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Supervisors: Dr. A. Visser

Prof. dr. G.J.E.M. Sanders

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In March 1999, the management of Philips, Santiago in Chile, asked for a survey done at the commercial plant of their organization. The motive for this survey was a lack of overview and knowledge of their communication system. As a result, the management had trouble controlling and coordinating the internal communication and information flow in the organization. The management question can be formulated as follows:

Based on this management question the following research question is derived:

Therefore, the objective of this survey is to provide the management of Philips with a clear view of its internal communication system. This blue print of the internal

communication system enables the management to ultimately manage, coordinate, and guide the internal communication flow in a more suitable manner.

In order to create a reflective blue print, interviews among members of all layers of the organization were conducted, and observation of several communication processes took place. The social environmental influences being, the political and economic climate and the idiosyncrasy of the Chilean people as well as the management of Philips and the organizational structure were explored. These findings together with the theoretical framework provided the means to put the results of the above interviews and observations in perspective.

Thorough analysis of the processed data indicated that there is a general malfunctioning of the communication, within the entire organization. There is a lack of proper and clear information from the management, which results, in poor communication. This together with the economic depression causes a lot of insecurity and uncertainty among the members of the Phillips organization. Because of this, there is a lot of job-protection and open communication is not being stimulated.

The following recommendations have been derived from these conclusions:

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Naturally, a more thorough overview of the above recommendations can be found in chapter twelve. There the recommendations are presented in detail. The recommendations are given in rank of priority. It is however advisable to conduct further research on each recommendation, and to meticulously weigh them, before implementation can take place.

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En Marzo de 1999, la Gerencia de la empresa Phillips en Santiago de Chile pidió hacer un completo estudio respecto a la organización de su planta comercial. El motivo de este estudio era la falta de visión y conocimiento de su sistema de comunicación. Como resultado la Gerencia tiene dificultad de controlar y coordinar la comunicación interna y el flujo de información dentro de la organización. La pregunta de la Gerencia se puede formular como sigue:

Basado en esto, se transforma en la siguiente pregunta.

Por esto el objetivo de este estudio es proveer a la Gerencia de Phillips una visión clara de su sistema de comunicación interna. La base del sistema de comunicación interna, posibilita a la Gerencia de dirigir, coordinar y guiar el flujo interno en una manera más eficiente.

En orden de crear una base reflectiva, entrevistas fueron conducidos entre miembros de todas las secciones de la organización y la observación de varios procesos de

comunicación. La influencia social siendo el clima de la política, la economía y la idiosincrasia de los chilenos como también la Gerencia de Phillips y su estructura de organización fueron exploradas. Estos resultados junto con su marco teórico proveyeron los medios de poner las mencionadas entrevistas y observaciones en perspectiva.

Un análisis exhaustivo de los datos procesados dentro de la organización entera,

indicaron que hay un mal funcionamiento general de la comunicación. Falta información bien clara de la gerencia hacia el personal, que da como resultado una comunicación bien pobre. Esto, junto con la depresión económica causa mucha inseguridad y indecisión entre los miembros de la organización Phillips. Por esto, cada empleado protege su propio empleo y la comunicación abierta no es estimulada.

Las siguientes recomendaciones han sido derivadas de estas conclusiones:

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Naturalmente un resumen más amplio de las recomendaciones de arriba se pueden encontrar en el capítulo doce. Allí las recomendaciones están presentadas en detalle. Las recomendaciones están dadas por orden de prioridad. Es sin embargo recomendable de conducir más estudio sobre cada recomendación y de pesarlos meticulosamente antes de implementarlos.

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The poem by Pablo Neruda, found in the beginning, is a perfect synonym of what research is about. It is an ode to the clarity, clarity that will be derived when research is well conducted. The latter is the full responsibility of the researcher. This introduction is the beginning of this survey that describes the research done at the human resource department of Philips Chilena S.A.. It covers the problems Philips is having with its internal communication.

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In 1999, the management of Philips had trouble with the internal communication system.

Trouble with managing the information flow and coordinating the communication within the organization. In short, the expectations of the communication system were not met.

The above management problem can be put in words in the following management question:

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To answer the above question a thorough investigation of the communication system is needed. In the last two decades management theories and literature have acknowledged the important value of the internal aspects of an organization. Knowledge and

comprehension of aspects as organizational climate, organizational culture and internal communication systems can be seen as vital necessities for most organizations, especially if they operate in a dynamic environment. High levels of competence, innovation, and rapid changes are some of the characteristics of a dynamic environment and therefore demand an organization to be flexible and innovative. This does not apply to all organizations or businesses but it most certainly applies to an electronic conglomerate like Philips. By understanding its own culture and function of communication systems, organizations like Philips can easily manage the changes necessary to adapt it self in those environments.

