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Cultural dimensions in logistics management: a case study from the European automotive industry
Malin Aquilon
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Malin Aquilon, (1997),"Cultural dimensions in logistics management: a case study from the European automotive industry",
Supply Chain Management: An International Journal, Vol. 2 Iss 2 pp. 76 - 87
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Case studies
Cultural dimensions in
logistics management:
a case study from the
European automotive
industry
Malin Aquilon
The author
Malin Aquilon is a researcher based at the Research
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Centre for Transport and Logistics (CRET-LOG), University
of the Mediterranean, Aix-en-Provence, France and Lund
Institute of Technology, Centre of Packaging Logistics,
Sweden.
Abstract
Discusses why cultural awareness becomes increasingly
important in the context of global sourcing, process
management and relation-oriented logistics. Presents the
results of a qualitative study based on 50 in-depth inter-
views with Volvo Car Corporation’s European suppliers.
The study illustrates some of the national cultural differ-
ences between Volvo’s European suppliers. The findings,
based on Hofstede’s four-dimensional model, show that
different cultural clusters (Scandinavian, Latin, Germanic,
Anglo-Saxon) behave quite differently in their contractual
relations with their customers. Explains that the main
differences are related to organizational structure, access
to information, communication style and the degree of
assertiveness towards their customers. Presents Volvo’s
strategy to increase cultural competence as a result of the
study, along with examples of measures undertaken.
Supply Chain Management
Volume 2 · Number 2 · 1997 · pp. 76–87
© MCB University Press · ISSN 1359-8546
76
Introduction
An increasing number of academics and
practitioners in the logistics field are recogniz-
ing the value of taking culture into account in
the context of internationalization and global
sourcing. However, there has been little
research (theoretical or empirical) in this
particular field. One could argue that cultural
awareness is especially significant for those
working in the logistics area, where the inter-
faces between people with different cultural
backgrounds (professional, gender, regional,
corporate, national) are increasing.
However, highlighting culture-dependent
differences is not always a welcome interven-
tion (Hofstede, 1980). Generally, the amount
of international exposure significantly affects
the way the subject is treated and experience
of working and living abroad facilitates an
understanding of the importance of the sub-
ject. Internationally “naïve” audiences often
find it difficult to identify the issues and some-
times even feel insulted when their own cul-
ture is discussed.
This paper discusses why cultural knowl-
edge is becoming increasingly important in
today’s logistics environment, focusing on the
automotive industry and its supply processes
(in-bound logistics – purchase and procure-
ment). The concept of culture is presented
briefly, followed by the results of a pioneering
study on cultural differences between Euro-
pean suppliers, conducted at Volvo Cars
Europe Industry in Belgium.
From process management to logistics-
oriented relationship management
Companies operating in today’s highly com-
petitive world markets must not only learn to
innovate, adapt and exploit technology, but
also develop new types of professional rela-
tionships (Organization for Economic Co-
operation and Development, 1992, p. 12).
Buyer-seller relationships can take on many
forms; from single transaction relationships,
to vertical integration (Ellram, 1992, p. 23).
Between these extremes, companies become
increasingly interdependent (in external
alliances, outsourcing agreements, joint-
ventures) and share cost and competence in
R&D, production, information, quality assur-
ance and logistics.
The logistics function – to plan, develop,
organize, co-ordinate, steer and control
 physical flows from raw material supplier to
final customer (Persson, Virum and Ericsson,
1991) – has undoubtedly contributed, or at
least supported the development of these new
relationships. The company is no longer seen
as a sum of isolated functions, but as a system
of inter-linked process chains which have to
be understood and steered. Aspects like
process capability, security and control
become more important than function and
field targets (Baumgarten, 1995).
As process chain management aims at
optimizing the whole logistics chain, those
outside the traditional limits of the company
are included. Through new and innovative
collaboration forms, the border between the
company and these participants more or less
disappears (through, for example, various
forms of supplier integration). When the
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traditional hierarchical organizational struc-
tures are decomposed through a boundary
spanning process organization, it becomes
increasingly necessary to manage the relation-
ships with the numerous people/organizations
participating in the chain.
