International business environment lesson 04

45 Comparison of Various Business Cultures LESSON 4 COMPARISON OF VARIOUS BUSINESS CULTURES CONTENTS 4.0 Aims and Objectives 4.1 Introduction 4.1.1 Development and Social Dynamics o

45 Comparison of Various Business Cultures

LESSON

4

COMPARISON OF VARIOUS BUSINESS CULTURES

CONTENTS

4.0 Aims and Objectives

4.1 Introduction

4.1.1 Development and Social Dynamics of an Alternative Culture

4.1.2 Current State of Alternative Culture

4.1.3 Permanence of Alternative Culture within the Popular Imagination

4.1.4 Alternative Cultures around the World Africa

4.2 Comparison of Cultures between Western and Eastern Countries

4.3 Business Mannerism

4.3.1 Nomenclature

4.4 Let us Sum up

4.5 Lesson End Activity

4.6 Keywords

4.7 Questions for Discussion

4.8 Suggested Readings

4.0 AIMS AND OBJECTIVES

After studying this lesson, you should be able to:

z Study the various cultures

z Know the various business mannerisms

z Know the comparisons of different cultures

4.1 INTRODUCTION

Despite all their cultural differences, all alternative cultures follow a similar process of

origination, development, and decline Alternative cultures also share several common

values

A subculture is usually formed by young working class people in a small region or a

single city in response to a generally felt lack of proper fulfillment by the options

available to that particular social group This disenchantment is in reference to a wide

range of things, from acceptable codes of public behaviour to the likelihood of decent

long-term employment The result is a rapid evolution of an externally displayed

attitude and an accompanying visual style (regarding art, dress, etcetera) and

soundtrack The factors that necessitate the creation of a subculture often forge the

elements that make it unique and give it some form of cultural legacy in retrospect

For example, the hippie movement of the 1960s is remembered, although not

exclusively, for its championing of the concept of "free love", which was a fairly

successful attempt to break away from the perceived social frigidity of the previous

46

International Business Environment two decades Hip hop culture allowed poor African-Americans to express themselves

creatively when they had minimal access to musical instruments and very little chance

of having their work displayed in art galleries It meant that the turntable, normally only used to play music produced by others, was used as an "instrument" in its own right and that public areas became substitute canvasses for a style of art known as wild style

4.1.1 Development and Social Dynamics of an Alternative Culture

During the point that these subcultures enjoy their "peak", they are simultaneously the subject of much negative attention from the media This is often due to objections to the subcultures' disregard for the legality of their activities, the physical appearance of their members, their anti-establishment and/or anti-consumerist values and their frequent indulgences in sex and drug use (Not all these points apply to all subcultures, a good example being the fact that members of the "straight edge" hardcore punk scene were completely teetotal) However, it is this publicity which often drew more young people into each subculture, usually, but not always, because they were attracted by its apparent dissident nature

There is often a period that is considered to be "pure" in terms of what defined each subculture in various ways This is the point between the complete development of its unique characteristics - where it has an ideology, a style of dress, a new genre of music to call its own, et cetera - and the point where publicity has caused a large influx of new members into the community and various business interests have begun

to co-opt its unique aspects The grunge subculture (although according to its original members, it was not a culture as such, but rather a fan base for alternative rock) is a particularly interesting case, as its conception was to some extent deliberately self-conscious of the factors that could skew its original intents Grunge was a regional off-shoot of DIY culture, which focused more on its members being cynical

