COMM 173 FINAL EXAM
Race
A group of persons related by common decent or heredity. An arbitrary classification of humans based on physical characteristics tied to genetic markers. Your hardware.
True or false: CQ can be developed
True!
Key practices to combat parochialism and ethnocentrism
Understand that recognition does not equal judging Make a conscious effort to recognize cultural diversity without judging it
Key practices to successfully managing multicultural teams
Understand the differences Build bonds Establish trust Actively learn and teach Be inclusive Elicit ideas Address and be creative with conflict Be confident and positive Do not obsess over culture
Trompenaar's Cultural Dimensions
Universalism vs. Particularism: Relative importance of applying standardized rules and policies across societal members; role of exceptions in rule enforcement Neutral vs. Affective: Extent to which people are free to express their emotions in public Specific vs. Diffuse: Extent to which people's various roles are compartmentalized or integrated Achievement vs. Ascription: Manner in which respect and social status are accorded to people Sequential vs. Synchronous time: How people manage time Internal vs. Outer direction: Extent to which people believe they control the environment or it controls them
Parochialism
Viewing the world solely from one's own perspective. Being blind to cultural differences We are all parochial, whether we like it or not The greater one's CQ, the less parochial one is when it comes to cultural differences
Cultural influence
We all stereotype. Americans and Canadians are told not to stereotype.
The mechanics of stereotyping
We are programmed to: Anticipate, Categorize, and Stereotype Otherwise we would be mentally overwhelmed
How did Deng alter Mao's "central plan"
"Dual track" approach: many farmers were allowed to sell their surplus on the open market. Others stayed strictly on the plan, and could not interact with the free market Strict separation of domestic and foreign sectors to allow foreign investment without impacting the internal economy (foreigners built factories in Special Economic Zones but imported all materials besides labour and exported everything they made) Central plan was eventually outgrown
Key tenets of the Flying Geese Paradigm
1. Product development within a particular developing country, within a single industry, grows over three time-series curves Import phase: Foreign products surge in domestic market because market is open but domestic industry is not fully developed Domestic production phase: Domestic companies expand production by incorporating foreign technologies Export phase: With improved technology and management capabilities, domestic companies ready to enter global market via export, capitalizing on lower domestic input costs 2. Over time, development of industries moves upward from production of simple goods to more sophisticated products 3. More advanced countries relocate factories for less sophisticated export products to less advanced countries 4. Over time, those less advanced countries' exports move upward in level of sophistication, through learning and innovation
Administrative heritage and MNCs
1. Shaped by Socio-political era during which the firm first internationalized, including nature of the global grading environment at the time Home country of the firm; market size, geographic location, and home country culture Value of the firm's founders and early management 2. Reinforces certain organizational capabilities and provides constraints on others
3 organizational models of MNCs
1. "Multinational" organization model - Foreign operations are a portfolio of independent business - Draw on local resources + knowledge and adapt - Decentralized federation: assets, responsibilities, and decision-making is decentralized to foreign subsidiaries = hands off approach - Emphasize strategies of adaption - High use of local managers and imprinted with the culture of local host country environment 2. Global organizational model - Foreign operations are implementers of parent company strategies on a global scale - Focus on strategies of standardization, aggregation and economies of scale - Treats globe as single market - Tight-control and coordination from HQ with standardization not only for products/services but operational procedures and culture - Centralized hub structure, HQ retains majority of control of assets, responsibilities and decision making - High use of expatriate managers from HQ, imprinted with culture of the HQ home country