PSuN IENBA

INTERC0LT0RAL NANAuENENT by
Bi Paul Leow
ASSIuNNENT

8y I|ora kaza||






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Shell Cultural Web and distinct competencies compared to competitors
"While a student, I attended a conIerence where we broke up into syndicates. All the other
groups chose their most senior person to report back to the big group, except ours - which was run by
a senior Shell executive. It was our most junior person who had this responsibility. When I asked the
Shell person the reason, he simply said 'Always give the opportunity to the person who beneIits
most.' And that comment sums up the Shell culture

Shell has been chosen as the company oI choice in this assignment because oI proven
successIul cross-cultural management strategies in the multi-national business in the oil and gas
industry. In reIerence to the Cultural Web
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` by Gerry Johnson and Kevan Scholes, Shell identiIies
with stories, ritual and routines, symbols, organizational structure, control system and power structure
that is now described in more detail.
Shell Stories
To start with, stories that Iormer and current employees oI Shell tell inside and outside the
company, speciIically this example when Jorret chose to immortalize the senior Shell executive about
his values oI giving him, then a junior person in the company, the responsibility and chance to
represent the team to the big group, just shows conIidence and trust, Shell values that is perceived as
great behaviour. When the senior Shell executive replied to Jorret`s question and said that he always
gives opportunity to the person who beneIits the most, this mindset is very positive and give Jorret the
conIidence that this is the kind oI management that he would be happy to work Ior, because this
mindset reIlects that Shell management cares Ior their employees and want their employees to have
better opportunities Ior growth regardless oI gender, or seniority. A quote demonstrates this skill as
well 'The great leaders oI tomorrow will be the ones who understand how to get everyone to
participate
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.This is unlike many organizations where opportunities are given only to more senior
staII, or in some countries in the oil industry, Ior example in India, opportunities are only presented to
the male population and there are no concepts oI equal gender opportunities being practiced.
Shell rituals and routines
Shell also perIorms rituals and routines that are practiced by the Shell companies worldwide.
One ritual that is practiced and appreciated by all Shell staII is work-liIe balance. This work-liIe
balance ritual in Shell emphasizes that business hours, or working hours are limited to only 8 hours a
day. This ritual is enIorced by Shell management who consistently monitor time tracking oI each staII
within their teams to work 8 hours each day, or a maximum oI 40 hours each week, to ensure that they
achieve work-liIe balance. Shell believes that when an employee is able to have a balanced liIe
between work and Iamily, that the employee will be emotionally more happy, rested and ready to

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!orreL Shell P8 Manager Clobal ulsLrlbuLlon !uly 1994 Shell webslLe
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Cerry !ohnson and kevan Scholes
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Sara LlLLle 1urnbull
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dedicate a better quality oI work the next day. Shell teaches employees 'F.I.R.S.T
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. To Focus,
Implement, ReIlect, Seek and TransIer. Basically, to prioritize the important things Iirst, get Ieedback
and then adapt and plan Ior continued learning. This ritual is accepted by staII and valued by
management, which strengthens the Shell culture because many other companies expect their
employees to work long hours into the night and even weekends sometimes, without compensating
them Ior this extra eIIort or rewarding them Ior their dedication. Instead, many employees are
expected to put in long hours to be seen as committed and helping the company become more
eIIicient, jeopardizing Iamily quality time and personal interests. This is practiced by many
developing countries Ior example, China and Taiwan where employees get minimal pay Ior working
hours exceeding 12 hours each day, and even in big cities like New York where everyone is expected
to participate in the rat-race to be seen as successIul, or otherwise will be judged as being a loser with
no goals or ambitions in liIe. This has resulted in many side eIIects such as high divorce rates, suicide
rates and children being involved with drugs. Thus iI the ritual culture that Shell practices that
empowers people to have work liIe balance is practiced by other companies, this will reduce these
problems and create more productive working environments and better quality oI liIe.
'Multinational corporations may Iind it less risky and more proIitable to expand into more
similar cultures rather than those which are drastically diIIerent
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.
Shell Organizational Structure and Communication Process
Organizational structure in Shell is also very diIIerent than that oI a competitor. Petronas is an
example. Taking the Communication Process model to demonstrate this Iurther, Shell coming Irom a
UK/Dutch company culture, highly encourages very open communication between the sender and
receiver. The message being encoded and decoded have very little noise because the communication
is direct and open, and response as well as Ieedback are given immediately and without personal
judgement. In most Shell meetings, diIIerent levels oI people Irom the most senior managers to the
most junior staII are able to discuss and share viewpoints with each other on any areas they Ieel are
relevant without having to worry that they will be judged or that they might lose their job Ior voicing
their opinions. In these scenarios, Shell employees have the beneIit oI being very open and honest
with their opinions because they Ieel they can be themselves and be appreciated Ior their Ieedback.
This point is emphasized in this quote that demonstrates Shell leaders display this very important skill
oI listening to their staII: 'Listening is a magnetic and creative Iorce. The Iriends who listen to us are
the ones we move toward
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.
From the opposite end oI this communication process model, Petronas culture Ior its
organizational structure does not promote an open communication process between diIIerent levels oI
staII. In Petronas meetings, the noise levels are very high because the message being sent by the
sender has to go through a lot oI noise beIore being received by the receiver. The messages are
usually encoded with many indirect meaning making it diIIicult to decode. Response and Ieedback is