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The following model gives an indication of the research structure. The management question will be transformed to a research question. The latter will be answered by using different suitable theories that can be found in the theoretical framework. With these theories, the questionnaire will be formed and the results will be analyzed. Final

conclusions will be made and recommendations will be given to answer the management question.

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5522%%//((00 This chapter will start with a roughly description of the history of Philips Chilena,

starting from the moment the organization was founded in Chile until how it can be found today. The second section shows that the changes within this period of time are part of the management problem.

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Philips Chilena S.A. was founded in 1937 in Santiago, Chile. Initially Philips started out as an import and sales office but within four years, the company was transferred into a subsidiary with its own production plant. Philips Chilena started to produce radio receivers, light bulbs and tubes, and became one of the most important electronic industries in the area. Due to both industrial and commercial expansion in the following two decades, a new location was found in the sixties for the industrial plant outside the city. The commercial plant remained where it nowadays still can be found, at the border of the commercial center of Santiago in Bellavista.

This research project will be concentrated on the commercial plant only, later referred to as Philips Santa Maria or Santa Maria. The Santa Maria location gave office during the research period, to approximately two hundred employees who were working in five divisions and various departments. Many job vacancies were being out sourced.

Therefore, the actual amount of people working at the plant during that time was higher.

There is purposely spoken in the past tense since during and after the research period many reorganizations took place.

The different product divisions, PD’s, in order of size were:

♦ Lighting

♦ Consumer Electronics

♦ Projects (former Business Electronics)

♦ DAP (Domestic Appliances and Personal care)

♦ Philips Medical Systems

In 1995, Philips International changed its organizational structure from functional to divisional, presently known as the “New Governance Model”, (NGM). Before the implementation of the NGM, each division and department had to report directly to their local country manager, CM. Since the implementation of the new structure, all divisions and departments have to respond directly to their regional manager. This means that Chilean managers now have to report to Brazil given that the Latin American headquarters are located in Sao Paulo, Brazil. Later in this research, the impact and consequence of this structural change on the Philips organization in Chile will be discussed more thoroughly.

Nowadays Philips products and activities vary and both can be found throughout the whole country. Presumably, most people can only guess about the diversity of a conglomerate like Philips.

The products vary from: the illumination of important and historic monuments, traffic lights, radio and car navigation systems, medical systems as x-ray machines and

microscopes, telecommunication systems, professional surveillance systems, till the well known shaving equipment’s and televisions. All these products and activities come from the same organization. It is only natural that these varieties of products and services are the result of different divisions with therefore different markets strategies and cultures.

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The changes in environment, the expansion of its markets and businesses, and the growth as a multinational, made Philips decide to alter its organization thoroughly with help from many different programs. Operations “Centurion” and “Let’s make things better” have become inevitable in the Philips history. These organizational changes and

transformations where initiated by the Philips headquarters in the Netherlands some years ago and some of these are still in process. It is evident that all these changes, being structural, procedural, or even noticeable physical, have had a very big impact on the organization. An impact that consequently had an influence on the way people perceive their work, hence affected the organizational culture, and as result of that, affected the communication within the organization as well. One of the results of the “Let’s make things better” philosophy involved as mentioned above the worldwide change in the organizational structure of Philips, also known as “the New Governance Model”.

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The organizational chart of the commercial plant, on the previous page shows both the different divisions and departments. The dotted line between the country manager and the divisions points out the supervision and coordinating relation between the country

manager and the divisions. Later in chapter 6, the exact nature of that relation will be explained. Unfortunately, it was not possible to gain all the, up to date, organizational charts, since a lot of changes occurred during my stay.

The main consequence of this model is that nowadays, within the local organizations, the different product divisions report directly to the responsible regional manager instead of their country manager. Therefore, the level of autonomy and responsibility of the PD’s increased noticeably. This change in power is likely to ask for a great adaptation, one that can cause friction, which possibly can be noticed in the line and way of communicating and reporting.

Although Philips used, and even designed, numerous models, improvement and quality programs to realize this transformation, non-of these refer directly to the flow of

information and communication within the Philips organizations. There is no corporate policy or guideline of how the internal communication should be managed. Basically, it is left upon the judgement and management of the local organizations and its divisions, which is an understandable decision since each country and its people have their own mentality and culture and thus their own way of communicating. As a result of that, each department and product division adapted respectively designed its own proper way of communicating. The last couple of years, Philips Chilena S.A. has been under a lot of pressures both internally and externally. The coming of the NGM, the Asiatic crisis, Philips’ performance in general which caused some divisions to stop, and the political situation in this country are some of these pressures which are reflected within the organization.