The concept of relationship management
aims at identifying, conceptualizing, describ-
ing and explaining a company’s various rela-
tionships and their evolution. Diller and
Kusterer (1988) define relationship manage-
ment as a marketing concept. Applied to
logistics, relationship management (also
known as relationship-oriented logistics or
relationship logistics) tries to take the relevant
logistics relationships with internal and exter-
nal stakeholders into consideration (Wehberg,
1996, p. 13). It does so by identifying differ-
ent levels of logistics relationships, including
practical, organizational, power and
human/emotional issues (Wehberg, 1996,
pp. 13-17).
Relationship-oriented logistics, combined
with other theories like transaction cost
Table I Obstacles to global sourcing
Environment-related obstacles
Each country has a specific legal system
Political instability and consequences
Fluctuating interest and exchange rates
Cultural variety: different norms, attitudes,
values and thus behaviour
77
analysis (Noorderhaven, 1995; Williamson,
1985), the property-rights theory (Picot and
Dietl, 1990, p. 178) and the principal-agent
theory (Kaas, 1992; Picot, 1989, p. 370;
Spremann, 1988, p. 64) provide a useful
framework for the analysis of a company’s
various relationships in a systems perspective.
Because of the globalization of companies’
commercial and industrial activities, an
increasing number of process chain partici-
pants are dispersed geographically. In the case
of global sourcing, suppliers can, for example,
be spread all over the world. To pilot flows
over national borders brings about specific
obstacles, related to time and distance, but
also to the specific environment (Table I).
The consequences of the obstacles shown
in Table I are well documented in the logistics
literature, except for the culture-related ones.
The cultural issues have attracted occasional
attention (Ellram, 1992, p. 35; Fawcett and
Birou, 1992, pp. 4-6; Pfohl and Large, 1993,
p. 14), but have, to the author’s knowledge,
not been analysed more deeply in the context
of business logistics. Even the above-men-
tioned relationship theories ignore, to a large
extent, the effects of culture.
The concept of culture
The conceptualization of culture has con-
cerned social scientists for decades. Numer-
ous definitions exist (according to Lundberg
(1991, p. 12), over 400 definitions exist in the
literature), but to date no clear consensus has
emerged within or across disciplines
(Gudykunst and Ting-Toomey, 1988, p. 27).
In the majority of European languages, the
word culture has two basic meanings. One
refers to civilization, that is, the refinement of
the senses, referring to a residual process, like
art, literature, education, religion, sport,
entertainment (Brinkmann, 1996, p. 124).
Time- and distance-related obstacles
Longer and more insecure lead times
The risk of various types of damages
Difficult to get hold of correct and reliable
information about foreign markets
Customs obstacles and extensive documentation
requirements
Divergent database equipment and computer
information systems
 The other meaning of culture goes deeper. It
refers to the context of symbols, norms, inter-
pretation models and values shared by a social
group. Values form the core of culture and
concern what is good/bad, clean/dirty, nor-
mal/abnormal, logical/illogical, rational/irra-
tional, fair/unfair, etc. Once we have learnt
what values to cherish (from our parents
and/or other important family members, in
school and other institutions) it is very diffi-
cult to change them. This is why we tend to
think that our way of doing things and looking
at the world is the most natural (and often the
best). Culture can be compared in this respect
to what Hofstede (1980) classifies as a “men-
tal program”, reflecting all the elements (like
upbringing, socialization, traditions), con-
tributing to the forming of behaviour.
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The idea that all societies (modern and
traditional) are confronted with the same type
of basic problems, with differing solutions,
was developed by socio-anthropologists dur-
ing the first half of the twentieth century
(Hofstede, 1980, p. 36). The next challenge
was to define these basic problems. Naturally,
a great number of proposals of these so-called
cultural dimensions have appeared and still
appear in the literature (Brinkmann, 1996,
p. 181; Lytle et al., 1995, pp. 178-191).
The idea of using dimensions to describe
cultures stems from an ambition to describe
culture in a schematic, more distant and
objective way. The focus is on the empirically
verifiable and on the independence of the
dimensions. Four of the five dimensions
which Hofstede established from his research
are defined: power distance, individualism,
masculinity and uncertainty avoidance.
