Chapter 3

Cross-cultural risk-

a situation/event where a cultural misunderstanding places some human value at stake- frequently occurs due to different values, expectations or different ways of communicating.

Cultural Homogenization

The belief that as a result of the globalization of culture, cultural differences are minimized and similarities across cultures are emphasized and reinforced. Consequently, eventually only one cultural form in the world will exist.

Religion

- A system of common beliefs or attitudes regarding a being or system of thought that people consider sacred, divine, or the highest truth; and the associated moral values, traditions, and rituals. - influences ethics, social responsibility and culture- therefore business and consumer behavior.

High power distance societies in Hofstede's dimensions

- Organizations have clear hierarchies and those at the top make decisions - Powerful people are expected to look and act powerful - Others are a threat to power, trust and information sharing are dangerous - In firms, top management tends to be autocratic, giving little autonomy to lower-level employees. Examples: Guatemala, Malaysia, Philippines, and several Middle East countries.

Self-reference criterion

- interpreting other cultures through the lens of one's own culture, i.e. ethnocentric tendency.

Critical incident analysis

- requires being culturally aware, not making value judgments, developing empathy for other points of view, and selecting the most likely interpretation of foreign behaviors.

Low uncertainty avoidance societies in Hofstede's dimensions

managers are relatively entrepreneurial and comfortable with risk. Firms make decisions quickly. People are comfortable changing jobs. Examples: Ireland, Jamaica, U.S.

Cross-cultural risk

A situation or event where a cultural miscommunication puts some human value at stake. It arises in environments comprised of unfamiliar languages, and unique values, beliefs, and behaviors

indulgent societies in Hofstede's dimensions

Members that allow relatively free gratification of their basic and natural human desires related to having fun and generally enjoying life. Denmark, Mexico, and the U.S. score high on indulgence.

Acculturation:

The process of adjusting and adapting to a culture other than one's own; commonly experienced by expatriate workers.

Geocentric orientation

a global mind-set in which the manager is able to understand a business or market without regard to country boundaries

Polycentric Orientation

a host-country mind-set in which the manager develops a strong affinity with the country in which she or he conducts business rather than for the home country

short-term orientation in Hofstede's dimensions

a national culture attribute that emphasizes the past and present, respect for tradition, and fulfillment of social obligations is typical in the United States and most other Western countries.

Socialization:

The process of learning the rules and behavioral patterns appropriate to one's society.

Restrained societies in Hofstede's dimensions

believe that such gratification should be curbed and regulated by strict norms . China, Iraq, and South Korea score high on restraint.

Hofstede's typology of cultural dimensions

consists of individualism versus collectivism, power distance, uncertainty avoidance, masculinity versus femininity, long-term versus short-term orientation, and indulgence versus restraint.

High-Context Cultures

cultures that rely heavily on nonverbal and subtle situational cues in communication and a more holistic approach to communication that promotes harmonious relationships.

Low-context cultures

cultures that rely heavily on words to convey meaning in communication

Power Distance in Hofstede's dimensions

describes how a society deals with inequalities in power that exist among people

Indulgence versus restraint in Hofstede's dimensions

describes the degree to which people in a society attempt to control their impulses and desires.

Feminine cultures in Hofstede's dimensions

emphasize nurturing roles, interdependence among people, and caring for less fortunate people - for both men and women. Examples: Scandinavian countries, where welfare systems are highly developed, and education is subsidized.

Long-term orientation in Hofstede's dimensions

emphasizes the long view in planning and living, focusing on years and decades. Examples: Traditional Asian cultures, such as China, Japan, and Singapore, which base these values on the teachings of the Chinese philosopher Confucius (500 B.C.), who espoused long-term orientation, discipline, hard work, education, and emotional maturity.

Managers can achieve cross-cultural proficiency by...

keeping an open mind, being inquisitive, and not rushing to conclusions about others' behaviors.

Manners and customs

refer to ways of behaving and conducting oneself in public and business situations. - Informal cultures -egalitarian, in which people are equal and work together cooperatively. - Formal cultures- status, hierarchy, power, and respect are important. -Varying customs: eating habits, mealtimes, work hours and holidays, drinking and toasting, appropriate behavior at social gatherings, gift-giving (complex ritual), the role of women in the workforce, handshaking, greetings, kissing, and bowing).

Masculinity versus femininity in Hofstede's dimensions

refers to a society's orientation based on traditional male and female values.