environment 3. Transnational organizational model - Simultaneously capture benefits of global efficiency and local adaption - Each national market and operating environment may have unique needs, but also globally shared characteristics - Market/technological knowledge is not only locally relevant, but relevant to other regions and global organization as a whole - Centres of excellence in particular countries that draw on unique technological or market knowledge of national environment - Worldwide learning: Ability to leverage firms geographically dispersed resources and capabilities to benefit entire global organization - Integrated network structure: Specialized, geographically distributed capabilities, power balance between HQ and subsidiaries, high degree of communication and coordination, functions and business units, transnational culture in both HQ and foreign subsidiaries, balance of global and local perspectives
6 key ways to assist interpreters/translators
1. Brief them ahead of time - Study beforehand to note potential problems - Provide written material as far ahead of the meeting as possible 2. Provide additional breaks - Provide at least double the number of breaks normally provided 3. Write difficult to interpret info - Clarity is critical, especially for numbers, dates, and times - Write the information in an explicit and complete format 4. Use extra care when joking - Jokes can be offensive/not translate well - Keep sense of humour but avoid sensitive topics 5. Do not talk excessively - Overwhelms interpreter/undermines ability to build relationship with counterpart - Have interpreter stand behind you and speak directly to your counterpart 6. Check the quality of their work - Use back-translation to check the quality of their work
Prerequisites for sustaining competitive advantage
1. Constantly innovate and upgrade 2. Adopt a global approach strategy 3. Making existing advantages obsolete by creating new advantages
2 factors to ensure globalization is better for everyone
1. Displaced workers are provided with assistance and/or 2. The mechanism for skill renewal is robust
Modes of Entry Decision
1. Extent of local production: Extent it will export vs. locally produce 2. Extent of ownership: Extent of ownership control over activities that will be performed locally. 0%, partial, or 100%.
Pressures multinational corporations (MNCs) are subject to
1. Forces fro global integration: Pressure to aggregate and coordinate international activities - Cost pressure - Innovation pressure - Cultural convergence - Consumer taste convergence - Trade liberalization 2. Forces for local responsiveness: Pressure to respond to the unique needs and conditions of each market or location the firm operates in Persistence of: - Cultural differences - Consumer traste differences - Differences in government policy and laws - Trade barriers - Economic differences
International assignee local credibility enhancement tools
1. Identify at least 2 cultural translators - Assignee with lots of local experience in the host country - A native with lots of experience working with assignees 2. Develop and share an entry plan - With local HR staff, new host country boss, and home country boss 3. Go to the front lines right away - Do not stay in office. Meet people you wouldn't see on a regular basis 4. Ask many questions, avoid statements - Be open and eager to learn. Lessens chances of appearing ethnocentric. 5. Do not focus on the problems - Focus on the positive. Lessens chances of appearing ethnocentric
6 key drivers for internationalization
1. Market growth: Can be driven by both push and pull factors 2. Cost: Lower input costs or arbitrage strategy (greater size of market can yield economies of scale, allowing firm to lower production costs, and potentially gaining competitive advantage through a low-cost strategy) 3. Competition: Depending on what their competitors are doing 4. Government: Home and host governments. 5. Resource: Acquisition of key resources 6. Knowledge: Acquisition of knowledge. "Strategically tap" into another country's knowledge.
Framework for international market selection
1. Strategic importance Market potential - Market size - Market growth Learning potential - Presence of sophisticated and demanding consumers - Pace at which relevant technologies are evolving 2. Ability to exploit Market distance barriers - Barriers created by CAGE distance - Specific knowledge and capabilities of the firm Intensity of local competition - Hinders ability to exploit
What is team effectiveness most dependent on?