"slackers": an outlook publicly exemplified best by the band Dinosaur Jr - and, as the popular phrase was at the time, over-educated and under-paid (A phrase which was,

incidentally, lifted from Douglas Coupland’s novel Generation X: Tales for an Accelerated Culture (1991)) Although these were all myths that originated from the

media, of which participants in the grunge scene treated with some suspicion Still, in

the wake of the massive success of the album Nevermind (also 1991) by Nirvana, the

media and the marketing industry popularised and mass-marketed "grunge" clothes, music and such However, the nature of the culture meant it resisted glamorisation and

it was soon abandoned by the media, leaving the scene to wither as a result

4.1.2 Current State of Alternative Culture

Alternative culture has stalled somewhat since the mid 1990s The major factors behind this can be largely attributed to the prevalence of homogenised "top-down" culture, which is where young people tend to have taken to consumerism as a source

of identity and recreational facilities This runs counter to alternative cultures' tradition of innovation, geographical diversity and communal self-sufficiency It has become regular practise to attribute this to the members of Generation Y - (people born roughly between the mid 1980s and late 1990s) - having grown up with different values than those before them For rather than a subculture being perceived as something that could be contributed to, it has become accepted by people of this generation that being part of an "alternative culture" is something which requires little beyond personal styling On the other hand, people of this generation have, in some ways, broader tastes than their elders and thus they incorporate various elements that they like from a range of subcultures, while never claiming to be a member of any, or

if they do, then they often lack the occasional narrow-minded preferences of the group's original members

47 Comparison o

Due to subcultures of this nature being in a constant change, they often splinter off

into niche groups They often develop an "old skool" crowd who tend to resist

"polluting" elements and carry on as before until inevitably evolving themselves Take

the UK's rave scene, which suffered very badly from tough legislation aimed at it in

the mid 1990s (Criminal Justice and Public Order Act 1994), leading to its discrete

continuance on a smaller scale, before manifesting itself again on the large scale in the

form of the teknival, which retains many of the principles of the original acid house

culture

f Various Business Cultures

4.1.3 Permanence of Alternative Culture within

the Popular Imagination

Regardless of whether or not alternative culture is truly alternative (and many claim

that it is not), many subcultures that have been considered alternative were created as

a response to perceived negative qualities in society However, many subcultures have

become heavily associated with products rather than ideals; for example, hippies

stated a belief in the shedding of material possessions, but the Volkswagen 'Type 2'

van is inseparably associated with them

4.1.4 Alternative Cultures around the World Africa

South Africa has a long tradition of alternative culture From the Creole fusion

experience of the 17th and 18th centuries, to recent experiments in alternative living

A cross-over fusion between white punks and black ethnics in the eighties produced

an innovative local culture articulated by magazines such as Value, music such as

Void and Via Africa, and clubs such as The Indaba Project and The Base Alternative

"Afrikaners" existed in juxtaposition to the dominant mainstream polices of racial

oppression, alongside anti-apartheid resistance to war by students and groups such as

the End Conscription Campaign

Check Your Progress 1

What is the current state of alternative culture?

……….……

……….……

4.2 COMPARISON OF CULTURES BETWEEN WESTERN

AND EASTERN COUNTRIES

Today, business and political climates are changing dramatically across Asia,

“transforming Asian countries in unprecedented ways – with lessons, benchmarks and

opportunities for the rest of the world” (Rao, 2005, p.1986) That is why a fair

question would be: why then it is so hard to conduct business in the eastern World?

Qualcomm has come through one major Eastern market battles with China

Regardless it is the world’s giant, China still can be a good example of the Eastern

mentality that was formed within thousands of years and due to the major conquests, it

influenced the surrounding countries’ development

To penetrate any market, it is very important to study social structure and culture of

the country to avoid any misunderstandings with the government officials, unexpected

moments within the business and eliminate cultural gaffes when approaching

customers To view a big picture of the country and the country’s market, it is

important to see it in at least four dimensions: historical and traditional background,

country’s political structure, level of business development and market culture The

latter refers to our case the best – Qualcomm had a difficulty getting through Chinese

market culture Victoria E Bonnel, who was approaching Shanghai, also mentions the

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International Business Environment importance of screening the local management as a part of the market culture, in order

to succeed in the business She states that it is necessary to take a detour into some empirical issues of the social structure in industrial Shanghai Bonnel focuses on three empirical variables: “the background of the general manager, the social networks, in which the managers are embedded, and a firm’s position vis-à-vis the institutional structure of the state”