Hofstede’s findings are based on a survey of
40 countries – later expanded to over 70
countries – including both oriental and occi-
dental cultures. A total of 160,000 managers
and employees working in local subsidiaries of
the multinational company, IBM, were sur-
veyed twice on work-related values. The
chosen investigation units made up an almost
perfect sample among the selected countries,
except for the nationality variable. The
answers provided by the employees can,
therefore, be said to represent national cultur-
al differences. As the examined nations are all
(to various degrees) individualistic (and thus
not collectivist), the dimension, individual-
ism, will not be explored further in this paper.
78
Procurement logistics in the automotive
industry
The automotive industry has made enormous
efforts to realize the new types of relationships
mentioned above, often referred to as partner-
ships, or purchasing alliances (Ellram and
Cooper, 1990). The common denominator
for these relationships is that they have a
relatively long-term orientation and aim to
link some aspects of the companies’ business
towards a common end, to improve perfor-
mance in terms of both cost and quality. This
includes sharing information, risks and
rewards. In the automotive industry, this kind
of collaboration has become a necessity
because of fierce world competition, empha-
sizing increased productivity, core compe-
tence, world class suppliers and international-
ization of sourcing. The significance of the in-
bound logistics system, which is the supply
organization which links a manufacturer with
his industrial network partners (suppliers,
carriers, third-party participants) has, there-
fore, increased.
In the in-bound logistics system, the pro-
curement and purchase function is an inter-
face between the plant and the supplier.
Together, they are responsible for the acquisi-
tion of goods to the company’s other services
(raw materials, components and semi-fin-
ished products, energy, machines, transport
and other services). Traditionally, purchasing
has been concerned with the acquisition of
requested goods or services within defined
conditions, while procurement has focused on
the organization of short-term, operational
actions (Bruel, 1991, p. 6).
Research methodology
The findings presented in this paper are based
on 50 in-depth-interviews with Volvo’s Euro-
pean suppliers. These interviews were con-
ducted as part of a procurement logistics
project called Volvo 95. The success of Volvo
95 was dependent largely on how well and
how rapidly the suppliers could integrate
Volvo’s requirements through changes in their
logistics organization (lead time reduction,
electronic data interchange (EDI) implemen-
tation, quality improvement, delivery service
performance, etc.).
During 1994, over 100 suppliers were
invited to the procurement department. To
assure a close personal contact with the Volvo
 employees (because of the importance of the
message) the suppliers were invited separate-
ly. The people invited were most often the
sales, production or quality manager together
with a contact person in sales administration.
From Volvo’s side, representatives from mate-
rial steering (the Disponenten in German, and
Approvisionneurs in French) and quality con-
trol assisted. They attended a presentation of
Volvo 95 and, together with a Volvo represen-
tative, they made an assessment of their logis-
tics system to detect potential improvements.
To follow up the effects of this ambitious
programme, a project was designed in close
collaboration with Volvo’s procurement
department.
Fifty of the hundred suppliers were inter-
viewed for between one and one-and-a-half
hours. The objective of this project was to
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identify different factors influencing the
customer-supplier relationship during the
process of change. The interviews focused on
three basic questions:
(1) Did the suppliers understand the message
of Volvo 95?
(2) What measures had they undertaken to
help Volvo reach their objectives?
(3) How did the suppliers perceive their
relationship with Volvo and how (if at all)
would they like to see it evolve?
The suppliers were addressed first by a letter,
containing the basic questions of the pro-
posed interview. They were then contacted by
telephone and an appointment for a (tele-
phone) interview was made. Personal inter-
views were made in eight cases, on request
from the supplier. The information was col-
lected over a period of five months. The infor-
mation from the interviews was analysed
subsequently with a view to identifying the
impact of cultural differences in the behaviour
of participants from different countries,
within the context of their trading relationship
in the procurement logistics field. The under-
lying question behind this qualitative analysis
was:
When and how do cultural differences become
visible in the trading relationship between a
manufacturer and its suppliers?
The work is an example of how it is possible to
use cultural theories (in this case Hofstede’s
(1980, 1991, 1994) five-dimensional model)
to detect how culture influences a particular
participant’s behaviour. Through such obser-
vations it is possible to draw conclusions of
79
what practical benefits can be drawn from
cultural theories in a business perspective.
The study concentrates on the national
dimension as the survey units (the suppliers)
form a relatively homogeneous group (same
business sector, same sex, same professional
profile). The interviewees were all supplying
various car parts to the automotive industry,
were 95 per cent men, and working either
within sales (manager or administration), or
sometimes within production (logistics).
