Chapter 4:The Meanings and Dimensions

of Culture

Walta Nemariam, Emily Roberson, Katie Quill, and Madison Cawthon

Culture is how people behave and react as a result of what they see and experience

This knowledge forms values, creates attitudes, and influences behavior

What is culture?

Learned -acquired by learning or experience

Shared - not specific to single individuals

Trans-generational - cumulative, passed down from one generation to the next

Characteristics of culture:

Symbolic - culture is based on the human capacity to symbolize or use one thing to represent another

Patterned - has structure and is integrated; a change in one part will bring changes in another

Adaptive - based on human capacity to change or adapt

Characteristics of culture:

-centralized vs. decentralized decision making

-safety vs. risk

-individual vs. group rewards

-informal vs. formal procedures

How can the culture of a society affect management approaches?

-high vs. low organizational loyalty

-cooperation vs. competition

-short term vs. long term horizons

-stability vs. innovation

How can the culture of a society affect management approaches?

A Model of Culture

Values are the basic convictions people have concerning right and wrong, good and bad, important and unimportant◦ learned from the culture in which the individual is

raised◦ help direct the person’s behavior

What are values?

• 5 dimensions that help explain how and why people from different cultures behave the way they do

Hofstede’s 5 Dimensions of Culture

1. Power distance- the extent to which less powerful members of institutions and organizations accept that power is distributed unequally

2. uncertainty avoidance- extent to which people feel threatened by ambiguous situations and have created beliefs and institutions that try to avoid these

Hofstede’s 5 Dimensions of Culture

3. Individualism/Collectivismindividualism- the tendency of people to look after themselves and their immediate family onlycollectivism- tendency of people to belong to groups or collectives and to look after each other in exchange for loyalty

Hofstede’s 5 Dimensions of Culture

4. masculinity- a cultural characteristic in which the dominant values in society are success, money, and materialistic things

femininity- a cultural characteristic in which the dominant values are caring for others and the quality of life

Hofstede’s 5 Dimensions of Culture

5. Time orientation is the fifth and newer dimension, but not as well known

Integrating the dimensions of culture into pairings or clusters helps depict what countries are similar in values

Hofstede’s 5 Dimensions of Culture

Dimensions:

1. Universalism vs. Particularism2. Individualism vs. Communitarianism3. Neutral culture vs. Emotional culture4. Specific vs. Diffuse culture5. Achievement vs. Ascription culture

Widely accepted study of international management Conducted over 10-year period, 28 countries These dimensions address the way people deal with

one another

Trompenaar’s Cultural Dimensions

Universalism◦ the belief that ideas and practices can be applied

everywhere without modification ◦ Focus is on rules over relationships◦ United States, Germany, Sweden, Australia

Particularism◦ The belief that circumstances dictate how ideas

and practices should be applied ◦ Legal contracts are modified◦ Venezuela, Indonesia, China ◦ Be prepared for small talk and meandering

1. Universalism vs. Particularism

a. My friend has a definite right as a friend to expect me to testify to the lower figure.

b. He has some right as a friend to expect me to testify to the lower figure

c. He has no right as friend to expect me to testify to the lower figure.

Universalism vs. Particularism dilemma

Individualism◦ People regard themselves as individuals.◦ Negotiation takes the form of a representative

Communitarianism◦ People regard themselves as being part of a

whole ◦ Decisions are usually referred to committees

How should people from these different cultures deal with one another in business settings?

2. Invidividualism vs. Communitarianism

Neutral culture◦ One in which emotions are held in check◦ Japan, UK◦ Lack of emotion does not mean disinterest or

boredom Emotional culture

◦ One in which emotions are expressed openly and naturally

◦ Mexico, the Netherlands, Switzerland◦ Those in an emotional culture should respond

warmly in a business setting

3. Neutral vs. Emotional Cultures

Specific◦ Individuals have large public space they readily enter

and share, and a small public space they guard closely and share with close friends and associates

◦ Strong separation between work and private life ◦ United States, United Kingdom, Switzerland

Diffuse ◦ Public and private space are similar in size and level

of privacy ◦ Work and private life are more closely linked ◦ Venezuela, Spain, China ◦ Formality is maintained in individual titles

4. Specific vs. Diffuse culture

Achievement culture◦ Status based on performance at functions◦ High status to high achievers ◦ United States, Switzerland, United Kingdom

Ascription culture ◦ Status is based on who or what someone is◦ Status based on age, gender, social connections◦ Venezuela, Indonesia, China

5. Achievement vs. Ascription culture

Sequential ◦ One activity at a time◦ Keep appointments strictly ◦ Show strong preference for following plans◦ United States

Synchronous◦ Multitasking◦ Appointments are approximate◦ Mexico ◦ “For French and Mexicans, what was important was that

they get to the end, not the particular path or sequence by which that end was reached.”