1. Team management 2. Task type - Routine tasks require repetition, like an assembly line production - Innovative tasks require creativity, like new product design
How to be a good international assignee mentor
1. Validate Home country mentor - find assignee a suitable post-assignment position that fits with their career trajectory and interests Host - aid assignee with local difficulties 2. Evaluate - be evaluate and evaluate 3. Communicate Home country mentor - keep assignee informed of home country changes while abroad Host country mentor - keep assignee informed of local initiatives 4. Be senior Home country mentor - stand up for assignee (have political power/capital within company) 5. Represent Home country mentor - voice assignee's interests (helps prevent them from falling victim to the "out of sight, out of mind" phenomenon)
Factors affecting decisions on extent of ownership
1. When CAGE distance is high: Benefit from local partners. 2. When company is short of capital: Shared ownership is better 3. When new foreign subsidiary will have low operational integration with the rest of multinational operations 4. When there is a low risk of asymmetric learning between partners 5. When government regulations require local equity participation
Factors affecting decisions on extent of local production
1. When size of local market is larger than minimum efficient scale of production: Larger size, more completely local production will translate into scale economies 2. When shipping costs associated with exporting to target market are higher than the benefit of producing in home country: Shipping costs neutralize any cost advantage? Produce locally 3. When tariff costs associated with exporting to the target market are higher than the benefit of producing in home country: High tariffs on imported goods? Neutralize cost advantage? Produce locally 4. When the input costs are sufficiently lower in the target market than the home market: Independent of shipping/tariffs 5. When the need for local customization of product is high: Requires a deep understanding of local market needs and an ability to incorporate this understand in design and production decisions. Local production enhances firm's ability to respond. 6. When there are strict local content requirements
The Ancient Silk Road
1453: Ottomans ended Byzantine Empire with the conquest of Constantinople (Istanbul). Cut off Western Europeans' access to Asia 1492: Christopher Columbus sailed Westward in search of an alternative route to Asia. Instead he reached the Americas 1497-98: Vasco da Gama sailed around Africa and reached India
West vs. the Rest throughout the years
1868: West was ahead (including Argentina) and everyone else was behind 1900: Growing divergence as west comes out ahead. The rise of the "New World": USA/Canada & Argentina 1938: Growing divergence. USA emerges as world leader. Surge of Germany. Emergence of Japan. 1978: Gap is persistent. Some signs of progress in Asia, Latin America & Middle East. Emergence of Japan as an advanced nation. Decline of Argentina
By when was virtually the whole Southeast Asia colonized
1885, India was in 1858
By when was all of Africa divided and colonized?
1914
Modes of Foreign Market Entry
ARM'S LENGTH MODES - Exporting: Sale of goods or services produced by a firm based in one country to customers that reside in another country - Licensing: Form of contract where "licensor" grants rights to intangible property (patents, formulas, processes, designs, copyrights, trademarks, etc.) to a "licensee" in return for a royalty fee - Franchising: Form of licensing where franchisor sells not only intangible property, but also requires franchisee to follow strict rules as to how it runs its operation. Frequently provides management training and facilitates supply chain. - Offshore Manufacturing or Service Contract: Outsourcing. Contracts where firm outsources a portion of its activities to be performed by another firm, and pays firm directly for those services MODES OF FDI - Wholly Owned Subsidiary: Firm owns 100% of foreign operations. Can be established in 2 ways: 1. Greenfield: Setting up new operation in target market from scratch 2. Acquisition: Purchasing an existing firm in the target market; acquires not only physical assets but also human resources and intangible assets such as knowledge - Joint Venture: Establishing a new firm in the target market that is jointly owned by two or more independent firms ("parents"). Equity ownership may be split in any number of ways.
Cluster productivity benefits
Access to world class talent: Access to large pool of world class, specialized resources, without high transaction costs of conducting global talent researches and international recruitment Access to quality supply: Efficient access to quality supply. Geographic proximity = timely feedback + communication to suppliers. Awareness of trends and access to specialized information: Market, technical, and competitive info circulates within a cluster through info channels. Develop informal relationships with key players and gain access to market trends or new competitive directions Complementarities: Benefit from quality and success of other related or supporting industries Access to public goods: Benefit from investments made by the government to enhance the specialized infrastructure that supports industry, or specialized training or testing Reputation: "Benefits of origin" Benchmarking and competitive motivation: Stimulated by local rivalry and easy to benchmark against leaders in the field
Jones Act/Section 27 of the Merchant Marine Act
All goods transported by water between U.S. ports must be carried on - US flag ships - Constructed in the U.S. - Owned by U.S. citizens - Has a primarily American crew (3/4 crew U.S. citizens and U.S. permanent residents) As a result: Shipping from 1 US port to another is very expensive because - American-built ships are 4-5 times more expensive than Asian-built ones - Ships with mainly American crew are 4 times more expensive to operate - Ships repair and maintenance in the US is 70% more expensive than overseas
Cultural Sensitivity
An awareness or a caring about another individual's culture
New Asian Industrial Development Plan/New AID Plan
Announced by Minister Hajime Tamura in Jan of 1987. Cooperation directly in the area of industry, so it's not just up to the government but also encourages direct investment by Japanese firms. Part of Flying Geese Paradigm. Steps: 1. Determine the most promising export industries 2. Develop a master plan to nurture those industries and set up a joint steering committee with the target country to decide how decide how to put the plan in place
How confident are you that you could effectively adapt to a foreign culture that is notably different than your own culture?
