A for the businesses culture, to make things ‘simple,

Study of Santander’s Cross-Cultural Management of Culture



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Santander is a bank operating on a global scale, while Santander
Group PLC has been operating since 1857, its venture into the UK market via the
acquisitions of Abbey National, Alliance & Leicester and Bradford &
Bingley occurred throughout July 2008 until 2010. Historically the group had
been run under many Spanish banking practices and traditions but upon their
introduction to the UK market, Santander began employing British people in the United
Kingdom. Many of these people had experienced working with British traditions
and cultures, so they had very different idea of how business culture was for
both employees and employers. This essay will analyse how Santander Group PLC
integrated their traditionally Spanish business practices into the United Kingdom and managed (and continue to manage)
the intrinsic culture differences between their main group and the UK
subsidiary. Such a study is of interest as the bank is now one of the foremost
retail and corporate banks operating in the UK and has penetrated the crowded
and established marketplace of UK banking. It achieved such penetration in a
remarkably short amount of time and may not have done so if it were operating
in its traditional Spanish methods. Santander’s UK commercial policy was
redeveloped in 2013 to ‘simple, personal and fair’ and this is also the motto
for the businesses culture, to make things ‘simple, personal and fair’ for
customers and employees alike. This clear central policy for practice provides
a distinct focus and offers an ‘inspiring and potentially creative way of
understanding management, organisations and the working life’ of Santander in
the UK (Alvesson, 2012).







Lit Review

The following literature review will firstly seek to justify the
selection of the module covered topic (managing culture), it will then attempt
to decipher a literature based definition of culture in the organisation. The
literature review will analyse the importance of national culture differences
and the issues which arise from their contrast and finally, the review will
address elements of the literature which suggest culture is the organisation
and thus, unchangeable and unmanageable.


Research into culture’s standing in International Business has significantly
grown in recent years, studies such as (Aycan et al. 2014) and (Hajro and
Podelko, 2010) have evolved the study of culture from solely an anthropomorphic
one, to a key area for Business and Management. As a consequence, considerable
effort has been devoted recently to mapping the International Business ?eld, identifying
patterns, trends and schools, analysing main research methodologies and positioning
key journals. The most recent include: Acedo and Casillas (2005), Chan et al.
(2006), Pisani (2011) and Yang et al. (2006). The increasing volume of
literature in this field is no coincidence, with enhanced levels of interest
being attributed to identifiable trends within business, an example of one of
these trends is globalisation (Mcfarlin and Sweeney, 2013).


The organisational ‘culture’ that this essay will discuss managing
can be represented in a number of different forms, the literature outlines four
key forms: basic assumptions (Schein, 1985, 1992), shared values (Peters &
Waterman, 1988; Wiener & Vardi, 1990; Calori & Sarnin, 1991), beliefs
(Davis, 1984; Lorsch, 1985) and norms of behaviour (Lepak, Takeuchi, Erhardt
and Colakoglu, 2006). The most representative point
from the perspective of basic assumption is the opinion that the organization
culture is ‘a pattern of shared basic assumptions that the group learned as it
solved its problems of external adaptation and internal integration, that has
worked well enough to be considered valid and, therefore, to be taught to new
members as the correct way to perceive, think, and feel in relation to those
problems’ (Schein, 1992). In addition to this conceptualisation of
culture, core texts such as Pettigrew (1979) depict
culture as a ‘collectively accepted meanings operating for a given group at a
given time’. The literature is also very careful to illustrate that although
‘culture’ is not a tangible, it can be observed by how an organisations
representative present themselves ‘culture is not itself visible, but is made
visible only through its representation’ (Van Maanen, 1988).


Fewer than 5 percent of organizational behaviour articles which
were published throughout the 1970’s in top American management journals, paid
diligence to cross-cultural issues. In the following 40 years the
trans-national corporation became a much more common entity. As International Business directly relates to
‘?rm-level business activity that crosses national boundaries or is conducted
in a location other than the ?rm’s home country’ (Wright & Ricks, 1994). A
nations’ culture is a key factor in conditioning not only decisions in
international organisations but also: the choice of host country(ies), entry
mode strategies, the international firm’s organisation design, the knowledge
transfer, human resource management in addition to the final performance of the
process. Because of this and deriving from Hofstede (1980),
Schwartz (1999) and House et al., ‘national culture’ pertains to a
collection of shared values which make for diverse communities (similar or
different). Although it has emerged as a central topic, the analysis of a
nations’ culture to impact different International Business practice range of comprehensive
examples (and studies) are relatively small in number. Examples of studies
aimed at reviewing this phenomenon include Harzing (2003) and Shenkar (2001). More
than practical and technical problems, national culture and characteristics
frequently interfere in the decision-making process, (Lewis, 1996) highlights
the stark contradictions in aims between the American and Japanese businesses,
the decisions taken are all dependent on what markers are set for success.
Although US businesses are often driven by profits, Japanese businesses
concentrate more on ‘market share’ as the main marker of success and thus, this
is an example of national culture impacting organisational decision making and


