7/31/2019 j 03340000120104004 Chap 003

1/26

International Business8e

By Charles W.L. Hill

7/31/2019 j 03340000120104004 Chap 003

2/26

Chapter 3

Differences

in Culture

Copyright 2011 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

7/31/2019 j 03340000120104004 Chap 003

3/26

3-3

Chapter Objectives

know what is meant by the culture of asociety

Identify the forces that lead to differences

in social culture Identify the business and economic

implications of differences in culture

Understand how differences in socialculture influence values in the workplace

Develop an appreciation for the economic

and business implications of cultural change

7/31/2019 j 03340000120104004 Chap 003

4/26

3-4

What Is Cross-Cultural Literacy?

Cross-cultural literacy is an

understanding of how cultural differences

across and within nations can affect the way

in which business is practiced

A relationship may exist between culture

and the costs of doing business in a country

or region

7/31/2019 j 03340000120104004 Chap 003

5/26

3-5

What Is Culture?

Culture is a system of values and norms that are

shared among a group of people and that when

taken together constitute a design for living

wherevalues are abstract ideas about what a group believes

to be good, right, and desirable

norms are the social rules and guidelines that prescribe

appropriate behavior in particular situations

Society refers to a group of people who share a

common set of values and norms

7/31/2019 j 03340000120104004 Chap 003

6/26

3-6

What Are Values And Norms?

Values provide the context within which a

societys norms are established and justified

and form the bedrock of a culture

Norms include

folkways - the routine conventions of everyday

life

mores - norms that are seen as central to the

functioning of a society and to its social life

7/31/2019 j 03340000120104004 Chap 003

7/26

3-7

How Are Culture, Society,

And The Nation-State Related?

The relationship between a society and a

nation state is not strictly one-to-one

Nation-states are political creations

can contain one or more cultures

A culture can embrace several nations

7/31/2019 j 03340000120104004 Chap 003

8/26

7/31/2019 j 03340000120104004 Chap 003

9/26

7/31/2019 j 03340000120104004 Chap 003

10/26

3-10

How Are Individuals

And Groups Different? A group is an association of two or more people who have

a shared sense of identity and who interact with each otherin structured ways on the basis of a common set ofexpectations about each others behavior

In Western societies, there is a focus on the individual individual achievement is common

dynamism of the U.S. economy

high level of entrepreneurship

But, creates a lack of company loyalty and failure to gaincompany specific knowledge competition between individuals in a company instead of than

team building

less ability to develop a strong network of contacts within a firm

7/31/2019 j 03340000120104004 Chap 003

11/26

7/31/2019 j 03340000120104004 Chap 003

12/26

7/31/2019 j 03340000120104004 Chap 003

13/26

7/31/2019 j 03340000120104004 Chap 003

14/26

7/31/2019 j 03340000120104004 Chap 003

15/26

7/31/2019 j 03340000120104004 Chap 003

16/26

7/31/2019 j 03340000120104004 Chap 003

17/26

3-17

What Is Hinduism?

Hinduism

practiced primarily on the Indian sub-continent

focuses on the importance of achieving spiritual

growth and development, which may requirematerial and physical self-denial

Hindus are valued by their spiritual rather thanmaterial achievements

promotion and adding new responsibilities maynot be important, or may be infeasible due tothe employee's caste

7/31/2019 j 03340000120104004 Chap 003

18/26

7/31/2019 j 03340000120104004 Chap 003

19/26

3-19

What Is Confucianism?

Confucianism

ideology practiced mainly in China

teaches the importance of attaining personal

salvation through right actionhigh morals, ethical conduct, and loyalty to

others are stressed

three key teachings of Confucianism - loyalty,

reciprocal obligations, and honesty - may alllead to a lowering of the cost of doing businessin Confucian societies

7/31/2019 j 03340000120104004 Chap 003

20/26

7/31/2019 j 03340000120104004 Chap 003

21/26

3-21

What Is The Role

Of Education In Culture?Formal education is the medium through

which individuals learn many of thelanguage, conceptual, and mathematical

skills that are indispensable in a modernsociety

important in determining a nationscompetitive advantage

general education levels can be a good index forthe kinds of products that might sell in acountry

7/31/2019 j 03340000120104004 Chap 003

22/26

3-22

How Does Culture

Impact The Workplace? Management processes and practices must be adapted to

culturally-determined work-related values

Geert Hofstede identified four dimensions of culture

1. Power distance - how a society deals with the fact that

people are unequal in physical and intellectualcapabilities

2. Uncertainty avoidance - the relationship between theindividual and his fellows

3. Individualism versus collectivism - the extent to which

different cultures socialize their members into acceptingambiguous situations and tolerating ambiguity

4. Masculinity versus femininity -the relationshipbetween gender and work roles

7/31/2019 j 03340000120104004 Chap 003

23/26

3-23

How Does Culture

Impact The Workplace?Work-Related Values for 20 Countries

7/31/2019 j 03340000120104004 Chap 003

24/26

3-24

Was Hofstede Right?

Hofstede later expanded added a fifth dimension calledConfucian dynamism captures attitudes toward time, persistence, ordering by status,

protection of face, respect for tradition, and reciprocation of giftsand favors

Hofstedes work has been criticized becausemade the assumption there is a one-to-one relationship between

culture and the nation-state

study may have been culturally bound

used IBM as sole source of information

culture is not static it evolves

But, it is a starting point for understanding how culturesdiffer, and the implications of those differences formanagers

7/31/2019 j 03340000120104004 Chap 003

25/26

3-25

Does Culture Change?

Culture evolves over time

changes in value systems can be slow and

painful for a society

Social turmoil - an inevitable outcome of

cultural change

as countries become economically stronger,

cultural change is particularly common

7/31/2019 j 03340000120104004 Chap 003

26/26

3-26

What Do Cultural Differences

Mean For Managers?1. It is important to develop cross-cultural

literacy companies that are ill informed about the practices of

another culture are unlikely to succeed in that culture

managers must beware of ethnocentric behavior, or abelief in the superiority of one's own culture

2. There is a connection between culture andnational competitive advantage suggests which countries are likely to produce the

most viable competitors has implications for the choice of countries in which

to locate production facilities and do business