The Nature of Culture Culture defined: Acquired knowledge that people use to interpret experience and generate social behavior. This knowledge forms values,

The Nature of Culture

Culture defined: Acquired knowledge that people use to interpret experience and generate social behavior. This knowledge forms values, creates attitudes, and influences behavior.

Characteristics of Culture

LearnedSharedTrans-generationalSymbolicPatternedAdaptive

Priorities of Cultural Values

A Model of Culture

Business Customs in South Africa

Arrange meeting before discussing business over phone.

Make appointments as far in advance as possible.

Maintain eye contact, shake hands, provide business card

Maintain a win-win situationKeep presentations short

Values in Culture

ValuesLearned from culture in which individual is

rearedDifferences in cultural values may result in

varying management practicesBasic convictions that people have about

Right and wrongGood and bad Important and unimportant

Value Similarities and Differences Across Cultures

1. Strong relationship between level of managerial success and personal values

2. Value patterns predict managerial success and can be used in selection/placement decisions

3. Country differences in relationship between values and success; however, findings across U.S., Japan, Australia, India are similar

4. Values of more successful managers favor pragmatic, dynamic, achievement-oriented and active role in interaction with others

5. Values of less successful managers tend toward static and passive values; relatively passive roles in interacting with others

Hofstede’s Cultural Dimensions

1. Power distance

2. Uncertainty avoidance

3. Individualism/collectivism

4. Masculinity/femininity


Power distance: Less powerful members accept that power is distributed unequallyHigh power distance countries: people

blindly obey superiors; centralized, tall structures (e.g., Mexico, South Korea, India)

Low power distance countries: flatter, decentralized structures, smaller ratio of supervisor to employee (e.g., Austria, Finland, Ireland)


Uncertainty avoidance: people feel threatened by ambiguous situations; create beliefs/institutions to avoid such situations

High uncertainty avoidance countries: high need for security, strong belief in experts and their knowledge; structure organizational activities, more written rules, less managerial risk taking (e.g., Germany, Japan, Spain)

Low uncertainty avoidance countries: people more willing to accept risks of the unknown, less structured organizational activities, fewer written rules, more managerial risk taking, higher employee turnover, more ambitious employees (e.g., Denmark and Great Britain)


Individualism: People look after selves and immediate family onlyHigh individualism countries: wealthier,

protestant work ethic, greater individual initiative, promotions based on market value (e.g., U.S., Canada, Sweden)

High collectivism countries: poorer, less support of Protestant work ethic, less individual initiative, promotions based on seniority (e.g., Indonesia, Pakistan)


Masculinity: dominant social values are success, money, and things High masculine countries: stress earnings,

recognition, advancement, challenge, wealth; high job stress (e.g., Germanic countries)

High feminine countries: emphasize caring for others and quality of life; cooperation, friendly atmosphere., employment security, group decision making; low job stress (e.g., Norway)

Strategic Predispositions

Ethnocentric predispositionA nationalistic philosophy of

management whereby the values and interests of the parent company guide strategic decisions.


Polycentric predisposition A philosophy of management whereby

strategic decisions are tailored to suit the cultures of the countries where the MNC operates.


Regio-centric predisposition A philosophy of management whereby the

firm tries to blend its own interests with those of its subsidiaries on a regional basis.


Geocentric predisposition A philosophy of management whereby the

company tries to integrate a global systems approach to decision making.

Meeting the Challenge

The Globalization Imperative: Belief that one worldwide approach to doing business

is key to efficiency and effectiveness. Many factors facilitate the need to develop unique

strategies for different cultures: Diversity of worldwide industry standards Continual demand by local customers for differentiated

products Importance of being insider as in case of customer who

prefers to “buy local” Difficulty of managing global organizations Need to allow subsidiaries to use own abilities and talents

unconstrained by headquarters

Globalization vs. National Responsiveness

Advertising (for example) French

Avoid reasoning or logic Advertising predominantly emotional, dramatic, symbolic Spots viewed as cultural events – art for sake of money – and

reviewed as if they were literatures or films British

Value laughter above all else Typical broad, self-deprecating British commercial amuses by

mocking both advertiser and consumer Germans

Want factual and rational advertising Typical German spot features standard family of 2 parents, two

children, and grandmother

Globalization vs. National Responsiveness

How to add value to marketing:Tailor advertising message to particular

cultureStay abreast of local market conditions;

don’t assume all markets basically sameKnow strengths and weaknesses of MNC

subsidiaries; provide them assistance in addressing local demands

Give subsidiary more autonomy; let it respond to changes in local demand

Cross-Cultural Differences and

Similarities

Parochialism and SimplificationParochialism: view world through own eyes

and perspectivesSimplification: exhibit same orientation toward

different cultural groups

Cross-Cultural Differences and Similarities

Similarities across cultures: Not possible to do business same way in every

global location Procedures and strategies that work well at home

can’t be adopted overseas without modifications Some similarities have been found

