Chapter 4 Managing Within Cultural Contexts

Learning Objectives Explain why a thorough understanding of culture is important for all mangers. Define culture. Explain how culture affects managerial behavior and practices. After studying this chapter, you should be able to:

Explain why a thorough understanding of culture is important for all mangers.

Define culture.

Explain how culture affects managerial behavior and practices.

Learning Objectives Describe the role of fundamental assumptions in corporate, regional, or national cultures. Map aspects of culture in terms of the extent to which they are deeply held and widely shared. After studying this chapter, you should be able to:

Describe the role of fundamental assumptions in corporate, regional, or national cultures.

Map aspects of culture in terms of the extent to which they are deeply held and widely shared.

Learning Objectives Describe the key strategies managers can use to create and change culture. Explain the differences between and describe the implications of high‑ and low‑context cultures. After studying this chapter, you should be able to:

Describe the key strategies managers can use to create and change culture.

Explain the differences between and describe the implications of high‑ and low‑context cultures.

Definition of Culture Culture Learned set of assumptions, values, and behaviors Accepted as successful Passed on to new comers Culture begins when a group of people faces a set of challenges Culture evolves and changes with time

Culture

Learned set of assumptions, values, and behaviors

Accepted as successful

Passed on to new comers

Culture begins when a group of people faces a set of challenges

Culture evolves and changes with time

Managerial Relevance of Culture Impact of Culture on Behavior How people observe and interpret the business world around them Can lead to different beliefs about “right” behaviors Subordinates who identify with the culture of a unit or company are likely to try harder to make it successful

Impact of Culture on Behavior

How people observe and interpret the business world around them

Can lead to different beliefs about “right” behaviors

Subordinates who identify with the culture of a unit or company are likely to try harder to make it successful

Cultural Differences Among Managers “ It is important for a manager to have at hand precise answers to most of the questions his/her subordinates may raise about their work.” Sweden Holland USA Denmark UK Switzerland Belgium Germany France Italy Indonesia Japan 78 73 66 53 46 44 38 27 23 18 17 10 Adapted from Exhibit 4.1: Cultural Differences Among Managers 0% 10% 20% 30% 40% 50% 60% 80% 70%

“ It is important for a manager to have at hand precise answers to most of the questions his/her subordinates may raise about their work.”

Managerial Relevance of Culture Cultural diversity in the workplace Globalization Increasingly culturally diverse U.S. workforce Culture as a management tool Once established, culture guides employee behaviors without overt or constant supervision Managers must be careful what they instill as the cultural values of the unit (organization)

Cultural diversity in the workplace

Globalization

Increasingly culturally diverse U.S. workforce

Culture as a management tool

Once established, culture guides employee behaviors without overt or constant supervision

Managers must be careful what they instill as the cultural values of the unit (organization)

Artifacts: visible manifestations of a culture such as its art, clothing, food, architecture, and customs Levels of Culture Values: enduring beliefs that specific conduct or end states which are personally or socially preferred to others Assumptions: the beliefs about fundamental aspects of life lying below the surface, but supporting the culture Adapted from Exhibit 4.2: Managing Within Cultural Contexts

Artifacts: visible manifestations of a culture such as its art, clothing, food, architecture, and customs

Values: enduring beliefs that specific conduct or end states which are personally or socially preferred to others

Assumptions: the beliefs about fundamental aspects of life lying below the surface, but supporting the culture

Levels of Culture Cultural assumptions Certain cultural values and behaviors are only possible with certain underlying cultural assumptions An understanding of assumptions is necessary to understand, change, or even create a new culture Assumptions (Hidden)

Cultural assumptions

Certain cultural values and behaviors are only possible with certain underlying cultural assumptions

An understanding of assumptions is necessary to understand, change, or even create a new culture

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications People are meant to dominate the environment People must coexist harmon-iously with the environment Humans and the Environment Firms should seek positions that allow them to coexist with others Strategic plans should be developed to enable the firm to dominate its industry Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications People are generally lazy Work is as natural as play for people Human Nature Provide people with opportunities and responsibilities and encourage their development Implement systems for monitoring be-havior and establish clear punishment for undesired behavior Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications Individuals have certain rights and freedoms People exist because of others and owe an obligation to them Human Relationships Cooperation with and contributions to the’ group should be evaluated and rewarded Individual performance should be measured and rewarded Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications People create their own destinies and must plan for the future People should react to and enjoy whatever the present provides Human Activity Planning the future only gets in the way of enjoying the present People who fail to plan should plan to fail Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications Truth objectively exists Truth is what is socially accepted Truth and Reality Opinion leaders are how you influence people and decisions Facts and statistics are how you convince and influence people Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Basic Assumptions and Their Managerial Assumptions Specific Assumptions Specific Assumptions Managerial Implications Managerial Implications Time is like a river, what you don’t use wisely today is gone forever Time is like a lake, what you don’t use today will be there tomorrow Time Taking advantage of the moment is valued. Arriving late for appointments is not a character flaw Time management is a critical skill. Appointments are made well in advance and punctuality is valued Adapted from Exhibit 4.3: Basic Assumptions and Their Management Implications

