 2 1.180 .974 .035* Within Groups 59.332 49 1.211 Total 61.692 51

M4 Between Groups .830 2 .415 .176 .229 Within Groups 115.689 49 2.361 Total 116.519 51

Note: M2; M3 *p<.05

4.4.3 Creating Teams

Table 4.13 indicates that 38.5% of the respondents felt that the organization form teams

across diverse background and 51.9% of the respondents were in agreement that teams at

TNC are easy to work with.

Table 4.13: Creating Teams

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree My organization forms teams across diverse backgrounds 9.6 23.1 25.0 38.5 3.8

There is a deliberate attempt by management to form dynamic teams at my work place

5.8 21.2 30.8 38.5 3.8

Teams at my work place are easy to work with 3.8 19.2 15.4 51.9 9.6

In my organization there is strong sense of team work 5.8 21.2 19.2 36.5 17.3

42

Figure 4.13 shows that 69% staff members from Zambia agreed that team creation and

team environment is favorable compared to staff members from Kenya where only 33%

were in agreement.31% of the staff members in Tanzania disagreed that team creation

and team environment at TNC is favorable

Figure 4.13: Country versus Creating of Teams

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.14 indicated statistical

significance at p value <.05 level for whether the organization forms teams across diverse

backgrounds; teams at TNC are easy to work with and whether there is strong sense of

team work at TNC.

Table 4.14: One-Way Analysis of Variance on Creating Teams by Country

One-Way Analysis of Variance by Country Source SS df MS F P

CT1 Between Groups 4.470 2 2.235 1.975 .002* Within Groups 55.453 49 1.132 Total 59.923 51

CT2 Between Groups 2.571 2 1.286 1.327 .539 Within Groups 47.486 49 .969 Total 50.058 51

CT3 Between Groups 4.937 2 2.469 2.425 .038* Within Groups 49.890 49 1.018 Total 54.827 51

CT4 Between Groups 5.129 2 2.565 1.928 .048* Within Groups 65.179 49 1.330 Total 70.308 51

Note: CT1; CT3; CT4 *p<.05.

8% 11%

25% 28%

8%

23% 28%

19%

33% 31%

69%

13%

3% 4%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

43

4.4.4 Information Management

Table 4.15 shows that 42.3% of the respondents agreed that they can easily access work

related information from other divisions in other countries and 41.2% of the respondents

were strongly in agreement that it is easy to access employee blogs from other countries.

On the contrary, 38.5% of the respondents disagreed that they get free access to mentors

within the organization from any part of the world.

Table 4.15: Information Management

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree I easily access work related information from other divisions in other countries

11.5 28.8 1.9 42.3 15.4

I easily access employee blogs from other countries 13.7 7.8 2.0 35.3 41.2

I get free access to mentors within the organization from any part of the world

28.8 38.5 9.6 13.5 9.6

Information is freely shared at TNC regardless of the division 32.7 42.3 1.9 5.8 17.3

Figure 4.14 indicates that the highest level of disagreement was exhibited by staff from

Zambia at 40% followed by Tanzania at 34%.

Figure 4.14: Country versus Information Management

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.16 indicated statistical

20%

31%

19% 23%

34% 40%

5% 4%

32%

11% 15%

20% 23% 21%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

44

significance p (.040) <.05 level for whether the staff can easily access employee blogs

from other countries and whether staff can access mentors from other divisions p (.009)

<.05 level.

Table 4.16: One-Way Analysis of Variance on Information Management by Country

One-Way Analysis of Variance by Country

Source SS df MS F P

IM1 Between Groups 4.920 2 2.460 1.406 .150 Within Groups 85.753 49 1.750 Total 90.673 51

IM2 Between Groups 4.176 2 2.088 1.052 .040* Within Groups 95.236 48 1.984 Total 99.412 50

IM3 Between Groups 9.883 2 4.942 3.179 .009* Within Groups 76.174 49 1.555 Total 86.058 51

IM4 Between Groups 10.143 2 5.072 2.608 .156 Within Groups 95.299 49 1.945 Total 105.442 51

Note: IM2; IM3 *p<.05.

4.4.5 Encouraging Creativity and Innovation

Table 4.17 shows that 59.6% of the respondents agreed that they are offered an

opportunity to try new innovations at work. 88.5% of the respondents disagreed that that

they get a financial reward whenever they introduce something new at work.

Table 4.17: Encouraging of Creativity/Innovation

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree I am offered an opportunity to try new innovations at work 11.5 7.7 1.9 59.6 19.2

Authority to try innovations by staff can be granted at the local TNC office

19.2 55.8 9.6 11.5 3.8

We are encouraged to adopt local solutions in solving work related issues

19.2 65.4 3.8 7.7 3.8

I get a financial reward whenever I introduce something new at work. 88.5 9.6 1.9 0.00 0.00

45

Figure 4.15 shows that on average all the staff from the three countries indicated that

there is a challenge of active encouragement of creativity and innovation. 42% of the

respondents in Zambia disagreed that there is encouraged for creativity and innovation,

39% of respondents from Tanzania also disagreed and in Kenya 37% of the respondents

strongly disagreeing.

.

Figure 4.15: Country versus Creativity/ Innovation

Analysis of variance was then carried out to find out if the observed differences in the

country on creativity and innovation were statistically significant. Table 4.18 indicated

lack of statistical significance at p values >.05 level.