A very common method to evaluate market is also Porter’s PESTL analysis It refers

to Political, Economic, Social, Technological and Legal pictures on the market:

“Using Porter’s 5 forces reveals the increased complexity of operating in an overseas market Suppliers and customers may be able to improve on their bargaining power with the new nạve exporter and finally the threat of substitute technologies may come from an even greater number of unpredictable sources compared to the domestic market”

At the meantime, regarding Powell’s analysis of the sociological and economic literatures on exchange, we see that transactions can take place through “loose collections of individuals who maintain impersonal and constantly shifting exchange ties, as in markets, or through stable networks of exchange partners who maintain close social relationships” The key distinction between these systems remains the structure and quality of the exchange ties, because these factors shape all expectations and opportunities According to Powells, the ideal-type atomistic market links the exchange partners by arm’s-length ties In Qualcomm’s case, sociological ties were completely broken Chinese market did not welcome Qualcomm, neither government, manufacturers, nor customers (at first) To see the true reasons for this, we should come back to one of the assessment dimensions – history and traditions

Historically, China has been a country of mystery for the Western world, thus it is always a pressure to start a business with a billion population mysterious market Imperialistic Confucianism mentality have been growing in Chinese people for centuries Empire’s replacement by communistic structure aggravated the relationships with Western world even more For thousands of years the majority of the population consisted of illiterate peasants, who were thought to be influenced by the examples of their rulers In this society, the highest and most prestigious positions were political generalists, as for example members of the emperor’s council and provincial governors Experts, such as tax specialists or physicians, were ranked below the ruling political representatives Regardless commerce has been a major element of Chinese everyday life since the beginning of imperial period, and wealthy merchants have been major in Chinese cities, Confucianists dishonored merchants Commercial success was never in respect, and wealth, based on commerce, was a subject to official taxes, fees, and sometimes confiscation

Even though the establishment of the People’s Republic in 1949 replaced the uncertainty, risks and partial instability “by an increase in the scale of organization and bureaucratization” then, as a consequence, an “increase in predictability and personal security”, the country still remains true to its political idolatry Today it is no difference in the upper level governing mechanisms Disrespect to the business field is one of the causes of the difficulties of doing business with this country

When Wu Jichuan, the minister of posts and telecommunications declined to attend the presentation of one of the largest business deals in the history of China, it was a great spit in the American businessmen’s face Understanding this issue, Qualcomm could try to find another approach to the governing officials If the deal was really important to the development of the United States business, Irwin Jacobs should have approached with the American Governing officials, as a respectful party in China If Chinese minister had a deep respect to the rules of business, he would not require Jacobs the transformation of the design for the mobile chips The businessman never

49 Comparison of Various Business Cultures

done this before and would never do Although Mr Wu felt the authority in front of

the American Businessman

China’s “socialist system, with state ownership of most industry and central control

over planning and the financial system, has enabled the government to mobilize

whatever surplus was available and greatly increase the proportion of the national

economic output devoted to investment” This was great reason to enter Chinese

market But regarding the fact that Chinese people are trustful to their government and

used to do whatever they are told, Americans are unlikely to spread their mobile

fashion as fast as they would have done in European Union, for example, if it was

invented before the GSM system launched Chinese are very loyal to their traditions

and whenever something new comes, they are keen to listen to the opinion of the

leaders first Thus, second Qualcomm’s biggest mistake was to ignore government’s

approval of the project in Public Relations If this country launched CDMA system in

exchange to the US vote for China’s membership in WTO, the American politicians

should have made sure all necessary PR and advertisement was done to the product

with the official approval But for some reason Chinese stayed with GSM, regardless

it was three times slower than CDMA

Also, until 17th China was a recognized world leader in technology and scientific

discovery Plenty of Chinese inventions - paper and printing, magnetic compass, the

lift lock for canals – were the major contributors to the economic growth in Europe

and the Middle East These are the facts that are well known in the Western countries

But many businessmen that are working in the technological sphere don’t pay

attention on the issue that under the last two dynasties, the Ming and the Qing

(1644-1911), China’s ruling elite consentrated on its humanistic subjects: literature, arts, and

public administration They “regarded science and technology as either trivial or

narrowly utilitarian” What is it to do with the 21st century technological boost?

