OB in the Cross-Cultural Context Why are cross-cultural issues important? Growing impact of global...
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Transcript of OB in the Cross-Cultural Context Why are cross-cultural issues important? Growing impact of global...
OB in the Cross-Cultural Context Why are cross-cultural issues important? Growing impact of global business
New markets Demand for global services Low cost manufacturing
U.S. management practices not necessarily likely to translate to different cultures
Paradox: may be easier to adjust to a very different culture than to a very similar culture
Why International Management? Important to have a global perspective
Overseas suppliers or markets Low cost production Emerging markets (Eastern Europe, LDC) E-business has no borders Immigrant labor force even in U.S.
Culture critical to global business, yet hardest to understand Based on unspoken values and assumptions Human behavior isn’t logical But, human behavior is very complex
Approaches to International Business
EthnocentricHome countrymethods are thebest
PolycentricHost countrymethods are thebest
GeocentricUse the bestmethods, no matterwhat the source
Basic Principles of Culture What is logical and important in one culture may
seem irrational and unimportant in another In describing cultures, people tend to stress the
differences and overlook the similarities Stereotyping may be inevitable for people who lack
frequent contact with another culture Cultures are not homogenous; differences exist due
to gender, age, socioeconomic status, education Understanding another culture is a journey, not a
goal
Barriers to Cross-Cultural Understanding Cultural chauvinism / corporate
imperialism / ethnocentrism Stereotypes (positive and negative) The highly successful organization may
find it more difficult to adapt
But……. The ethical dilemma Are there common values?
Basic idea of social organization, goal orientation
Personality structure (Big 5) What about cultural convergence?
Cultural evolution Cultural diffusion Immigration and acculturation
What Kinds of Differences Make a Difference? Some specific items:
Language Religion
Business practices and etiquette Different laws Different customs
Culture in general
Language Issues U.S. one of few countries where we don’t
learn a second (or a third) language Languages learned in school often do not
translate to business usage Do you try?
Not in France, not unless you can pronounce it right !
Other countries, yes: it’s a gesture of goodwill But, even if the language is the same, will we
understand? (Britspeak)
Languages of The World
0100200300400500600700800900
1,000
Mill
ion
s of
Sp
eake
rs
Source:http://www.infoplease.com/
World Religions
Christianity Islam Hindu
Chinese Folk Buddhist Judaism
Other
Source:http://www.infoplease.com/
Catholic Protestant
Orthodox Other
Religious Issues Islam:
Ramadan fasting 5 daily prayers (15 minutes or so), even at
work Modest dress for women (including head
scarf) Friday, not Sunday (noon prayers on
Fridays)
Legal Issues Sample of Mexican employment laws
Individual employment contracts required Strict limits on overtime Unionization by facility Full pay for workers while on strike Discrimination covers political doctrine and
social condition
Different Country, Different Customs: Dress and Address Dress
“Casual Days” are a U.S. custom Removing one’s shoes
Addressing Other People Herr und Frau, not first names in Germany Titles (Dr., Professor, “Assistant Vice President”,
etc.) very important everywhere but U.S. Business cards essential in Latin America,
Europe, Japan Personal space: much smaller in Latin
America, Spain, Italy
Different Country, Different Customs: Time Time
Time fluid in Latin America, Spain, Italy Time off work: Germany, France, Scandinavia: 6
weeks vacation, August in the country Africa: everyone attends funerals (impact of AIDS)
Working hours and pace Europe (esp. Germany) isn’t open 24/7 Latin America, Middle East, Japan: take time to
establish relationship before getting down to business
Different Country, Different Customs: Eating and Drinking Drinking
Tea in Japan Coffee in Egypt Vodka in Russia A pint over lunch in the UK
Dietary Restrictions: India: no beef Islamic countries: no pork or alcohol
Perceptions of Corruption
0
2
4
6
8
10
12
Source: Transparency International
Higher score = less corrupt
Economic Freedom
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
Nigeria 3.6
Source: Wall Street Journal
Higher score = less freedom
Cultural Dimensions:Hofstede’s Big 4 Based on survey of IBM employees
worldwide The dimensions
Collectivism - Individualism Power Distance Uncertainty Avoidance Masculinity / Femininity (quality of life)
Weaknesses: Does not include LDCs Data 20 years old
However, recent research confirms this structure
Change in Cultures Hofstede’s data indicates some shift to
individualism, but no change in other dimensions
Disneyland phenomenon That is, surface indicators change, but meaning
does not But….the case of Hong Kong
Management values in Hong Kong intermediate between PRC and U.S.