Table 4.18: One-Way Analysis of Variance on Creativity/Innovation by Country

One-Way Analysis of Variance by Country Source SS df MS F P

ICI1 Between Groups 6.920 2 3.460 2.474 .095 Within Groups 68.522 49 1.398 Total 75.442 51

ICI2 Between Groups 3.702 2 1.851 1.812 .174 Within Groups 50.048 49 1.021 Total 53.750 51

ICI3 Between Groups 1.360 2 .680 .758 .474 Within Groups 43.948 49 .897 Total 45.308 51

ICI4 Between Groups .691 2 .346 2.298 .111 Within Groups 7.367 49 .150 Total 8.058 51

Note: ICT1; ICT2; ICT 3; ICT 4 p<.05.

37% 31% 33%

30%

39% 42%

8%

16%

25% 25%

10% 6%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

46

4.5 Political Challenges Affecting Global Expansion

The study sought to find out the impact of nationalization policies, government stability,

international relations and government bureaucracies on the global expansion of TNC.

4.5.1 Nationalization Policies

Table 4.19 showed that the majority at 54% agreed that restrictive human resource laws

on the maximum number of expatriates to be employed in certain countries discourage

TNC from fully globalizing. Similarly a majority at 44% indicated that restrictive fund

repatriation laws discourage TNC from venturing in some countries. On the contrary, the

majority at 72% disagreed that demand for local share in the organization discourages

TNC from full globalization as well as 54%, who disagreed that laws limiting

conservancy activities to governments is a major hindrance to TNC globalization.

Table 4.19: Nationalization Policies

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Conditions set on the maximum number of expatriates to be employed in certain countries discourages TNC from fully globalizing

6.0 24.0 16.0 54.0 0.00

Restrictive fund repatriation laws discourages TNC from venturing in some countries

6.0 36.0 10.0 44.0 4.0

Demand for local share in the organization discourages TNC from full globalization

14.0 72.0 10.0 4.0 0.00

Laws limiting conservancy activities to governments is a major hindrance to TNC globalization

18.0 54.0 16.0 12.0 0.00

Figure 4.16 show that respondents from the three countries were in disagreement that

nationalization policies hindered TNC’s globalization. The strongest level of

disagreement was exhibited in Kenya where 50% of the respondents disagreed, followed

by Zambia at 43% then Tanzania at 31%. This would mean Kenya has less

nationalization policies compared to Tanzania and Zambia.

47

Figure 4.16: Country versus Nationalization Policies

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.20 indicated statistical

significance at p value <.05 level for whether conditions set on the maximum number of

expatriates to be employed in certain countries discourages TNC from fully globalizing

and restrictive fund repatriation laws discourages TNC from venturing in some countries

Table 4.20: One-Way Analysis of Variance on Nationalization Policies by Country

One-Way Analysis of Variance by Country Source SS df MS F P

NP1 Between Groups 7.460 2 3.730 4.182 .021* Within Groups 41.920 47 .892 Total 49.380 49

NP2 Between Groups 12.176 2 6.088 5.993 .005* Within Groups 47.744 47 1.016 Total 59.920 49

NP3 Between Groups .038 2 .019 .045 .956 Within Groups 19.882 47 .423 Total 19.920 49

NP4 Between Groups 1.932 2 .966 1.239 .299 Within Groups 36.648 47 .780 Total 38.580 49

Note: NP1; NP2 *p< .05

13% 17%

50%

31%

43%

13% 17%

10%

20%

33%

41%

1% 3%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly agree

48

4.5.2 Government Instability

Table 4.21 shows that 64% of the respondents agreed that government instability hinders

TNC’s global expansion, 54% of the respondents strong agreed that terror attacks are a

major hindrance to TNC global expansion.

Table 4.21: Government Instability

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Frequent change of governments is a major hindrance to TNC global expansion

6.0 12.0 6.0 64.0 12.0

Terror attacks is a major hindrance to TNC global expansion

6.0 14.0 2.0 24.0 54.0

Civil strife is a major hindrance to TNC global expansion 6.0 12.0 4.0 22.0 56.0

Political coups have greatly hindered the TNC global expansion

6.0 12.0 4.0 30.0 48.0

Figure 4.17 further confirms that the challenge of government instability was expressed

by all the respondents across different countries with Zambia being the most assertive as

79% of the respondents agreed , followed by Tanzania at 50% strongly agreeing and

finally Kenya at 37 % agreeing.

Figure 4.17: Country versus Government Instability

10% 22%

6% 3%

37% 47%

21% 25%

50%

79%

Kenya Tanzania Zambia

Strongly Disagree Disagree Neutral Agree Strongly Agree

49

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.22 indicated statistical

significance at p value <.05 level for whether frequent change of governments was a

major hindrance to TNC global expansion; Terror attacks was a major hindrance to TNC

global expansion ; Civil strife was a major hindrance to TNC global expansion and

Political coups have greatly hindered the TNC global expansion.

Table 4.22: One-Way Analysis of Variance on Government Stability by Country

One-Way Analysis of Variance by Country Source SS df MS F P.

GS1 Between Groups 12.404 2 6.202 7.090 .002* Within Groups 41.116 47 .875 Total 53.520 49

GS2 Between Groups 23.106 2 11.553 9.093 .000* Within Groups 59.714 47 1.271 Total 82.820 49

GS3 Between Groups 20.855 2 10.428 8.217 .001* Within Groups 59.645 47 1.269 Total 80.500 49

GS4 Between Groups 18.600 2 9.300 7.487 .002* Within Groups 58.380 47 1.242 Total 76.980 49

Note: GS1; GS2; GS3; GS4 *p< .05

4.5.3 International Relations

Table 4.23 shows that 60% of the respondents agreed that poor international relationship

between USA which is the TNC’s mother country and some foreign governments has led

to limited funding of projects in some foreign countries.50% of the respondents disagreed

that poor relations between USA and some foreign countries has restricted movement of

TNC staff to open divisions in some countries.