Giving the above and the fact that it might be “healthy” to explores ones inner activities (like cars need to be checked by a mechanic after a fixed amount of miles) Philips Chilena S.A. asked me to do a survey on internal communication within their

organization. Nowadays due to the NGM, the divisions are, officially separated from each other and the departments. This and the continuously reorganizations in the Philips

Chilena firm have caused a lack of overview and unity concerning the organizational communication.

With the term organizational, internal, communication, the flow of information

throughout the entire organization being, bottom up, top down, diagonal or horizontal, in and between departments & divisions, is meant. A definition of internal communication will be given in chapter nine. A focus will be made on the transfer of the information itself and its quality instead of the systems that are being used. Organizational

communication is very much related to organizational culture; in fact, one can say that the latter influences the way of communication. Therefore, those aspects of the

organizational culture will be explored, that most probably will influence the internal communication of an organization. On the other hand culture and thus organizational culture is manifested by the interaction of people and since a large part of the interaction takes place trough communication one can say that the two are intertwined and influence the other. There are many definitions of both internal communication and organizational culture, and many different angels and perspectives possible when discussing the two topics, let alone the relation between the two.

Gary Kreps describes in his book “Organizational Communication”(1990, USA) the intertwined relationship between organizational culture and the internal communication.

He states:

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By exploring the informal and formal communication channels of an organization one can learn about the organizational culture and at the same time learn about the

communication climate. It is interesting to explore which channels are being used to transfer the information and to determine the weight of the two channels. This leads us to the question: “Is the emphasis put on the formal channels, or are the informal channels more emphasized within the organization.

There are various external factors of an organization that have an effect on the culture and thus the communication climate. The political and economical climate of a country, and the idiosyncrasy are such external factors. It is particularly interesting to see in a country like Chile in what manner both the behavior and culture in the organization are being influenced by the above factors. Interesting since the external environmental influences and factors are likely to differ from what one might expect from a European or western country. This assumption is another reason why the organization culture is involved in this research.

It is more valuable to understand the context and nature of a problem (i.e. the lack of a sufficient operating internal communication system) and hence explore the influencing factors, than to take a more mechanical approach and focus entirely on the system itself.

A third powerful influence on the organizational culture and internal communication climate is management. Management styles, personal influences, uses of management power etc are extremely important and the influence on the above topics cannot be underestimated.

In Philips some of the managers seem to be aware of the communication problem and are willing to explore and change it. At first sight the picture is given that management and employees are on the same side and pointed in the same direction. However, after some short initial interviews within the whole organization, it became clear that this was not the case. In order to obtain a more objective view of what is happening in Philips, it is

necessary to explore all the elements that have an influence on the communication climate.

The title "/(7¶60$.(7+,1*6%(77(5¡I^{RONY OR} TRUTH! " is for seen, since it will be a challenge to find out whether or not things need to be improved and, assuming that things can always be better, to explore if the people of the Philips organization in Chile are willing to make the step to improvement.

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In this chapter, the management question “How can we improve the internal communication system” will be translated into the research question. This process includes, defining the objective, dividing the eventual question into sub-questions, and demarcating the research project.

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Initially Philips Chile asked for a proper design of the internal communication model and policy. According to the management, this needed to be accomplished by investigating and exploring mainly on the operational level of the organization asking people’s opinions on the subject. However, in the past a lot of efforts have been made by the management to improve the internal communication in the organization and none of these efforts have resulted in a really noticeably change in the way the communication takes place. Besides that, Philips possesses all the necessary facilities and communication tools possible to communicate and direct the flows of information.

Therefore, as mentioned before, the solution to the problem needs to be looked for in a different direction. In the former chapter, the intertwined relationship between

organizational communication and organizational culture has been discussed. As

mentioned before, the internal communication and the communication climate are a part of the organizational culture. Charles Conrad states about the subject:

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The results of exploring the organizational climate, in combination with the definition of the organizational culture, could point to the direction of a suitable policy and design for the internal communication. By discovering and revealing the organizational culture of Philips, the reason and the motivation why people communicate in a certain manner will be exposed. This and a thorough diagnose, description, and blue print of the internal communicational climate will without doubt lead to recommending policies.

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The objective of this research is to provide a policy recommending the management, how to improve the internal communication system climate. In fact, one can say a blue print instead of policy. This blue print, or policy, enables Philips to ultimately manage, coordinate, and guide the internal communication flow in a more suitable manner.

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This leads to the following research question:

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In order to answer the research question posed, it has been divided into the following specific sub-questions.

