Transcript ib2-19 - UAH

What is Culture?
Culture is the sum of the knowledge, values, beliefs and
attitudes shared by a particular society and a group of people.
Culture includes:
--Material culture
--General life style
--Belief system/religion
--Aesthetics
--Language/education
--Time orientation
--Space
--Taste
Characteristics of Culture
Culture is omnipresent;
Culture is different;
Culture is dynamic;
Culture is never wrong or right.
• Cultural aware
• Cultural tolerant
• Cultural adaptive
Christianity
Shinto
Judaism
Islam
Religion
Confucianism
Buddhism
Hinduism
Behavior
Speech
Manners
and
Customs
Dress
Folk Customs
Popular Customs
Aesthetics
• Music
• Painting
• Dance
• Drama
• Architecture
Identification and Dynamics of Cultures
The nation as a point of reference
• Each nation has certain human, demographic, and
behavioral Characteristics that give it a national
identity
– people share values, language, and race
• Laws governing business apply along national lines
• Problems using a country-by-country approach
– individual differences within a country
– similarities link groups from different countries
Cultural formation and dynamics
• Value systems set early in life, but may change
• Values may change due to choice or imposition
– cultural imperialism
• IB increases change in cultures and governments
Identification and Dynamics of Cultures (cont.)
Language as a cultural stabilizer
• Culture spreads rapidly when people from different
areas speak the same language
• Stronger adherence to a culture if it does not share
its language with other peoples
• English, French, and Spanish are widespread
– most of IB conducted in English
Religion as a cultural stabilizer
• Religion has a strong influence on values
• Specific beliefs may affect business
– not all nations that practice the same religion
have the same constraints on business
– where rival religions vie for political control,
resulting strife may disrupt business
Cultural Context
• Low-Context Culture: Communication depends on
explicit, verbally expressed vehicles, such as contract,
reports, and other written documents. So, people get down
to business quickly.
• High-Context Culture: Communication depends on
implicit and nonverbal aspects such as metaphor, hinting,
and personal relationship. So, business processes are
lengthy.
Contextual Background of Various Countries
Japanese
Arabian
Latin American
Spanish
Italian
English (UK)
French
North American (US)
Scandinavian
Low
Context
Explicit
German
Swiss
High
Context
Implicit
Business Customs in Different Cultural Contexts
Event
meeting People
getting acquainted
depth of
relationship
Low Context
Informal or formal?
Fast or Slow?
Shallow or Deep?
High Context
Informal or formal?
Fast or Slow?
Shallow or Deep
trust in
relationship
Little or Much?
Little or Much?
focus in
Business
Transaction or
Relationship?
Transaction or
Relationship?
relationship
in business
Business or personal?
Business or personal?
length of
meeting
Efficient/short or
lengthy?
Efficient or lengthy?
Hofstede’s Cultural Typology
PDI- Power Distance Index
• This refers to the degree to which power differences are
accepted and sanctioned by society.
• A high PDI describes a society that believes there should
be a well - defined order in which everyone has a rightful
place.
• Whereas the low PDI is associated with the prevalent
belief that all people should have equal rights and the
opportunity to change their position in the society.
IDV - Individualism
• This refers to the degree to which individual decision
making and action are accepted and encouraged by
society.
• A high IDV score depicts a society that emphasises the
role of the individual. Conversely a low IDV
emphasises a societal emphasis on the importance of
the group model.
• Individualism vs. Collectivism
MAS - Masculinity
• This refers to the degree to which traditional male
values are important to society.
• A high MAS would have clearly differentiated sex
roles with men being dominant. In low MAS
culture, the sex roles are more fluid and there is
predominance of feminine values.
UAI - Uncertainty Avoidance Index
• This refers to the degree to which society is willing to
accept and deal with uncertainty.
• A high UAI score suggests a culture that seeks certainty
and security and wishes to avoid uncertainty.
• A low UAI score reflects the society is comfortable with
a high degree of uncertainty and is open to the
unknown.
Long-term Orientation
• This concerns a society’s search for virtue, rather than
a search for truth. It assesses the sense of immediacy
within a culture, whether gratification should be
immediate or deferred.
a. life time employment
b. hard work
c. loyalty
d. extensive training
e. generalised training
f. promotion based on seniority
Cultural Awareness
Problems that hinder cultural awareness
• Subconscious reactions to circumstances
• Assumption that all societal subgroups are similar
Cultural awareness can be improved
• Research descriptions of specific cultures
• Observe behavior or respected foreign nationals
• Study foreign market directly
Company’s need for cultural knowledge increases as it
• Moves from one to multiple foreign functions
• Increases the number of countries in which it operates
• Moves from similar to dissimilar foreign environments
• Converts from external to internal handling of international
operations
Strategies for Instituting Change
Value system
• The more a change upsets important values, the more
resistance it will engender
Cost benefit of change
• Company must consider the expected cost-benefit
relationship of any adjustments it makes abroad
Resistance to too much change
• Resistance to change may be lower if the number of
changes is not great
• Make fewer demands at one time and phase in other
policies more slowly
Participation
• Discussing proposed change with stakeholders in
advance may reduce resistance
• Participation must not violate prevailing value system
Strategies for Instituting Change (cont.)
Reward sharing
• Employees are more apt to support change when
they expect personal or group rewards
Opinion leaders
• Should be convinced first about benefits of change
• Can help speed up the acceptance of change
Timing
• Change should be timed to occur when resistance
is likely to be low
• Must attend to attitudes and needs of culture
Learning abroad
• International companies should learn things
abroad that they can apply at home