Answer
How would a person's attitude towards materialism influence their commitment to the company
Answer
Identify 3 distinct subcultures that exist in Canada.
Answer
Select one of Trompenaars' Dimensions and discuss a specific workplace behaviour that you would expect to see in Canadian companies given Canada's rating on the dimension that you selected
Answer
What can you do to increase your CQ going forward?
Answer
ecological fallacy
Applying country level scores to individuals
Central Mode of Entry Tradeoffs
Arm's Length/Wholly Owned: Cost/risk vs. control Wholly Owned/Arm's Length: knowledge vs. complexity
Cross-Cultural Competency
Awareness: Increased awareness of one's own cultural perspective Respect: Appreciate cultural differences Reconciliation: Resolve differences, integration, adaption Increased by education, experience, reflection, openness and feedback
What happens when managers adopt ethnocentrism?
Believe that cultural diversity has only a negative impact on firms. Believe that management strategy should aim to minimize cultural diversity
Country differences and their impact on economic development
CULTURAL FACTORS ECONOMIC FACTORS Economic Structure: The proportion of various economic sectors - Agriculture vs. Industry vs. Service - Labour-intensive vs. capital intensive Economic System: The system of production, resource allocation, and distribution of goods and services - Market economy vs. Command economy vs. Mixed economy POLITICAL FACTORS System of government: Democracy vs. Autocracy
Deciding between Arm's Length Modes and FDI
Capital availability Economic and political risk Need for brand and reputation control Strategic importance of market
Key international assignment assessment criteria
Career advancement Compensation Job characteristics Living and working abroad interest Host country and culture interest Family's view and fit
Absolute advantage
Compare economic outputs of different countries (or individuals). Determine which country has the highest productivity, aka country that requires the least inputs to produce one unit of output is most productive and therefore has an absolute advantage
Cultural profile
Composite picture of working environments, people's attitudes, and norms of behaviour for each country/region for which someone is considering business in
International assignee selection criteria
EQ CQ Motivations International experience Family's view and fit Host country's language proficiency Stress tolerance Extroversion
Clusters and new business formation
Easy to see gaps: Already in cluster, easy to spot gaps in market/value chain where they can launch a new business Lower barriers to entry: Necessary inputs, skills, human resources, infrastructure, etc. are plentiful and of high quality; investors may also see a new business in a cluster as a lower risk than if it were locating elsewhere
Hindu rate of growth
Economic growth rate after independence never rising much above 4% a year during Nehru's reign. Slow productivity and innovation
New Trade Theory
Considers more sophisticated aspects such as returns to scale, network effects, and the strategic choices of government and firms
Necessary conditions for ELI
Cost Advantage: Begin with labour-intensive sectors Capital (for infrastructure & capital goods): Mobilize domestic sources of capital (ex. encourage household savings) ^ | Welcome foreign capital | v Expertise (for production technology & foreign market intelligence)
License raj
Countless regulations installed by the government to make it hard to own large businesses and fire people in economic downturn
Factor Proportions Theory/The Heckscher-Ohlin Theory
Countries would specialize in producing and exporting using the factors of production they have in abundance, and import products for which the key factors of production are in short supply
CAGE distance
Cultural Administrative Geographic Economic
Culture's Circle of Influence
Cultural Drivers Values: General beliefs that define what is right and wrong or specific general preferences Attitudes: Expresses values and disposes a person to act or react in a certain way towards something Behaviours: Any form of human action
What are the benefits of diversity?