50

Table 4.23: International Relations

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Poor international relationship between TNC mother nation (USA) has led to closure of some divisions in foreign countries

12.0 40.0 12.0 30.0 6.0

Poor international relationship between USA and some foreign governments has led to limited funding of projects in some foreign countries

14.0 16.0 4.0 60.0 6.0

Foreign countries normally deny registration of TNC divisions due to their poor international relations with the USA

28.0 50.0 16.0 2.0 4.0

Poor relations between USA and some foreign countries has restricted movement of TNC staff to open divisions in some countries

26.0 50.0 18.0 2.0 4.0

Figure 4.18 indicates that in all the three countries, there was a general disagreement with

the minimum level of the respondents observed in Kenya at 31%, Zambia 56% and

Tanzania 42%

Figure 4.18: Country versus International Relations

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.24 indicated lack of statistical

24.0% 31.0%

2.0%

31.0%

42.0%

56.0%

17.0%

6.0% 6.0%

19.0% 22.0%

35.0%

9.0%

Kenya Tanzania Zambia

Strongly Disagree Disagree Neutral Agree Strongly Agree

51

significance at p value >.05 level on whether international relations was a challenge.

Hence the observed differences were purely by chance.

Table 4.24: One-Way Analysis of Variance on International Relations by Country

One-Way Analysis of Variance by Country Source SS df MS F P

IR1 Between Groups 5.464 2 2.732 2.034 .142 Within Groups 63.116 47 1.343 Total 68.580 49

IR2 Between Groups 2.724 2 1.362 .897 .415 Within Groups 71.356 47 1.518 Total 74.080 49

IR3 Between Groups 1.555 2 .778 .863 .429 Within Groups 42.365 47 .901 Total 43.920 49

IR4 Between Groups 3.665 2 1.832 2.152 .128 Within Groups 40.015 47 .851 Total 43.680 49

Note: IR1; IR2; IR3; IR4 p <.05

Hence the study showed that international relations presents a challenge to TNC’s

globalization to the extent of poor international relationship between USA which is the

TNC’s mother country and some foreign governments which leads to limited funding of

projects in some foreign countries. Results of ANOVA indicate that these views cut

across the three states, Kenya, Tanzania and Zambia.

4.5.4 Government Bureaucracies

Table 4.25 shows a high level of neutrality with the impact of government bureaucracies.

34% of the respondents were neutral that too many forms filled for registration has

discouraged TNC from venturing into some jurisdictions.34% of the respondents agreed

that too lengthy registration of international organizations was a major hindrance of

globalization at TNC .32% of the respondents agreed that demand for home government

support has hindered TNC from achieving full globalization.

52

Table 4.25: Government Bureaucracies

Statement Percentages (%) N=52

Strongly disagree Disagree Neutral Agree Strongly

agree Too many forms filled for registration has discouraged TNC from venturing into some jurisdictions

8.0 30.0 34.0 26.0 2.0

Demand for responsiveness to many layers of governments limits TNC’s globalization

8.0 22.0 24.0 36.0 10.0

Too lengthy registration of international organizations has be a major hindrance of globalization at TNC

12.0 14.0 40.0 34.0 0.0

Demand for home government support has hindered TNC from achieving full globalization

24.0 26.0 12.0 32.0 6.0

Figure 4.19 shows that 54% of respondents from Zambia were in agreement that

government bureaucracy hinders TNC from achieving full globalization.

Figure 4.19: Country versus Government Bureaucracies

Analysis of variance was then carried out to find out if the observed differences in the

country percentages were statistically significant. Table 4.26 indicated statistical

significance at p (.047) <.05 level for whether too many forms filled for registration

discouraged TNC from venturing into some jurisdictions and p (.011) <.05 level for too

lengthy registration of international organizations was a major hindrance of globalization

at TNC.

15.0% 19.0%

4.0%

22.0% 22.0% 27.0%

32.0% 33.0%

13.0%

25.0% 25.0%

54.0%

7.0% 2.0%

Kenya Tanzania Zambia

Strongly disagree Disagree Neutral Agree Strongly Agree

53

Table 4.26: One-Way Analysis of Government Bureaucracies by Country

One-Way Analysis of Variance by Country Source SS df MS F P

GB1 Between Groups 3.946 2 1.973 2.168 .047* Within Groups 42.774 47 .910 Total 46.720 49

GB2 Between Groups 2.687 2 1.343 1.040 .361 Within Groups 60.693 47 1.291 Total 63.380 49

GB3 Between Groups 3.066 2 1.533 1.606 .011* Within Groups 44.854 47 .954 Total 47.920 49

GB4 Between Groups .809 2 .405 .227 .798 Within Groups 83.691 47 1.781 Total 84.500 49

Note: GB1; GB3, *p<0.05

4.6 Chapter Summary

The chapter captured the findings from the foregoing study. It highlighted those factors

that affect globalization of TNC. It has also shown those factors that do not have

significant impacts. The following chapter gives the summary, discussions, conclusions

and recommendation drawn from the current study.

54

CHAPTER FIVE

5.0 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS

5.1 Introduction

The purpose of this study was to determine the challenges that face organizations as they

expand their operations globally. The chapter presents the study summary discussions,

conclusions and recommendations.