In the final part of this review of the literature a counter
argument will be observed, the counter argument that culture is endemic to an
organisation, that it is buried so deep below the consciousness that it is the
organisation. Though some of the literature described culture as something an
organisation has, some describes it as ‘something an organisation is’ (Ogbonna,
1992). It is this view that leads to the belief that management/change in
culture is a nearly unachievable task to complete wholly, if organisations are
culture then there is ‘very little point in trying to control this socially
constructed phenomenon…embedded in the roots of organisational existence’
(Ogbonna, 1992). This point has been illustrated numerous times throughout the
literature, most notably in Siehl, 1985, ‘organisations don’t have cultures,
they are cultures and it is this which makes culture so difficult to change’.
Others such as Uttal (1983) and Fombrun (1983) speak of ‘awesome and impossible
tasks’ when attempting to manage and change culture as well as having to aspire
to ‘modest expectations’. These are not the most hopeless views of individuals
on managing and changing culture with other researchers going further in saying
that culture merely exists, it cannot be created or altered. Ultimately one
must ask themselves the question that if they believe that culture has its
origins or its existence in the unconscious then how can one attempt to manage
it consciously, or ‘if culture is funnelled through the unconscious…and not always
orderly, then it is unlikely that efforts to manage such a culture can be
precisely predict or tightly controlled’ (Krefting and Frost, 1985).


Case Study

The Santander Group is a Spanish banking group originating from
the city of Santander (as the name suggests). The city is a port city on the
North Coast and serves as the location of the headquarters of Banco Santander,
the Santander Group is located in Madrid. The bank was founded in 1857 (Gullien
& Tschoegl, 2008) and the banking group is now one of the foremost European
and South American banks globally. In 2017, Santander was ranked as 33rd in the
Forbes Global 2000 list of the world’s biggest public companies (Forbes, 2017),
the group generated total Revenues of €76.526bn and employs just under 200,000
people worldwide (as of 2015) (pwc, 2016). The Group has banks in 32 nations
across the globe and is prominent brand in sports sponsorships with such
sponsorships as the Spanish Football Premier League, Formula 1 racing teams
McLaren and Ferrari and from 2018 the UEFA Champions League. Although the bank
has a presence both throughout Europe and in European nations it had yet to
establish itself as a prominent bank in the UK prior to 2004. As the UK is
widely regarded as the finance hub of Europe (if not the world) (Wales, 2017)
Santander was keen to challenge the historically established corporate, retail
and private banks for their business in the 21st century (those
being: Barclays, Lloyds, RBS and HSBC). To challenge these organisations
Santander chose not to enter the market as new contenders for business, but to
acquire smaller or struggling organisations in order to gain a solid customer
base in both retail and corporate markets. This began in 2004 when the Santander
Group acquired Abbey National plc (Kay, 2004), then in 2008 they acquired
Bradford and Bingley plc (Taylor & Aldrick, 2008) and finally in 2009 when
they acquired Alliance and Leicester plc (Farrell, 2008). This collection of
companies was rebranded as Santander UK in 2010 both as a corporate entity and
in branches throughout the United Kingdom.


Santander UK is a British bank which is entirely owned by the
Santander Group, the UK bank employs around 20,000 people and services around
14 million retail customers in over 1,000 branches and in 2015 Santander UK
accounted for €4.5bn of the Santander Group’s annual revenue (Santander, 2015).
Due to the afore mentioned unconventional way in which the bank entered the
British market in the late 2000’s Santander UK found itself in the unusual
position of having multiple branches in a number of British high streets. In
Newcastle for example, Northumberland Street had 3 Santander branches which
each were one of the former British organisations that Santander acquired
(Alliance & Leicester, Bradford & Bingley and Abbey National). A further
example would be Plymouth city centre which had four branches all within 300
metres of each other, two branches of which were adjacent to each other (Treanor,
2012) (see figure 1).