Russia and U.S. (for example) Traditional management Communication Human resources Networking activities OB Mod

Cross-Cultural Differences and Similarities

Differences across culturesFar more differences than similarities found in

cross-cultural researchWages, compensation, pay equity, maternity

leave Importance of criteria used in evaluation of

employees

Cultural Differences in SelectedCountries and Regions

Doing Business in Russia1. Build personal relationships with partners. When there

are contract disputes, there is little protection for the aggrieved party because of the time and effort needed to legally enforce the agreement.

2. Use local consultants. Because the rules of business have changed so much in recent years, it pays to have a local Russian consultant working with the company.

3. Ethical behavior in the United States is not always the same as in Russia. For example, it is traditional in Russia to give gifts to those with whom one wants to transact business.

4. Be patient. In order to get something done in Russia, it often takes months of waiting.

Cultural Differences in SelectedCountries and Regions: Russia

5. Russians like exclusive arrangements and often negotiate with just one firm at a time.

6. Russians like to do business face-to-face. So when they receive letters or faxes, they often put them on their desk but do not respond to them.

7. Keep financial information personal. Russians wait until they know their partner well enough to feel comfortable before sharing financial data.

8. Research the company. In dealing effectively with Russian partners, it is helpful to get information about this company, its management hierarchy, and how it typically does business.

Cultural Differences in SelectedCountries and Regions: Russia

9. Stress mutual gain. The Western idea of “win–win” in negotiations also works well in Russia.

10. Clarify terminology. The language of business is just getting transplanted in Russia so double-check and make sure that the other party clearly understands the proposal, knows what is expected and when, and is agreeable to the deal.

11. Be careful about compromising or settling things too quickly because this is often seen as a sign of weakness.

12. Russians view contracts as binding only if they continue to be mutually beneficial, so continually show them the benefits associated with sticking to the deal.

Organizational Cultures and Diversity

The Nature of Organizational Culture

Organizational culture: shared values and beliefs enabling members to understand their roles and the norms of the organization, including: Observed behavioral regularities, typified by

common language, terminology, rituals Norms, reflected by things such as amount of work

to do and degree of cooperation between management and employees

Dominant values organization advocates and expected participants to share (e.g., low absenteeism, high efficiency)

Organizational Culture (continued)

Other values and beliefs:Philosophy set forth regarding how to treat

employees and customersRules dictating do’s and don’ts of employee

behavior pertaining to productivity intergroup cooperation…

Organizational climate as reflected by way participants interact with each other, treat customers, and feel about how treated by senior level management

Interaction between National and Organizational Culture

National cultural values of employees may significantly impact their organizational performance

Cultural values employees bring to workplace are not easily changed by organization

Organizational Cultures in MNCs

Shaped by numerous factors including cultural preferences of leaders and employees

Some MNCs have subsidiaries that (aside from logo and reporting procedures) wouldn’t be easily recognizable as belonging to same MNC

Organizational Culture in MNCs

Four steps in integration of organizational cultures resulting from international expansion via mergers/acquisitions:

1. Two groups establish purpose, goals, and focus of merger

2. Develop mechanisms to identify most important structures and manager roles

3. Determine who has authority over resources4. Identify expectations of all involved participates

and facilitate communication between departments and individuals

Overall Communication Process

Communication: The process of transferring meanings from sender to receiver.