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uavld eLerson Mary uee Plcks Leader as Coach g 20
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!ournal of World 8uslness 37 (2002) pg 1113
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karl Mennlnger
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highly constraint because employees oI junior ranking are not encouraged to be too Iorward with their
Ieedback especially iI it targets their boss or senior management in Petronas. This culture sees direct
Ieedback as being too assertive and arrogant and causes the management to lose Iace. Junior staII that
has corrected their boss or senior management in meetings where other people are present are duly
reprimanded during and aIter the meetings. This represses any honest and truthIul Ieedback, which
results in a very clear power structure where employees with no seniority basically have no voice or
inIluence. Another Iamous quote explains this 'You can listen like a blank wall or like a splendid
auditorium where every sound comes back Iuller and richer
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.
'Cultural communications are deeper and more complex than spoken or written messages.
The essence oI eIIective cross-cultural communication has more to do with releasing the right
responses than with sending the 'right messages
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.
Shell Power Structures
The pockets oI real power in Petronas lies in the senior executives who have the greatest
amount oI inIluence on decisions, operations and strategic direction. This clearly depicts a company
with no power respect, only power tolerance. This clearly diIIerentiates Shell Irom Petronas where
Shell clearly represents a company where the employees Ieel a sense oI power respect, instead oI
power tolerance. In Petronas this quote applies, 'The lamb and the lion shall lie down together. But
the lamb will not be very sleepy
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.
Shell Symbol
The culture web also mentions symbols as an element oI culture. Shell has a strong symbol,
used as a logo to represent the Shell brand. Synonymous with its name, Shell symbol is the shape oI a
shell, and clear colors oI yellow and orange are used as corporate colors. These symbols and colors
are consistently used where shall has presence in the downstream business, in shell retail stations,
shell oIIices that carry this logo worldwide, shell logos on letterheads, on sponsorships ie F1 events
on Ferrari cars, on uniIorms and saIety hats at reIineries. This brand extends more than just doing
business, it has built a reputation oI being involved with a lot oI eIIorts around building and helping
communities everywhere, helping in social works, Iunding research and studies on activities geared
around saving the planet such as sustainable developments, alternative energies, and the greener
world.
'A generally accepted deIinition oI sustainable development Ior business enterprises is that oI
adopting business strategies and activities that meet the needs oI the enterprise and its stakeholders