Levels of Culture Cultural Values Enduring beliefs that specific conduct or end states of existence are personally and socially preferred to others Managerial values are enduring beliefs about specific ways of managing and conducting business that are deemed successful enough to be passed on Values

Cultural Values

Enduring beliefs that specific conduct or end states of existence are personally and socially preferred to others

Managerial values are enduring beliefs about specific ways of managing and conducting business that are deemed successful enough to be passed on

Questions to Get at Cultural Assumptions Adapted from Exhibit 4.4: Questions to Get at Cultural Assumptions Humanity’s Relationship to the Environment Should we dominate the environment? How right is logging, mining or building dams? Nature of Human Nature Are people basically good or evil? Are workers basically self-motivated or lazy? Humanity’s Relationship to the Environment Should people be treated as equals? Are hierarchical and status difference right and natural? Are individuals more important than groups? Should individual interests be subjected to those of the group?

Questions to Get at Cultural Assumptions Adapted from Exhibit 4.4: Questions to Get at Cultural Assumptions Nature of Human Activity Is worth assessed through activity and accomplishment? Are inner states of mind and well-being more important than outward deeds? Nature of Truth Is truth objective or does it depend on the eye of the beholder? Are facts the way to persuade people? Nature of Time Is time like a river and what you don’t use today will be gone tomorrow? Is time like a lake and what you don’t use today will be there tomorrow?

Theoretical people Classification of Values Adapted from Exhibit 4.5: Classification of Values Value the discovery of truth. They are empirical, critical, and rational, aiming to order and systematize their knowledge. Economic people Value what is useful. They are interested in practical affairs, especially those of business, judging things by their usefulness Aesthetic people Value beauty and harmony. They are concerned with grade and symmetry, finding fulfillment in artistic experiences.

Theoretical people

Social people Classification of Values Value altruistic and philanthropic love. They are kind, sympathetic, and unselfish, valuing other people as ends in themselves. Religious people Value unity. They seek communication with the cosmos, mystically relating to its wholeness. Adapted from Exhibit 4.5: Classification of Values Source: G. W. Allport, P. E. Vernon, and Q. Lindzey, A study of Values (Boston: Houghton Mifflin, 1966.

Social people

Levels of Culture Cultural Artifacts and Behavior In modern organizations, important artifacts include Office arrangements (individual offices for all versus open offices with no walls) Parking arrangements (reserved spaces for some versus open spaces for all) Clothing (individual suits versus uniforms) Artifacts (visible)

Cultural Artifacts and Behavior

In modern organizations, important artifacts include

Office arrangements (individual offices for all versus open offices with no walls)

Parking arrangements (reserved spaces for some versus open spaces for all)

Clothing (individual suits versus uniforms)

Culture and Managerial Behaviors Planning Managerial Activity Organizing Adapted from Exhibit 4.6: Culture and Managerial Behaviors Plan for every possible contingency. Develop a plan jointly with boss. Accept unexpected surprises. Develop a plan and then seek boss’s approval Culture B Culture A Structure department strictly by hierarchy. Communicate frequently face to face and rarely use e-mail. Organize department into free-flowing teams. Communicate infrequently face to face and frequently by e-mail.

Culture and Managerial Behaviors Leading Managerial Activity Controlling Adapted from Exhibit 4.6: Culture and Managerial Behaviors Inform subordinates of decisions. Intervene when there are disputes. Involve subordinates in decision process. Allow subordinates to solve their own problems. Culture B Culture A Closely monitor activities and directly guide behavior. Emphasize financial results in evaluating performance. Evaluate and then reward based on results. Focus on customer satisfaction in evaluations.

Cultural Diversity Diversity comes from two primary sources Increased international activity of organizations Greater diversity in the cultures of employees Diversity includes differences in Age, race, ethnicity, gender, physical abilities, and sexual orientation Work background, income, marital status, military experience, religious beliefs, geographic location, parental status, and education

Diversity comes from two primary sources

Increased international activity of organizations

Greater diversity in the cultures of employees

Diversity includes differences in

Age, race, ethnicity, gender, physical abilities, and sexual orientation

Work background, income, marital status, military experience, religious beliefs, geographic location, parental status, and education

Cultural Diversity Number of Groups Adapted from Exhibit 4.7: Effects of Cultural Diversity on Productivity Low Performance High Performance Many Few

Number of Groups

Strong and Weak Cultures The strength of cultures varies along two dimensions The extent to which they are are widely shared among group members The extent to which they are deeply held Subculture Cultural values are deeply held but not widely shared