A nations banking culture is often derived from its nations
culture and this is true in the instance of Banco Santander (and therefore the
wider Santander Group). There is a strong religious presence in the national
decision making and its day to day practice which results in a number of notable
idiosyncrasies when it comes to organisational structure and how business
culture is managed in Spain. As is common in countries with strong senses of
tradition and religion there is a heavy patriarchal directorship, management
and board membership, those in the upper echelons of the organisation are
frequently male (more so than would be expected in the United Kingdom). This
tradition and heavy sense of patriarchy condition the culture of the wider
Santander Group, junior employees are expected to work long hours and carry out
the more menial tasks without exception. Hours are long and structured; dress
code expectations are formal and ultimately there is a sense that those of a
more junior rank are expected to earn respect from their superiors and peers.
As mentioned the traditional and religious nature of the national culture makes
industries such as finance male dominated, and though opportunities for women
are increasing there are certain cultural taboos that prevent the industry from
being aligned with those in other European countries, namely issues such as the
acceptance of homosexuality. Less controversial impacts of the national culture
which manifest in Spanish business culture can also be equally difficult to
mitigate for, on a day to day basis individuals in Santander UK interact and
communicate with individuals working at the group headquarters in Madrid and
must constantly take into account the Spanish national practice of siestas.
Their Spanish colleagues are therefore very difficult to communicate with in
the afternoons without prior booking and so this cultural divide must be


It is not just Spanish business culture that is impacted by its
national culture, the United Kingdom’s national culture also dictates how
organisational culture is managed and maintained. Contrary to Spain’s heavily
traditional and religious overtones, the UK has a much more liberal and
progressive culture. Women in higher positions in financial institutions are
more prevalent and there is considerably less institutional discrimination
toward individuals depending on their sexual orientation. Often UK
business/organisations have a more open attitude to those less formal business
cultures akin to those of Silicon Valley, with relaxed attitudes towards junior
employees, work attire and working hours. In addition to the culture within the
organisation there are other practices which national culture impacts upon for
example, customer service. Upon its arrival to British retail banking Santander
was voted frequently as the bank with the poorest customer service, this was
due to the adoption of the Santander Group global products and practices. After
5 years Santander UK introduced a number of schemes which endeared them to the
British public, the ‘123’ current accounts became the most popular product in
the market and the adopted motto of ‘simple, personal fair’ became the central
theme for which day-to-day business was conducted (and thus how Santander aimed
to be perceived by its customer base).


At the time of writing, Santander UK Chief Executive Officer
Nathan Bostock has recently released a statement surrounding 2017 Q3 results.
In the first nine months of trading in 2017 Santander UK profits before tax
have risen to £1.568bn, net interest income growth, efficiency improved and credit
quality remained high. Though there is lip service paid (as one would expect at
a bank) to financial performance, the statement is telling in the amount it
speaks of the future rather than the past. Speaking of achieving ‘sustainable
results against a backdrop of an uncertain environment’, meeting ‘customers
changing needs’ aspiring to bring ‘competition and choice to SME’s’ as well as
focusing on improving ‘customer loyalty’ with a view to ‘helping people and
businesses prosper’ (Bostock, 2017).


Although in building this case study, the banks beginnings and
recent practice has been observed, what may be the most telling time (in terms
of culture) for the bank is the future. Santander, like many banks, is on the
cusp of a technological revolution, bank branches are becoming obsolete, online
banking is becoming universal and the entire attitude to banks and banking is
changing. Internally Santander UK management are working to the ‘Santander 2025
model’ which means shaping all of their modern practice so that it is in
accordance with (or in place to transition to) where the bank sees itself in 7
years’ time. Senior management positions are being changed/planned to change so
that Santander UK find itself with individuals who will be there in 2025 or are
incentivised to oversee the transition. In this sense, Santander is evoking
Darwinian evolutionary theory, those species (in this case banks) that are the
most capable of adapting to change are the most likely to have the best chance
of survival. In this post-modern phase Santander UK has lost its marquee
employee, in Mrs Botin, to the Group Executive Chairwoman position in Spain but
has maintained its dedication to promoting a culture of diversity and
opportunities for women by appointing Baroness Vadera as Chairwoman.











In this discussion, the aforementioned theories from the
literature review will be used to explain how the Santander have managed and
are managing their venture into the UK market. It will also discuss how organisational
cultural divides are being managed now that there are contrasting national
cultures in decision making roles In order to do this, the section will discuss
the central beliefs which support the culture, the importance of managing
organisational culture in contrasting national cultures and the  concept that Santander’s culture is intrinsic
and therefore not worth managing.


As (Schein, 1985, 1992), (Peters and Waterman, 1982; Wiener &
Vardi, 1990; Roland Calori & Philippe Sarnin, 1991), (Davis, 1984; Lorsch,
1985) (Lepak, Takeuchi, Erhardt and Colakoglu, 2006) outlined there are four
main pillars of culture: Basic Assumptions, Beliefs, Behavioural norms and
Shared Values. Santander must now manage each of these pillars whilst also
taking into account the national culture which shapes how employees of British
organisations expect to practice business. Because of this Santander developed
the ‘simple, personal, fair’ central motto. This central motto is not only
applied for trading but also as an attitude to its personnel, on the banks
television commercials this motto is followed by the line ‘its what a bank
should be’. By advertising this central motto and confirming that this is how a
‘bank should be’ Santander are representing themselves in a specific manner, and
as this is the foremost means by which culture is made visible (Van Maanen,
1988) they are dictating and managing the organisations culture. However, when
analysing the issues surrounding cross culture management one must concentrate
more on the micro-level rather than the macro (Adler, 1983) i.e. the study of
people rather than the organisation itself (Renwick, 1982).