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Allce uuer Mlller Leader as Coach g 33
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L1 Pall and M 8 Pall undersLandlng CulLural ulfferences (?armouLh ML lnLerculLural ress
1990) pg 4
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Woody Allen
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today; while protecting, sustaining and enhancing the human and natural resources that will be needed
in the Iuture
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. This quote is demonstrated by Shell in the next example given.
A Iew years back the Shell oIIice in Cyberjaya held a competition Ior the staII to think about
ways to make the oIIice 'greener. The winner oI the competition came up with a plan to reduce
paper usage by promoting Iixed computer screens in meeting rooms so people do not need to print
minutes oI meetings or meeting agendas to bring to meeting rooms. Shell recognized this eIIort and
awarded 3 winners with giIts. This culture encourages Shell employees to care about the world, not
just the work that they are hired Ior.
Shell Control Systems
Shell`s control system as part oI an element oI the cultural web emphasizes on strict
adherence to Health, SaIety and Environment (HSE). Shell has strict regulations about saIety, Ior
example employees are expected to park their cars in reverse because in case oI emergency they will
be able to vacate the area quickly. No lighter or matches or mobile phones are allowed at oIIices in
the reIinery or exploration areas to avoid sparks that will cause hazards like explosions. Many Shell
oIIices have clinics and medical staII within the oIIice to care Ior staII who do not Ieel well. There are
resting rooms available Ior staII to rest, caIeterias with catering agencies who have been screened
thoroughly to provide clean Iood to the staII (which in many locations the Iood are tasty and Iree!),
gyms where staII can exercise and partake in sports together, no-smoking campaigns where staII are
given Iree nicotine gums and patches, and go through a monitoring system that helps them stop
smoking, and health weeks that encourage staII to take the stairs instead oI liIts to encourage
employees to exercise more, and strict saIety measures like employees have to use the hand rail when
going up or down the stairs to avoid people Irom tripping and Ialling down. For the environment,
Shell provides employees with Shell buses that take employees Irom the city to the Shell oIIices and
back, and to encourage the staII to carpool to reduce the gas emissions and air pollutions. This clearly
demonstrates that Shell as a global multi-national player in the oil and gas industry take seriously the
responsibility oI understanding cultural diIIerences and social responsibility by implementing a set oI
practices that best suit the needs oI that culture and can be replicated in the diIIerent cultures and
locations.
'Oil and gas revenues provide unique investment opportunities, but the region`s greatest
challenges are likely to be in managing expectations, lowering trade and investment barriers and
educating the next generation to handle wealth that is now being produced. Education is the biggest
challenge
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.



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!ournal of Soclo Lconomlcs 37 no 3 (2008) pg 907918
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khalld Abdulla!anahl Chalrman of lLhmaar 8ank and CoChalr of Lhe World Lconomlc lorum on
Lhe Mlddle LasL
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Shell Corporate Value Chain
Shell Firm Infrastructure
ReIering to Porter`s Corporate Value Chain, Shell`s Iirm inIrastructure consisting oI general
management takes the approach oI disseminating inIormation top-down. Town Halls are sessions
conducted in Shell locations in HQ at The Hague, London, Kuala Lumpur and Texas where
management will provide strategic inIormation to employees to keep to up-to-date and aware oI the
corporate initiatives taking place and how employees are involved in them. One example when Shell
was managing a massive organizational change where an arm oI Shell, Shell IT, was going to be
outsourced completely to an IT service provider, many town hall sessions were held to manage the
gradual change and to also address the questions and concerns that the employees had. A good quote
to validate this goes, 'My task is not to motivate people to play great Iootball. They are already
motivated when they come to me. My challenge is simply not to demotivate them.
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This is the opposite approach to disseminating inIormation employed by Petronas. Petronas
do not have sessions where management present to employees what their strategic initiatives are,
inIormation is rarely shared, and most oI the time the employees do not get involved in any oI the
corporate initiatives taking place except Ior how it individually becomes part oI their perIormance that
will be measured and monitored at year end. Thus Petronas would learn Irom this advice Irom the
Pope, 'See everything; Overlook a great deal; Correct a little
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.

