Global Multi-Products Chile Innovation Strategies Cross-Border Implications

What is Multi-products' strategy? What specific systems or programs is it using to implement this strategy? What environmental changes have taken place in Chile? What internal changes have been made at Multi-products Chile? What were the barriers to change? How did they operate as barriers?

STRATEGY? A strategy is the specific means by which an organization will meet its objectives. INNOVATION Product 30 Technology platforms 30% of sales from products > 4 yrs old Customer Service Key Accounts Integrated Solutions One voice, One face, One company What is the innovation strategy being implemented at GMP Chile?

Multi Products Chile: Changes Old Market Conditions? Internal changes? New Market Conditions?

WHY SO DIFFICULT? Change Process Organizational changes: Changes in Chile: New competition New ways of operating Increased sophistication of customers Distributor changes Organizational changes: Empowerment councils Teams & teamwork Reward system Sales rep roles & skills New positions (IS managers, key account leaders) Barriers: Product groups Distributor based selling Hierarchy Management attitudes Rewards Culture, politics, isolation Desired State: Key Accounts Integrated Solutions Increased Profit WHY SO DIFFICULT?

Putting global strategies into practice is difficult! GLOBALIZATION HQ FOREIGN DIVISION Replicate or Adapt? Don’t change & train Adapt & learn Putting global strategies into practice is difficult! Must understand company’s (home country) strategy and management systems AND history and culture of host country if strategy and systems are to be implemented.

A Brief History of Human Rights Violations in Chile Professor Harry Lane Northeastern University, Boston

Salvadore Allende 1970 wins election and forms a left wing “Marxist’ government “Reforms” Banking, insurance, communications, textiles and copper were nationalized Hostility by local business groups and USA Capital flight Inflation was 300% in 1973; cost of living increased 647% in 1972 Anti-government strikes in 1972 and 1973

Augusto Pinochet Coup d’etat Sept. 11, 1973 Military rule 1973–1990 130,000 arrests 7,000 people held in national football stadium torture 30,000 exiles in Western Europe 3000 people killed or missing (los desaparecidos) Economic stability 1990 – civilian government followed by a period of peace and prosperity

Augusto Pinochet (continued) 1998 - Arrested in London England March 2000 – Determined to have irreversible brain damage and sent home to Chile June 2000 – Chilean court strips him of immunity he held as a senator July 2002 – Chilean Supreme Court rules he is mentally unfit to stand trial September 2004 – Interrogated by a judge about human rights abuses and placed under house arrest

Augusto Pinochet (continued) December 2004 – He suffers a stroke January 2005 – A Chilean court finds him unfit to stand trial March 2005 – US Senate report claims US bank (Riggs Bank) helped him conceal his wealth October 2006 – Chilean judge ordered him placed under house arrest December 10, 2006 – Pinochet dies after suffering a heart attack; violence in the streets of Santiago; Chile still polarized

Pinochet’s legacy Pros Cons Lucia Pinochet Returned property Economic stability Peaceful transition to civilian government Model economy of Latin America Cons Human rights record 3,000+ dead or missing “We live in a strong, safe Chile. I think if you look at the result of what my father did, you will understand that he did what had to be done.” Lucia Pinochet “The damage he has done to this country is too great for his retirement to heal. Our scars are too great. Luisa Toledo, mother of 3 victims of execution

The Evolution of Chile: Prosperity for Some Chile: Tradition of Democracy Effects of Pinochet’s Dictatorship Chile’s New Democracy Title Name: The Evolution of Chile: Prosperity for Some In just 25 years, Chile has gone from a Marxist state to a dictatorship to a democracy. The transition has strengthened Chile’s economy, but not all Chilean citizens have shared in the prosperity. In fact, the divisions between rich and poor have widened, causing critics to question whether democratic capitalism is the right solution. As the scenario unfolds, so do the moral issues surrounding the economic path Chile has chosen. Using Chile as a case study, this program examines these issues, and the difficulties experienced by other Third World nations also riding the tidal wave of post-Cold War economic reforms. (29 minutes) Length: 29mins To view this video, click on the link below: http://digital.films.com/PortalPlaylists.aspx?aid=15162&xtid=7932

Hofstede’s comparison: CANADA CHILE POWER DISTANCE Extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. Value placed on egalitarianism. Lack of overt status and/or class distinctions in society. Intermediate. Organizational arrangements show taller pyramids and low degrees of delegation. Hierarchical social structure, rigid social classes. Common cafeterias are rare, privileges for power-holders common. INDIVIDUALISM The degree of interdependence a society maintains among its members. Individualistic culture. Expectation that people look after themselves and immediate families. Employees are expected to be self-reliant and display initiative. Collectivist culture. While shifting in organizations some paternalistic practices still remain in place. MASCULINITY: Driven by competition, achievement and success. FEMININITY: Caring for others and quality of life. Moderately masculine. Subdued respect for achievement, success and winning. Tend towards work-life balance. Feminine. People need a sense of “belonging”, place value on warm interpersonal links and tacitly search for approval of their group. Tend to be supportive team members. UNCERTAINTY AVOIDANCE Extent to which members feel threatened by ambiguous or unknown situations and have created beliefs and institutions that try to avoid these. Uncertainty accepting. Easy acceptance of new ideas, willingness to try something new or different. Tolerant of ideas or opinions, allow freedom of expression. Uncertainty avoiding. Strong need for rules and elaborate legal systems to structure life. Great dependence on experts and authorities, particularly among non-managerial employees.

Cultural Differences Canada and Chile Implications for team work, bonus systems, and empowerment?