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R chapter 3 culture and business
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R chapter 3 culture and business
May 17, 2014
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1. 3-1 Chapter 3 Culture and Business © Sanjyot Dunung 2011, published by Flat World Knowledge
3-2 Learning Objectives • Understand what is meant by culture • Know that there are different kinds of culture • Identify several different kinds of culture • Know several methods to describe cultures • Define and apply Hofstede’s and Hall’s categories for cultural identification • Identify and discuss additional determinants of culture © Sanjyot Dunung 2011, published by Flat World Knowledge
3-3 Learning Objectives • Identify the ways that culture can impact how we do business • Understand the aspects of business most impacted by culture • Define what global business ethics are, and discover how culture impacts business ethics • Learn how ethical issues impact global business • Identify how companies develop, implement, and enforce ethical standards © Sanjyot Dunung 2011, published by Flat World Knowledge
3-4 What Is Culture • Culture is the beliefs, values, mind-sets, and practices of a group of people • It includes the behavior pattern and norms of that group—the rules, the assumptions, the perceptions, and the logic and reasoning that are specific to a group • It’s the collective programming of our minds from birth – It’s this collective programming that distinguishes one group of people from another • Challenge - Whenever we deal with people from another culture, we expect people to behave as we do and for the same reasons © Sanjyot Dunung 2011, published by Flat World Knowledge
3-5 What Is Culture • Culture awareness - Having an understanding of another culture’s values and perspective – Understanding another culture’s mind-set and how its history, economy, and society have impacted what people think • Cross-cultural understanding: The requirement that we reorient our mind-set and, most importantly, our expectations, in order to accurately interpret the gestures, attitudes, and statements of the people we encounter from other cultures © Sanjyot Dunung 2011, published by Flat World Knowledge
3-6 What Is Culture • Value: Something that we prefer over something else—whether it’s a behavior or a tangible item – Values are acquired early in life and are usually nonrational—although we may believe that ours are actually quite rational – Our values are the key building blocks of our cultural orientation – Each of us has been raised with a considerably different set of values from those of our colleagues and counterparts around the world © Sanjyot Dunung 2011, published by Flat World Knowledge
3-7 What Is Culture • In coming to terms with cultural differences, we tend to employ generalizations – Generalizations can save us from sinking into what may be abstruse, esoteric aspects of a culture • Cultures and values are not static entities – They’re constantly evolving—merging, interacting, drawing apart, and reforming • Understanding what we mean by culture and what the components of culture are will help us better interpret the impact on business at both the macro and micro levels © Sanjyot Dunung 2011, published by Flat World Knowledge
What Kinds of Culture Are There? 3-8 Nationalities Subcultures Organizations © Sanjyot Dunung 2011, published by Flat World Knowledge
3-9© Sanjyot Dunung 2011, published by Flat World Knowledge
Hofstede and Values • Geert Hofstede: An influential Dutch social psychologist who studied the interactions between national cultures and organizational cultures • Value dimensions: The specific values included in Hofstede’s research. Values, in this case, are broad preferences for one state of affairs over others, and they are mostly unconscious 3-10© Sanjyot Dunung 2011, published by Flat World Knowledge
Key Methods Used to Describe Cultures 3-11 • The value dimension referring to how openly a society or culture accepts or does not accept differences between people in hierarchies in the workplace, in politics Power Distance • The value dimension referring to people’s tendency to take care of themselves and their immediate circle of family and friends, perhaps at the expense of the overall societyIndividualism • The value dimension referring to how a society views traits that are considered feminine or masculine Masculinity • The value dimension referring to how much uncertainty a society or culture is willing to accept Uncertainty Avoidance (UA) • The value dimension referring to whether a culture has a long-term or short-term orientation Long-Term Orientation © Sanjyot Dunung 2011, published by Flat World Knowledge
Figure 3.1 - The United States’ Five Value Dimensions 3-12© Sanjyot Dunung 2011, published by Flat World Knowledge
Edward T. Hall • Edward T. Hall: A respected anthropologist who applied his field to the understanding of cultures and intercultural communications – Hall is best noted for three principal categories of how cultures differ: context, space, and time • High- and low-context communication: How a message is communicated – In high-context cultures, the physical context of the message carries a great deal of importance – In low-context cultures, people verbally say exactly what they mean • Space: The study of physical space and people; called proxemics, one of Hall’s principal categories on describing how cultures differ 3-13© Sanjyot Dunung 2011, published by Flat World Knowledge
Attitudes toward Time: Polychronic versus Monochronic Cultures • Polychronic culture: A culture in which people can do several things at the same time • Monochronic culture: A culture in which people tend to do one task at a time 3-14© Sanjyot Dunung 2011, published by Flat World Knowledge
3-15© Sanjyot Dunung 2011, published by Flat World Knowledge
Ethnocentrism • The view that a person’s own culture is central and other cultures are measured in relation to it • The challenge occurs when we feel that our cultural habits, values, and perceptions are superior to other people’s values 3-16© Sanjyot Dunung 2011, published by Flat World Knowledge
Understanding How Culture Impacts Local Business Practices • Culture impacts: – The pace of business – Business protocol—how to physically and verbally meet and interact – Decision making and negotiating – Managing employees and projects – Propensity for risk taking – Marketing, sales, and distribution • To conduct business with people from other cultures, you must put aside preconceived notions and strive to learn about the culture of your counterpart 3-17© Sanjyot Dunung 2011, published by Flat World Knowledge
Understanding How Culture Impacts Local Business Practices • Your understanding of culture will affect your ability to: – Enter a local market – Develop and maintain business relationships – Negotiate successful deals – Conduct sales – Conduct marketing and advertising campaigns – Engage in manufacturing and distribution 3-18© Sanjyot Dunung 2011, published by Flat World Knowledge
Global Business Ethics • Ethics: A branch of philosophy that seeks to address questions about morality—that is, about concepts such as good and bad, right and wrong, justice, and virtue • The areas of business impacted by global perceptions of ethical, moral, and socially responsible behavior include the following: – Ethics and management – Ethics and corruption – Corporate social responsibility 3-19© Sanjyot Dunung 2011, published by Flat World Knowledge
Corporate Social Responsibility • The corporate conscience, citizenship, social performance, or sustainable responsible business, and is a form of corporate self-regulation integrated into a business model • Corporate social responsibility encompasses what companies do with their profits and how they make them – It goes beyond philanthropy and compliance and addresses how companies manage their economic, social, and environmental impacts, their relationships in all key spheres of influence: • The workplace, the marketplace, the supply chain, the community, the public policy realm 3-20© Sanjyot Dunung 2011, published by Flat World Knowledge
Enforcement of Ethical Guidelines and Standards • In the interest of expediency, many governments may not strictly enforce the rules governing corporate ethics – Example: The practice of gift giving • Governments do not enforce laws until it’s politically expedient to do so – Example: Child labor 3-21© Sanjyot Dunung 2011, published by Flat World Knowledge
The Evolution of Ethics • Ethics evolves over time • Changing values, as influenced by global media, and changing perceptions and cultures will impact global ethics • The most challenging aspect is that global business does not have a single definition of “fair” or “ethical 3-22© Sanjyot Dunung 2011, published by Flat World Knowledge