Cross cultural management 3e by cullen ch02

Business culture: norms, values, and beliefs that pertain to business in a culture.. Occupational and organizational culture 3.Occupational culture: the norms, values, beliefs, and expec

Chapter 2

Culture and Multinational

Management

Learning Objectives

• Understand the Hofstede and 7d models

• Appreciate the complex differences among cultures

and use these differences for building better

organizations

What is Culture?

• Pervasive and shared beliefs, norms, values, and

symbols that guide everyday life

• Cultural norms: both prescribe and proscribe behaviors

• What we should do and what we cannot do

• Cultural values: what is good/beautiful/holy, and what are legitimate goals for life

• Culture is pervasive in society

• Affects all aspects of life

Culture: Front Stage & Back Stage

• Front stage of culture: easily observable aspect of

• e.g., Japanese saying “it’s difficult” and twisting

head to one side really means it’s impossible

Three Levels of Culture

1 National culture: the dominant culture within the

political boundaries of the nation-state

2 Business culture: norms, values, and beliefs that

pertain to business in a culture

1 Tells people the correct, acceptable ways to

conduct business in a society

Three Levels of Culture (cont.)

3 Occupational and organizational culture

3.Occupational culture: the norms, values, beliefs,

and expected ways of behaving for people in the

same occupational group

4.Organizational culture: the set of important

understandings that members of an organization

share

Cultural Differences and Basic Values

• Two diagnostic models to aid the multinational

manager:

1 Hofstede model of national culture

2 7d culture model

Hofstede’s Model of National Culture

• Five dimensions of basic values

Hofstede’s Model Applied to Organizations and

Hofstede’s Model Applied to

Power Distance

• Power distance concerns how cultures deal with

inequality and focuses on

• Norms that tell superiors (e.g., bosses) how much

they can determine the behavior of their

subordinates

• Values and beliefs that superiors and subordinates are different kinds of people

Power Distance (cont.)

• High power distance countries have norms, values,

and beliefs such as

• Inequality is fundamentally good

• Everyone has a place: some are high, some are low

• Most people should be dependent on a leader

• The powerful are entitled to privileges

• The powerful should not hide their power

Exhibit 2.2: Managerial

Implications for Power

Distance

Uncertainty Avoidance

• Norms, values, and beliefs regarding tolerance for

ambiguity

• Conflict should be avoided

• Deviant people and ideas should not be tolerated

• Laws are very important and should be followed

• Experts and authorities are usually correct

• Consensus is important

Exhibit 2.3: Managerial

Implications of Uncertainty

Avoidance

• Focus is on the relationship between the individual and the group

• Countries high on individualism have norms, values,

and beliefs such as

• People are responsible for themselves

• Individual achievement is ideal

• People need not be emotionally dependent on

organizations or groups

• Collectivist countries have norms, values, and beliefs

such as

• One’s identity is based on group membership

• Group decision making is best

• Groups protect individuals in exchange for their

loyalty to the group

Exhibit 2.4: Managerial

Implications of

Individualism/Collectivism

• Tendency of a culture to support traditional masculine

orientation

• High masculinity countries have beliefs such as

• Gender roles should be clearly distinguished

• Men are assertive and dominant

• Machismo/exaggerated maleness in men is good

• Men should be decisive

Exhibit 2.5: Managerial

Implications of Masculinity

Long-Term Orientation

• Belief in substantial savings

• Willingness to invest

• Acceptance of slow results

• Persistence to achieve goals

• Sensitivity to social relationships

• Pragmatic adaptation

Exhibit 2.6: Managerial

Implications of Long-term

Orientation

Exhibit 2.7 Hofstede’s

Classification of Countries by

Clusters

Exhibit 2.7 Hofstede’s

Classification of Countries by

Clusters

7d Cultural Dimensions Model

• Builds on traditional anthropological approaches to

understanding culture

• Culture exists because people need to solve basic

problems of survival

• Challenges include

• How people relate to others

• How people relate to time

7d Cultural Dimensions Model (cont.)

• Dimensions that deal with relationships include:

7d Cultural Dimension Model (cont.)

• Dimensions dealing with how a culture manages time and how it deals with nature

• Sequential vs Synchronic

• Internal vs External control

Exhibit 2.8: The 7d Model of

Culture

Universalism vs Particularism

• Pertain to how people treat each other based on rules

or personal relationships

• Universalistic

• Right way is based on abstract principles such as

rules, law, religion

• Particularistic

• Each judgment represents unique situation that can

Exhibit 2.9: Managerial

Implications for Universalism

vs Particularism

Exhibit 2.10: Managerial

Implications of

Individualism/Collectivism

Neutral vs Affective

• Concerns acceptability of expressing emotions

• Neutral

• Interactions are objective and detached

• Focus is on tasks rather than relationships

• Affective

• Emotions are appropriate in all situations

Exhibit 2.11: Managerial

Implications of Neutral vs

Affective

Specific vs Diffuse

• Extent to which an individual’s life is involved in work

• Specific

• Business segregated from other parts of life

• Contracts often delineate relationships

• Diffuse

• Business relationships encompassing/involving

Exhibit 2.12: Managerial

Implications of Specific vs

Diffuse

Exhibit 2.13: Managerial

Implications of Achievement

vs Ascription

Time Orientation

• How cultures deal with the past, present, and future

• Future-oriented societies, such as the U.S.,

consider organizational change as necessary and

beneficial

• Past-oriented societies assume that life is

predetermined based on traditions or will of God

Exhibit 2.14: Managerial

Implications of Time Horizon

Internal vs External Control

• Concerned with beliefs regarding control of one’s fate

• Best reflected with how people interact with the

environment

• Does nature dominate us or do we dominate

nature?

• In societies where people believe nature dominates

them, managers are more fatalistic

Exhibit 2.15: Managerial

Implications of Internal vs

External Control

Exhibit 2.16: 7d Percentile

Rankings for Selected

Countries

Exhibit 2.16: 7d Percentile

Rankings for Selected

Countries

Exhibit 2.16: 7d Percentile

Rankings for Selected

Countries

Propensity to Trust

• Growing concern with the development of trusting

relationships with partners

• Differences among cultures in terms of how and when people trust each other

• Logic presupposes that individualism should be related

to low trust

• Individualistic cultures have higher trust relative to

collectivist societies

Exhibit 2.17: Levels of General

Trust in People

Exhibit 2.17: Levels of General

Trust in People

Exhibit 2.17: Levels of General

Trust in People

Caveats and Cautions

• Stereotyping: assumes that all people within one

culture behave, believe, feel, and act the same

• Ethnocentrism: occurs when people from one culture

believe that theirs are the only correct norms, values,

and beliefs

• Cultural relativism: all cultures, no matter how different, are correct and moral for the people of those cultures