Culturally diverse teams have the potential to be more effective than single culture teams Greater diversity allows for greater creativity due to the existence of divergent ideas and the ability to avoid groupthink
The CQ Wheel
Definition: The degree to which you can function across a variety of cultural contexts Drive: Your interest and confidence to adapt to multicultural situations. Do you believe that it can be fun, educational and beneficial to be around other cultures? Knowledge: Your understanding about how cultures are similar and different. Can you distinguish behaviour that is primarily affected by personality from behaviour that is primarily affected by culture? Strategy: Your awareness and ability to plans for multicultural interactions. Are you able to check your assumptions on and devise plans for dealing with other cultural ways? Action: Your ability to adapt when relating and working across cultures. Are you able to act in a way that goes against your own cultural ways?
Low vs. high context cultures
Degree to which language itself is used to communicate a message. Low context: Language is very much used to communicate a message and expected to be explicit and unambiguous High context: Communicated information is either derived from the physical context or the behaviours of the communicator. Less information is derived from the verbal message
Cultural dimensions
Describe the attitudes of most people most of the time, not all of the people all of the time within a particular country
Result of World War II for Japan
Desperate conditions in the country at the war's end made it imperative to get the economy moving again as quickly as possible. Fierce nationalistic energy went into economic development.
Direct vs. indirect communication
Direct cultures: Use direct communication as a sign of respect and professionalism to speak clearly and leave no room for misinterpretation Indirect cultures: Utilize mainly indirect communication such as subtle hints, vague references, or general statements
Global managers and culture shock
Experience the greatest amount of culture shock because they tend to immerse themselves in local culture. They perform so well because they effectively manage culture shock
Extended Diamond of National Competitive Advantage
Factor conditions: Position in factors of production, such as skilled labour or infrastructure Demand conditions: Nature of home-market demand Related and Supporting Industries: Presence/absence in nation of supplier industries and related industries that are internationally competitive Firm strategy, structure, and rivalry: Conditions governing how companies are created, organized, and managed as well as the nature of domestic rivalry + Role of government + Culture
CQ is a stronger driver of success across cultures than:
Gender IQ (general intelligence) EQ (emotional intelligence)
Clusters
Geographic concentrations of firms and institutions focused on a particular industry, field, or sector Affect competition in 3 ways: 1. Increase productivity of firms located in the cluster 2. Drive both the direction and pace of innovation 3. Stimulate the formation of new related businesses which in turn reinforces the strength of the cluster
CQ is absolutely critical for:
Global Mobility success
Flying Geese Paradigm
Goal: To integrate the Asian economies into an economic flock, with japan at the head Envisioned a regional division of labour in East Asia based on the law of comparative advantage. Four Dragons: Hong Kong, Singapore, South Korea, and Taiwan Association of Southeast Asian Nations (ASEAN): Indonesia, Malaysia, the Philippines and Thailand Japan provides leadership and direction and produces the highest-value-added products Under the Japanese approach to investment, as labour costs rise in one country, higher-value-added technology is introduced, while labour-intensive technology is moved to countries where wages are lower TWO KEY ELEMENTS: 1. Countries' export move upward in level of sophistication through learning and innovation 2. Factories are relocated for less sophisticated export products to less advanced countries
Factors affecting decision between greenfield or acquisition
Greenfield if: 1. Company's culture is unique/company's operational procedures are specific 2. Market growth rate is high/intensity of competition is low Acquisition if: 1. Company culture/procedures are not unique 2. Market growth rate is low/intensity of competition is high - Diversification - Market positioning in specific regional/cultural market - Supply chain integration (vertical merger) - Acquisition of knowledge (and market position) ALSO CONSIDER - Importance of speed entry
The Black Ship & Meiji Restoration
Gun Boat Diplomacy (1852-1854): The "Black Ships" commanded by American Navel Officer Commodore Matthew Perry arrived in Edo (Tokyo) and demanded that Japan open itself for trade Japan's ruler chose diplomacy over war (1854-58): Treaties were signed between USA & Japan which allowed trade between the 2 countries Meiji Restoration (1868-1912): Japan underwent a period of industrialization and modernization. Group of people came together to restore Meiji as emperor - Construction of railways - Establishment of public education
Where does Mexico fall on the cultural dimensions?