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♦ The research will only cover and consider the commercial plant “ Santa Maria” of the Philips organization in Chile.

♦ The research will only be focused on the internal communication climate, and the question ZK\ the communication tools available are not used properly. That is a different perception then the question of KRZ these tools are used!

♦ The time in which the actual research will take place will be 6 months.

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5$5$00((::2255.. Now that the research question is posed, the conceptual model and theoretical framework will be given. They both will be used as tools to answer the research question in a proper manner. However first the research methods will be discussed.

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This research can be seen as an indicative authority survey since the techniques of

interviewing were used. From now on, this project will be mentioned as survey instead of research. The 16 out of approximately 200 people were not a -selected and hence are not representative. Both desk- and field research has been used as methods for this project.

The first method consists of finding literature, articles, and theories concerning the problem area, and the latter refers to case research. According to Biemans & Van der Meer-Kooistra (1994, NL), case research is a very qualified method to handle and confront a large diversity of management organizational problems, which will provide a thorough comprehension in complex situations.

Their definition of case research is:

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Meaning that the emphasis of conducting case research lies in the exploration and

analysis of the UHODWLRQ between the research’s subject, and the context, other internal and external elements. In this research, this “subject” will be the internal communication climate.

Biemans & van der Meer…. (1994, NL) make the following distinctions of case research:

♦ ([SORUDWLYH Case Research. (to be able to answer the WHAT question)

♦ ([SODQDWRU\ Case Research. (to be able to answer the WHY question)

♦ 'HVFULSWLYH Case Research. (to be able to answer the HOW question)

This case research can be typed as a combination of the first and the third one, since the internal communication climate in its present state will be explored.

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There were two reasons to reduce to do qualitative research only. The most important being that Philips, as a result of “Operation Centurion”, conducts every other year a motivation survey in all its organizations over the world. This survey was taken one month before the start of this project and the results of it could be used, DSSHQGL[ The survey, in the form of an inquiry, is used to audit the progression of the reorganizations and to establish how these changes are taken by the employees. With these findings, it is possible to establish the points that need improvement and extra care. The results of this test are very interesting since they point out the differences in performances and opinions of the regions and between the regions.

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However, in order to interpret these differences, one needs to understand the culture and perceptions of the different regions. It is most likely that people from Holland have a different manner of responding then people in Japan or Latin–America.

Getting to know the culture and language is time consuming and since this project had a limited amount of time, it was best to concentrate on bonding with the people in the organization and learn to speak "their" language in order to get the most valuable information during the interviews. This is the second reason why performing qualitative research only was decided.

Schein (1992, USA) mentions some possible problems when using an inquiry as a survey instrument to measure a culture. Since most of the culture and the artifacts are tacit knowledge, it is difficult to interpret the results. However, when placed in the right context, it can be of aid and then these surveys are useful to uncover the norms of behavior in the organizational climate.

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The previous model represents the framework of this research project. The arrows between the boxes indicate the mutual influences and forces between them. The figure in the last box between formal and informal communication indicates a possible field of tension between them. The first three boxes indicate the influences on organizational culture and on the communicational climate. These there boxes are derived from a model formed by Falcione, R.L. & others (1987, USA). His descriptive model of Organization Communication Climate does not include the organizational culture. However, there is reason to believe that in this case, the exploration of the organizational culture can be extremely valuable and that both the culture and the communication climate are

intertwined. Therefore, the model of Falcione is not fully applied, but is it used to create the above model.

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In FKDSWHU, the 1st box of the conceptual model will be described which, subsequently, answers the first sub-question “:KDWDUHWKHHQYLURQPHQWDOHOHPHQWVWKDWHQIRUFHWKH LQWHUQDOFRPPXQLFDWLRQFOLPDWHDQGKRZFDQWKH\EHGHVFULEHG"´

Box 2 will be described in FKDSWHU. This chapter gives answer to the 2nd sub-question

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In FKDSWHU, box number 3 of the conceptual model in combination with the 3rd sub- question “:KDWDUHWKHPDQDJHPHQWHOHPHQWVWKDWHQIRUFHWKHLQWHUQDOFRPPXQLFDWLRQ FOLPDWHDQGKRZFDQWKH\EHGHVFULEHG"´will be examined.

In FKDSWHU, the organizational culture will be discussed. Definitions will be given and the theories of Organizational Culture from Schein (1992, NL) and Sanders & Neuijen, (1992, NL) will be described. This chapter will answer the fourth sub-question “+RZFDQ RUJDQL]DWLRQDOFXOWXUHEHGHVFULEHG"´

The last and fifth sub–question “+RZFDQDQLQWHUQDOFRPPXQLFDWLRQFOLPDWHEH GHVFULEHG"´ will be answered in FKDSWHU. A definition of internal communication or organizational communication will be given. Followed by an explanation of the elements that can be found in the communication climate in Philips.

