Case Summary

Uganda is a country of about 32 million people, gas English as its official language. But
many people speak only another language, mainly Bantu or Nilotic languages of the
Bugandas, langos, Acholi, Teso and Karamojong tribes, There has been a strong separist
movement among the Bugandas. Although about two third of Ugandans are Christians.
From that perspective of a foreign company wants to operate its business in Uganda then
language for communication is the main problem because of the different types of
language is here. For that reason a company engines many specialist employees for
speaking with different people by different languages. On the other hand, Business in
Uganda typically moves slowly. For instance one may wait months to a phone installed.
This is a country where incomes are extremely low and there having on exorbitant
payment system

HG (Hydro Generation) is U.S.-based Company, specialist in power plants (dams). Its

values strongly built on the Christian culture. It has built plants in 16 countries
maintained an ownership in about half of them. The Uganda project is its first anywhere
in Africa. Because dam construction involves huge amounts of capital and because many
groups oppose their construction on the grounds that they typically displace large groups
of people, HG wanted to build as many local allies as possible for its Ugandan project in
order to prevent adverse publicity that could lead demonstrations and costly work
stoppages. Its employees have a high degree of empowerment, being fully responsible for
their actions. There is no code of conduct concerning expatriates lifestyle, but its
corporate culture was one that reflected the lifestyle of a prosperous international
company.

Charles Martin was 29 year-old American. He was specialist in African culture,

graduating with a major in African studies and a professional experience in Kenya,
Ethiopia and Tanzania. He took a job in HG with the purpose of being assigned to an
African project after two years of training and doing business in the U.S. He combined a
home-country corporate perspective and a deep knowledge of Uganda economic, political
and cultural aspects. He devoted of the philosophy of integrating the African society, not

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drawing attention to oneself, but learning and respecting its culture. He lived among
middle-class Ugandans and not in up-scale neighbourhoods where most international
managers live.
Charles Martin didn’t integrate himself within the expatriate’s community. He made
“extra payments” to local people to get things moving faster. He hired staff closely
related to Government officials and participated in tribal rituals to get support from
villagers affected by the dam construction, although being employed in a company
embedded in Christian values. Some of Martin’s practices were concerning James Green,
the Vice President of Hydro Generation (HG) such as, independent lifestyle, participation
in tribal rituals, way of achieving results, unethical practices, payments which might be
illegal under U.S. law, Martin’s distance from the expatriate community.

The Concept of the Case

This case shows how important it is for a foreign company to understand and adjust to
ever changing operating environments is an integral part of operating environment.
Culture refers to the learned values, norms based on attitudes, values and believes of a
group of people. Because people simultaneously belong to different group that have
different culture. From this case we have found HG Company’s culture and also the
problems the company was faced because of cultural differences and legal facilities.
Basically all people have culturally ingrained responses to given situation and some times
expect that people from other cultures will respond the same way as people in their own
culture do.

Again this case heave also given a concept that an international company must be
sensitive to these cultural difference in order to predict and control its relationship and
operations. Finally it should realize that it’s accustomed way of doing business might not
be the only on best way .when doing business in abroad a company should first determine
what business practices in a foreign country differ from those it’s used to. Management
then must decide what if any adjustment necessary to operate efficiently in the foreign
company.

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Uganda
Uganda lies on equator and surrounded by the Victoria Lake. Arab traders came here
1840’s in search of slaves and ivory then British came here. Uganda became independent
in 1962 from Britain became republic in the following year. First prime minister was
Milton Obote. In 1971 Obote’s government was toppled in military coup led by Idi Amin.
Amin was toppled in 1979 and Obote back in to power. At present there is presidential
form of government and Museveni is the president of Uganda. Uganda is a country of
about 32 million people, gas English as its official language. There has been a strong
separist movement among the Bugandas. Although about two third of Ugandans are
Christians. From that perspective of a foreign company wants to operate its business in
Uganda then language for communication is the main problem because of the different
types of language is here. For that reason a company engines many specialist employees
for speaking with different people by different languages. On the other hand, Business in
Uganda typically moves slowly. For instance one may wait months to a phone installed.
This is a country where incomes are extremely low and there having on exorbitant
payment system. If any comp any involves such activities then it is illegal under U.S law.
Not only that in Uganda nepotism is a norm and this country considered one of the more
corrupt in the world because. From the root level to Government in all sectors conniption
exists.

Language and Religion

English and Kiswahili are the official languages, but Luganda is most widely spoken in
the capital city of Kampala. Many Ugandans live among people who speak different
languages, especially in rural areas. But many people speak only another language,
mainly Bantu or Nilotic languages of the Bugandas, langos, Acholi, Teso and
Karamojong tribes, there are more than 40 ethnic groups but no single ethnic majority.