Indication of flexibility / change?
Collectivism - Individualism Identification with group vs. identification as an
individual Collective cultures:
Think in terms of in-groups and out-groups Life decisions made by group Look after one’s in-group, no matter what
Individualistic cultures Concern for self and immediate family Individual privacy
Association with level of economic development
Collectivism - Individualism: Where
Venezuela Pakistan Taiwan Portugal Greece Brazil India Japan Arab countries
Spain Israel Austria Germany Norway France Canada Great Britain U.S.
Collective…………...……Individualistic
Power Distance The extent to which a culture accepts that
power is distributed unevenly High power distance
People have a place in society, high or low Superiors are to be respected Less trust and cooperation
Low power distance Equal rights for everyone Hierarchies are established for convenience Power can be judged to be legitimate or not
Power Distance: Where
Philippines Mexico India Brazil Hong Kong France Turkey Pakistan Japan
Argentina U.S Canada Australia Germany Sweden Ireland Denmark Israel
High…………………...……...……Low
Uncertainty Avoidance The extent to which a society feels threatened by
ambiguity and uncertainty High uncertainty avoidance
Lots of policies, rules, regulations Hard work valued, time is money Acceptance of authority Conflict avoided
Low uncertainty avoidance Look to common sense Tolerance, constructive conflict Aggression less accepted
Uncertainty Avoidance: Where
Uruguay Belgium Japan France Mexico Israel Italy Austria Arab countries
Germany Switzerland East Africa Canada U.S. India Great Britain Sweden Singapore
High…………………...……...……Low
Masculinity / Femininity (Quality of Life) The extent to which society values typically
“masculine” values, such as assertiveness, and acquisition of things, as opposed to caring for others and quality of life.
Masculine cultures Clear gender roles; machismo Live to work Ambition, success valued
Feminine cultures Sympathy for the unfortunate Work to live People are important
Masculinity / Femininity: Where
Japan Italy Mexico Ireland U.S. Australia Hong Kong Arab countries Brazil
Israel Indonesia France Spain South Korea Portugal Finland Netherlands Sweden
High…………………...……...……Low
…Plus One Confucian Work Dynamic Based on work done in East Asia by
“Chinese Cultural Connection” group Focus on:
Long-term Order Thrift Persistence Respect for tradition
Different Dimensions…Same Result Company provided housing, marriage
brokers, etc. in Asian countries Feminine concern for people? Taking care of the in-group?
Cooperative labor negotiations Japan: collective orientation Netherlands: feminine quality of life
Economic growth and development Europe: Protestant Work Ethic (Individualistic,
High Power Distance, Masculine) Asia: Confucian Work Dynamic
Do National Borders = Cultural Borders? Multiple cultures
Canada Belgium India
Culturally homogeneous areas Scandinavia
Cultural clusters
Cultural Clusters
Arabs
East-Central Europe
Developing Countries Latins
Anglos
Asians Northern Europe
General Expatriate Issues: The Sojourners How many are there?
Nobody really knows Estimated 350,000 or more (estimate from 1996)
Who are they? 87% male Managers Sales, technical, professional
What happens? Estimated 25% to 50% of assignments fail Cost…$50,000 and up
Why do Expatriates Fail? Family problems (60%) Inability to adjust
Lack of flexibility “Culture shock”
Lack of sensitivity to host culture
Culture Shock An emotional and psychological
reaction to the confusion, ambiguity, value conflicts and hidden clashes that occur as a result of fundamentally different ways of perceiving the world and interacting socially between cultures. Disequilibrium
Aspects of Adjustment Sociocultural
Social skills needed to operate in different culture
Psychological Well-being, satisfaction “Culture shock”
What Can Be Done? Selection procedures Organizational support: before, during,
and after assignment TrainingTraining
Few U.S. firms train expatriates (30%) Most European / Asian firms do Different success rates clearly establish
value of training
Training for Expatriates Knowledge-based
Language Cultural differences
Cultural sensitivity General Specific
Include spouse and, if possible, family members