Slide international business ch03

Environmental Variables Affecting Management Functions Exhibit 3-1 National Variables Economic system Physical situation Legal system Technological Political system know-how Sociocultura

Understanding the Role of Culture

Chapter 3

Chapter 3 - Overview

 Culture and its effects on organizations

 Cultural variables

 Cultural value dimensions

 The Internet and culture

 Developing cultural profiles

 Culture and management styles around the world

Environmental Variables Affecting

Management Functions

(Exhibit 3-1)

National Variables

Economic system Physical situation

Legal system Technological

Political system know-how

Sociocultural Variables

Religion Education Language

Cultural Variables

Values Norms Beliefs

Attitudes

Work Time Materialism

Individualism Change

Individual and Group Employee Job Behavior

Productivity Ethics

Common Cultural Terms

cultural variables affecting management

decisions

awareness and an honest caring about another

individual’s culture

What is Culture?

 The culture of a society comprises the shared

values, understandings, assumptions, and goals

that are learned from earlier generations, imposed

by present members of a society, and passed on

to succeeding generations

Definitions of Cultural Terms

 Self-reference criterion refers to the unconscious

reference point of one’s own cultural values.

expects those from or in another country to automatically fall into patterns of behavior common in France.

operate from the assumption that their ways of doing

things are best – no matter where or under what

conditions they are applied.

 Many countries comprise diverse subcultures

whose constituents conform only in varying

degrees to the national character

 In Canada, for example, distinct subcultures

include anglophones and francophones speaking and French-speaking people) and

(English-indigenous Canadians

Cultural Variables

(Identified by Harris and Moran)

 Kinship: A kinship system is the system adopted by a given society

to guide family relationships.

 Education: The formal or informal education of workers in a foreign

firm, received from whatever source, greatly affects the expectations placed on those workers in the workplace.

 Economy: Whatever the economic system, the means of production

and distribution (and the resulting effects on individuals and groups) has a powerful influence on such organizational processes as

sourcing, distribution, incentives, and repatriation of capital.

 Politics: The system of government in a society, whether democratic,

Communist, or dictatorial, imposes varying constraints on an

Cultural Variables

(contd.)

 Religion: The spiritual beliefs of a society are often so powerful that

they transcend other cultural aspects.

 Associations: many and various types of associations arise out of the

formal and informal groups that make up a society.

 Health: The system of health care in a country affects employee

productivity, expectations, and attitudes toward physical fitness and its role in the workplace.

 Recreation: Closely related with other cultural factors, recreation

includes the way in which people use their leisure time, as well as

their attitudes toward leisure and their choice of whom to socialize

What are Values?

 Values are a society’s ideas about what is good or

bad, right or wrong – such as the widespread

belief that stealing is immoral and unfair Values determine how individuals will probably respond

in any given circumstance

Project GLOBE Cultural Dimensions

expected to be tough, confrontational and competitive

versus modest and tender.

 Future Orientation: refers to the level of importance a

society attaches to future-oriented behaviors such as

planning and investing in the future.

performance improvement and excellence is in a society.

society encourages and rewards people for being fair,

GLOBE Research Project

Selected Findings

(Example of countries for each factor)

Hofstede’s Value Dimensions

 Power distance is the level of acceptance by a society of

the unequal distribution of power in institutions.

people in a society feel threatened by ambiguous

situations.

after themselves and their immediate family only and

neglect the needs of society.

 Masculinity refers to the degree of traditionally

Power Distance

(Selected Countries)

High Orientation Toward Authority Low

Uncertainty Avoidance

(Selected Countries)

Country Clusters

 Ronen and Shenkar (synthesizing Hofstede’s

research and other cluster studies) developed

eight country clusters based on the following

factors:

– the importance of work goals

– need fulfillment and job satisfaction

– managerial and organizational variables

– work role and interpersonal orientation

Trompenaar’s Value Dimensions

 The Universalistic approach applies rules and

systems objectively, without consideration for

individual circumstances; whereas the

Particularistic approach puts the obligation

toward relationships first and is more subjective

 In the Neutral versus Affective dimension, the

focus is on the emotional orientation of

relationships

Trompenaar’s Value Dimensions

(contd.)

 Managers in Specific-oriented cultures separate

work and personal issues and relationships In

Diffuse-oriented cultures there is spill-over from

the work into the personal relationship and versa

vice- In an Achievement society the source of status

and influence is based on individual achievement

In an Ascription-oriented society, people ascribe

status on the basis of class, age, gender, etc

Critical Operational Value Differences

 Time: differences in temporal values

“the clock is always running” vs “mañana” which

means “tomorrow” in Latin America or “bukra” which

means “tomorrow” or “some time in the future” in

Critical Operational Value Differences

(contd.)

nature – that it is there to be used for their benefit – differs from the attitudes of Indians or Koreans, for example, whose worship of nature is part of their religious belief

individual achievement over group goals; for

others, conformity and cooperation takes

precedence over individual achievement

The American-Japanese Cultural Divide

Action

The American-Japanese Cultural Divide

(contd.)

Harmony

Conformity Individuality Group convention Personal principle Trusted relationships Legal safeguards Collective strength Individual independence Maintain the group Protect the individual Modest resignation Righteous indignation Saving face Being heard Oppressive unanimity Chaotic anarchy Humble cooperation Proving oneself

Freedom

The American-Japanese Cultural Divide

Dependency Autonomy Dutiful relationships Level playing field Industrial groups Industrial competition Strict ranking Ambiguous/informal ranking Racial differentiation Racial equality

Equality