This is a case study of a new manager facing a meeting issue that reflects the culture conflict between two different countries, would you mind help me to answer these questions?
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Case: Perils of a being a junior manager
While General Electric had long dominated the market for basic electrical supplies, recent
competition from Asia and Europe had begun to seriously erode its market share and the
company was determined to reestablish itself in this lucrative global market.25 In its Asian
markets, GE had a long-standing partnership with Japan’s Fuji Electric Corporation, but this
alliance failed to produce the results GE sought. Perhaps it was time to find a new partner. Jeff
Depew, an aspiring young manager at GE, was assigned the task of laying the groundwork to
make this happen. Fluent in Japanese, he was sent to Japan with instructions to cultivate a new
relationship with Mitsubishi Electric, one of Japan’s premier electrical equipment
manufacturers and a possible partner for GE’s new strategy. It was made clear to him by his
boss that success in this assignment would position him well for continued career progression
upon his return to the United States.
As Depew tells the story, upon his arrival in Tokyo he began a carefully orchestrated effort to
nurture relationships with his counterparts at Mitsubishi and over time won their respect and
trust. What he envisioned was a quantumleap of the sort that would catch the attention of
GE’s then-CEO Jack Welch. Welch valued managers who could take control and make deals
happen. He wasted little time on the niceties of negotiation and preferred to work with people
who thought as big as he did. To Depew, a possible alliance between GE and Mitsubishi was
just such a venture. The partnership would catapult them into a position of dominance in the
global market with combined annual sales of $3.5 billion. As Depew saw it, the partnership
made strategic and economic sense for both partners. The combined company would be the
world leader in six of its eight product lines and would allow GE to establish a working
relationship with a leading Japanese conglomerate.
After lengthy and promising discussions with Mitsubishi, Depew was finally ready to invite GE’s
CEO to come to Japan to meet Moriya Shiki, Welch’s counterpart at Mitsubishi. The visit (called
an aisatsu, or formal ceremonial greeting) would be a brief get-acquainted meeting to
demonstrate GE’s commitment to the project and begin to establish a working relationship
between the two CEOs.26 A date was set for the official meeting.
When Welch arrived, Depew briefed him on the progress that had been made, as well as the
tasks that remained to be done. While many details of the agreement remained to be
negotiated, everything looked good to Depew and he estimated that a deal could be reached
after approximately five months of further cultivation and negotiation. Welch was obviously
pleased and excited about the prospects. A meeting was scheduled for the next morning with
The official meeting between the two companies was a standard protocol session a mating
dance that preceded most major alliances. Not only did Welch understand this, he had
participated in several such rituals in the past. In these initial meetings, specific discussions
about business were studiously avoided. Instead, only general issues were discussed, such as
the state of the US electronics industry and Japanese competition. It was only later in private
meetings that the details of any partnership would be discussed. The meeting between Welch
and Shiki would proceed along a similar path. The two CEOs would exchange pleasantries,
declare their mutual respect for one another, and withdraw. It was too early to discuss details;
subordinates would handle this later.
When Jack Welch and his colleagues arrived at the Mitsubishi building for the scheduled
meeting, he was both well prepared and enthusiastic. He was ushered into the conference
room and formally introduced to Mr. Shiki and his subordinates. To Depew, both executives
were impressive. Shiki was the epitome of the Japanese executive: dignified, elegant, smooth,
and very much in control. As they exchanged business cards, both executives began with a
profuse exchange of thanks along with the expected expressions of mutual admiration.
But then without notice, Welch quickly ended the pleasantries and launched into a discussion
of why a deal was attractive to GE: the product lines were impressive, the cultures could work
well together, and everything seemed to be a good fit. The venture would be a powerful force
in the marketplace, one that would allow both Mitsubishi and GE to smash the competition.
Mr. Shiki nodded his head quietly while Welch went on to point out that in the past, GE had
tried to do deals with other big Japanese companies but had always had troubles. Maybe this
time would be different, he observed. He noted that both firms had large bureaucracies, but
that this should not get in the way. Then he surprised everyone by suggesting that the two
companies should agree to a deal then and there.