5.2 Summary

The study was guided by the following research questions: What are the cultural

challenges that affect TNC’s expansion in Africa? What are the leadership challenges that

affect TNC’s expansion in Africa? What are the political challenges that affect TNC’s

expansion in Africa?

A case study research design was used for this study. The design was appropriate for this

study due to its holistic approach which aims to capture all the details of a particular

individual or group as presented in real life situation. The study population was limited to

The Nature Conservancy. The study population comprised of a total of 53 members of

staff based in Kenya, Tanzania and Zambia categorized into the top level management

team, the middle level managers and the general staff. A census of the entire population

was carried. Frequency distributions and percentages were utilized in the descriptive part

of this study. The analysis also included analysis of variance (ANOVA) and bivariate

analysis to determine the relationship between various variable and thus draw

conclusions. The findings were presented using tables, graphs and percentages.

The findings on the cultural challenges revealed that language barrier did not present a

global expansion challenge to TNC (75% disagreed) but staff from Tanzania are mostly

likely to be affected by language barriers in the global arena (41.7% were in

disgreement). This difference on how language barriers affect staff from different

countries was statistically significant at p (.017) <.05 level on the challenge of

communicating with other colleagues directly due to language barrier and statistically

significant at p (0.02) <.05 level for the challenge of missing out on important

information at TNC staff functions due to language barrier. The study also showed that

55

different values and attitudes do not present a global expansion challenge to TNC (64.7%

disagreed). Similarly the study showed that different education systems do not present a

challenge to TNC’s global expansion (70.2% in disagreement).

The findings on the leadership challenges revealed that motivation was a challenge to

TNC in its global operations but the challenge was most manifested in Zambia (71%).

The country difference was statistically significant at P (.039) <.05 level for whether staff

were frequently consulted on matters affecting their jobs and p (.035) <.05 level for

whether staff were satisfied with other benefit programs such as medical cover and

pension at TNC. Likewise encouraging of creativity and innovation was a challenge to

TNC’s global operations since even though employees were offered a chance to try new

things, there was lack of local authorization of such; lack of active encouragement to

adopt local solutions in solving work related issues and lack of reward system for

innovations which discourages local creativity and innovation. On the contrary the study

showed that supervision/direction setting did not affect TNC’ global expansion in general

as 50%, indicated presence of clear supervision and direction setting but the challenge

was faced in Tanzania (47.2%, agreed). This country difference in opinion with regard to

the challenge of supervision/direction setting was statistically significant at p (.048) <.05

level for whether common goals were clearly demonstrated by all, statistically significant

at p (.024) <.05 level for whether superiors fostered and sustained commitment to

excellence and statistically significant at p (.029) <.05 level for whether supervisors did

not understand employee feelings, needs and concerns. The challenge of creation of teams

and team environment was only faced in Tanzania as affirmed by a majority at 38.9%.

The different opinion held by staff from different countries as to whether creation of

teams posse a challenge was statistically significant at p (.002) <.05 level for whether the

organization forms teams across diverse backgrounds, statistically significant at p (.038)

<.05 level for whether teams at TNC were easy to work with and statistically significant

at p (.048) <.05 level for whether there was a strong sense of team work at TNC. Finally

TNC leadership faces organizational information management challenge in form of

limited cross boundary mentorship and information sharing in Tanzanian (64.9%

disagreed) and Zambia (59.6% disagreed). The country difference on the opinions on

information management was statistically significant at p (.040) <.05 level for whether

the staff could easily access employee blogs from other countries and p (.009) <.05 level

for whether staff could access mentors from other divisions.

56

The findings on political challenges revealed that government instability hindered TNC’s

global expansion and this was statistically significant at p (.027) <.05 level for whether

conditions set on the maximum number of expatriates to be employed in certain countries

discouraged TNC from fully globalizing and statistically significant at p (.05) <.05 level

for whether restrictive fund repatriation laws discouraged TNC from venturing in some

countries. The international relations was a challenge to TNC’s globalization to the extent

of poor international relationship between USA which is the TNC’s mother country and

some foreign governments which leads to limited funding of projects in some foreign

countries. The impact of nationalization policies on globalization at TNC is only to a

limited scale to the extent of restrictive human resource laws on the maximum number of

expatriates to be employed in certain countries and restrictive fund repatriation laws in

some countries. Lastly despite that fact there lacked sufficient empirical evidence from

this study to generalize that government bureaucracy affected TNC’s global expansion

due to high level of response neutrality, staff from Zambia were in agreement (56.3%)

that government bureaucracy hindered TNC from achieving full globalization. This

difference in opinion across countries on the effects of government bureaucracy was

statistically significant at p (.047) <.05 level for whether too many forms filled for

registration discouraged TNC from venturing into some jurisdictions and statistically

significant at p (.011) <.05 level for whether too lengthy registration of international

organizations was a major hindrance of globalization at TNC.

5.3 Discussion

5.3.1 Cultural Challenges

The study showed that different customs and manners was a challenge to TNC’s

expansion in Africa. This was in line with sentiments by Okoro (2012) that the increasing

mobility of workers in global markets, expansion of international joint ventures and

strategic alliances, and the presence of global entrepreneurs in developing nations makes

cross-cultural communication competence inevitable. This is further supported by Oya

(2006) who pointed out that incomplete information about cultural values and attitudes;

structure and properties of an employee group causes wrong estimations in the period of

performance evaluation, measurement and, in general, the decision making of

management. In Africa specifically there are multiple tribes or groupings of people who

hold different customs and prefer different manners in their engagements. Each country

57

literally has different groupings of people with unique backgrounds which may present a

challenge to international organizations. Therefore to overcome the challenges of cross

cultural manners and customs and to communicate effectively in international

organizations requires that managers develop cultural sensitivity, be careful in encoding

their messages, thoughtful in decoding and analysing content and context and selective in

choosing channels for transmission of messages (Okoro, 2012).