Table II shows the number of suppliers
from various countries and the proportion of
suppliers interviewed. Volvo has around 285
suppliers for its car production. These suppli-
ers come from around 20 countries. The
biggest suppliers (in terms of value and
volume) are from Sweden, Belgium and
Germany.
Research findings
The information collected during the inter-
views with the suppliers illustrates their men-
tal programming in a way which corresponds
very well with Hofstede’s research on cultural
dimensions. There is a certain scepticism over
empirical research of this type, with quota-
tions used as anecdotal evidence. Mintzberg
(1994) comments on this:
As good scientists, we are all expected to rely on
hard data systematically collected. Anecdotal
evidence is supposed to be soft, biased, and
superficial. Yet we have just seen exactly the
same about hard data – that these have a decid-
edly soft underbelly. The systematic collection
of data about ill-specified processes does not
provide much insight into what is going on out
there. Let us therefore turn to some anecdotal
evidence, not to resolve any issue so much as to
gain a bit of insight into several of them
(Mintzberg, 1994).
This quotation captures the objectives of this
particular study to gain some insight into the
impact of culture through the suppliers’
Table II Sample profile
Supplier Total number Number of Representation
nation of suppliers interviews in per cent
Sweden 87 11 12
Germany 75 17 20
Belgium 45 3 6
France 18 9 50
Great Britain 16 5 31
Norway 7 2 30
 comments and consequently to show the
practical benefits of cultural knowledge.
Below, each cultural dimension is presented
briefly, followed by the observations made
from the interview material.
Power distance
To what extent do the less powerful members
of institutions and companies in a country
expect or accept that power is unequally
distributed?
One of the aspects which distinguishes one
country from another is the way in which
equality between its inhabitants is treated. It
mirrors a country’s way of handling the fact
that people are unequal. For instance, in
countries with “larger power distance”,
employees have greater emotional distance
from their directors, which means they are
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more intimidated by their superiors. Power
distance explains the value systems of less
powerful members of society, accepting or
otherwise that power is unequally distributed.
Table III shows the scores corresponding to
the selected supplier nations according to
Hofstede’s research (on a scale from 0 to 100
– scores above 50 indicate medium to large
power distance, scores below 50 represent
medium to low power distance).
According to Hofstede’s research findings
(and numerous other research works such as
Adler, 1991; Crozier, 1963; D’Iribarne,
1989; Laurent, 1983; Strategor, 1992), the
Latin countries have a relatively large power
distance, whereas the Scandinavian, Anglo-
Saxon (UK and USA) and Germanic coun-
tries have smaller power distance. The find-
ings in this study confirm this conclusion.
The following tendencies (see Table IV)
were connected with large power distance
(LPD):
• the role of hierarchy and access to informa-
tion;
• the centralization of power;
Table III The selected supplier nations’ scores on the power distance
dimension
Larger power distance Smaller power distance
France 68 The Netherlands
Belgium 65 Germany
Spain 57 Great Britain
Sweden
Norway
Denmark
• protecting employees from a dominating
customer;
• distance towards Volvo.
In countries characterized by small power
distance (SPD), the subordinates seemed to
know more about developments in the com-
pany. It was, therefore, less important to
speak with the manager. The contact person
expressed more freely personal opinions
about the relationship to Volvo, which partly
indicates less dependency on superiors. In
addition, the level of communication was
more direct (see Table V).
Uncertainty avoidance
To what extent the members of a culture feel
threatened by uncertain or unknown situa-
tions.
Societies have different ways of handling
and tolerating what is not possible to forecast
or predict. In societies where uncertainty is
perceived as very threatening, solutions to
uncertainty elements are more rigid. For
example, the religious beliefs are more
absolute, representing “The Truth”. Laws are
stricter, punishments harder. The type of
technology used reveals priorities and which
threats are considered important. Cultures
which are less sensitive to uncertainty use less
rigid solutions, have more flexible ways of
dealing with ambiguity and there is more
tolerance towards what is foreign and
unknown.
In countries with strong uncertainty avoid-
ance, people appear relatively busy, charged
with emotions, abrupt, aggressive and active.
People communicate more vividly with their
hands and bodies. It is acceptable to raise the
voice and to show strong emotions in public.