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Ugandan’s Population is approximately 84% Christian and 12% Muslim. Only 1%
follows traditional religions.

Population
Uganda has 31 million people, and 47% are age 15 or younger. (Texas is 3 times the size
of Uganda with 22 million people.). The HIV/AIDS infection rate is 5% today due in
large part to the Government’s political commitment to HIV prevention and care. Uganda
is currently the only country to reduce its HIV/AIDS rate by double digits. In
comparison, the HIV/AIDS infection rate in Washington DC is estimated between 3-5%.
Uganda has 250,000 refugees from Sudan, the Congo, and Rwanda.

Economy
Agriculture employs 80% of the work force. Coffee and fish is the largest export. Foreign
investment has slowly returned after the reign of brutal corrupt dictator Idi Amin (1971-
1979). Uganda is a lower income country where 4 out of ten people live on less than a
dollar a day.

Hydro-Generation
HG (Hydro Generation) is U.S.-based Company, specialist in power plants (dams). Its
values strongly built on the Christian culture. It has built plants in 16 countries
maintained an ownership in about half of them. The Uganda project is its first anywhere
in Africa. Because dam construction involves huge amounts of capital and because many
groups oppose their construction on the grounds that they typically displace large groups
of people, HG wanted to build as many local allies as possible for its Ugandan project in
order to prevent adverse publicity that could lead demonstrations and costly work
stoppages. Its employees have a high degree of empowerment, being fully responsible for
their actions. There is no code of conduct concerning expatriates lifestyle, but its

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corporate culture was one that reflected the lifestyle of a prosperous international
company.

Charles Martin
Charles Martin was 29 year-old American. He was specialist in African culture,
graduating with a major in African studies and a professional experience in Kenya,
Ethiopia and Tanzania. He took a job in HG with the purpose of being assigned to an
African project after two years of training and doing business in the U.S. He combined a
home-country corporate perspective and a deep knowledge of Uganda economic, political
and cultural aspects. He devoted of the philosophy of integrating the African society, not
drawing attention to oneself, but learning and respecting its culture. He was working with
Ugandan governmental authorities and with villagers to gain support and necessary
permissions for the dam’s construction. He was establishing an office and hiring people
who would be responsible for local purchases, clearance of incoming goods through
customs, immigration permissions, and logistics of materials. He was helping foreigner
visitors become accommodated and oriented when visiting Uganda.

Charles Martin’s Assignments

He gained support and necessary permissions from the Ugandan governmental authorities
and affected villagers for the dam construction and builds an operating structure and
facility, with people responsible for local purchases and hiring, customs, immigration
affairs, logistics of materials and record keeping. He helped foreign visitors and HG
expatriates to become accommodated and oriented when visiting/arriving at Uganda.

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Charles Martin’s Practices
He lived among middle-class Ugandans and not in up-scale neighbourhoods where most
international managers live. He didn’t integrate himself within the expatriate’s
community. He made “extra payments” to local people to get things moving faster. He
hired staff closely related to Government officials and participated in tribal rituals to get
support from villagers affected by the dam construction, although being employed in a
company embedded in Christian values.

Problems with Charles Martin

Some of Martin’s practices were concerning James Green, the Vice President of Hydro
Generation (HG) such as,

 Independent lifestyle,
 Participation in tribal rituals,
 Way of achieving results,
 Unethical practices,
 Payments which might be illegal under U.S. law,
 Martin’s distance from the expatriate community.

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Company and Management Orientation
Whether and how much a company and its managers adapt to foreign cultures depends
not only on the conditions within the foreign cultures but also on the attitude of the
companies and their managers. This can be explained by the following three such
attitudes or orientations- Polycentrism, Ethnocentrism, and Geocentrism,

Polycentrism
In polycentric organizations, control is decentralized so that managers feel free to
conduct business in what he thinks. In other words, business units in different countries
have a significant degree of autonomy from the home office and act very many like local
companies. Because many discussions of international business focus on the unique
problems that companies have experienced abroad, it is understandable that many
companies develop a polycentric orientation. Polycentrism may be, however, an overly
cautious response to cultural variety. A company that is too polycentric may shy away
from certain countries or may avoid transferring home-country practices or resources that
may, in fact, work well abroad. When practices do not work abroad, management may
point to the unique foreign environment. If the foreign environment is not the cause, the
company might erroneously take a more polycentric orientation.

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In intercultural competence the term polycentrism is understood as attitude and openness
towards other cultures, opinions and ways of life: when intercultural actions and
correlations are interpreted not only with the background of own cultural experiences, but
when the independence of other cultures is recognized and appreciated and when cultural
values are relativized and seen in the whole context.