◦ Past, present, future orientation

Time

One thing he did was asked managers to choose one of the following statements.1. What happens to me is my own doing.2. Sometimes I feel that I do not have enough

control over the directions my life is taking.

◦ When dealing with those from cultures who believe in dominating the environment, it is important to play hardball.

◦ When dealing with cultures that believe in letting things run their course, it is important to be polite and to maintain relationships.

The Environment

Trompenaar’s research lends itself to cultural patterns.

◦ Anglo cluster: United States, United Kingdom ◦ Asian cluster: Japan, China, Indonesia, Hong Kong,

Singapore◦ Latin American cluster: Argentina, Mexico,

Venezuela, Brazil ◦ Latin European cluster: France, Belgium, Spain,

Italy◦ Germanic cluster: Austria, Germany, Switzerland,

Czechoslovakia

Cultural Clusters

Similar to Trompenaars and Hofsted with greater emphasis on managerial styles

A different approach to measuring cultural differences

Conducted by a team of multicultural researchers

The GLOBE Project

GLOBE Project

Researchers use these attributes to predict the most suitable, effective and acceptable organizational and leader practices within that culture

Goal: to develop an empirically based theory to describe, understand and predict the impact of cultural variables on leadership and organizational processes and their effectiveness

Culture and Management

Ch. 5 Managing Across Cultures

For MNCs to be successful companies must carefully address the cultural similarities and differences in their varied markets.◦ Renault

Managing Across Cultures

Ethnocentric Predisposition ◦ allows the values of the parent company to guide

strategic decisions. Polycentric Predisposition

◦ firms make strategic decisions tailored to suit the cultures of the countries where the MNC operates. EX- Disney

Regiocentric Predisposition◦ firm tries to blend its own interests with those of its

subsidiaries on a regional basis. Geocentric Predisposition

◦ tries to integrate a global systems approach to decision making

Strategic Predispositions

Some companies are committed to a globalization imperative or one worldwide approach to doing business. ◦ A study showed that 103 medium and large MNCs

out of 115 use the same strategies at home as they do abroad.

◦ http://www.youtube.com/watch?v=m0rKn7X7UWk◦ http://www.youtube.com/watch?v=rB85iQ0Y_bw

Managing Across Cultures

The most effective MNCs are constantly trying to address local needs. ◦ Warner-Lambert

They have manufacturing facilities in Belgium, France, Germany, Italy, Ireland, Spain, and the United Kingdom. Each plant is specializes and produces a small number of products for the entire European market. This allows each one to focus on the unique demands for the various markets.

Managing Across Cultures

There are several reasons for differentiating strategies to meet the needs of different cultures. ◦ 1. Industry standards are different for each

country.◦ 2. Customers want differentiated products ◦ 3. Customers prefer to buy local ◦ 4. The difficulty of managing global organizations◦ 5. Letting subsidiaries customize their products

for their market

Managing Across Cultures

Marketing becomes especially different when dealing cultures. ◦ Cosmetic products

In Spain and Greece tooth paste is marketed as a cosmetic product but is marketed as a cavity-fighter in the Netherlands and the US. Soap is also considered a cosmetic product in Spain.

http://www.youtube.com/watch?v=mCSxbIvpE4Q http://www.youtube.com/watch?v=nT1uvi7qjrs

Managing Across Cultures

How the marketing message is delivered is essential.◦ German advertising is factual and rational. They

fear being manipulated.◦ French avoid reasoning and logic. Their

advertising is emotional and dramatic. Commercials are viewed as short films.

◦ British value laughter above all else. They like to mock the advertiser and consumer. However, with a high end or low end products

marketing messages are similar world wide. Ex. Coca-Cola, Porsche

Managing Across Cultures

The need to adjust global strategies for regional markets presents three major challenges:◦ 1. The MNC must stay up to date about local

markets and be careful not to assume that all markets are basically the same.