Chinese are honoring their history much more than Americans and are sometimes

over conservative in their views Together with the fact that they are the following the

leader’s directions, this country is hard to persuade in anything

American businessmen also missed the fact that China’s middle class is different from

American The majority of Chinese people residing in cities nowadays are looking up

to the new technologies But the reason United States keeps most of its production

business in China is because of cheap labor Thus, people just don’t earn enough

money to buy a $350 CDMA network mobile Such high price was, of course,

explained by the company’s need to cover expensive CDMA handset, but the majority

of Chinese, unlike Americans or Europeans, are unable to pay this price This was the

matter of the trivial market research China is a vast market, but is it ready for such

purchases?

Also, in manufacturing terms, Asian countries, such as China, Japan, South Korea,

and Taiwan have become leading global players in hardware, where as innovations

and software have immerged in Singapore, India and the Philippines Thus, the local

companies are much better off in spreading their business, than the foreign ones, the

major reason is that the national companies have started the introduction of their

mobile systems in those countries much earlier, than Western countries Thus, today,

in order to change the wireless systems to the more advanced will require huge

investments and research Chinese communications leaders wanted to cheat

Americans by demanding the design of the chips that run the CDMA systems Thus,

they would give the design to the local companies and start the production CDMA

systems by the local companies without paying royalties to Quallcomm Thus, they

would promote the national businesses rather than the foreigners’ This situation

reveals a strong Eastern characteristic of standing for their own well fare, rather than

American’s or other western country America supported China in the entrance to the

WTO, but China failed to be open to help America to establish its technological

systems They did their best to avoid Americans from their market China understands

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International Business Environment that they are dependant on US on the international Arena, but still try to prevent its

dominance over the national business Although this characteristic is somehow similar

to the American’s mentality, as we are quite patriotic as well and are doing our best to keep the national companies in the winning market position

Regardless the major differences in conducting business in Western against Asian countries, the success of the system in the East was inevitable and the product is accelerating in growth To make the market penetration easier, every American businessman is obliged to keep in mind those differences Of course, it is hard to put all differences in principals into one formula and state that it works Learning differences creates red flags on the business road and states, where a manager should turn, jump, stop or run faster

A decent number of studies in the international marketing and management have focused on the identification and discussion of major differences across Eastern and Western business worlds One of them is Jean-Emile Denis, the author of the “Culture and International Marketing Mix Decisions” He views the culture as the center of all social interaction processes Thus, it is expected that the impact of culture on communication decisions is more clearly identifiable than on any other marketing mix variable According to Denis, “culture will affect the type of roles depicted in ads, and the choice of themes which relate to underlying values and norms Advertising budget and structure will depend on buyers’ habits and consumption style, that is on values and norms” (Denis, University of Geneva) Qualcomm completely depended on Chinese Unicorn to introduce the CDMA system, but the latter was promoting his own product with the certain advertisement approach What would happen, if the same company states that two different systems are the best? They should state the priority to one product in promotion But CDMA appeared to be a competitor for Unicorn, thus creating a competition within the company

The approach to business also lies deeper in the philosophical values of two parts of the world West is very individualistic and competitive: personal success is a guideline for everybody else to follow Where as eastern countries are more into harmonious teamwork The success of a team (company) is a standard tradition for other companies to follow The meaning of competition was brought to the east by western countries and emerged through industrial revolutions Currently, eastern companies are building their competition on the market stability For example, if a company produces soaps and has been doing it for years, it already has its own market and it is highly unlikely that it will bankrupt because of the competitor’s pressure Simply laws

in the eastern countries are such as it is hard to compete with a few companies that are traditionally trusted It is already a tradition in the western countries as well, for example Nokia is not likely to loose it’s respect, unless it introduces a completely bankrupting mobile model

