Differences in Culture Societies’ differ along cultural dimensions What is culture? How/why do social structure, religion, language influence cultural differences? What are differences between culture and values in the workplace (corporate culture)? Culture changes over time. What are some reasons behind this? Implications for business managers
Cultural Appreciation Values Customs Aspects of culture Symbols Language
What is Culture? Culture: a society’s (group’s) system of shared, learned values and norms; these are the society’s (group’s) design for living – Values: abstract ideas about the good, the right, the desirable – Norms: social rules and guidelines; guide appropriate behavior for specific situations Folkways: norms of little moral significance dress code; table manners; timeliness Mores: norms central to functioning of social life – bring serious retribution: thievery, adultery, alcohol
Cultural Diversity Values represent personal or socially preferable modes of conduct or states of existence that are enduring. Why doesn’t McDonald’s sell hamburgers in India?
Cultural Diversity Customs are norms and expectations about the way people do things in a specific country. Why were 3M executives perplexed concerning lukewarm sales of Scotch- Brite floor cleaner in the Philippines?
What is Culture?“the collective programming of the mind which distinguishes the members of one human group over another… Culture, in this sense, includes systems of values; and values are among the building blocks of culture”Geert Hofstede
National Culture“Nation” is a useful: – Definition of society similarity among people a cause -- and effect -- of national boundaries – Way to bound and measure culture for conduct of business culture is a key characteristic of societ can differ significantly across national borders – also within national borders laws are established along national lines Culture is both a cause and an effect of economic and political factors that vary across national borders
Social Structure and CultureUnit of social organization: individual or group?Society may be stratified into classes or castes High-low stratification High-low mobility between strataThe individual: building block of many Western societies Entrepreneurship Social, geographical and inter-organizational mobilityThe group: Two or more associated individuals with a shared identity Interact with each-other in specific ways on the basis of a common set of expectations.
Individual vs Group Societal Characteristics Individual Group – Managerial mobility – Loyalty and commitment to between companies company – Economic dynamism, – In-depth knowledge of innovation company – Good general skills – Specialist skills – Team work difficult, – Easy to build teams, non-collaborative collaboration Exposure to different – Emotional identification with ways of doing business group or company – e.g., Japanese companies – e.g., U.S. companies
Religion, Ethics and Culture Religion: system of shared beliefs about the sacred Ethical systems: moral principles or values that shape and guide behavior; often products of religion Major religious groups and some economic implications – Christianity protestant work ethic – Islam Islamic economic principles – Hinduism anti-materialistic, socially stratified – Buddhism anti-materialistic, social equality – Confucianism hierarchy, loyalty, honesty
Language: Culture BoundLanguage, spoken – “private” does not exist as a word in many languages – Eskimos: 24 words for snow – Words which describe moral concepts can be unique to countries or areas – Spoken language precision important in low- context culturesLanguage, unspoken – Context... more important than spoken word in high context cultures
Cultural Diversity – “Chevy Nova Award” Dairy Association’s huge success with the campaign “Got Milk?” prompted them to expand advertising to Mexico It was brought to their attention the Spanish translation read, “Are you lactating?”
Cultural Diversity – “Chevy Nova Award” Clairol introduced the “Mist Stick”, a curling iron into Germany Only to find out that “mist” is German slang for manure.
Cultural Diversity Chevy Nova AwardWhen Gerber started selling baby foodin Africa, they used US packaging withthe smiling baby on the label.In Africa, companies routinely putpictures on labels of what’s inside, sincemany people can’t read.
Cultural Diversity Chevy Nova AwardPepsi’s “Come Alive With the PepsiGeneration” in Chinese translatedinto“Pepsi Brings Your Ancestors BackFrom the Grave”
Cultural Diversity Chevy Nova AwardCoca-Cola’s name in China was first read as“Kekoukela”, meaning “Bite the wax tadpole”or “female horse stuffed with wax”,depending on the dialect.Coke then researched 40,000 characters tofind a phonetic equivalent “kokou kole”,translating into “happiness in the mouth.”
Cultural Stereotypes Cultural stereotypes: values and behaviorsconsidered typical of a culture Are they valuable? Yes, if they reduce uncertainty about what expatriate can expect. No, if used to label an individual unlike thestereotype
High/Low Context CulturesH ig h-C o nte x t L o w-C o nte x tC rucial to C ommunications:ex ternal environment, situation, non-verb al b ehavior ex p licit information, b lunt communicative styleR elationship s:long lasting, deep p ersonal mutual involvement short duration, heterogeneous p op ulationsC ommunication:economical, fast b ecause of shared "code" ex p licit messages, low reliance on non- verb alAuthority p erson:resp onsib le for actions of sub ordinates, loyalty at a diffused through b ureaucratic system,p remium p ersonal resp onsib ility tough to p in downAgreements:sp oken, flex ib le and changeab le written, final and b inding, litigious, more lawyersInsiders vs outsiders: very distinguishab le difficult to identify, foreigners can adjustC ultural p attern change: slow faster
Education and Culture Education – Medium through which people are acculturated – Language, “myths,” values, norms taught – Teaches personal achievement and competition – Critical to national competitive advantage Education system may be a cultural outcome
Culture and the workplace (Hofstede)Finds national culture dimensions meaningful to businessBasis: – Work related values not universal – National values may persist over MNC efforts to create corporate culture – Home country values often used to determine HQ policies – MNC may create morale problems with uniform moral normsPurpose: understanding of business situations across-culturesMUST understand own culture AND other culture(s)
Culture and the workplace Geert Hofstede – sampled 100,000 IBM employees 1963-1973 Compared employee attitudes and values across 40 countries Isolated 4 dimensions summarizing culture: 1. Power distance 2. Individualism vs. collectivism 3. Uncertainty avoidance 4. Masculinity vs. feminity
Power Distance -- (Hofstede) Degree of social inequality considered normal by people Distance between individuals at different levels of a hierarchy Scale: from equal (small power distance) to extremely unequal (large power distance)
Individualism Vs. Collectivism (Hofstede) Degree to which people in a country prefer to act as individuals rather than in groups Describes the relations between the individual and his/her fellows
Uncertainty Avoidance (Hofstede) Degree of need to avoid uncertainty about the future Degree of preference for structured versus unstructured situations – Structured situations: have tight rules may or may not be written down High uncertainty avoidance: people with more nervous energy (vs easy-going), rigid society, "what is different is dangerous."
Masculinity Vs. Femininity (Hofstede) Division of roles and values in a society Masculine values prevail: – assertiveness, success, competition Feminine values prevail: – quality of life, maintenance of warm personal relationships, service, care for the weak, solidarity
Confucian Dynamism (Hofstede) Attitudes towards – Time – Persistence – Status in society – “Face” – Respect for tradition – Gifts and favors
Cultural Change Over TimeChange is slow and often painfulShifts away from “traditional values” towards “secular values”Changes with shift from “survival values” to “self- expression values”
Cultural Distance Geographic and cultural (or pshychic) distance among countries may not be the same Key concept which can affect IB strategy and conduct
Managerial Implications Ethnocentrism vs Polycentrism Must a company adapt to local cultures or can corporate -- often home-country dominated -- culture prevail? Cross-cultural literacy essential Do some cultures offer a national competitive advantage over others?
Applying Cultural Analysis1. Describe culture using Hofstede’s Model2. Estimate cultural impact on management • Strategic planning: Futile? How much information needed? • Employee motivation: Security or money reward? Immediate or long-term rewards • Employee monitoring and control: Rules o trust? • Decision making: overcoming problems o seizing opportunities?