On surface appears straightforwardHowever, a great many problems can

result in failure to transfer meanings correctly

Verbal Communication Styles

Context is information that surrounds a communication and helps convey the message

Context plays a key role in explaining many communication differences

Messages often highly coded and implicit in high-context society (e.g., Japan, many Arab countries)

Messages often explicit and speaker says precisely what s/he means in low context society (e.g., U.S. and Canada)

Verbal Communication Styles

Indirect and Direct StylesHigh-context cultures: messages implicit

and indirect; voice intonation, timing, facial expressions play important roles in conveying information

Low-context cultures: people often meet only to accomplish objectives; tend to be direct and focused in communications

Communication Barriers

Language barriers Cultural barriers

Be careful not to use generalized statements about benefits, compensation, pay cycles, holidays, policies in worldwide communication

Most of world uses metric system so include converted weights and measures in all communications

Even in English-speaking countries, words may have different meanings.

Communication Barriers

Cultural barriers (continued)Letterhead and paper sizes differ worldwideDollars aren’t unique to U.S. Also

Australian, Bermudian, Canadian, Hong Kong, Taiwanese, and New Zealand dollars. Clarify which dollar.

Perceptual Barriers

Perception: a person’s view of realityAdvertising Messages: countless

advertising blunders when words are misinterpreted by others

How others see us: May be different than we think

Common Forms of Nonverbal Communication

Nonverbal Communication

Nonverbal communication Transfer of meaning through means such as body

language and use of physical space Chromatics

Use of color to communicate messages Kinesics

Study of communication through body movement and facial expression

Eye contact Posture Gestures

Nonverbal Communication

Proxemics Study of way people use physical space to convey

messages Intimate distance used for very confidential

communications Personal distance used for talking with family/close friends Social distance used to handle most business transactions Public distance used when calling across room or giving

talk to group

Personal Space in U.S.

Communication Effectiveness

Improve feedback systemsLanguage trainingCultural trainingFlexibility and cooperation

Negotiating Styles

Managing Cross Cultural Negotiations

Negotiation: Process of bargaining with one more parties at arrive at solution acceptable to all

Two types of negotiation: Distributive when two parties with opposing

goals compete over set value Integrative when two groups integrate

interests, create value, invest in the agreement (win-win scenario)

Negotiation Types and Characteristics

Steps of the Negotiation Process:

1. Planning

2. Interpersonal relationship building

3. Exchange of task related information

4. Persuasion

5. Agreement

Cultural Differences Affecting Negotiations

1. Don’t identify counterpart’s home culture too quickly; common cues such as accent may be unreliable.

2. Beware of Western bias toward “doing”. Ways of being, feeling, thinking, talking can shape relationships more powerfully than doing.

3. Counteract tendency to formulate simple, consistent, stable images.

4. Don’t assume all aspects of culture are equally significant.5. Recognize norms for interactions involving outsiders may

differ from those for interactions between compatriots.6. Don’t overestimate familiarity with counterpart’s culture.

Negotiation Tactics

LocationTime limitsBuyer-seller relationshipBargaining behaviors

Use of extreme behaviorsPromises, threats and other behaviorsNonverbal behaviors

Supermarket Lab Exercise

Project is about..

Shanghai Disneyland The most recent Disneyland in

the world Planning to expand rapidly

The goal of the project is to propose ONE attraction for

Shanghai Disneyland’s future expansion, the one that your team will bring the most success to Shanghai Disneyland (the “killer” attraction).

Exercise Process

Step 1: Each person needs to figure out what is your killer attraction. (a one-page description is due on Nov 23)

Step 2: Exchange your idea with your partners Set up at least TWO meetings for all team members, each fo

r about 30-45 minutes First meeting to know each other and to exchange ideas Second meeting to continue discussion to reach an agreement

Step 3: Class presentation (Nov 23) Report and present the communication process between yo

u and your partner. At the end of the presentation, use 3 key words to describe y

our partner.

Some expectations

For the collaboration/negotiation process: Be Creative Be collaborative, but it doesn’t mean to be compromised Be aware of communication/technology/cultural barriers Have fun in the process, but also think about the 5 steps of

negotiation For presentation:

Use the concepts we have learnt as a guideline when explaining what has happened in the exercise (e.g., What kind of communication barriers you have encountered, and how you have overcome them)

A picture is worth a thousand words. Report the funny details in your negotiation/collaboration

Project description

Each team will be responsible for giving a 10 minutes presentation to report the final result of collaboration and communication/negotiation process.

The evaluation of this exercise is based on the quality of both your oral presentation and your slides.

Documents

The Nature of Culture Culture defined: Acquired knowledge that people use to interpret experience and generate social behavior. This knowledge forms values,