1. Identify and discuss Corning's strategic predisposition toward a joint venture with Vitro.
Because of long histories of successful joint ventures and had been an innovative leader in foreign alliances for over 73 years, Corning's strategy of establishing the joint venture relationship with Vitro seems to be a ideal combination and will lead to success. However, the joint venture became subject to a series of cultural and other conflicts that began to undermine this vision. According to company officials and external analysts, cultural differences were a principal cause of the alliance's failure. Therefore, lack of fully understanding Mexico culture is the key predisposition of Corning's strategy.
What is culture? One of the well-accepted definitions is given by Goodenough (1971), who has defined culture as a set of beliefs or standards, shared by a group of people, which help the individual decide what is, what can be, how to feel, what to do and how to go about doing it.
The main cultural clashes between two companies are discussed as follow:
Ã¢ÂÂ Different decision-making style between Mexican and American:
Vitro and other Mexican businesses are much more hierarchical, with loyalty to fathers and patrons somehow carried over to the modern corporation. As a matter of loyalty or tradition, decisions are often left either to a member of the controlling family or to top executives, while middle level managers are often not asked their opinions.
As a result, Corning managers who work in the joint venture were sometimes left waiting for important decisions about marketing and sales. Refers to a Corning executive: "If we were looking at a distribution decision, or a customer decision, we typically would have a group of people in a room, they would do an assessment, figure alternatives and make a decision, and I as chief executive would...