Managing the Outsourcing_Cultural sensitivity


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  • Note to facilitator: Engage the class in a discussion. Let them come up with some other examples that they know. So what did go wrong in these situations? The companies concerned failed to understand the local culture. They assumed what worked in their home country will work in the other parts of the world as well In this session, we will look at importance of cultural sensitivity in today’s business scenario.
  • Talking points – every culture has a set of customs, and patterns of behavior that have evolved for a reason. There is history behind why people think the way they do
  • Today’s world is getting more and more connected.
  • This video depicts an advertisement by the Aditya Birla group. This is quite common now. Most corporations are going global to reach out to markets globally and also leverage talent pools available globally.
  • Stress the importance of not letting prejudices, and stereotypes affect how we relate to other people. Mindsets like “Americans are very arrogant”, “Indians are very disorganized” lead to lack of trust and mutual respect.
  • Set the stage for the video by talking about global companies having operations all over the world, cross cultural teams, and global customers. Vivek Gupta08_WMV9_Large.wmv
  • It is useful to understand the factors that lead to differences in behavior that can impact business. A framework makes it easier to understand a concept, and then to apply it to situations that we have not encountered before.
  • This framework is based on extensive research done by Geert Hofstede
  • The framework is based on how a culture is oriented with respect to five key factors. Differences is these orientations lead to differences in outlook, thinking, and behavior.
  • Engage the class in a discussion. Which cultures in their experience are Individualist? Which ones are Collectivist? What would be some manifestations of this type of orientation? Singapore, Pakistan, South Korea, China, are highly Collectivist, whereas Australia, Canada, UK, US are highly Individualist. India is somewhere in the middle. If they ask about a country that you are not sure about, tell them that we are giving them a reference material they can use to find out
  • Ask the class to guess examples of cultures in each category. Singapore and Jamaica are the lowest, whereas Greece and Portugal are the highest. Russia, Japan are high on UA, whereas China, India and USA are low on UA. What are some likely traits of people on each extreme? Talk about “Jugaad” in the Indian context. Jugaad is our answer to uncertainty. We do not fear uncertainty, but use Jugaad to deal with it.
  • This is a somewhat difficult one to grasp. High PD means that the culture readily accepts differences in status, position, authority. For example young Indians have a lot of trouble addressing seniors by name – the can’t drop the “sir”. In the USA, one hardly every uses “Mr.” or “Ms.” to address anyone. In the Indian context, this is a result of our history – kingdoms, princely states, the caste system, the absoluteness of political power etc. Lowest PD cultures are Austria, Denmark, Israel, NZ, Sweden. USA, UK, Germany are medium. Malaysia is the highest! Arab World, India, China, Russia are very high. Pakistan is significantly lower than India!
  • The IBM studies revealed that (a) women's values differ less among societies than men's values; (b) men's values from one country to another contain a dimension from very assertive and competitive and maximally different from women's values on the one side, to modest and caring and similar to women's values on the other. The assertive pole has been called 'masculine' and the modest, caring pole 'feminine'. The women in feminine countries have the same modest, caring values as the men; in the masculine countries they are somewhat assertive and competitive, but not as much as the men, so that these countries show a gap between men's values and women's values. Slovakia, Japan, and Hungary are the most “Masculine” countries, whereas Scandanavia and Netherlands are the most “Feminine”. UK, USA, and China are more “Masculine” than India and Pakistan. Infact India is more “Masculine” than Pakistan.