The study also showed that language barrier was not a global expansion challenge to TNC

in an overall but staff members from Tanzania are mostly likely to be affected by

language barriers in the global arena compared to those from Zambia and Kenya. Vielba

and Edelshain (1997) posit that language boundaries may occur within the constituent

parts of an international business and between the business and its environment or market.

They continue that while English may be the language of international business for

transactions between business people, it is questionable whether it is so in every part of

the world. His is supported by Nickerson (2005) who indicated that a global organization

which consists of headquarters and branch units which are spatially separated are often

embedded in different language environments. Consequently, he posits that internal

organizational communication involves crossing language boundaries and operating at the

interface between several languages including those of the home country and the host

country, the corporate and company languages.

The study also showed that different values and attitudes did was not a global expansion

challenge to TNC. The different values and attitudes are expected to arise from varied

cultural values and attitudes among consumers and organizational employees dependent

on individual cultures e.g. with respect to consumer perception on marketing (Alas,

2008). Cui, Lui, Chanthe and Joy (2012) further notes that cross-cultural differences in

consumer attitude towards products affect multinational corporations this is especially

with standardization or customization of their international products when they expand in

markets that are at a different stage of economic and consumerism development. Looking

at the three countries studied, they are all neighbours. Kenya borders Tanzania to the

North West while Zambia borders Tanzania to the South West. Kenya and Tanzania fall

in the same East Africa bloc with extensive political, social and economic integration.

Zambia is a land-locked country with its access to the sea through Tanzania’s port of Dar

Salem through rail and road networks. Likewise Zambia and Tanzania are members’

58

states to the South African Development Community (SADC). These integrations would

mean a lot of commonality in the three states thus similar value and attitudes to

international organizations.

Similarly the study showed that different education systems was not a challenge to

TNC’s global expansion. This goes against the general expectation that education systems

vary and lack standardizations across the world which presents significant difference

views from different countries (Cisco, 2010). This study further goes against the

sentiments by Lehner and Wurzenberger (2013) that globalization has created more

mobile international labour markets yet the current existing education systems are

importantly different around the world, reflecting the distinctive challenges of different

regions creating different countries need to think differently about their route to economic

success and social cohesion. The study showed that the education systems in the three

countries are sufficient for the staff to be posted and work anywhere in the world.

The difference on how language barriers affect staff from different countries was

statistically significant at p (.017) <.05 level. Likewise the difference in opinions across

different countries on the challenge of communicating with other colleagues directly due

to language barrier was statistically significant at p (0.02) <.05 level. Further the study

showed that different values and attitudes did not present a global expansion challenge to

TNC.

5.3.2 Leadership Challenges

The study showed that motivation was a challenge to TNC in its global operations; it also

showed that there was a variation with respect to country, department, age group and

management position. The challenge was most manifested in Zambia. This was in line

with the argument by Lunenburg (2011) that with diversity in global workforce, there is a

never ending ways of different factors that employees demand to be motivated. Most

international organizations are faced with the challenge of designing motivation strategies

that cover the varied interest groups. Thus White (2009) proposes that in order to

accommodate the needs of globally diverse employees, corporations may offer flexible

benefits plans, also known as cafeteria plans. He explains that with this plan individuals

may choose the benefits that are best suited to their particular needs. In addition, a

cafeteria plan would prevent benefits from being wasted on employees who have no need

for them and thus of no motivational value.

59

Encouraging of creativity and innovation was also a challenge to TNC’s global operations

since even though employees are offered a chance to try new things, there was lack of

local authorization of such; lack of active encouragement to adopt local solutions in

solving work related issues and lack of reward system for innovations which discourages

local creativity and innovation. This goes against the findings by Knight and Cavusgil

(2004) that at the core of global organization is the diversity because they deal with

diverse environments across numerous foreign markets and the diversity offers an

opportunity and ability to innovate. Agbor (2008) further notes that creativity and

innovation in an effective organization do not emerge by accident but require leaders to

drive and control deliberate changes in structure; culture; and process. He notes that

leaders can successfully encourage organizational creativity and innovation by designing

the organization to foster an environment that is conducive for creativity to flourish, build

friendly and inclusive working conditions for the members of the organization. Lack of

local authorization of innovative initiatives delays process; lack of active encouragement

to adopt local solutions in solving work related issues shows lack of motivation; and lack

of reward system for innovations would discourage local creativity and innovation. This

means that TNC does not have favourable environment where creativity and innovation

can flourish.

On the contrary the study showed that supervision/direction setting did not affect TNC’

global expansion in general but was experienced in Tanzania. Finally TNC leadership

faced organizational information management challenge in form of limited cross

boundary mentorship and information sharing in Tanzanian and Zambia. This is in line

with Huang and Trauth (2007) who posited that maintaining mutual knowledge is a

central problem of dispersed collaborations and one of the problems that may lead to the

failure of establishing mutual knowledge is the difficulty of understanding the “silence”

in communication. Therefore unless global managers clearly understand the intricate of

information management in a diverse environment, it would remain a major challenge to

these managers. On the other lack of mentorship points to failure by the organization to

adopt what Makani (2008) say that the conversion of organizational tacit knowledge into

explicit knowledge is critical in that tacit knowledge, (dormant or more actively acquired

for example through experiences), resides in people’s minds, and strategies such as

mentorship and active cross division is necessary to transfer this knowledge to other

60

within the organization. There is also the need for codification of the same knowledge

into books, manuals, databases.