Having answered the above sub-questions, the findings of the research, the results of the interviews, and the analysis can be made. In FKDSWHU, this process has been worked out.

In FKDSWHU, all the above information is put together to answer the research question posed “How can the internal communication climate of Philips, “Santa Maria” be characterized, in relation with the organizational culture and important and significant environmental elements?” hence giving a final conclusion.

Finally in the ODVWFKDSWHU, a policy will be recommended to the management in order to resolve their problems with the communication.

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The data collected can be split up in data found outside the organization being external information and data collected within the organization being, internal information.

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The sources from the external informationwere:

♦ Literature: articles, books, Internet

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Before, during and after my stay I found and read many articles and theories. The books of Schein and Sanders were the only books, besides some methodological ones I had with me in the plane and were helpful. I used the Internet and several libraries both in Chile as in Holland, as a source. Although it was possible to obtain some valuable books from Holland, thanks to the help of friends and sponsors, the majority of collecting and consulting books took place back in Holland, after my internship with Philips. The main reason was that the libraries in Chile could practically not provide the books needed. A large part of the literature found on the topics was antedated or only available in Spanish.

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Besides, the interviews held in the organization, which I will refer to later in this section, I consulted various people outside the organization. The main purpose of these visits were to discuss and tests my findings with their expertise, to be able to provide the most correct and objective setting in which the research needed to be placed in. Among them were: The dean of the faculty of business administration of the “Universidad Diego Portales”, a respected organizational psychologist who gave seminars and courses to many, local and international organizations in Chile, her specialty is emotional intelligence, and the founder of a fifteen-year-old large Chilean IT company.

Furthermore, I discussed a lot my findings with both expatriates and Chilean managers.

All of the above helped me in revealing and finding the “truth”.

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The internal informationI have gathered can be categorized in the following way:

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With effort and patience I was able to find reports and some magazines provided by Philips. I learned about the organization through Intranet, and the possibilities to ask for documentation through the Intranet and Internet.

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Since my first day at Philips I kept a diary in which I wrote all the things that entered my mind that concerned Philips, the organization, the people, the work and the culture.

My supervisor in Holland had recommended that to me, and this advice could not have been more helpful than any book or theory. It is a bit odd, but the e-mails I wrote to friends and relatives in Holland to share my experiences were very valuable for the same reason. I used the e-mail and fax to put my mind at order, giving the input a place.

It is important to document all the experiences and first impressions of the organization, for these experiences could be essential indicators of the organizational culture.

Besides there is a danger that the researcher, in this case myself, gets too involved and at one point looses the objective eye. With help of these notes, one can go back in time. It is important to keep a certain distance and objective view. The danger being that one goes trough an internalization process, i.e. what was first is experienced as new and different, can later be seen as normal and standard.

I have tried several times to attend meetings and gatherings. Although I received

permission and was promised to be invited and join some meetings, these promises were not kept, which is in a way valuable data itself. On the other hand, I was able to walk around and bond, and talk with many different people. After a while most of them were willing to give their cooperation, only after I assured them that I would not reveal my sources.

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The most valuable information for this research project was gathered by the interviews I took. The interviews lasted varying from one until two hours, depending on the time available of the interviewees. I originally planned one hour per interview, but almost every interview lasted longer, usually because the respondent had a lot information to give and stories to tell. At first, I had the impression that most of the respondents seemed a little bit averse and reluctant to give their true opinion. Nevertheless, once the ice had been broken, the motivation that their contribution might help change things increased their willingness to give useful information.

In the next section, the preparation and the set up of the interviews will be explained in detail.

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Taking interviews asks for a thorough and long preparation. The first thing I had to do was bond with the people. This was an ongoing process that lasted until the last good bye.

A Chilean manager that worked at Philips, Carolina Pesce, gave me a valuable lesson and tip on the subject. She was responsible for the external communication at Philips and had therefore contact with all the divisions and departments of the organization. Besides the following story, she stood by me and advised me during my entire stay and we still have contact today. The woman had studied one year at Harvard university, Boston U.S.A., and had noticed that Latin orientated women have a different way of approaching and conducting business then Western European orientated women like myself.

In Chile, there is a different perception of women in business. There, and I believe in more Latin countries, being a woman, one always has to remember that being a woman comes before anything else! First, you have to acknowledge that you are a woman, so there is no point in trying to be equal as a man.