High power distance Collectivism Slight preference for masculinity High uncertainty avoidance Short-term orientation High indulgence Slight preference for particularism Emotional Neutral between specific and diffuse Ascription Synchronous External Slight preference for cooperative Being Relationship High context Indirect Formal More gender role distinction Quality of Life / Leisure / Nurture
U Curve of Cross Cultural Adjustment
Honeymoon: (first 3 months) Enthusiasm and fascination to be abroad; friendly but superficial contact with locals Culture shock: (4-6 months) Frustration and anxiety result from language, values and behavioural differences; compatriot contact is sought Adjustment: (after 6 months) Improvement of language skills; dealing with new environment and attitude towards local culture Mastery: (timeline varies) Acceptance of local culture and customs
Comparative advantage
If each country specializes in economic activities for which it has a comparative advantage and trades with other countries, all involved countries benefit Implies that if all barriers to international trade are removed, countries, guided by the "invisible hand" of market forces, will gravitate toward categories of economic activities for which they have a comparative advantage and will be better off because of it
New structural economics
Ignoring the law of comparative advantage carries enormous cost. The invisible hand of market forces must be allowed as the basic mechanism for resource allocation in LDC's process of structural transformation. While government should encourage industrial upgrading and diversification, it must focus the nation's attention on industries that are in alignment with its comparative advantage.
How did Japan achieve successful industrialization?
Implemented state-run industries. Corporate conglomerates called zaibatsu formed. By World War II, Japan's technology and industrial capabilities matched those of Europe due to military drivers.
Misconception about culture shock
Implies something that is immediate and sudden
Are the citizens of the world becoming culturally similar as global mobility and with it cross-cultural interaction continues to grow? Explain why or why not you believe we are becoming more culturally similar
Individuals diverge and firms converge
Informality vs. formality
Informal cultures: Communication tends to be informal. Move to using first names after meeting someone, and are less inclined to use titles, ranks, and honorifics when addressing others Formal cultures: Communication tends to be formal. People tend to be uncomfortable using given names. Use titles, ranks, and honorifics when addressing others
Import Substitution Industrialization
Intended to help developing countries industrialize rapidly and reduce dependence on costly imported manufactured goods. Assumes that by imposing protectionist policies, the government would give domestic manufacturers a leg up on foreign competition, speeding their growth and assuring their success. High barriers to foreign imports so that domestic production of a wide range of manufacturing goods in labour-intensive as well as capital-intensive industries would become viable Saddled with heavy debts, inflation, and lethargic firms sheltered from global competition
Stereotyping
Involves a form of categorization that organizes our experience and guides our behaviour towards various groups in society
Trans-Atlantic Slave Trade
Late 1700s - Early 1800: Most countries in the Americas became independent 1807-08: Slave trade was abolished
What is the impact of parochialism and ethnocentrism?
Leads managers and firms to miss opportunities to benefit from cultural diversity
Hofstede's Cultural Dimensions
Low vs. high power distance: beliefs about the appropriate distribution of power in society individualism vs. collectivism: relative importance of individual vs. group interests masculinity vs. femininity: (materialism vs. quality of life): The extent to which a society stresses achievement vs. nurture uncertainty avoidance: degree of uncertainty that can be tolerated and its impact on rule making short vs. long-term orientation: describes how every society has to maintain some links with its own past while dealing with the challenges of the present and future indulgence vs. restraint: degree of allowed individual indulgence of basic human drives vs. restraint of such behaviour
Degree of team effectiveness
Low: Poorly managed culturally diverse teams - more so if task is routine. Poorly managed single culture teams - more so if task is innovative High: Well managed single culture teams - more so if task is routine Well managed culturally diverse teams - more so if task is innovative
Key criteria for an interpreter/translator
Loyalty - More likely if: Paid by your firm. Counterparts paying for the services enhances the likelihood of information leakage to them Is an in-house employee. Enhances dedication to the company and your task, in addition to greater understanding Competence - More likely if: Professionally trained. Had completed a certification program as there is more to translating than just being fluent Technically experienced. Understands the jargon and practices of the profession of those whom they are working for
International assignment HRM key preparation initiatives
Meetings with repats Mentors Host country visit Language training Cross-cultural training
Why is Brazil known as the world's farm?