The strength of cultures varies along two dimensions

The extent to which they are are widely shared among group members

The extent to which they are deeply held

Subculture

Cultural values are deeply held but not widely shared

Managing Cultural Diversity for Competitive Advantage Cost Adapted from Exhibit 4.8: Managing Cultural Diversity for Competitive Advantage As organizations become more diverse, the cost of a poor job in integrating workers will increase. Companies with the best reputations for managing diversity will win the competition for the best personnel. As the labor pool shrinks and becomes more diverse, this edge will become increasingly important. For multinational organizations, the insight and cultural sensitivity that members with roots in other cultures bring should improve marketing efforts. Resource Acquisition Marketing

Cost

Resource Acquisition

Marketing

Managing Cultural Diversity for Competitive Advantage Adapted from Exhibit 4.8: Managing Cultural Diversity for Competitive Advantage Source: T. H. Cox and S. Blake, “Managing Cultural Diversity: Implications for Organizational Competitiveness,” Academy of Management Executive 5, no. 3 (1991), p. 23. Creativity Diversity of perspectives and less emphasis on conformity to norms of the past should improve creativity. Cultural diversity in decision and problem solving groups potentially produces better decisions through consideration of a wider range of and more thorough critical analysis of issues. Cultural diversity enables the system to be less determinant, less standardized, and therefore more fluid, which will create more flexibility to react to environmental chang4es. Problem Solving System Flexibility

Creativity

Problem Solving

System Flexibility

Strong and Weak Cultures Values held Values Shared Adapted from Exhibit 4.9: Matrix of Cultural Strength Narrowly Shared Deeply Held Violation of these values usually results in informal but significant sanctions Widely Shared Deeply Held Violation of these values usually results in formal but significant sanctions Narrowly Shared Shallowly Held Violation of these values usually results in sanctions that are inconsistent Widely Shared Shallowly Held Violation of these values usually results in minor sanctions or second chances Deep Shallow Wide Narrow

Values held

Strong and Weak Cultures Core value A specific behavior that is Widely shared Deeply held Directly related to one or more of the six fundamental assumptions Difficult to change

Core value

A specific behavior that is

Widely shared

Deeply held

Directly related to one or more of the six fundamental assumptions

Difficult to change

Creating and Changing Organization Culture To create and reinforce a particular set of values or corporate culture Alignment between desired values and other systems in the organization needs to exist Five critical strategies to effectively manage organizational culture Selection Socialization Performance appraisal Rewards and Compensation Stories and Symbols

To create and reinforce a particular set of values or corporate culture

Alignment between desired values and other systems in the organization needs to exist

Five critical strategies to effectively manage organizational culture

Selection

Socialization

Performance appraisal

Rewards and Compensation

Stories and Symbols

Creating and Changing Organization Culture Selection Select individuals whose assumptions, values, and behaviors already match those you desire Selection Adapted from Exhibit 4.10: Strategies to Manage Organizational Culture

Selection

Select individuals whose assumptions, values, and behaviors already match those you desire

Creating and Changing Organization Culture Socialization Orientation Training Arranged interactions with experienced organizational members Selection Socialization Adapted from Exhibit 4.10: Strategies to Manage Organizational Culture

Socialization

Orientation

Training

Arranged interactions with experienced organizational members

Creating and Changing Organization Culture Performance Appraisal Clarify for new employees what the organization measures and evaluates Selection Socialization Performance Appraisal Adapted from Exhibit 4.10: Strategies to Manage Organizational Culture

Performance Appraisal

Clarify for new employees what the organization measures and evaluates

Creating and Changing Organization Culture Rewards and Compensation Signal what the organization values by reinforcing desired behaviors in newcomers Selection Socialization Performance Appraisal Rewards & Compensation Adapted from Exhibit 4.10: Strategies to Manage Organizational Culture

Rewards and Compensation

Signal what the organization values by reinforcing desired behaviors in newcomers

Creating and Changing Organization Culture Stories and Symbols Stories communicate company values Rituals play a key role in the symbolic communication of an organization’s culture Selection Socialization Performance Appraisal Rewards & Compensation Stories & Symbols Adapted from Exhibit 4.10: Strategies to Manage Organizational Culture

Stories and Symbols

Stories communicate company values

Rituals play a key role in the symbolic communication of an organization’s culture

International Contexts and Cultures Cultural context: degree to which a situation influences behavior or perception of “appropriateness” In high-context cultures, people pay close attention to the situation and its various elements in assessing appropriate behavior In low-context cultures, the situation may or may not make a difference in what is considered appropriate behavior Neither high nor low-context cultures are right or wrong, just different

Cultural context: degree to which a situation influences behavior or perception of “appropriateness”

In high-context cultures, people pay close attention to the situation and its various elements in assessing appropriate behavior

In low-context cultures, the situation may or may not make a difference in what is considered appropriate behavior

Neither high nor low-context cultures are right or wrong, just different