In fact, you should not be offended at all and jump in the defense, when anyone

compliments you with the way you look, how you are dressed, or the color of your eyes.

It is all part of the game. The part of being intelligent, qualified, skilled to do your job, or a professional comes and will be accepted in a later stage. Referring to the opposite sex, male managers at Philips, they have to be willing to “marry you”, and after that they will provide you with all the help you need!

The manager warned me that if I would act the same way I was “taught” or “ought to”, according to the Dutch standard, I would not get the cooperation I wanted and needed.

The attitude of being equal to the men and in control will not get a woman anywhere. It will probably result in not being taken seriously, and getting the results they think I would like to hear!

In contrast, in the Western culture, this kind of behavior is not appreciated at all and many women might feel insulted or offended by it. In our society woman have fought for equal treatment and behavior and they still try to achieve that. Therefore when

compliments or remarks about the looks are being made, many women will consider that as sexist behavior. They might interpret that as "being judged by the looks and not the brains". In other words, they feel that they are not taken serious at all, and in the worst case, they might see it as sexual harassment. In addition, asking about ones family is another issue that is not considered correct behavior in the western societies. It will be seen as an invasion of privacy. Whereas, in addition to the above, in Latin Countries it is wise for anyone, male or female, to first bond and socialize with the people you want to do business with and talk about family or hobbies. The key is to talk in the beginning of every contact with a business nature about anything but business. Since family is an important pillar of the Latin culture, it is a good and save topic to start with.

The tips of the manager were very useful since the majority of the Philips employees were of the opposite sex. I was able during the interviews to obtain the information I was looking for! Of course, the essence of the message, “family and social talk before

business”, also applied for the women I consulted and interviewed.

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Due to lack of time and the nature of this project, only 16 interviews were conducted. A selection had to be made between the different divisions and departments because it was impossible to audit them all. Together with the supervisors in both Philips and Holland, there was decided to select three of the five divisions and make one group of the different departments. The most distinguished divisions being Lighting, Consumer Electronics, and DAP were chosen. In the selection process the underlying differences in size, in management style and coordination, and in products and processes were taken into account. Lightning was chosen for its size. It is the biggest an oldest division at Philips Chilena. Another reason was that during the period of the research, unfortunately due to both reorganizations and economic cut backs many people were dismissed in that division.

Consumer Electronics was chosen for its “distinctive” management. The manager was a former employee of the department and had climbed the ladder in the division. He knew all the ins and outs of the division and its market and could not be fooled around by his subordinates. Everyone, from manager until mechanical servant, was aware of his notorious leadership and reputation in the Philips organization.

Finally, DAP was chosen because the division manager was Dutch, and was the first and only foreign PD manager. I wanted to explore if his management style was distinctive from the others. The department group was selected on diversity of function and years in the organization.

Each group had an equal amount of people being interviewed, four persons in each group.

All individuals in each group were equally selected by gender, age, years in the organization and function, see DSSHQGL[

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The actual making or creating of the instrument started at the moment I decided to try to go to Chile for my final project. The process of observing the culture started much earlier.

I cannot recollect the precise moment when I was first drawn to, or triggered by the Latin American culture, if this was due to my first contact with Latin people or my first visit to Latin America. My point is, that all these events whether conscious or not are part of the process of making the inquiry. Every contact both familiar and business orientated is an indication of a culture of a country and organization. In the previous sections, I referred to the use of a diary and personal e-mails as well.

For the actual structure of the instrument, the questionnaire for my interviews, the theories from both Schein and Sanders as a direction for the part of exploring the organizational culture were used. For the questions on the communication climate and internal communication the levels of communication posed by Reezigt, C (1995, NL) were applied. Reezigt divides the internal communication in four sub-levels being:

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The different levels will be described and discussed in Chapter 9, The Internal Communication Climate.

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The interviews were conducted in Spanish since most of the employees either, did not speak English or where not comfortable speaking it. The list was divided in themes, inspired by Sanders and Neuijen (1992, NL), in combination with the structure of Reezigt (1995, NL). The original questionnaire was English and with the aid from a Spanish teacher, Alejandra Rebolledo, it was translated into ”Chilean”, seeDSSHQGL[  The Chilean version was more extended. All possible questions that could be found on each theme were put on the list, in order to better manage the interviews. It guaranteed me that the conversation would go as fluent as possible and the respondent would not be

disturbed by the fact that my Spanish was not as fast and fluent as theirs was.

At the beginning of the interview a small inquiry was handed out with all the themes that were going to be asked for in the interview, seeDSSHQGL[The respondents were asked to give their mark on the topics, on a scale of 1 to 7. This is the Chilean ranking system comparable to the 1 to 10 scale in for example The Netherlands with the 4 being the minimum as 6. They had a few minutes to fill it in.