More spare land and water than anywhere else in the world. Embrapa made the cerrado fit for farming through innovation (limestone and bacteria from Africa) Turned soyabeans into a tropical crop
Export-Led Industrialization
National investment strategy that targets industries in which the country has a potential comparative advantage so that the country can become a strong exporter in these industries. They become cost-competitive in the global market, enhanced by economies of scale from high-volume export for Asian countries. Also increases efficiency because of intense competition.
Environmental Variables and Management Functions
OUTSIDE LAYER National Variable Drivers: Political system Legal system Economic system Sociocultural Variable Drivers: Religion Language Education INSIDE LAYER Cultural Components: Norms Values Beliefs INSIDE LAYER Attitudes: Individualism Time Materialism INSIDE LAYER Work Behaviour: Motivation Punctuality Commitment
What happens when stereotyping is accurate?
Only describes the behavioural norm for members of a particular group, not individual behaviour Can be a useful tool
Dependency Theory
Only the industrialized West could make a go of manufacturing in a free trade environment. Left the rest of the world dependent on selling raw materials to the Western industrial colossus, which in turn sold manufactured goods back to them at inflated prices. Exploited and fomented a sense of resentment against Yankee imperialists
Three layers of culture
Outer layer: Surface culture (explicit culture). Observable aspects, such as dress, food, architecture, customs, body language, gestures, etiquette, and gift giving Inner layer: Hidden culture (the middle layer). Values, religions, and philosophies Inside layer: Invisible culture (implicit culture, the core). The culture's universal truths, the bases for all of a culture's values and beliefs
Critical importance of language translation
Over 6,900 languages in the world. Many errors go unnoticed to the communicator (can be very damaging to relationships, contracts, and etc.)
Resource curse
Paradox that countries with an abundance of natural resources tend to have less economic growth than countries with less natural resources Causes: 1. Poor stewardship of natural resource wealth 2. Lack of economic diversification Solutions: 1. Establish a well-managed national stabilization fund (or sovereign wealth fund) - Save during periods of commodity boom (avoid long-term liability) - Make investment for long-term growth 2. Diversify into midstream and/or downstream businesses - Bring midstream and/or downstream businesses into the country 3. Transition to a more diversified economy - Invest in physical and human capital to enable the transition - Attract foreign expertise to facilitate the transition
What do American and Canadian cultures encourage?
Parochialism, they send a repeated message to not place others into groups when viewing them Seeing people only as individuals.
Peach vs. coconut culture
Peach cultures: Friendly with strangers and acquaintances. Smile, use given names, share information about themselves, and ask personal questions. Not invest much moving forward. Coconut cultures: More closed off with strangers and acquaintances. Hard exterior shell that is difficult to break through. Become friendlier and more open over time as a relationship develops. Slow-developing but long-lasting relationships.
3 levels of mental programming
Personality: Specific to individuals, inherited/learned Culture: Specific to groups, is learned Human Nature: Universal, inherited
Asian Model of Development
Plan to "overtake Europe and America" in the 1960s. Combining features of the Meiji and wartime economies with new elements.