It is also very important to differ Islamic and Buddhist countries Islam is the initiator

of Jihad, the conquer of the world and the triumph of Allah Even in business it is noticed quite well War in Iraq was partially due to the fact that it was impossible to conduct free market business there In the Buddhist countries is almost the opposite – they are more close to themselves Anti-globalizm movement in China is a good example to it Loyal to its traditions, the majority of Chinese population finds globalization unnecessary and very hard to handle Thus, China’s participation in WTO is very controversial for the population Those that are excited about the world and migrate to either USA or just like to travel are much more exposed to globalization tendencies, but those that are more conservative and stick to their culture are unlikely to change their mind and use imported system Thus, China is divided in perception on imported goods

Thus, a research center that was opened by Quallcomm is a very good idea for the company, as it will need to have good knowledge about the culture, if it wants to

51 Comparison o

penetrate the market deeper and have a long term commitment The company will also

need to address human resource development techniques to prepare it’s management

for the business conduct in Asian countries

f Various Business Cultures

Human resource development could be done through various ways First, the company

should introduce training sessions for its managers on Asian business management,

cultural ethics, traditions, language, etc To succeed in business, like in any other

field, one has to understand the surroundings and then to master the market and lead a

fair battle The program should start as a very intensive and after the company’s

decision makers have the basic knowledge, they keep on developing their knowledge

through different conferences and seminars, organized by the businesses in Asian

countries As overall regions strategy is going towards international cooperation,

many Asian companies are eager to provide guest speakers and lecturers on certain

business issues Such organizations, as Asia-Pacific Economic Cooperation (APEC)

organize conferences on Human Resource development For example, in collaboration

with ABAC, APEC helps to promoting sustainable development in the Asia Pacific

Region “Through a series of workshops and seminars, APEC experts met to discuss

issues, challenges and to share best practices to build capacity for a Recycling-based

Economy (RBE) in APEC” (Human Resource Development APEC) The

organization also conducts various seminars on buisness development, such as:

Innovations in Entrepreneur Development, Capacity Building Program for Trade and

Investment Insurance Practitioners, Human Capacity Building, Responding to Change

in the Workplace: Innovations in Labour Management Government Cooperation The

latter is the most progressive program in terms of volume of information and practical

approach APEC elaborates on the benefits of LMG cooperation in terms of:

economic benefits for both economies as well as organizations; social and political

benefits; and how Labour Management Government cooperation helps workers to

better realize their human potential (Responding to Change in the Workplace APEC)

According to APEC, their program enhances productivity in two ways: improved

dialogue between workers and managers from different cultures results in the sharing

of information, valuable ideas and synergy which make work processes more

productive and efficient Besides, when workers and managers have good

relationships, they induge much less in behavior that negatively impacts productivity,

as open conflict, gossip, complaints and grievances It results to spending more time

in productive activities

Check Your Progress 2

Fill in the blanks:

1 The word mannerism derives from the Italian maniera, meaning

2 South Africa has a long tradition of _ culture

3 Mannerism is a period of art

4.3 BUSINESS MANNERISM

Mannerism is a period of European art which emerged from the later years of the

Italian High Renaissance around 1520 It lasted until about 1580 in Italy, when a more

Baroque style began to replace it, but continued into the seventeenth century

throughout Europe Stylistically, Mannerism encompasses a variety of approaches

influenced by, and reacting to, the harmonious ideals and restrained naturalism

associated with artists such as Leonardo da Vinci, Raphael, and early Michelangelo

