Cross cultural management 3e by cullen ch02

Chapter Culture and Multinational Management Copyright© 2004 Thomson Learning All rights reserved Learning Objectives •• Define Define culture culture and and understand understand the the basic basic components components ofof culture culture •• Identify Identify instances instances ofof cultural cultural stereotyping stereotyping and and ethnocentrism ethnocentrism •• Understand Understand how how various various levels levels ofof culture culture influence influence multinational multinational operations operations Copyright© 2005 South-Western/Thomson Learning All rights reserved Learning Objectives •• •• Understand Understand the the Hofstede Hofstede and and 7d 7d models models Appreciate Appreciate the the complex complex differences differences among among cultures cultures and and use use these these differences differences for for building building better better organizations organizations Copyright© 2005 South-Western/Thomson Learning All rights reserved What is Culture? •• Pervasive Pervasive and and shared shared beliefs, beliefs, norms, norms, values, values, and and symbols symbols that that guide guide everyday everyday life life •• Cultural Cultural norms: norms: both both prescribe prescribe and and proscribe proscribe behaviors behaviors •• What What we we should should do and and what what we we cannot cannot do •• Cultural Cultural values: values: what what isis good/beautiful/holy, good/beautiful/holy, and and what what are are legitimate legitimate goals goals for for life life Copyright© 2005 South-Western/Thomson Learning All rights reserved What is Culture? (cont.) •• Cultural Cultural beliefs: beliefs: represent represent our our understandings understandings about about what what isis true true •• Cultural Cultural symbols, symbols, stories, stories, and and rituals: rituals: communicate communicate the the norms, norms, values, values, and and beliefs beliefs ofof aa society society or or aa group group toto its its members members •• Culture Culture isis pervasive pervasive inin society society •• Affects Affects all all aspects aspects ofof life life •• Not Not all all aspects aspects are are observable observable Copyright© 2005 South-Western/Thomson Learning All rights reserved Culture: Front Stage & Back Stage •• Front Front stage stage ofof culture: culture: easily easily observable observable aspect aspect ofof culture culture •• e.g., e.g., Japanese Japanese executive executive bows bows or or North NorthAmerican American robust robust handshake handshake •• Back Back stage stage ofof culture: culture: only only insiders insiders or or members members ofof the the culture culture understand understand other other aspects aspects ofof culture culture •• e.g., e.g., Japanese Japanese saying saying “it’s “it’s difficult” difficult” and and twisting twisting head head toto one one side side really really means means it’s it’s impossible impossible Copyright© 2005 South-Western/Thomson Learning All rights reserved Three Levels of Culture 1.1.National National culture: culture: the the dominant dominant culture culture within within the the political political boundaries boundaries ofof the the nation-state nation-state 2.2.Business Business culture: culture: norms, norms, values, values, and and beliefs beliefs that that pertain pertain toto business business inin aa culture culture 1.1 Tells Tells people people the the correct, correct, acceptable acceptable ways ways toto conduct conduct business business inin aa society society Copyright© 2005 South-Western/Thomson Learning All rights reserved Three Levels of Culture (cont.) 3.3.Occupational Occupational and and organizational organizational culture culture 3.Occupational 3.Occupational culture: culture: the the norms, norms, values, values, beliefs, beliefs, and and expected expected ways ways ofof behaving behaving for for people people inin the the same same occupational occupational group group 4.Organizational 4.Organizational culture: culture: the the set set ofof important important understandings understandings that that members members ofof an an organization organization share share Copyright© 2005 South-Western/Thomson Learning All rights reserved Cultural Differences and Basic Values •• Two Two diagnostic diagnostic models models toto aid aid the the multinational multinational manager: manager: 1.1 Hofstede Hofstede model model ofof national national culture culture 2.2 7d 7d culture culture model model Copyright© 2005 South-Western/Thomson Learning All rights reserved Hofstede’s Model of National Culture •• Five Five dimensions dimensions ofof basic basic values values •• Power Power distance distance •• Uncertainty Uncertainty avoidance avoidance •• Individualism Individualism •• Masculinity Masculinity •• Long-term Long-term orientation orientation Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.12: Managerial Implications of Specific vs Diffuse Copyright© 2005 South-Western/Thomson Learning All rights reserved Achievement vs Ascription •• •• Manner Manner inin which which society society gives gives status status Achievement Achievement •• People People earn earn status status based based on on performance performance and and accomplishments accomplishments •• Ascription Ascription •• Characteristics Characteristics or or associations associations define define status status •• E.g., E.g., status status based based on on schools schools or or universities universities Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.13: Managerial Implications of Achievement vs Ascription Copyright© 2005 South-Western/Thomson Learning All rights reserved Time Orientation •• How How cultures cultures deal deal with with the the past, past, present, present, and and future future •• Future-oriented Future-oriented societies, societies, such such as as the the U.S., U.S., consider consider organizational organizational change change as as necessary necessary and and beneficial beneficial •• Past-oriented Past-oriented societies societies assume assume that that life life isis predetermined predetermined based based on on traditions traditions or or will will ofof God God Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.14: Managerial Implications of Time Horizon Copyright© 2005 South-Western/Thomson Learning All rights reserved Internal vs External Control •• •• Concerned Concerned with with beliefs beliefs regarding regarding control control ofof one’s one’s fate fate Best Best reflected reflected with with how how people people interact interact with with the the environment environment •• Does Does nature nature dominate dominate us us or or do we we dominate dominate nature? nature? •• InIn societies societies where where people people believe believe nature nature dominates dominates them, them, managers managers are are more more fatalistic fatalistic Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.15: Managerial Implications of Internal vs External Control Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.16: 7d Percentile Rankings for Selected Countries Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.16: 7d Percentile Rankings for Selected Countries Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.16: 7d Percentile Rankings for Selected Countries Copyright© 2005 South-Western/Thomson Learning All rights reserved Propensity to Trust •• Growing Growing concern concern with with the the development development ofof trusting trusting relationships relationships with with partners partners •• Differences Differences among among cultures cultures inin terms terms ofof how how and and when when people people trust trust each each other other •• Logic Logic presupposes presupposes that that individualism individualism should should be be related related toto low low trust trust •• Individualistic Individualistic cultures cultures have have higher higher trust trust relative relative toto collectivist collectivist societies societies Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.17: Levels of General Trust in People Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.17: Levels of General Trust in People Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 2.17: Levels of General Trust in People Copyright© 2005 South-Western/Thomson Learning All rights reserved Caveats and Cautions •• Stereotyping: Stereotyping: assumes assumes that that all all people people within within one one culture culture behave, behave, believe, believe, feel, feel, and and act act the the same same •• Ethnocentrism: Ethnocentrism: occurs occurs when when people people from from one one culture culture believe believe that that theirs theirs are are the the only only correct correct norms, norms, values, values, and and beliefs beliefs •• Cultural Cultural relativism: relativism: all all cultures, cultures, no no matter matter how how different, different, are are correct correct and and moral moral for for the the people people ofof those those cultures cultures Copyright© 2005 South-Western/Thomson Learning All rights reserved ... What is Culture? (cont.) •• Cultural Cultural beliefs: beliefs: represent represent our our understandings understandings about about what what isis true true •• Cultural Cultural symbols, symbols,... Hofstede’s model model include: include: 1.Human 1.Human resources resources management management •• Management Management selection selection •• Training Training •• Evaluation Evaluation and... South-Western/Thomson Learning All rights reserved Hofstede’s Model Applied to Organizations and Management •• Management Management practices practices considered considered inin the the discussion discussion