In contrast, members of societies with
weak uncertainty avoidance seem calm, easy-
going, slow, controlled and lazy. People are
less expressive. To show strong emotions in
public and to be “loud” is met with social
dislike. Stress is more internalized.
Table VI shows the scores corresponding to
the selected supplier nations according to
Hofstede’s research on uncertainty avoidance.
Again, the Latin countries show relatively
38 high scores on the uncertainty avoidance
35 dimension, followed by the Germanic coun-
35 tries (also Austria and German-speaking
31 Switzerland). Lower scores are indicated for
31 the Anglo-Saxons and Scandinavians (Norway
18 and The Netherlands have medium scores).
80
 Table IV Summary of observations concerning LPD
Observations
Hierarchy and access to information
During the interviews with suppliers from LPD countries, it was
obvious that subordinates knew less about what was going on
in the company (concerning ongoing logistics projects and
improvements in this area, etc.). It was therefore important to
talk to a superior (the logistics, quality, or production manager),
to get the necessary information. In LPD organizations,
information is to a larger extent centralized at the executive
level. Access to information therefore becomes a power
question and, subsequently, the subordinates are more
“thirsty” for information
The centralization of power
Various quotations reflect a more hierarchical structured
organization with central control. The role of senior
management in LPD organizations is crucial. Information and
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changes must be initiated from the top and down the hierarchy.
In small PD organizations, this is less articulated. Initiatives
from blue collar workers and subordinates are common and
expected
Protecting employees from a dominating customer
In line with the observation above, it appeared that a majority
of French suppliers elaborate the information they receive from
Volvo. This is to improve the internal acceptance of the message
from the customer, the role of senior management is again
emphasized. Employees are dependent on their superiors, who
protect them from the requirements of the customers and lead
them towards the appropriate goals
Distance towards Volvo
The suppliers from LPD countries constantly referred to the
goals of the Volvo 95 programme without implying their role
in this context. This coldness was visible only in comments
from Latin suppliers. One possible explanation is that French
suppliers are historically strongly integrated with French car
manufacturers, which is why the relations with other customers
(who are geographically and culturally distant) are more
detached
High uncertainty avoidance
On the basis of the information collected
during the interviews, the following observa-
tions (see Table VII) were made concerning
the high uncertainty avoidance (HUA)
dimension:
• the importance of being well-prepared;
• more anxiety and questions concerning the
interview;
• emphasis on meeting face to face;
81
Examples of comments from suppliers
“If I think of the company (Volvo), it represents a good work
environment, in every aspect, not so hierarchical, everybody is
integrated and there is a nice atmosphere” (a German woman
working for a French supplier)
“We are informed regularly from France. They are managing the
whole world from there. They know about everything going on in the
company, everything is very secret. It’s a family company, if one can
call a company with 100,000 people a family company!”
(a Belgian working for a French supplier)
“We talked to the production managers and the rest of the
management about Volvo’s requirements. Yes, the message stayed
only at management level. Why? Well, because we think it’s difficult
for the operators to understand and interpret it due to its form…
If we present the message as it comes from Volvo, in this slide form,
the personnel will feel as if it is the customer who imposes. If we
transform it, they are more likely to feel that the wish for the change
comes from the management and that we are all in this together”
(French supplier)
“What I think about when I hear Volvo 95? Well, I think of your
(Volvo’s) progress. It’s a total quality plan not differing very much
from those of our other customers. There are differences but the
philosophy is the same” (French supplier)
“Volvo 95 is about the way they (Volvo) want to work for 95”
(Spanish supplier)
• only once you know people well is it possi-
ble to talk about work-related problems;
• emphasis on avoiding failure;
• a need for well-defined rules from the
customer;
• discomfort regarding the use of a foreign
language.