Obstacles in India
Poor infrastructure: - Roads, bridges & railways - Ports - Power supply - Internet Convoluted Bureaucracy: - Taxes - Business licenses & permits - Land acquisition - Labour regulations
Clusters and innovation
Pressure from sophisticated customers: Near cluster = high level sophistication about goods and services, so place pressure on firms to innovate Capacity to react rapidly: React rapidly to market pressure since can leverage own capabilities and capabilities of other firms and institutions Ability to experiment at lower cost: May leverage the capabilities of other firms in the cluster rather than investing in those new capabilities internally, or incurring large transaction costs in finding the complementary capabilities on the open market Knowledge synergies: Ease of collaborative R&D projects between organizations; inter-firm collaboration, and between firms and universities, allows for syngeries of diverse pools of knowledge and the integration of complementary capabilities
Product Life Cycle Theory
Product's life cycle drives international trade. A firm's new innovations, which would typically emerge in an industrialized nation, would increase in exports as the product reached maturity in its life cycle; as exports increased, the product would become more and more standardized and international competition would then increase with imitations of the original product at lower prices
The Association for Overseas Technical Scholarships
Quasi-public corporation under MITI guidance, assists direct investment in developing countries by training developing-country personnel and investing firm in Japan
Culture
Shared by all or almost all members of a given social group. Learned through interactions with the social environment. An organized system of values, attitudes, beliefs, and behaviours "Shared mental programs that control individuals' responses to their environment." Your software (of the mind).
Relative weight of strategic importance of the market vs. ability to exploit is shaped by:
Size, experience, capital and human resources of the firm Number of international market entries being considered at one time Risk propensity of decision-makers
Strategic approaches to a phased-in entry
Small geographic focus, then national expansion Focus on niche in market where product/service requires less adaptation Focus on beachhead market before entering target market
Key assignee culture shock management initiatives
Stability zones Language study Stress reduction tactics Journal keeping Problem solving tactics Compatriot use
3 steps of back-translation
Step 1: Translator A, working independently, translates an original document into a translated version Step 2: Translator B, working independently and not having seen the original document, translates the translated version into a back-translated version Step 3: Translators A and B working together compare the back-translated version and original document, note any differences between the two documents, discuss the reasons for the differences, and agree upon the best wording
Individuals with higher CQ are better:
Strategic decision-makers Team leaders Networkers Innovators Negotiators
International assignee selection process dangers
Subjectivity Overlooking soft skills
Task vs. relationship orientation
Task: View communication as a chance to exchange info to complete a task. Get down to business quickly Relationship: Conversations are an opportunity to enhance the relationship. Goal is to cultivate goodwill and reinforce feelings of interdependence and mutual obligation
Groupthink
Team members striving for consensus while setting aside personal beliefs to adopt the opinion of others Symptoms include: Overestimating the team's power and morality Closed mindedness Pressures toward uniformity
The World economy since 1978
The Rest seems to be catching up to the West. The beginning of a "GREAT CONVERGENCE"?
Ethnocentrism
The belief that your way of life is the best way. We all behave in an ethnocentric manner. Only true in your home country.
That elephant diagram
The conscious mind is not a good multitasker. The unconscious mind is unseen and has more power. But when identified, it can be tamed
National culture
The set of norms, values, and beliefs that exist within the population of a nation Includes subcultures: Cultural groups within a larger culture
What happens when managers adopt parochialism?
They don't recognize other people's different ways of living and working They believe that cultural diversity can offer opportunities or create consequences
Components of structural transformation
Transforming from an agrarian to an industrial & urban economy Developing globally-competitive modern sectors that follow closely the nation's comparative advantage Building, and constantly upgrading, a robust manufacturing sector during the early stages of development - May not be necessary for nations with a very small population & very rich resources
When is stereotyping the most effective?
When consciously held (moving the stereotype up to the rider of the elephant) When accurate (when inaccurate it can pose extreme risk to all parties involved, depending on the stereotype and the context) When descriptive, not evaluative (remember: one should strive to recognize, without judging) When a first best guess (only used when there is no other information available) When modifiable (one does not hold on to the stereotype when information suggests that the stereotype is inaccurate)
When are culturally diverse teams most effective?
When well managed and engaged in innovative tasks
Individuals with higher CQ report experience greater enjoyment and satisfaction with intercultural:
Work Relationships
Ideal African Strategy
Work with as many countries as possible Form alliances with other African Countries Pan-African Free Trade Agreement?
