Keywords: international management, cultural knowledge, cultural competence, international strategies, cultural distance, local culture, Middle East, Southern Mediterranean, case study, Technip Italy, oil and gas industry
Does cultural competence affect the success of international strategies? A case study analysis
The increasing environmental turbulence and the high competition push firms to enlarge their markets, and research new opportunities to implement and successfully develop their products. Internationalisation becomes more and more a learning strategy, aimed at exploring opportunities, and consolidating existing advantages. Above all in emerging markets, such as Middle East Countries (MECs) and Southern Mediterranean Countries (SMCs), cultural distance can limit firms' success: different behaviours, different communication styles and different social dynamics have a strong impact on intra–and inter–organisational relationships. Successful firms are those who are able to adapt to different contexts. Managers have to develop a deep knowledge of the host market, and understand which behaviours can better fit with the local culture. Managers' cultural competence becomes consequently a factor of success. This paper aims at exploring the concept of cultural competence and at highlighting its value for European firms entering SMCs and the Middle East. The empirical analysis is focused on the case study of Technip Italy, a world leader in engineering, technologies and project management for the oil and gas industry, successfully operating in the area. This case study is useful to understand some key factors of success for international strategies in the area.