The study revealed that motivation was a challenge to TNC in its global operations but it

was most manifested in Zambia. The country difference was statistically significant at p(

.039) <.05 level for whether staff were frequently consulted on matters affecting their

jobs and statistically significant at p (.035) <.05 level for whether staff were satisfied with

other benefit programs such as medical cover and pension at TNC. Secondly,

encouraging of creativity and innovation also presented a challenge to TNC’s global

operations since even though employees were offered a chance to try new things, there

was lack of local authorization of such; lack of active encouragement to adopt local

solutions in solving work related issues and lack of reward system for innovations which

discouraged local creativity and innovation. Similarly TNC leadership faces

organizational information management challenge in form of limited cross boundary

mentorship and information sharing in Tanzanian and Zambia. The country difference on

the opinions on information management was statistically significant at p (.040) <.05

level for whether the staff could easily access employee blogs from other countries and

statistically significant at p (.009) <.05 level for whether staff could access mentors from

other divisions.

On the contrary the study showed that supervision/direction setting did not affect TNC’

global expansion in general but was experienced in Tanzania. This country difference in

opinion with regard to the challenge of supervision/direction setting was statistically

significant at p (.048) <.05 level for whether common goals were clearly stated,

statistically significant at p (.024) <.05 level for whether superiors fostered and sustained

commitment to excellence and statistically significant at p (.029) <.05 level, for whether

supervisors did not understand employee feelings, needs and concerns. Similarly the

challenge of creation of teams and team environment was only faced in Tanzania. The

different opinion held by staff from different countries as to whether creation of teams

posed a challenge was statistically significant at p (.002) <.05 level for whether the

organization formed teams across diverse backgrounds, statistically significant at p (.038)

<.05 level for whether teams at TNC were easy to work with and also statistically

significant at p (.048) <.05 level for whether there was strong sense of team work at TNC.

61

5.3.3 Political Challenges

The findings on political challenges showed that government instability hindered TNC’s

global expansion. It showed that frequent change of governments; terror attacks; civil

strife; and political coups are some of the government instability hindrances to global

expansion at TNC. The findings also revealed that respondents from Zambia were most

assertive on this issues followed by Tanzania and finally Kenya. This is in line with the

arguments by Koch (2001b) that unstable political system discourages direct investment.

He notes that political leadership, of either form, and their entrenched policies present one

of the greatest challenges to internationalization organizations. Fogel (2006) expects that

political stability provides the necessary environment for organizations to prosper and

grow through increased operational confidence brought about by stable, predictable, and

reliable political processes. A political system that thrives on orderly and transparent

transition of power in governance ensures the continuity of government services,

including the maintenance of peace and order as preconditions for building a sound and

stable environment for investments.

The international relations was a challenge to TNC’s globalization to the extent of poor

international relationship between USA which is the TNC’s mother country and some

foreign governments has led to limited funding of projects in some foreign countries.

This is in line with Wang (2006) who while giving an example of countries engaged in

national branding, indicate that a nation’s international relations with other countries and

reputational capital is significant, both politically and economically as it affects the

country’s ability not only to pursue and achieve international political objectives but also

to attract in-flow of foreign investment as well as tourism. Thus with the increasing

exchange of information and migration of people on the global scale, the inter-

governmental relations give more way to the multi-actor model in international relations

implying international relations would have an effect not only on the government

diplomacy but other sectors of the economy and international organizations.

The impact of nationalization policies on globalization at TNC is only to a limited scale

to the extent of restrictive human resource laws on the maximum number of expatriates to

be employed in certain countries and restrictive fund repatriation laws in some countries.

These are manifested only to a limited scale in Zambia. This tends to support the

argument that politics as the art of governing is important in ensuring that local firms and

62

people gain or maintain dominance in certain economic areas (Quinn, 1991).

Nationalization is most evident where many governments quite simply aim to secure for

themselves or their nation a larger share of the proceeds from the foreign investment once

assets are sunk in the host country and this can be achieved, for example by limiting the

number of expatriates who can be posted to the foreign nations and limiting the amount of

proceeds which can be repatriated to the organizations mother country (Jakobsen, 2012).

Lastly despite that fact there lacked sufficient empirically evidence from this study to

generalize that government bureaucracy affects TNC’s global expansion due to high level

of response neutrality, staff from Zambia were in agreement that government bureaucracy

hinders TNC from achieving full globalization. Limited effect of bureaucracy in both

Kenya and Tanzania goes against Jalali (2012) argument that bureaucratic requirements

ranks as the most active barrier for international operations. Similarly it goes against Luo

(2008) argument that government bureaucracy remains largely un-improved over decades

in most emerging economies consequently lowering the countries’ competitiveness and

business performance and retarding economic growth and entrepreneurial development.

The current study would point to a case of improved situation as regards government

bureaucracies in these states.

Politically the study showed that government instability hindered TNC’s global expansion

and this was statistically significant at p (.027) <.05 level for whether conditions set on

the maximum number of expatriates to be employed in certain countries discouraged

TNC from fully globalizing and statistically significant at p (0.05) <.05 level for whether

restrictive fund repatriation laws discourages TNC from venturing in some countries. It

showed that frequent change of governments; terror attacks; civil strife; and political

coups are some of the government instability hindrances to global expansion at TNC. The

international relations was a challenge to TNC’s globalization to the extent of poor

international relationship between USA which is the TNC’s mother country and some

foreign governments which leads to limited funding of projects in some foreign countries.