Although one might question the methodological value of the inquiry, it proved to be very helpful since it helped the interviewees to start the interview and explain why they had given that specific note.

The inquiry was used as a guideline of the actual questionnaire. I made sure that all the topics and themes were answered but let the respondent tell their story in their own way.

If that led to a different order of themes than the questionnaire indicated I did not try to correct them. The most important thing being getting the information I was looking for and not the order in which it was given to me!

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At the beginning of the interview I explained the procedures of the interview and why I was doing this research, and needing their help. I explained the reason and apologized for my “poor” Spanish and as a result, the interviewees were very friendly and helpful. This personal introduction provided me with a connection with the respondent and hence a pleasant setting for the interview. All the interviews were held in my office a room at the back of the organization where we could not be disturbed.

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The interviewees were told that my responsibility lay at the university and not at Philips.

They were guaranteed that I would not use the information to harm them in any way. It might seem a bit exaggerated to mention this, but these sentiments among the group of respondents was the exact reason why I did not use a tape recorder to tape the interviews.

I sensed that trust and anonymity were very important for the respondents and I did not want the presence of the machine to be an obstruction to talk.

It is a fact that there are many advantages using a tape recorder. Using a recorder, one can fully concentrate on the respondent and adequately react to the information given. Also, it is possible to rewind and play to be able to listen carefully how the information was given to you. Then there is the advantage of perfectly working out the interviews afterwards.

In this case, I think not using a tape recorder was a benefit for me for the simple reason of the value of the information that was given. Of course, I lack proof. I am quite certain, though, that with a tape recorder I would not have been given the answers and

experiences that the respondents were willing to share with me. After all, it is the information that makes this research worthwhile!

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In this chapter the external environmental elements as shown in box 1 of figure 2.1 will be described and discussed. According to this model, organizational culture and

organizational communication climate emerge from the interaction of three big

influences, being external and organizational influences and the influence of the people working in the organization, management. In the following chapters, the organizational influences being organizational structure and procedures, and the third influence, the management will be discussed.

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The external environment includes elements that are physical, societal, and competitive.

The physical and societal factors are a country’s: geography, politics, economy, law, culture, and idiosyncrasy of its inhabitants. The competitive factors are the number and strength of suppliers, the customers and consumers, and of course the numbers and strength of the rival organizations. According to Daniels and Radebaugh (1995, USA), the organization’s external environment is the aggregate of conditions outside the

organization that influence its success. The influence is vice versa, however, an organization influences its external environment to a lesser degree.

In this research project, the focus will be on the societal external elements only. Since, in my opinion of all the above external elements, the culture and the communicational climate of an organization are most influenced by these factors. Knowledge of the social sciences as history, political science, law, anthropology, sociology, economics and psychology of a country helps to understand and describe an organization’s culture. This is especially the case when an organization is located in country that has few similarities with the home country, as Philips Chilena.

The external environmental elements determine the amount of influence on an organization. For example if a country is known to be stable both political and

economical the influence of an organization will be known on terms of regulations, labor conditions, investments foreign trade etc. These factors will influence the organizational culture in the format period only but hardly in the evolution of the culture.

However, it is likely that a sudden change in the economy or political situation will have a direct effect on the organizational culture. If the economy is going through a recession and jobs are at stake due to an increase of unemployment, this will truly influence the way people act, handle, and communicate inside an organization. It can cause a hostile and insecure climate. The same can be said if there is an unstable political climate in the area, and consequently organizations cannot predict in what way, their future strategies and projections are to be affected by this situation. For some foreign organizations, this instability might lead them to withdraw their business and move to another area. This will step will most definitely influence the people and thus the internal organization as well.

In this way, there is a direct relation between the organizational culture and its external environmental factors. These are some examples that indicate the possible influence that external elements can have on an organization.

In the coming sections, the environmental context of Philips in Chile will be described.

1999 has been a turbulent year for Chile, in a both political and economic way. In short, the main events that caused this and how it affected an organization as Philips Chilena will be described. Finally, in the last section the culture and idiosyncrasy of Chile and its inhabitants will be discussed.

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Since the start up of the democracy in 1990, Chile has evolved to one of the most stable countries of Latin America. The country and economy has gradually recovered and still is recovering of the years of repression by the regime and dictatorship of General Augusto Pinochet. One could say things are slowly turning back to normal. However, it is

impossible to erase the horror the coup has brought in 1973. The amount of blood that has fled, the people that have been killed or been missing since those horrible years in the early seventies cannot be forgotten. On the surface, it seems Chile has fully recuperated however, the fear can still be noticed on the people’s faces and is still causing a lot of anxiety and insecurity. It is like a taboo, a shared secret, which presence cannot be avoided and it is still sensible today, but is covered in silence.