Depew was surprised but couldn’t betray his emotions in the meeting. He sat quietly but
nervously. GE had crossed the protocol line. Perhaps they could have gotten away with this in
the United States, but not in Japan where protocol was religiously observed. It was highly
inappropriate to press for an immediate commitment when negotiating with the Japanese especially when Mitsubishi had already agreed to GE’s proposed five-month timetable for
closure of the deal. Shiki looked over at Depew as if to say, “What’s going on here?” but Depew
didn’t have the slightest idea. After a long period of silence, Shiki reiterated his desire to go
ahead with the plan – a subtle yet significant indication of how badly his company wanted to
finalise the agreement. However, he was not about to conclude a final agreement on the spot.
It was well understood by both parties, although not discussed, that Mitsubishi Electric was
trying to extricate itself from a long-standing agreement with GE rival Westinghouse.
Mitsubishi was aware that Westinghouse was quietly preparing to abandon its business in
Japan, and Shiki needed a new US partner on whom he could depend for the foreseeable
future. GE suited his goals perfectly. However, Japanese etiquette required Mitsubishi to
inform Westinghouse of its intentions to change partners before signing a formal agreement
with GE. But when Shiki mentioned this obligation to Welch, Welch questioned why this was
necessary. Shiki tried without success to explain the nature of the relationship, but Welch
concluded that his counterpart was trying to play him off GE against Westinghouse. He
reiterated that he didn’t want to move forward unless Mitsubishi was unequivocally
committed to the partnership. Shiki assured him that this was the case and that the agreement
would be completed in due time.
With that, the meeting broke up amicably and Welch and his colleagues returned to their hotel.
Later that evening, Welch observed that he had pressed Shiki because he concluded that if the
agreement was not completed quickly, it would not be accomplished at all. He was convinced
that Shiki’s reluctance to quickly agree to the proposal meant that he was not serious about it.
The next morning, while Welch made a courtesy call on the Ministry of Trade and Industry,
Depew returned to Mitsubishi. This meeting went better than the previous one, and a
consensus was soon reached concerning how negotiations should proceed and how the
agreement should be structured. The deal was back on track. Welch returned to New York and
Depew was assigned the task of moving things forward.
Several weeks later, however, Depew received a call from his boss in New York telling him that
Welch was leaning against signing the agreement. He felt he had been sandbagged and
embarrassed by one of the most prominent leaders of the Japanese business community. The
only way to save the deal now, Depew was told, was for Shiki to write a personal letter of
apology to Welch in which he stated unequivocally that he would agree to the proposal. Depew
dutifully approached Mitsubishi with his orders. After some negotiation, it appeared that
Mitsubishi was on the verge of complying with Welch’s demand when Depew received another
call from his boss notifying him to break off all negotiations with Mitsubishi. Instead, he was
to return to GE’s former partner, Fuji Electric, and attempt to rebuild relationships so a new
joint venture could be developed.
Two months later, Jeff Depew was recalled to New York headquarters. His boss explained that
GE had decided to take a different approach to the Asia/Pacific region, focusing more on sales
than business development. As a result of the change, GE was eliminating his position.
Shortly after the failure, Fuji Electric dissolved its partnership with GE. In accordance with the
dissolution agreement, Fuji then began selling products in North, Central, and South America
under its own brand name. At the same time, the Mitsubishi-Westinghouse partnership not
only survived, it expanded and is thriving today. Jeff Depew now works in the high-tech world
of Silicon Valley and is doing well.
1. There are three principal actors in this case, two CEOs and a junior manager. How does
each of them view the situation facing them? What, if any, are the principal differences
in their views of the situation?
2. In this case, what are the mistakes that these managers have made about cultural
management? Analyse all of the CEOs and managers (Welch, Shiki and Depew).
3. Does it look like either partner prepared sufficiently for their negotiation sessions (see
Exhibit 7.2 in the book for a guide)? Why or why not? Did they have the best possible
implementation mindset? What could have been done better?
4. How did the parties handle conflicts as they arose? In your view, how could these have
been better managed?
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