The impact of nationalization policies on globalization at TNC is only to a limited scale

to the extent of restrictive human resource laws on the maximum number of expatriates to

be employed in certain countries and restrictive fund repatriation laws in some countries.

Lastly despite the fact there lacks sufficient empirically evidence from this study to

63

generalize that government bureaucracy affects TNC’s global expansion due to high level

of response neutrality, staff from Zambia were in agreement that government bureaucracy

hinders TNC from achieving full globalization. This difference in opinion across

countries on the effects of government bureaucracy was statistically significant at p (.047)

<.05 level for whether too many forms filled for registration discouraged TNC from

venturing into some jurisdictions and statistically significant at p (.011) <.05 level for

whether too lengthy registration of international organizations was a major hindrance of

globalization at TNC.

5.4 Conclusions

5.4.1 Cultural Challenges

Different customs and manners was a challenge to TNC’s expansion in Africa. Increasing

mobility of workers in global markets, expansion of international joint ventures and

strategic alliances, and the presence of global entrepreneurs in developing nations makes

cross-cultural communication competence inevitable. Each country literally has different

groupings of people with unique backgrounds which may present a challenge to

international organizations. Therefore to overcome the challenges of cross cultural

manners and customs and to communicate effectively in international organizations

requires that managers develop cultural sensitivity, be careful in encoding their messages,

thoughtful in decoding and analysing content and context and selective in choosing

channels for transmission of messages

5.4.2 Leadership Challenges

The study revealed that motivation was challenge to TNC Africa as it expanded its

operations. Diversity in global workforce indicates that there is a never ending ways of

different factors that employees demand to be motivated. Most international organizations

are faced with the challenge of designing motivation strategies that cover the varied

interest groups. In order to accommodate the needs of globally diverse employees,

corporations may offer flexible benefits plans where by individuals choose the benefits

that are best suited to their particular needs. Thus preventing benefits from being wasted

on employees who have no need for them and thus of no motivational value.

64

Creativity and innovation in an effective organization do not emerge by accident but

require leaders to drive and control deliberate changes in structure; culture; and process.

Leaders can successfully encourage organizational creativity and innovation by designing

the organization to foster an environment that is conducive for creativity to flourish, build

friendly and inclusive working conditions for the members of the organization.

5.4.3 Political Challenges

Unstable political system discourages direct investment. A political system that thrives on

orderly and transparent transition of power in governance ensures the continuity of

government services, including the maintenance of peace and order as preconditions for

building a sound and stable environment for investments. A nation’s international

relations with other countries and reputational capital is significant, both politically and

economically as it affects the country’s ability not only to pursue and achieve

international political objectives but also to attract in-flow of foreign investment as well

as tourism. Thus with the increasing exchange of information and migration of people on

the global scale, the inter-governmental relations give more way to the multi-actor model

in international relations implying international relations would have an effect not only on

the government diplomacy but other sectors of the economy and international

organizations.

5.5 Recommendations

5.5.1 Recommendations for Improvement

5.5.1.1: Cultural Challenges

The study recommends that as a measure of managing cultural challenges, organizational

managers should be properly prepared for the multinational assignments and their training

should include cultural sensitivity, understanding the importance of maintaining

relationships, and impression management. International employees should be informed

about the complexities in international culture and human resources management. This is

due to the fact that as businesses globalize, there continues to be a compelling need for

cross-cultural awareness, knowledge of business etiquette, culture-specific management

styles, and intercultural exchanges, as managers find themselves faced with multiple

challenges emanating from domestic cultural issues and traditional systems.

65

5.5.1.2: Leadership Challenges

The study recommends that TNC can improve its leadership by promoting staff within the

organization’s ranks and finally use of research and development. Senior management

support should be encouraged to enable staff to perform their best.

5.5.1.3: Political Challenges

The political challenges highlighted such as the nationalization policies would be

addressed through structured negotiations either with the support of the home nation or

directly with the host nations.

5.5.2 Recommendations for Further Studies

The current study was a case study of TNC with the respondents only from three African

states. Further studies on other organizations and across the globe would be welcome to

ensure that the findings can be generalized.

66

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Appendix A: Cover Letter

Dear Respondent,

RE: RESEARCH QUESTIONNAIRE

I am a graduate student at United States International University pursuing an Executive

Master of Science in Organization Development (EMOD). I am currently conducting a

research on the challenges facing organizations as they expand their operations globally.

This is a requirement in partial fulfillment of the Executive Master of Science in

Organizational Development (EMOD) degree program at United States International

University (USIU).

The study will be based on The Nature Conservancy which is recognized as global

organization and you have been selected as one of the respondents to participate in the

survey. The results of the survey will be instrumental for TNC in identifying the

prevailing global challenges and the best strategies to manage them.

This is an academic research and confidentiality will strictly be adhered to. Your name

will not appear anywhere in the report. Kindly spare 10 minutes to complete the

questionnaire attached. The questionnaire has four sections.

Yours faithfully

Ritah Esther Mutui

P.O. Box 14634, 00800 NAIROBI DATE:

CELL: +254724482444 EMAIL: ritahmutui@yahoo.com

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Appendix B: Questionnaire

PART 1: DEMOGRAPHIC INFORMATION

Kindly answer all the questions by ticking in the boxes or writing on the spaces provided.