For western people it is almost surreal to try to imagine what has happened in that country. The stories are known and heard, sometimes from second hand and sometimes even from first hand but it is impossible to imagine what it was really like. The

captivation of Pinochet in England, in the fall of 1998, brought the stories and memories right back in the spotlights and worldwide media. Chile was holding its breath nobody knew what was about to happen. It showed that the matching line between the pro- Pinochistas, people in favor of Pinochet, and its opponents was very fragile and about to split the country in two again.

During the regime and directly after the democracy the country was split into two parties.

It took al long time to match the line. It was known that although Pinochet had officially been retired he had maintained a lot of the control behind the scenes. Therefore on the surface things had changed but the whole nation could still feel his breath in their necks.

At the days that the important and decisive decisions concerning his case were made on the other side of the world, no business was conducted in Chile. There were televisions on every floor in organizations and the entire nation was covered in silence. There were no comments or even chats in the metros. Nobody dare to speak up, or show his or her true feelings or sentiments. It were days like this that made me realize that Pinochet had and unfortunately still has, a tremendous impact on the Chilean people.

However, with Pinochet being in England something else happened during this time.

Slowly people became aware of the fact that the main reason there were holding back was their own fear, and that their enemy was not Pinochet but that same fear. Whilst most people on the street did not share their opinion, it were the people that had nothing to loose that were starting to speak up. Students were demonstrating against the repression and propaganda from the universities and the indigenous Mapuche were striking against their repression. Especially the latter resulted in a lot of violence and riots on the streets.

It became a sort of vendetta, on both sides people were killed and molested. To give an example, one-day a Chilean farm was burned to the ground because of dissatisfaction of the Mapuche people and the next day a Mapuche bus driver was killed in Santiago to settle the score.

Another point that was causing turmoil in the country was the coming elections. With the general out of the country, Ricardo Lagos, the first socialist after Allende, was on the winning hand in the polls. Nobody knew what to expect and with the propaganda of the media, it was hard to get a realistic opinion. There were many and wild speculations about what would happen if Lagos was taking over from President Frei, a right orientated democrat. To give an idea how Chileans think of socialists, many people, from different classes and especially in the upper classes, are under the impression that Europe was or is a socialistic continent in the way as Marx intended, simply because the majority of the European countries have a social liberal government. The possible outcome of the

elections and the economic crisis made many foreign investors consider the possibility to withdraw their activities from Chile and move their offices to a border country since nobody knew what to expect from the political situation either. This prospect put a heavy pressure on domestic firms and as well on Philips and their business results. If FI would move out of the country that would mean a loss of capital etc.

The main question after reading this section will be: "How can the above, effect the organizational communication climate?" This fear, climate of distrust and fighting ones own battle is partly a consequence and legacy of the regime and is reflected in the

behavior and attitude of the Chilean people. Chileans are known to be very individualistic but in a hidden way. On the surface, they appear very friendly, helpful, and open.

However, they have the tendency to act individually and on behalf of there own only, instead of the community/group. They prefer to keep a low profile and avoid any possible confrontation. In an organizational cultural aspect this behavior can led to a tensed and distrustful atmosphere caused by external uncertainties as mentioned above. An

interesting thing is that most people are not consciously aware of this behavior. In a way, it is embedded and excepted, nobody really likes it, but since everybody shows the same behavior why should they bother to try to change, it or even fight it. If you confront them about it, they make it clear that it is your problem since that it the way things work in Chile! This behavior and effect on the communication climate will be described more thoroughly in the last section.

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This last decade the Chilean economy has developed in a most impressive way. Chile can be proud of the progression made. The average GNP growth over this period has been about 6.5 percent per year. This has been achieved despite the international slowdown of the early years of the decade and despite Latin American upheavals, in 1995, mainly in Mexico and Argentina. Moreover, Chile has shown a leader in controlling its inflation rate.

An important component of the Chilean economic model is the growing role of the private sector in the economy. Which has been the result of a deliberate policy called the

“subsidiary principle” articulated in the late 1970’s by the Chicago boys. The Chicago boys were reputable economic consultants hired by Pinochet to improve Chile’s economic climate. The subsidiary principle indicated that the government would not undertake those activities that could be successfully developed by the private sector, that it would maintain only a “normative and supervisory” role, including the regulative activities characteristic of government. This translated into a massive privatization of government-owned firms, extending the influence of privately owned firms in the economy, Abarca, Nureya ea. (1998, CL).