Introduction This case tells us about Stanley Wong, division manager for Erie Performance Polymers and general manger of Wuhan Erie Polymers joint venture who had received an approval for his transfer request to Gary, Indiana, USA, headquarters of Erie. He was given the task of recommending to the board, from a list of six candidates, a successor to his position. During his tenure Stanley Wong has tried to modernize the thought process of his mainly Chinese employees, at the same time being sensitive to the cultural differences, he tried to create an organisational culture which was a mix of both Chinese and western values. He must make sure that his successor is sensitive to the existent differences in culture and that he is well equipped to handle problems or conflicts which these differences might cause. Nomination of Successor After considering the six candidates it can be said that all of them six have certain shortcomings and none can be considered ideal for the job, however Bruce Po would probably best suit this position since he possesses several important qualities required for succeeding in this position. Wright and Mischel (1987) have stated that predictable behavior would be achieved when management practices would be congruent with national cultural values which according to Earley (1994) would further result in high performance. According to Perlmutter (1969) polycentric firms are those, which, by experience or by inclination of the top executive begin with the assumption that host country cultures are different and that foreigners are difficult to understand (p11). Perlmutter (1969) further states that local people know what is best for them and the part of the firm which is located in the host country should be as local in identity as possible. Bruce Po is a national manager and possess’ the advantage of having the knowledge of the local business scene (Scullion & Collings, 2006). Being fluent in Chinese and having a good understanding of Chinese culture and traditions, he will be able to not only communicate and motivate his staff efficiently but also socialize and maintain good relations with government officials, which is required for this post. Governmental policies favour appointment of HCN managers (Dowling & Welch, 2004). Wilson, Bernadin and Russel (1998) have concluded that the failure rate of PCN managers is also high compared to HCN managers. Appointment of Po would satisfy the need to appoint a host country national (HCN) as the manager. Po has shown in the past that he is capable of making crucial decisions much needed for this managerial post. He is intelligent, committed and hardworking and will successfully be able to implement modern business techniques which he is currently learning. The current scenario requires a manager who can ensure that the subsidiary has a similar corporate culture and shares similar values of the main firm to maximise productivity using socialization must to assert control, much like a ‘bumble–bee’ (Harzing, 2001). Po lacks networking skills with the head quarters and might fail to assert the required amount of control. The Chinese have shared the tradition of respect for elders for many generations (Wales, 1946). Po, being only 32 years of age might not be able to command that respect from his colleagues. AREAS WHERE CROSS-CULTURAL CONFLICTS MAY ARISE AND RECOMMENDATIONS TO SOLVE THESE CHALLENGES (Q2) According to Choi and Beamisch (2004) conflicts could cause substantial problems to a company and cultural conflicts may further complicate the process. Large cultural differences would increase the difficulty for the involved groups to understand each other’s point of view. To get a better understanding of the cultural differences between the two nations lets take into account the research done by Hofstede (1984). Hofstede (1984) developed and named 5 dimensions, which best characterised a culture, enabling us to make a comparison between cultures. These five dimensions were individualism, power distance, uncertainty avoidance, masculinity and long-term orientation (Hofstede, 1984). Chinese differ substantially with re