1. Kindly indicate the country you are working in………………………………………

2. Which department do you work in?

Finance and Operations

Conservation

Water Fund and Agriculture Program

3. Gender

Male Female

4. What is your age bracket

24 or below

25-30

31-40

41 -50

Above 50

5. Please indicate your management position

Top level management

Middle level management

Non-management Staff

6. How long have you worked for The Nature Conservancy (TNC)

Less than 2 years

3-5 years

6-8 years

9 years and above

76

PART II: CULTURE AND GLOBALIZATION

Please indicate the degree to which you agree or disagree with the following cultural challenges. Use a scale of 1-5 where 1 is strongly disagrees, 2 disagree, 3 neutral, 4 agree and 5 strongly agree fill the empty boxes using a (√) or (X).

Statement

Strongly disagree

(1)

Disagree (2)

Neutral (3)

Agree (4)

Strongly Agree

(5) 1 Language barriers I can’t communicate with other

colleagues from other divisions directly due to language barrier

I sometimes miss out on important

information at TNC staff functions due to language barrier

Language barrier limits my posting

to other countries I sometimes fail to fully express

my views due to language differences

2 Different values and attitudes

upheld by different employees across the globe

At work am not judged at face value

I am offered an opportunity to explain what I mean at TNC

At TNC, I have the opportunity to solve problems in more than one way

My superior considers my feelings

when handling job matters 3 Different education systems

across the globe

TNC retrains her staff before posting to other countries

My training doesn’t allows me to be posted anywhere in the world

My colleagues from other countries are more skilled than me

I am less skilled when it comes to the latest technology

4 Different customs and manners upheld by different employees across the globe

TNC respects her employees way of life

I am allowed time off to participate in cultural activities

TNC promotes local cultures TNC’s CSR is based on the views

of the locals

77

PART III: LEADERSHIP IN A GLOBAL ENVIRONMENT

Please indicate the degree to which you agree/disagree with the following statements concerning leadership challenges in your organization. On a scale of 1 to 5 where 1 is strongly disagrees, 2 disagree, 3 neutral, 4 agree and 5 strongly agree by filling the empty boxes by using a (√) or (X).

Statement

Strongly disagree

(1)

Disagree (2)

Neutral (3)

Agree (4)

Strongly Agree

(5) 1. Supervision/Direction setting At TNC, my supervisors are always

available for a two way communication

My supervisors at all levels of the

organization normally understand my feelings, needs and concerns

Common goals are clearly

demonstrated by all leaders at TNC at all levels of the organization

My superiors at TNC have fostered

and sustained commitment to excellence at all level of the organization

2. Motivation I am happy with my pay at TNC I am frequently consulted on matters

affecting my job I am satisfied with other benefit

programs such as medical cover and pension at TNC

I am happy at TNC because of the

carrier advancement opportunities 3. Creating Teams My organization forms teams across

diverse backgrounds There is a deliberate attempt by

management to form dynamic teams at my work place

Teams at my work place are easy to

work with In my organization there is strong

sense of team work 4. Information Management

I easily access work related information from other divisions in other countries

I easily access employee blogs from

other countries

78

I get free access to mentors within the organization from any part of the world

Information is freely shared at TNC

regardless of the division 5. Encouraging creativity and

Innovation

I am offered an opportunity to try new innovations at work

Authority to try innovations by staff can be granted at the local TNC office

We are encouraged to adopt local

solutions in solving work related issues

I get a financial reward whenever I

introduce something new at work.

79

PART IV: POLITICS AND BUSINESS GLOBALIZATION

Please indicate the degree to which you agree/disagree with the following statements concerning politics and business globalization in your organization .On a scale of 1 to 5 where 1 is strongly disagrees, 2 disagree, 3 neutral, 4 agree and 5 strongly agree where ; by filling the empty boxes by using a (√) or (X).

Statement

Strongly disagree

(1)

Disagree (2)

Neutral (3)

Agree (4)

Strongly Agree

(5) 1. Nationalization Polices Conditions set on the maximum

number of expatriates to be employed in certain countries discourages TNC from fully globalizing

Restrictive fund repatriation laws discourages TNC from venturing in some countries

Demand for local share in the

organization discourages TNC from full globalization

Laws limiting conservancy activities

to governments is a major hindrance to TNC globalization

2. Government Stability Frequent change of governments is a

major hindrance to TNC global expansion

Terror attacks is a major hindrance to

TNC global expansion Civil strife is a major hindrance to

TNC global expansion Political coups have greatly hindered

the TNC global expansion 3. International Relations

Poor international relationship between TNC mother nation (USA) has led to closure of some divisions in foreign countries

Poor international relationship between USA and some foreign governments has led to limited funding of projects in some foreign countries

Foreign countries normally deny registration of TNC divisions due to their poor international relations with the USA

Poor relations between USA and some foreign countries has restricted movement of TNC staff to open divisions in some countries

80

4. Government Bureaucracy Too many forms filled for registration

has discouraged TNC from venturing into some jurisdictions

Demand for responsiveness to many

layers of governments limits TNC’s globalization

Too lengthy registration of

international organizations has be a major hindrance of globalization at TNC

Demand for home government support has hindered TNC from achieving full globalization

In your opinion, kindly indicate any other political factors not listed above that limits

TNC from expanding globally

………………………………………………………………………………………………

………………………………………………………………………………………………

………………………………………………………………………………………………

THANK YOU FOR YOUR TIME