  • this fifth dimension was found in a study among students in 23 countries around the world, using a questionnaire designed by Chinese scholars It can be said to deal with Virtue regardless of Truth. Values associated with Long Term Orientation are thrift and perseverance; values associated with Short Term Orientation are respect for tradition, fulfilling social obligations, and protecting one's 'face'. Both the positively and the negatively rated values of this dimension are found in the teachings of Confucius, the most influential Chinese philosopher who lived around 500 B.C.; however, the dimension also applies to countries without a Confucian heritage. UK, USA, Canada, Pakistan have a low Long Term Outlook. China, HongKong, Taiwan, Japan have a high Long Term Outlook. India is in the middle, comparable to Brazil and Thailand
  • Talk about some of the major differences here as an illustration. For IDV, USA and China are very different. Chinese more family oriented, decisions made in groups or with family, group is entitled to know what the individual does or thinks. For UAI Russia and China are very different. Therefore Russians fear lack of structure or ambiguity, whereas the Chinese are very comfortable with it. Therefore the Chinese are more likely to be entrepreneurial in nature. Interestingly USA, India, and China are very close on this dimension. There is a huge difference in LTO between the USA and China. High LTO for China indicates an attitude of persevering; that is overcoming obstacles with time, if not with will and strength.
  • The USA is Individualistic than Japan. Japan is more male dominated. Japanese do not like uncertainty. Japanese are more likely to invest in long term relationships, rather than look for immediate results
  • Cultural sensitization is a continuous process. It requires a change of mindset more than a few training sessions.
  • Vivek Gupta09_WMV9_Large.wmv
  • Managing the Outsourcing_Cultural sensitivity

    2. 2. Learning Objectives• At the completion of this session you will be able to: – Describe what Cultural Sensitivity is – Appreciate the importance of cultural sensitivity in business – Understand the Hofstede framework to understand cultural differences Learning Objectives
    3. 3. Topics Index Cultural Sensitivity Defined Why do we need Cultural Sensitivity? The Hofstede Framework How do we develop Cultural Sensitivity? Topics Index
    4. 4. Topics Index Cultural Sensitivity Defined Why do we need Cultural Sensitivity? The Hofstede Framework How do we develop Cultural Sensitivity? Topics Index
    5. 5. Some Examples When colouring in 800,000 pixels on a map of India, Microsoft coloured eight of them a different shade of green to represent the disputed Kashmiri territory. The difference in greens meant Kashmir was shown as non- Indian. The product was promptly banned in India. Microsoft was left to recall all 200,000 copies of the offending Windows 95 operating system software to try and heal the diplomatic wounds. It cost them millions. Introduction
    6. 6. Some Examples The fast food giant McDonalds spent thousands on a new TV ad to target the Chinese consumer. The ad showed a Chinese man kneeling before a McDonalds vendor and begging him to accept his expired discount coupon. The ad was pulled down by the Chinese Govt. The ad caused uproar over the fact that begging is considered a shameful act in Chinese culture. Introduction
    7. 7. Some Examples Pepsodent tried to sell its toothpaste in South East Asia by emphasizing that it "whitens your teeth." The ad bombed as They found out that the local natives chew betel nuts to blacken their teeth which they find attractive.. Introduction
    8. 8. Some Examples So what went wrong in these situations? Introduction
    9. 9. What is Cultural Sensitivity?Knowing that differences exist between cultures but not judging – for example better or worse, right or wrongThe quality of being AWARE, ACKNOWLEDGING, and RESPECTFUL of other cultures
    10. 10. Cultural SensitivityTolerance, inter-cultural dialogue andrespect for diversity are more essential thanever in a world where people are becomingmore and more closely interconnected.—Kofi Annan, Former Secretary-General of theUnited Nations
    11. 11. What is globalization?A process by which Economies, Societies, and CULTURES have become integrated.Some of the enablers of this integration are:• Technology• Trade The glue that binds all this together is• Migration COMMUNICATION• FDI BETWEEN PEOPLE
    12. 12. The Modern Global Corporation
    13. 13. Some Global Companies…
    14. 14. Topics Index Cultural Sensitivity Defined Why do we need Cultural Sensitivity? The Hofstede Framework How do we develop Cultural Sensitivity? Topics Index