Low uncertainty avoidance
Low uncertainty avoidance (LUA) is charac-
terized generally by greater tolerance for
 Table V Summary of observations concerning SPD
Observations
To spread the information directly from the customer inside
the company is positive
In contrast to the French suppliers, who elaborated the
message from Volvo, the suppliers from SPD countries chose
to present it directly within the company. The directness in the
communication between the parties is emphasized, which
shows that the employees are more positive towards the
customer. There is also an awareness that information might be
lost in a possible translation process
Table VI The selected supplier nations’ scores on the uncertainty avoidance
dimension
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Higher uncertainty avoidance Lower uncertainty avoidance
Belgium 94 Norway 50 (medium)
France 86 Great Britain 35
Spain 86 Sweden 29
Germany 65 Denmark 23
The Netherlands 53
deviant behaviour, more openness, flexibility,
less emphasis on written rules and regula-
tions, and less formality. Generally, the inter-
views with Scandinavian and British suppliers
were more open. The interviewees revealed
more of internal problems or concerns, had
more personal viewpoints to bring forward,
and almost never asked the reason for the
interview.
The following further specific observations
were made concerning the LUA dimension
(see Table VIII):
• openness in communication and less anxi-
ety;
• a preference for oral agreements, straight-
forwardness and trust.
Masculinity/femininity
Measures the extent to which a culture
emphasizes self-assertion and materialism
(masculine), or modest behaviour and con-
cern for people (feminine).
The importance of big incomes and possi-
bilities for promotion reflects the masculine,
self-assertive, competitive social role. Mas-
culinity dominates societies where the social
gender roles are clearly separated: men are
expected to be tough, self-assertive and ori-
ented towards material success. Women are
82
Examples of comments from suppliers
“The key people were here during the presentation. But we can do
more in this respect! The next step to take will be when the teams are
fully established. We will take the slides that we got from you and
show them to the production people. But there is a language problem,
they do not understand English so we have to translate it. There is a
risk that when we translate, there can be misunderstandings. It would
be a big help to have the slides in German. It’s difficult to say, but may
be it’s better to show them the slides as we saw them when you
presented them here. It’s more direct that way. We can then discuss
the questions with people directly” (German supplier)
expected to be tender, soft and interested in
the quality of life.
In feminine cultures, more emphasis on
relationships with managers and colleagues
reflects the caring, commitment and social-
environmental orientation of a female role.
In feminine societies, the gender roles are
overlapping. Both men and women can be
modest, tender, soft and concerned about
the quality of life.
Table IX shows the scores corresponding
to the selected supplier nations according to
Hofstede’s research on masculinity.
On the basis of the information collected
during the interviews, the following observa-
tions were made concerning the masculinity
dimension (see Table X).
• emphasis on own performance and
competence;
• production orientation.
In contrast to the Germans, Scandinavians
emphasized good co-operation and service
orientation. The following observations were
made concerning the feminine dimension (see
Table XI):
• emphasis on good collaboration with
Volvo;
• emphasis on service (in contrast to
production).
Improvement measures
As a result of this investigation, several mea-
sures have been taken at VCEI (Volvo Cars
Europe Industry) and at VCC (Volvo Car
Corporation). Apart from direct measures
resulting from the study, a strategy to develop
cultural competence within the company has
been initiated. This implies defining different
 Table VII Summary of observations concerning HUA
Observations
The importance of being well-prepared
The suppliers from HUA countries wanted to make an internal
inquiry before the interview could take place. This was not the
case with suppliers from LUA countries.
More anxiety and questions concerning the interview
Without exception, all persons from HUA countries wanted “What is the purpose of this interview, who’s going to read it?”
additional information about the objectives of the interview:
would the result be published?, would anonymity be confirmed?,
who would read the report?, etc. This very seldom happened
with people from LUA countries
Emphasis on meeting face to face
A majority of these suppliers requested to meet face to face to
discuss the issues presented in the letter
Only once you know people well is it possible to talk about
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work-related problems
Suppliers from HUA countries emphasized the importance of
knowing people very well before being able to talk about
problems in the company, etc. French and German suppliers
wanted to visit people at Volvo more often, and to have Volvo
people visit them. This would improve overall results
Emphasis on avoiding failure
The question of whether to inform the customer or not about a
problem is a greater concern for suppliers from HUA countries,
especially when a solution has not been identified. The urge to
avoid failure is very stong
A need for well-defined rules from the customer
A wish to receive clearly defined rules was common from these
suppliers. When you know exactly what is expected from you,
uncertainty is reduced
Discomfort regarding the use of a foreign language
It is certainly tiring and frustrating to communicate in a foreign
language which one does not master fully. However, this feeling
of discomfort is probably stronger for people from HUA
countries, who are concerned with avoiding failure. Language
school education (as well as other subjects) is in these countries
more authoritarian. Great individual differences can, however,
be discerned. Also, Belgium, which scores high on UA, has a
multi-lingual work force.