Ethnocentrism
Ethnocentrism is the belief that one’s own culture is superior to others. In international
business, it describes a company or individual so imbued with the belief that what
worked at home should work abroad that it ignores environmental differences.
Ethnocentrism takes three general forms,

 Managers overlook important cultural factors abroad because they have become
accustomed to certain cause-and-effect relationships in the home country.
 Management recognizes the environmental differences but still focuses on
achieving home-country rather than foreign or worldwide objectives. The result
may be diminished long-term competitiveness because the company does not
perform as well as its competitors and because opposition to its practices abroad.
 Management recognizes differences but assumes that the introduction of its new
products or ways to produce and sell them is both necessary and easy to achieve
when it is really a complex process. Ethnocentrism is not entirely bad. Much of
what works at home will work abroad. However, excessive ethnocentrism may
cause costly business failures.

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Geocentrism
Geocentrism is between the extremes of polycentrism and ethnocentrisms are business
practices that are neither the home operations nor the host-country company’s but a
hybrid of the two. When the host-country environment is substantially different from
home, the international company must decide whether to persuade people in that country
to accept something new (in which case, the company would be acting as a change agent)
or to make changes in the company itself. Geocentrism is when a company bassets
operations on an informed knowledge of home- and host-country needs, capabilities, and
constraints. This is the preferred approach to business dealings with another culture
because it increases introduction of innovations and decreases the likelihood of their
failures.

Discussion on Questions

Question 1: Describe Ugandan cultural attributes that might affect operations of a

foreign company operating there?

Answer:
Uganda is a country in central Africa with a population of about 25 million people.
Uganda is ethnologically diverse, with at least 40 languages in usage. Luganda is the
most common language. English is the official language of Uganda, even though only a
relatively small proportion of the population speaks it. Access to economic and political
power is almost impossible without having mastered that language. The East African
Swahili is relatively widespread as a trade language and was made an official national
language of Uganda in September 2005. Luganda, a language widespread in central
Uganda, has been the official language in education for central Uganda for a long time.

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Two thirds of Ugandan’s are Christians who are mainly divided between Roman
Catholics and Anglicans. There are also a large number of Muslims and also people
following animistic religions. Attributes that might affect the operations of a foreign
company trying to operate in Uganda.

Language Barrier
Uganda is a country which has a multi ethnic, multi religious and multi language
background. Even though it is stated that English is the official language as mentioned
above many people speak indigenous languages such as Bantu and Nilotic. Hence
resulting in a risk to the operations of the company by not being able to communicate
with the locals, thus resulting in a language barrier.

Religious Concerns
Uganda is also a multi religious country with people practicing many religions. This
would mean the company will have to hire employees fit to work from any religion and
also respect those belonging to all religious groups in order to avoid discrimination of the
workforce.

Violent Political History, Political Instability and Nepotism

Uganda is a country of about 25 million people, gas English as its official language. But
many people speak only another language, mainly Bantu or Nilotic languages of the
Bugandas, langos, Acholi, Teso and Karamojong tribes, There has been a strong separist
movement among the Bugandas. Although about two third of Ugandans are Christians.
From that perspective of a foreign company wants to operate its business in Uganda then
language for communication is the main problem because of the different types of
language is here. For that reason a company engines many specialist employees for
speaking with different people by different languages. On the other hand, Business in
Uganda typically moves slowly. For instance one may wait months to a phone installed.
This is a country where incomes are extremely low and there having on exorbitant
payment system.

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If any company involves such activities then it is illegal under U.S law. Not only that in
Uganda nepotism is a norm and this country considered one of the more corrupt in the
world because. From the root level to Government in all sectors conniption exists. Here
the main problems in Uganda for a foreign company have shown as like some key points,
we find out whishes.

 Different types of communication language

 Higher and lower class discrimination

 Nepotism is a norm for employment staffs

 Restructuring of rules and international law

 People are involve with corruption

 Lack of the legal opportunity

 People of Uganda's are too much devout to their religion and beliefs and culture

Question-2: Would you describe Green’s and Martin’s attitudes as being

ethnocentric, polycentric or geocentric? What factors do you think have influenced
their attitudes?

Answer:

HG’s corporate philosophy embraces the idea that although secular, HG’s business
activities should embody strong Christian values. Further, subordinates should be given
full responsibility in making and implementing decisions, but they should also be held
accountable for their results. By choosing to live in a middle-class Ugandan
neighborhood while shunning the expatriate community, by paying extra for service, by
hiring recommended relatives, and by paying fees and participating in tribal ceremonies,
Martin exhibited a more polycentric (autonomous) attitude, while Green seemed to be
more geocentric in his approach. While Martin was more concerned about his

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effectiveness with respect to his assignment in Uganda, Green was more concerned with
corporate-level issues.