Shell Human Resource
Another interesting element oI how Shell implement`s Porter`s corporate value chain is in the
Human Resource area. Recruiting, training and development areas Ior each Shell staII is managed by
the individual mostly, with advise Irom their managers and mentors. For example, each Shell staII has
to complete a minimum oI 11 training days each year, and depending on his or her career aspirations,
he can go Ior the trainings he Ieel will beneIit him the most. His manager will take an advisory role
and will only challenge or reject his training request iI the training was Iound to be completely
irrelevant to his job needs. This training method is practiced by Shell globally and has been proven to
be successIul across all cultures. Thus this practice results in success, as clearly quoted next. 'Success
is not the result oI spontaneous combustion. You must set yourselI on Iire
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. By providing Shell staII
with the training opportunities available, Shell allows their employees to grow and succeed even
Iurther.
Career development is also individually managed where the policy Ior moving to another
career is that each employee IulIils 2 or 3 years within a current role successIully, hands over the role
and responsibility to a new person, including transIer oI knowledge and support roles, and then the

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Lou PolLz
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ope !ohn xxlll
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8eggle Leach
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window Ior applying to a new job is open, and the online system called OR, or Open Resourcing, is
then available to be used by the employee to search Ior the new role he aspires. II he is shortlisted Ior
the role, then he will be called Ior an interview and iI accepted, he will begin his new role. This cycle
will continue Ior as long as he works in Shell, and is practiced worldwide so there is a consistency oI
practice in diIIerent regions and across diverse cultures. This is also another culturally successIul
implementation where staII Irom at least 150 nationalities worldwide Ieel they can rely on the same
system and will be Iairly judged when applying Ior the roles worldwide. This gives the employees oI
the continuous opportunity oI growth, as quoted by ConIucius, 'It does not matter how slowly you go
as long as you do not stop
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.
'Many large Iirms around the world are getting to the stage oI evolution known as the
stateless multinational, where work is sourced wherever it is most eIIicient; the result oI this stage oI
development is that Ior business leaders, building a Iirm that is seamlessly integrated across time
zones and cultures present daunting obstacles. Rather than huddling together in a headquarters
building in Armonk or Millbank, senior managers will increasingly be spread around the world, which
will require them to learn some new tricks
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. This quote holds true and encompasses many great
learnings; many oI which have been attained by Shell in their many years oI operating in multiple
zones and cultural environments.
Petronas implementation oI career development is similar to many companies like Exxon and
Schlumberger. The career advancement Ior a staII is only reactively managed when there is an
opening somewhere and the staII has perIormed exceptionally well and has been regarded as potential
leadership material. This generally constitutes 10 oI the staII, which means the rest oI the 90 oI
the staII will not have their career advancement interests being looked aIter. To many, this is highly
unIair and many oI the staII in these companies leave their jobs because oI Ieeling highly unsatisIied
with their career growth.
Summary
To conclude, a white paper by Global Intelligence Alliance shows a study about intelligent
culture and says 'Intelligence culture is essentially the glue that keeps the entire intelligence operation
together, and by the very deIinition oI culture, it is born and nurtured inside the organization. Perhaps
the most important element in gradually generating an intelligence culture in any organization is
senior management`s articulated support to the activity. Other important building blocks are
demonstrated beneIits oI the activity as well as successIul internal training and marketing eIIorts.
These together typically take the organization Irom Iirst being merely aware oI the intelligence
programme through accepting it and recognizing its value to Iinally assisting the intelligence team in
co-creating the insights that the company needs in order to stay competitive in the marketplace
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.

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Confuclus
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1he LconomlsL SepLember 20 2008
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Clobal lnLelllgence Alllance whlLe paper 2010 page 3
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Shell`s successIul cross-cultural management strategies clearly shows why Shell lead the
way in the oil and gas industry as being one oI the top employers to work Ior. Shell, in this example,
demonstrates an 'Intelligence culture. This case demonstrates that by Shell senior management
articulating serious commitment and support to this cross cultural strategies, Shell thus beneIits
greatly in terms oI a more successIul operations worldwide.
The study oI this oil and gas industry, speciIically Shell practices, Irom a western cultural
background impacts the Shell multi-national business strategy and how this diIIers to an eastern
background company such as Petronas. There are many learnings being implemented by Petronas that
are best practices in the oil and gas industry, which will help them advance Iurther and continue to
succeed in this arena. The Cultural Web model, as well as Porter`s Corporate Value Chain model and
quotes Irom internet materials, journals, Iamous people and academic books were used as the basis Ior
comparison and gives clearer understanding on how these companies perIorm and the strategies they
implement globally.