83
Examples of comments from suppliers
“I need to talk to my group about your request concerning the
interview, to see where we are concerning Volvo’s requirements”
“It is very difficult to talk about these kinds of issues over the phone.
These are sensitive questions”
“To know one another a bit more helps when there is a problem to
deal with. Maybe we don’t know certain problems and when we meet
and start to discuss about things, we will discover them”
“In Sweden, they change people a lot. It’s therefore difficult to get a
strong confidence, to get involved. I don’t know the people in
Gothenburg very well. Meeting the person is very important”
“I think we need to work together and solve the problems. It is
difficult to give information about problems sometimes because we
don’t have time. When there is a problem somewhere, it is difficult
to be able to say when we can deliver. It all depends. Then, we say,
OK, we say we deliver tomorrow at noon and the parts are not there,
you get upset of course. But it is sometimes impossible to say when.
Then it is better not to say anything when we can’t keep it anyway”
(German supplier – in a “face to face” interview)
“They (Volvo) indicate very clearly what the rules are, how they work
and how they would like us to work. They communicate the rules for
the relationship. It’s easier to handle problems when you know how
they (Volvo) are functioning” (German supplier)
“We would also like to know more about how you class us, how you
judge our performance” (French supplier)
“Also, another problem: we get the delivery instruction and the
Odette instruction booklet in English. It’s a lot of work to translate
them into French as all people do not speak English. It does not
matter for the slides of Volvo 95 and these kinds of thing, because the
presentation is made in French anyhow. And the effort that for
instance Willem does, trying to speak French, that’s very important,
it counts a lot. It means that you really try to get the message
through to us” (French supplier)
 Table VIII Summary of observations concerning LUA

Observations Examples of comments from suppliers

Openness in communication and less anxiety
The suppliers share more individual opinions and feelings in
the interviews, especially concerning the collaboration
modalities with the customer
“The attitude (from Volvo) is better today, there is a two-way
communication, more co-operation between us. We have noticed
this attitude in Gent also, it was different a few years ago. For
instance, concerning material steering, it used to be
‘I command you to deliver me this with that plane tomorrow and
at your cost!’ Now we agree on it, we discuss it more. I don’t think
it’s because you have decreased the level of your requirements,
we have improved in these respects” (Swedish supplier)

A preference for oral agreements, straight-forwardness and trust

It is probably easier for a Swedish supplier to have more “Volvo is a very straightforward company with high morals, which
informal contacts with a Swedish customer, as cultural likeness distinguishes it from other car manufacturers. An agreement is an
favours mutual trust agreement and one can trust a word, it does not always have to be
written, which makes it of course easier to act faster”
(Swedish supplier)
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Table IX The selected supplier nations’ scores on the masculinity dimension results. This will be done through an
increased exchange of ideas and problem-
Higher masculinity Lower masculinity
solving approaches among the suppliers.
Great Britain 66 France 43 • Two articles about the findings have been
Germany 66 Spain 42 published in Volvo’s internal magazines,
Belgium 54 Denmark 16 Volvo Leader (international management),
The Netherlands 14 Volvo Nu (Swedish) and Volvo Global (inter-
Norway 8 national), to spread the message.
Sweden 5
As the process to establish cultural awareness
and competence is rather long, the direct
competence levels for those participating in benefits cannot be evaluated immediately.
the supply chain. The competence tool aims Training needs to be combined with practice.
at identifying who needs which level of cultur- It is, however, clear that discussions concern-
al competence and in what situations, and ing cultural differences have become increas-
suggests how to measure this competence. ingly common internally. Cases where people
Another possible area for improvement is the take the initiative to hold seminars about their
redefinition of job profiles and increased job- own cultural experiences have been noticed.
rotations. Suddenly, people appear less culture-blind.
The following specific measures have Finally, the employees are starting to acquire
already been taken: a vocabulary which makes it possible to dis-
• A programme to increase cultural aware- cuss these issues with each other. This is
ness among those with international perhaps one of the greatest benefits for those
contacts has been elaborated. This is involved. Whether positive results will appear
known as the “Cultural Awareness is now very much up to the employees
Programme”. themselves.
