“Two sides to Every Story”
Four years ago Pressman Company entered into a joint venture with a Brazilian firm to manufacture a variety of plumbing supplies both for the internal Brazilian market and for export to neighboring countries. Last week Pressman received the resignation of Jonathan Smith, an expatriate from the home office who nine months ago was appointed general manager of the Brazilian subsidiary for a four-year term. In the previous 39 months, two other expatriate general managers from the home office had also decided to call it quits long before their foreign assignments expired. In addition, 13 of the 28 Canadian technicians sent to work in the Brazilian facility returned home early. George Stevens, a senior vice-president in corporate headquarters, estimates that these expatriates' resignations and early returns have cost the company at least $4 million in direct expenses and probably three times as much in lost production and delayed schedules.
When he heard rumors of widespread discontent in the workforce and a threatened
wildcat strike, Stevens decided to travel to the Brazilian facility to find out what was
happening. In the course of interviewing five local supervisors and 10 workers with the
help of a translator, he repeatedly heard three complaints: first, the Canadian managers
and technicians thought they "knew it all" and treated their Brazilian counterparts with
contempt; second, the Canadian employees had unrealistic expectations of what could
be accomplished within the stipulated deadlines established at corporate headquarters-
ters; and third, Canadian employees were making three times more money than their
Brazilian counterparts and enjoyed looking down their noses at locals by driving fancy
cars, living in expensive homes, and hiring an army of maids and helpers.
When he arrived back in Canada, Stevens also interviewed Jonathan Smith and five of
the technicians who returned early. Some common reasons for their early resignations
emerged from these interviews. First, they described their Brazilian colleagues as "lazy"
and "just doing the minimum to get by while keeping a close eye on the clock for
breaks, lunches, and go home on time." Pushing them to work harder only provoked
Second, they indicated that the Brazilian workers and managers had a sense of entitlement with little intrinsic motivation and initiative. Third, they complained of loneliness and their inability to communicate in Brazilian. Finally, most reported that
their spouses and children were homesick and longing to return to Canada after the first month or so. As he sits in his office, George Stevens is staring blankly out the window, trying to decide what to do.
Critical Thinking Questions
1. Based on what you have learned in this session, what do you think are the underlying problems in the Brazilian subsidiary of Pressman Company?
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