International bussiness the challenge of global competition 11e chapter 06

chapter six Sociocultural Forces McGraw-Hill/Irwin International Business, 11/e Copyright © 2008 The McGraw-Hill Companies, Inc All rights reserved Learning Objectives  Explain the significance of culture for international business  Identify the sociocultural components of culture  Discuss the significance of religion to businesspeople  Explain the cultural aspects of technology  Discuss the pervasiveness of the Information Technology Era 6-3 Learning Objectives  Explain the importance of the ability to speak the local language  Discuss the importance of unspoken language in international business  Discuss the two classes of relationships within a society  Discuss Hofstede’s four cultural value dimensions 6-4 Rules of Thumb for Cross Culture Business • Be prepared • Slow down • Establish trust • Understand the importance of language • Respect the culture • Understand the components of culture 6-5 What is Culture • The sum total of beliefs, rules, techniques, institutions, and artifacts that characterize human populations – – – – Learned Interrelated Shared Defines the boundaries 6-6 Ethnocentricity • Ethnocentricity – Belief in the superiority of one’s own ethnic group 6-7 Living with Other Cultures • Realize that there are many different cultures • Learn the characteristics of those cultures – Spend a lifetime in a country – Do training program 6-8 Culture Affects All Business Functions • Marketing – Variation in attitudes and values requires firms to use different marketing mixes • P&G Japanese Camay commercials • Disneyland Paris • Human Resource Management – Evaluation of managers • Production and Finance – Attitudes toward authority – Attitudes toward change 6-9 Sociocultural Components • Culture is: – Aesthetics – Attitudes and beliefs – Religion – Material Culture – Language – Societal organization – Legal characteristics – Political structures 6-10 Spoken Language • Most apparent cultural distinction • Spoken languages demarcate cultures – Switzerland: four separate cultures • Many languages can exist in a single country, but one usually serves as communication vehicle – Lingua franca or link language – English primary language of business 6-26 Language • Translation – The ability to speak the language well does not eliminate the need for translator • Back Translation – To avoid translation problems • Japanese hotel: “You are invited to take advantage of the chambermaid.” • Bangkok dry cleaner: “Drop your trousers here for best results.” 6-27 Language Issues • Technical words not exist in all languages – Usually use English • Many cultures avoid saying anything disagreeable 6-28 Unspoken Language • Nonverbal communication – Gestures vary tremendously from one region to another – Closed doors convey different meanings – Office size has difference meanings in various cultures – Conversational distance small in East – Gift giving has specific etiquette in each culture • Gift or bribe? • Questionable Payments 6-29 2003 Corruption Index Scores and Ranking 6-30 Societal Organization • Kinship – Extended Family • includes blood and marriage relatives – Member’s responsibility • Although the extended family is large, each member’s feeling of responsibility to it is strong • Associations – Social units based on age, gender, or common interest, not on kinship 6-31 Societal Organization • Associations – Age is important market segment criterion – Gender • As nations industrialize, more women enter the job market and assume greater importance in the economy – Free association • people joined together by a common bond: political, occupational, religious or recreational 6-32 Understanding National Cultures • Hofstede’s Dimensions of Culture • Individualism versus Collectivism • Large versus Small Power Distance • Strong versus Weak Uncertainty Avoidance • Masculinity versus Femininity 6-33 Scores for Hofstede’s Value Dimensions 6-34 Individualism versus Collectivism • Collectivistic cultures – people belong to groups that are supposed to look after them in exchange for loyalty • Individualistic cultures – People look after only themselves and the immediate family 6-35 Large versus Small Power Distance • Power distance – the extent to which members of a society accept the unequal distribution of power among individuals • In large-power-distance societies – employees believe their supervisors are right; employees not take any initiative in making non-routine decisions 6-36 Strong versus Weak Uncertainty Avoidance • Uncertainty avoidance – Degree to which members of a society feel threatened by ambiguity and are rule-oriented – Employees in high uncertainty-avoidance cultures tend to stay with their organizations • Japan, Greece, and Portugal – Those from low uncertainty-avoidance nations are more mobile • United States, Singapore, and Denmark 6-37 Plot of Nations: Power distance and Uncertainty Avoidance 6-38 Plot of Nations: Individualism and Power Distance 6-39 Masculinity versus Femininity • the degree to which the dominant values in a society emphasize assertiveness, acquisition of money and status – Masculinity • achievement of visible and symbolic organizational rewards – Femininity • emphasize relationships, concern for others, and the overall quality of life 6-40 ... technology  Discuss the pervasiveness of the Information Technology Era 6-3 Learning Objectives  Explain the importance of the ability to speak the local language  Discuss the importance of unspoken... significance of culture for international business  Identify the sociocultural components of culture  Discuss the significance of religion to businesspeople  Explain the cultural aspects of technology... down • Establish trust • Understand the importance of language • Respect the culture • Understand the components of culture 6-5 What is Culture • The sum total of beliefs, rules, techniques, institutions,