    15. 15. Why do we need Cultural Sensitivity?People do business with peopleCultural sensitivity can enable better relationships between people through• Better Understanding• Tolerance• Mutual Respect
    16. 16. Industry Perspective
    17. 17. Topics Index Cultural Sensitivity Defined Why do we need Cultural Sensitivity? The Hofstede Framework How do we develop Cultural Sensitivity? Topics Index
    18. 18. Understanding Cultural Differences: The Hofstede FrameworkThe Hofstede framework helps us understand:• Key factors underlying global cultural differences• How different cultures are rated on these key factors• How can we leverage this understanding to better work with each other
    19. 19. Hofstede’s Cultural Dimensions• Geert Hofstede – Dutch management researcher• Gathered data from 100,000 IBM employees – Wanted to determine values on which cultures vary• Surveyed workers from 50 countries and 3 regions• Concluded that there are five dimensions used to differentiate and rate cultures
    20. 20. The Five Dimensions• Individualist/Collectivist• Uncertainty Avoidance• Power Distance• Masculinity-Feminity• Long-Term/Short-Term
    21. 21. Individualist versus Collectivist• How people define themselves and their relationship to others – Individualist • Believe individual is most important • Stress independence over dependence • Reward individual achievement • Value uniqueness of individual – Collectivist • Views, needs, and goals of group most important • Obligation to the group is the norm • Self is defined in relation to others • Focus on cooperation, not competition
    22. 22. Uncertainty Avoidance• “The degree to which people within a culture are made nervous by situations which they perceive as unstructured, unclear, or unpredictable.” – High Uncertainty Avoidance • Avoid ambiguity • Strict codes of behavior • Belief in absolute truths – Low Uncertainty Avoidance • Accept ambiguity and lack of structure • More inclined to take risks and “think outside the box” • Rules are rejected or ignored
    23. 23. Power Distance• Extent to which people view inequality as normal or natural – High Power Distance • Power is scarce resource • Natural and inevitable • Power should be centralized – Low Power Distance • Minimal power differences • Power can be achieved through work • Superiority not rigid
    24. 24. Masculinity-Femininity• Relationship between gender and sex- appropriate behavior – Masculinity • Distinct roles • Men are assertive, ambitious, and competitive • Women are supportive, nurturing, and deferent – Femininity • Fewer rigid gender roles • Men and women are more equal • Interpersonal relationships important
    25. 25. Long-term/Short-term• Added later by Hofstede• Difference in Orientation – Long-term Orientation • Savings • Do anything to achieve a goal • “Eye on the prize” – Short-term Orientation • Immediate gratification • “Make money, spend money” • Less willing to sacrifice
    26. 26. Illustration
    27. 27. Exercise – 15 minutes Compare and contrast the US and Japan, and highlight the likely differences in thinking and behavior
    28. 28. Topics Index Cultural Sensitivity Defined Why do we need Cultural Sensitivity? The Hofstede Framework How do we develop Cultural Sensitivity? Topics Index
    29. 29. How are companies dealing with this challenge?• Cultural Sensitivity Training• Job rotations• Cross cultural teams• Overseas Assignments
    30. 30. How is industry preparing its workforce for Cultural Sensitivity
    31. 31. Some Real Life Examples• Keeping direct eye contact during a conversation may be perceived as rude in Japan• Americans have a strong notion of personal space. Even casual physical contact like a pat on the back can be perceived as rude• In countries like USA and Germany, punctuality is expected, whereas in some cultures like Latin America, showing up in time for a dinner appointment may be perceived as rude!• In some cultures, it is rude to ask personal questions like “Are you married”, unless you know the person well
    32. 32. Developing Cultural Sensitivity – A different mindsetIn cross cultural situations:• Be very observant about how people behave, speak, eat, and relate to others• Do not hesitate to ask polite questions with an attitude to learn• When in doubt, be conservative in – Speech – Clothing – Behaviour
    33. 33. Summing Up…• Different cultures have a different orientation and history• These differences lead to a different way of thinking, and differences in behaviour• It is important to understand, and respect these differences to be able to work with people• Being sensitive to different cultures takes time and effort
    34. 34. References• Kim’s Classy Tips:• The Hofstede Framework for understanding Cultural Differences:• Cultural Sensitivity and Global Leadership Skills:• Cultural Sensitivity in Business:
    35. 35. Thank You