Differences in values, practices, and systems among Hungarian managers and Western expatriates: an organizing framework and typology

Abstract

For managers of international alliances, the reconciliation of conflicting values, practices, and systems (VPSs) among partners is a critical challenge, which is magnified when partners originate from diverse institutional environments, such as transition and established market economies. Given the rapidly growing prevalence of international alliances in transition economies, differences in VPSs surface when managerial methods introduced by Western companies clash with institutionalized legacies of central planning. This paper examines this process in the context of international cooperative ventures (ICVs) between Hungarian and Western partners. Using data collected from 17 ICVs, and 44 local and expatriate managers during 1997-1999, I test a series of hypotheses and inductively develop a typology that identifies a number of important and often problematic partner differences in managerial VPSs. The study uses multiple theoretical lenses to show how VPSs are variously shaped by institutional, economic, and cultural factors, and provides useful insights into typical challenges faced by ICV managers. I conclude with a discussion of the typology's generalizability to other transition and emerging economies, its implications for theory and practice, and propose future research directions.