• Guidelines on cultural differences between
Swedes and Belgians working together
Conclusions
have been designed.
• In the procurement department at VCEI, The findings of the Volvo research show that it
the presentation material of the Volvo 95 is possible to establish a classification of cul-
(now Volvo 97) initiative has been tural profiles (in this case national cultures) in
redesigned to suit the audience (the suppli- the context of international sourcing. Based
ers) better. on such a classification, measures can be
• A “supplier club” is being created with the elaborated to improve collaboration and
objective of improving internal and external communication. The suppliers are not a

84
 Table X Summary of observations concerning masculine dimension
Observations
Emphasis on own performance and competence
The suppliers from masculine countries seldom mentioned
problems related to the company. They consistently stressed
the good sides of the company and its competence. When asked
whether the Volvo 95 message had been understood internally,
they answered: yes, for sure! (The Scandinavians admitted that
this was not always the case)
Production orientation
German suppliers connected quality and flexibility with
production concerns. Masculine countries (combined with high
UA) are generally better at mass production, where precision
and discipline are important features
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Table XI Summary of observations concerning feminine dimension
Observations
Emphasis on good collaboration with Volvo
To have close co-operation with the customer is considered
very important. When asked how the suppliers would like to
improve the co-operation with Volvo, a majority of
Scandinavians wanted to be more involved
Emphasis on service
When asked how they would define Volvo 95, the Swedish
suppliers emphasized collaboration, as opposed to own
performance
homogeneous group but should be treated
differently according to their cultural dimen-
sions. The findings confirm the predominant
pattern of the applied theory (Hofstede), but
add more specific information about the
context of supplier and manufacturer
relations and procurement logistics in the
European automotive industry.
The findings of this study suggest further
that knowledge, understanding and compe-
tence in the field of culture are indeed useful
capabilities to add to the classical list of abili-
ties and useful tools for logisticians and other
participants in today’s rapidly changing
industrial and commercial environment.
With increased cultural awareness, it is,
more specifically, easier to identify:
85
Examples of comments from suppliers
“Flexibility is the best point in our company. It’s our priority”
(German supplier)
“We are too good at flexibility! If Volvo has a new idea of a product
they want to develop, a request, we are very fast with doing it and we
do not think so much about the cost” (German supplier)
“Flexibility is about being able to rapidly switch from one flow to
another in production”
Examples of comments from suppliers
“When it concerns new models, to be involved earlier. To have some
kind of ‘open book’ and show all the costs that one has. To declare
all the changes that one ought to do openly. The price on the market
is, of course, different from the cost. If one could imagine a sort of
co-operation as in Japan, to come closer to each other. One has to
think long term to survive and can’t afford to make changes all the
time” (Swedish supplier)
“Increased co-operation and reduced lead-times” (Swedish supplier)
“I think of mutual responsibility and work with the supplier”(Swedish
supplier)
• Suitable steering tools for material and
information flows. As the Volvo research
shows, the sharing and spreading of infor-
mation is culturally dependent, so is the
preference for communication partners
(dependent on hierarchical levels).
• Suitable management methods. As exam-
ples of different (national) management
styles can be mentioned: management by
intuition, by objectives, by exception, high
profile management, participative manage-
ment, quality circles, strategic planning
and management by individual incentives
and by praising excellence in front of co-
workers.
• Some criteria for suitable suppliers (or
other partners) and people with whom to
interact in these firms.
 • Problems and/or opportunities which
affect the smooth running of the process.
• How to build and maintain a business
relationship, and how to improve it.
• More effective ways of communicating and
interfacing.
• Opportunities to innovate with respect to
existing types of relationships.
According to the literature (and to the
author’s own intercultural experiences)
increased cultural awareness and competence
reduce the uncertainty linked to not under-
standing divergent thinking and behaviour. It
makes it easier to act in a way that makes
culture work for rather than against us. It also
saves time which otherwise would be spent on
trying to understand why people react in the
way they do. It can thus reduce the amount of
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time necessary for negotiation. This last
aspect is crucial, because time is indeed a
strategic tool for competing in today’s busi-
ness environment (and particularly in the field
of logistics). Moreover, companies which
cannot impose themselves by their size and
force (like Volvo among the car manufactur-
ers) must find alternative, more refined ways
of managing their business relationships.
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