Long-term vs. short-term orientation in Hofstede's dimensions

refers to the degree to which people and organizations defer gratification to achieve long-term success

Uncertainty avoidance in Hofstede's dimensions

refers to the extent to which people can tolerate risk and uncertainty in their lives

Individualism versus collectivism in Hofstede's dimensions

refers to whether a person primarily functions as an individual or within a group

Values

represent a person's judgments about what is good or bad, acceptable or unacceptable, important or unimportant, and normal or abnormal.

Cross-cultural training emphasizes observational skills and human relations techniques

- Skills are more important than information because skills can be transferred across countries, while information is often country-specific.

Hofstede Framework Limitations

- The study is based on data from the 1970 time period. Changes such as successive phases of globalization, widespread exposure to global media, technological advances, and the role of women in the workforce, are not reflected. - Hofstede's findings are based on a single company, IBM, in a single industry, making it difficult to generalize. - The data were collected using questionnaires - not effective for probing some of the deeper issues that surround culture. - Hofstede did not capture all potential dimensions of culture.

Perceptions of Time

- Time dictates expectations about planning, scheduling, profit streams, promptness for arriving to work and meetings. - Longer planning horizon (Japan) prepare strategic plans for a decade. - Shorter planning horizon (Western companies) strategic plans-few years. Orientation- past, present and future - Examples: Past-oriented- Europeans (traditions/historical precedents) These cultures believe that plans should be evaluated in terms of their fit with established traditions, customs and wisdom- thus innovation and change are infrequent. Present-oriented- Australia, Canada, and the U.S.

polychromic time

- flexible, non-linear time orientation- the individual takes a long-term perspective and is capable of multi-tasking, thus may be distracted, time is elastic, long delays are sometimes needed before taking action. - Punctuality per se is relatively unimportant, time commitments are flexible, relationships are valued, future-oriented performance targets: 10 years, employee training, lifetime employment. - Examples- China, Japan, Africa, Asia, Latin America, and the Middle East- strict Muslims view destiny as the will of God ('Inshallah' or 'God willing') and perceive appointments as relatively vague future obligations.

monochronic time

- rigid time orientation- the individual is focused on schedules, punctuality, time as a resource, time is linear, "time is money". - Punctuality is a virtue. - Investors are impatient, and want quick returns. Managers have a relatively short-term perspective; performance is measured on a quarterly basis. - Example- the U.S. has acquired a reputation for being hurried and impatient; the word "business" was originally spelled "busyness."

Managerial Guidelines for Cross-Cultural Success

-Acquire factual and interpretive knowledge about the other culture; try to speak their language. -Avoid cultural bias -Develop cross-cultural skills such as perceptiveness, interpersonal skills, adaptability

Low-power distance societies in Hofstede's dimensions

-Have small gaps between the weak and powerful. - Firms tend toward flat organizational structures, with relatively equal relations between managers and workers. For example, Scandinavian countries instituted various systems to ensure socioeconomic equality.

Attitudes and preferences

Are developed based on values and are similar to opinions, except that attitudes are often unconsciously held and may not have a rational basis.

verbal language

At present the world has nearly 7,000 active languages, including over 2,000 each in Africa and Asia.

Why culture matters in international business-

National cultures influence consumer behavior, managerial effectiveness, and value-chain operations, e.g. product and service design, marketing, and sales. Managers need to develop skills in dealing with other cultures

Culture

The values, beliefs, customs, arts, and other products of human thought and work that characterize the people of a given society. - Not right or wrong - It is relative. There is no cultural absolute. Different nationalities simply perceive the world differently. - Not about individual behavior - It is about groups. It is a collective phenomenon of shared values and meanings. - Not inherited - It derives from the social environment. We are not born with a shared set of values and beliefs; we acquire them as we grow up.

nonverbal communication

Unspoken and includes facial expressions, gestures, body movements, eye contact, physical distance, posture and other non-verbal signals. - Inexperience with facial expressions and hand gestures in certain cultures can lead to confusion and misunderstandings, with negative consequences. Examples- Standing side-by-side with someone can indicate cooperation, while a face-to-face posture may indicate competition or opposition. Touching tends to indicate levels of intimacy, from shaking hands, to patting the back, to hugging.

High uncertainty avoidance societies in Hofstede's dimensions

create institutions to minimize risk and ensure security. Firms emphasize stable careers and regulate worker actions. Decisions are made slowly. Examples: Belgium, France, Japan

Ethnocentric Orientation

using our own culture as the standard for judging other cultures refers to a home-country mind-set.

Masculine cultures in Hofstede's dimensions

•value competitiveness, ambition, assertiveness, and the accumulation of wealth. Both men and women are assertive, focused on career and earning money. Examples: Australia, Japan.