When Culture Governs Business Practice: A Look at the Indian Diamond Cutting and Polishing Industry. Issue 3 (10th February 2016)

• Record Type: Journal Article
• Authors: Rao, Indu
• Is Part Of: Global business and organizational excellence. Volume 35:Issue 3(2016)
• Page Start: 6
• Page End: 17
• Publication Date: 2016-02-10
• Subjects: Industrial productivity -- Periodicals; Industrial management -- Periodicals; Industrial organization -- Periodicals; 658
• DOI: 10.1002/joe.21666
• Languages: English
• ISSNs: 1932-2054

Abstract

Abstract : As informal firms in emerging markets are expanding their role in global supply chains, managers of formal multinational organizations are increasingly relying on their services. Yet, little is known about the organizational aspects of enterprises in the informal sector. An investigation of informal firms engaged in the cutting and polishing of diamonds (CPD) in Surat, India, the world's hub of diamond manufacturing, reveals that in the absence of well‐defined strategies, structures, and processes, the intangible aspect of organizing—specifically, organizational culture—governs business practices. Despite the strong clan‐like orientation of these firms and a culture focused on loyalty, trust, team work, and consensus, the study found evidence of hierarchical characteristics and market‐driven leadership. Coupled with insightful observations of the overall Indian CPD sector, these findings can help guide managers in planning strategies for effective partnerships with informal firms, regardless of their industry. © 2016 Wiley Periodicals, Inc. Abstract : Eleven out of every 12 diamonds set in jewelry are cut and polished by informal firms in Surat, India. A study of this close‐knit network of enterprises highlights the cultural norms that contribute to their success in the global supply chain.