Question 3: Who was right, Green or Martin, about the controversial actions
Martin took in the Ugandan operation? What might have been the results if he had
not taken those actions?

Answer:

Martin was right about the controversial actions he took in the Uganda operation.
Because, HG saw the wisdom of having someone with both a home-country corporate
perspective and a knowledge of Uganda’s economic political and cultural complexity.
Charles Martin was 29 still young by business standards had a background that seemed
well suited to the Ugandan project. After high school, he entered the University of
Wisconsin-Madison where he becomes fascinated with African while taking a course
about its pre-colonial history. After graduating with a major in African studies, he joined

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the Peace Corps and served in Kenya. His duties involved working with the start up of
small business. So he had some knowledge and experience how to working with the start
up of any business and Uganda project for HG was first any where in Africa. Further for
that reason Martin quickly learned that by paying tips in advance to the responsible
people, he could speed completion of HG’s requirements such as phone installed,
supplies delivered on operating licenses issued. To handle import clearances Martin hired
the niece of high-ranking custom’s officer. From the perspective of Uganda’s culture and
economic situation Martin wanted to give the exorbitant payments and participated in the
second ceremony of tribal by respecting their believes. Not only had that he also hired a
specialist in African religions. Because Martin know that how to operate business as a
foreign company in a country, that company must gives respect and considered their
culture, norms and beliefs,

Arguments can be made for the positions of both Green and Martin. Certainly Martin
had achieved the desired results in a timely fashion. However, Martin’s rejection of the
typical expatriate lifestyle ran counter to Green’s idea of a desirable corporate image;
Green further felt that this might create assimilation problems for future HG expatriates
assigned to the project. Tipping for services could easily have led to the expectation of
increasingly larger payments as the project progressed. His dealings with the official
caretaker of the sacred site, who was willing to appease the spirits for increasingly higher
fees.

Further, Martin’s participation in the tribal ritual could have been construed as a mockery
of tribal customs and also have been seen as an affront by Uganda’s Christian majority.
Finally, the close connection between HG’s local Ugandan employees and government
officials represented an invitation to corruption. Nonetheless, had Martin chosen to
ignore local customs, the project could easily have fallen behind schedule at any point.
The result if Martin had not taken those actions would be:

 HG’s business operation would move slowly

 One may wait months to get a phone installed, supplies delivered on operating
licenses issued without paying tips

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  Without exorbitant payments and family connections hiring people or staffs will
be difficult because Nepotism is a norm in Uganda

 Without hiring a specialist in African religions and participation in the ceremony

by Martin. HG would not continue its operation and displace the villagers where
the dam will be built

 Every task would not be computed on time within the total budget

Question 4: In HG's next phase, the dam construction, should it employ some one
whose main function is to be a liaison between HG’s corporate culture and the
culture of Uganda? If so, should Martin be the person for the job?

Answer:
If in HG's next phase, the dam construction employ some one whose main function is to
be a lesion between HG's coronate culture and the culture of Uganda without considering
the Uganda's culture then the same problem will occurred which was occurred earlier in
Charles Martin case. Because, culture includes norms based on learn attitudes, values and
beliefs whishes are vary from one country to another country or if in one country then

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one place to another place. So Martin should be the right person for the job. Given the
importance and the size of the project, as well as the many pitfalls that will surely be
encountered along the way, it seems only logical to employ someone who is extremely
well versed in the culture of Uganda to serve as a liaison with HG’s headquarters.
Whether that person is Martin or someone else, however, HG must establish clear
guidelines that reflect both U.S. law and corporate policy to guide the managers of their
foreign operations.

Conclusion
After analyzing the case we can come to the following conclusion,

• The internationalization of business requires thorough research of the other

country’s culture
• There is a need for accommodation to the different standards of doing business by
the host company in the foreign country

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 • It is necessary to, above all, respect the other country’s cultural beliefs,
• People working in a foreign environment should try to become geocentric.

References
 International Business Environments and Operations, John D. Daniels and
Lee H. Radenbaugh, 11th Edition.
 International Business, Alan H. Rugman and Richard M. Hodgetts
 http://docentes.fe.unl.pt/FE/.../2_2_Charles_Martin_in_Uganda_G31.ppt

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  http://docentes.fe.unl.pt/FE/.../2_2_Charles_Martin_in_Uganda_G23.ppt
 www.mba.biu.ac.il/stfhome/bijaoui/891/case/2009/uganda.pdf

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