Mannerism is notable for its intellectual sophistication as well as its artificial (as

opposed to naturalistic) qualities

52

International Business Environment The definition of Mannerism, and the phases within it, continue to be the subject of

debate among art historians For example, some scholars have applied the label to certain early modern forms of literature (especially poetry) and music of the sixteenth and seventeen centuries The term is also used to refer to some Late Gothic painters working in northern Europe from about 1500 to 1530, especially the Antwerp Mannerists—a group unrelated to the Italian movement

4.3.1 Nomenclature

The word mannerism derives from the Italian maniera, meaning "style" or "manner" Like the English word “style,” maniera can either be used to indicate a specific type

of style (a beautiful style, an abrasive style), or maniera can be used to indicate an absolute that needs no qualification (someone ‘has style’) In the second edition of his

Lives of the Most Excellent Painters, Sculptors, and Architects (1568), Giorgio Vasari used maniera in three different contexts: to discuss an artist's manner or method of working; to describe a personal or group style, such as the term maniera greca to refer

to the Byzantine style or simply to the maniera of Michelangelo; and to affirm a

positive judgment of artistic quality Vasari was also a Mannerist artist, and he described the period in which he worked as "la maniera moderna", or the "modern style"

However for later writers, such as the seventeenth-century Gian Pietro Bellori, "la maniera" was a derogatory term for the decline of art after Raphael, especially in the 1530s and 1540s From the late nineteenth-century on, art historians have commonly used the term to describe art that follows Renaissance classicism and precedes the Baroque Yet historians differ in opinion, as to whether Mannerism is a style, a movement, or a period, and while the term remains controversial it is commonly used

to identify European art and culture of the sixteenth century

As a stylistic label, "Mannerism" is not easily pigeonholed It was first popularized by German art historians in the early twentieth-century to categorize the seemingly uncategorizable art of the Italian sixteenth century—art that was no longer perceived

to exhibit the harmonious and rational approaches associated with the High Renaissance

4.4 LET US SUM UP

During the point that these subcultures enjoy their "peak", they are simultaneously the subject of much negative attention from the media This is often due to objections to the subcultures' disregard for the legality of their activities, the physical appearance of their members, their anti-establishment and/or anti-consumerist values and their frequent indulgences in sex and drug use (Not all these points apply to all subcultures, a good example being the fact that members of the "straight edge" hardcore punk scene were completely teetotal) However, it is this publicity which often drew more young people into each subculture, usually, but not always, because they were attracted by its apparent dissident nature

4.5 LESSON END ACTIVITY

Prepare a study note on the concept of business mannerism

4.6 KEYWORDS

Sub-culture: It is usually formed by young working class people in a small region or a

single city in response to a generally felt lack of proper fulfillment by the options available to that particular social group

Vasari: A mannerist artist, described the period in which he worked as "la maniera

moderna", or the "modern style"

53 Comparison o

Various Business Cultures

1 Distinguish between the western and eastern culture

2 Explain the concept of business mannerisms

Check Your Progress: Model Answers

CYP 1

Alternative culture has stalled somewhat since the mid 1990s The major

factors behind this can be largely attributed to the prevalence of homogenised

"top-down" culture, which is where young people tend to have taken to

consumerism as a source of identity and recreational facilities This runs

counter to alternative cultures' tradition of innovation, geographical diversity

and communal self-sufficiency It has become regular practise to attribute this

to the members of Generation Y - (people born roughly between the mid

1980s and late 1990s) - having grown up with different values than those

before them For rather than a subculture being perceived as something that

could be contributed to, it has become accepted by people of this generation

that being part of an "alternative culture" is something which requires little

beyond personal styling

CYP 2

1 "style"

2 Alternative

3 European

4.8 SUGGESTED READINGS

Daniels, D and Radebangh H., “International Business”, Pearson Education Asia, New Delhi,

2002

Griffin and Pustay, “International Business”, Pearson Education Asia, New Delhi, 2002

Subba Rao, “International Business”, Himalaya, Mumbai, 2001

Schaffer, “International Business Law and its Environment”, Thomson, 2002

Onkwist and Shaw, “International Marketing”

Philip R Careora, “International Marketing”