Upon integrating into the UK banking market Santander had a number
of British employment expectations which had to be met, there must be clear
opportunities for women to reach positions of management, respect and
opportunities given to young employees and graduates and a less formalised
attitude to employment. To address the first point, when Santander UK entered
the market the Chief Executive Officer was Ana Patricia Botin (daughter of
Santander Group Chairman Emilio Botin), it could be argued that, although Mrs
Botin was entirely qualified for the position, the appointment of such an
individual was a clear marker that Santander aimed to manage what was a
perceived traditional cultural divide between Spanish and British
organisations. Following this, in order to create an organisation of ‘shared
values which makes for a diverse community’ (Hofstede, 1980) (Schwartz, 1999),
Santander began developing its graduate intakes from universities. By
developing one of the largest graduate intakes in the finance industry Santander
greatly increased the number of younger individuals they employed and by doing
so, increased the diversity of its thought pool. If a company embraces a diverse
age range, the management can structure strategies and transformative
techniques in order to motivate employees to their fullest extent (Dwyer,
2013). A motivated age diverse workforce has the capacity to support the
realisation of organisational goals/objectives (Dwyer, 2013). Although
tailoring managerial decision-making to a range of ages is a costlier (both in
finance and time), the benefits of a motivated and age-diverse range of
employees are apparent. They have the capacity to market products to society as
a whole (Parry and Tyson, 2010), in Santander’s case the 123-current account is
an example of such a product. Prior to the introduction of the 123-current
account Santander was consistently rated as the poorest retail bank for
customer service, this product revolutionised the relationship Santander UK had
with its retail customers to such an extent that it has become the most popular
product in the market. This is evidence that having diversity of all kinds
(particularly of age) is an advantageous characteristic for an organisations
culture, Spanish banking is a culture which is dominated by middle-aged, white,
males (and so is relatively close-minded on matters of diversity). This
conscious decision made by Santander in the UK is an example of managing
culture and the potential benefits of doing so.


In contrast to the previous writing in this section there is the
view outlined in the literature review that culture is something which an
organisation is rather than something an organisation has (Smirich, 1983;
Ogbonna, 1992; Burrell and Morgan, 2017). By taking such a stance, one would be
resigned to thinking that if culture is organisation and organisation is
culture then there would be little point in attempting to manage the phenomenon
(Ogbonna, 1992). If one took this view and applied it to Santander there are
aspects of the organisations culture which seem unalterable and therefore
futile to manage. As a bank there is an intrinsic culture to make money, the
majority of employees who work for Santander will spend all of their time
trying to optimise the profits of their individual business, whether that be:
the global bank, the corporate bank, the retail bank etc. No matter the
national culture or the attitudes/levels of diversity the overhaul of corporate
culture is an awesome ‘if not impossible task’ (Uttal, 1983). Although culture
may attempt to be managed the operations of the bank will mean that, no matter
how moral the culture is shaped, Santander’s financial conduct may frequently
fall foul of the law (as all banks will). In seeking improved profitability
banks must push legal limits or innovate new means of making money and
Santander is no different and instances of fine paying or investigation will
continue within the organisation, this culture of pushing limits for improved
profitability cannot be altered, managed or changed, it is integral to the
organisations function.



In conclusion, despite innumerable studies on the subject there is
no definitive definitions of culture. There are a number of pillars by which
culture can be observed by and these are what can be managed in a variety of
ways. National culture plays a key role in the case of Santander’s culture
management as an international organisation, the balance of Spanish and British
practices and expectations is the key challenge within the organisations
management, with elements such as clarity and diversity being stand out
opportunities to observe such culture. It must not be forgotten though, that
many view cultures as synonymous with organisations, an unalterable,
unconscious soul of an organisation with no capacity for change and therefore
no need to be managed. On balance, this essay serves to prove that there is a
purpose to managing an organisations culture (even if it is just the outward
perception of the culture). The features of culture covered in this essay are
manageable, changeable features that have already acted to benefit Santander’s
UK and international operation for example, the 123-current account as well as
‘simple, personal, fair, it’s what a bank should be’. It has been the careful
management of this culture which allowed Santander to penetrate the British
market to the extent it has and how Santander has gone from a new name in the
market, to the foremost challenger bank to the ‘big four’ British banks.