◦ 2.The MNC must know the needs of the subsidiaries so that it can provide best for these units when it comes to addressing local demands

◦ 3. The company must give the subsidiary more autonomy so that it can respond to changes in local demands.

Managing Across Cultures

Cross-Cultural Differences and Similarities- The way MNCs manage their home businesses often should be different from the way they manage their overseas operations.

Parochialism- the tendency to view the world through one’s own eyes and perspectives.◦ Soviet Companies

Simplification- exhibiting the same orientation toward different cultural groups.

Managing Across Cultures

There was a lot of hope that businesses would be able to keep their practices the same when internationalization started in the 1970s which proved to be false. However, there are similarities.

Studies show that the US has several similarities with Russia.◦ Managerial Activities- Networking ◦ Organizational Behavioral Modification- providing

corrective feedback proved to have positive results in Russia after adopting the US practice.

Similarities Across Cultures

From a Human Resource Standpoint◦ Management has to be careful when letting each

national operating company oversee evaluations. Each evaluation will vary greatly from

country to country. ◦ Shell Oil had the head office established criteria to

evaluate the personal and had the national operating company do the evaluating. Each company had completely different results.

Managing Across Cultures

Other Human Resource Management differences: wages, compensation, pay equity, and maternity leave. ◦  Hourly wage plays a minor role in Mexico. Labor law

requires that employees receive full pay 365 days a year. ◦ Austrian and Brazilian employees with one year of service

are automatically given 30 days of paid vacation.◦ Japan: compensation levels are determined by age, length of

service, and educational background rather than skill, ability, and performance…that comes into play at age 45

◦ United Kingdom: Employees are given 40 weeks for maternity leave including 18 weeks of government mandated pay.

 

Managing Across Cultures

Incentive Plans are also different for different cultures ◦ Pacific Rim: Japan, Hong Kong, Malaysia, the Philippines, Singapore.

High salaries should be paid to senior-level managers. ◦ For Belgium and Italy- significantly higher salaries should be paid to

local senior-level managers because of the high masculinity index.◦ Portugal and Greece- both of which have a low individualism index,

profit sharing plans would be more effective than individual incentive plan.

◦ Personal Incentive plans would be highly useful for Denmark, Netherlands, Germany because of the high individualism in these cultures.

◦ Great Britain and Ireland and the US managers value their individualism and are motivated by the opportunity for earnings, recognition, advancement, and challenge.

Managing Across Cultures

Hiring also varies from country to country. ◦ In the Untied States people are hired based on

what they can do for the firm in the short run. Americans also prefer specialized training.

◦ In Japan, they hire based on who will help the firm in the long run, and prefer cross training.

◦ Americans prefer to reward people as individuals while in Japan they prefer to reward people as a group.

Managing Across Cultures

1979-Deng Xiaoping opened the country to the world

US and Europeans find doing business with China a long and grueling process◦ Technical Competence◦ Time/Patience

Guanxi: means good connection in Chinese

Collective society: pride themselves on being members of a group

Doing Business in China

• Build personal relationships with partners• Use local consultants• Consider business ethics• Stress exclusivity• Keep financial information personal• Research the company• Stress mutual gain•Written contracts are not as binding

Doing Business in Russia

Unsaturated consumer markets, cheap labor and production location

Be on time Personal questions should not be asked Titles are important PDA is inappropriate (backslaps) Namaste gesture Many Indians understand that Westerners

may not be familiar with their culture and that’s ok

Doing Business in India

Social class is very important Friendly, humorous and sarcastic Accustomed to conflict Trustworthiness View on Work ethic Highly centralized and have rigid

structures Management differences French business tips

Doing Business in France

Portuguese influence Relaxed work ethic Good natured and avoid confrontation Working with Brazil:

Personal spaceFace-to-Face interactionTrustPatienceAppearanceLoyal and CommittedConsistency

Doing Business in Brazil

Allah controls time Status is determined by family position and

connections Emotions over logic Working with Arabs:

Never display feelings of superiorityNever take credit for joint effortsAdministrative channelsConnections are importantPatience

Doing Business in Arab Countries

Case Study! Page 153