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Kwame Nkrumah University of
Science & Technology, Kumasi, Ghana
MCS 358
INTERCULTURAL MANAGEMENT
Kwame Ohene Djan
(BSc, MSc, PhD)
Department of Marketing & Corporate Strategy
KNUST School of Business
2/7/2023 1
www.knust.edu.gh
2/7/2023 K Ohene Djan 2
Course Outline
Introduction to Intercultural Management
Unit 1: Role of Culture in International business management
2.1 Culture and its effects on Organizations
2.2 Cultural Value Dimensions
2.3 Project GLOBE Cultural Dimensions
2.4 Hofstede’s Cultural Dimensions
2.5 Trompenaars’s Value Dimensions
2.6 Developing Cultural Profiles
2.7 Culture and Management Styles around the world
Unit 2: Communication Across Cultures
3.1 The Communication Process
3.2 The Culture-Communication Link
3.3 Managing Cross-Cultural Communication
www.knust.edu.gh
2/7/2023 K Ohene Djan 3
Course Outline Cont’d
Unit 3: Motivating and Leading
3.1 Global Leader’s Role and Environment
3.2 Cross Cultural Research on Motivation
3.3 Cross-cultural research on leadership
3.4 Contingency leadership: The Culture Variable
Unit 4: International Human Resource Management
4.1 Expatriation and Repatriation
www.knust.edu.gh
2/7/2023 K Ohene Djan 4
Introduction to Intercultural Management
Origin of the concept
Intercultural management as a concept assumed an identity on its own in the mid
1980s. It gained considerable ground during the 1990s from international
diversity perspective.
Intercultural management concerns itself with the management of
workforces functioning in culturally different operating contexts.
These differences can be either ‘external’, where an organization operates across
national and ethnic cultures, or ‘internal’, where an organization operates across
different branches or regions.
Intercultural management may be viewed as a subset of international
management.
www.knust.edu.gh
2/7/2023 K Ohene Djan 5
Unit 1: Culture and Intercultural Management
What is culture?
Over 160 definitions of culture were uncovered in the research of Kroeber and Kluckholm
(1985), cited by North and Hort, (2002). There is no universally satisfactory definition of
the domain of culture (Daniels, 2004).
Culture represents a complex pattern of beliefs, expectations, ideas, values, attitudes and
behaviors shared by members of a group or team (Hellriegel and Slocum, 2004) who come
from the same village, town, country or region – or from the same work unit, department,
division or organization.
Hofstede (1984, p.13) sees culture as “the collective programming of the mind, which
distinguishes members of one human group from another
Culture consists of people with shared attitudes, values and beliefs. Cultural activities could
be national or organizational.
www.knust.edu.gh
2/7/2023 K Ohene Djan 6
Culture also refers to …
A set of shared values, understandings, assumptions,
and goals that are learned from earlier generations,
imposed by present members of a society, and
passed on to succeeding generations (Deresky, 2017)
Visible and Invisible cultures
• There are two dimensions to culture: visible and invisible.
• The visible dimensions of culture include:
 Language: that spoken language in different countries, organizations which
reveals the existence and non-existence of certain concepts;
 Short vs long term orientation: different cultural attitude toward time,
either short-term thinking and pressure on time, or a more unhurried, longer-
term perspective;
 Use of space: it varies among different cultures, in terms of comfort in being
close; physically to strangers or not;
 Religion: that most people follow in each country or a group of countries,
and it is the most influential part that can affect the society as whole.
Visible cultures Cont’d
• Founders’ values - are critical as they hire the first set of managers
• Founders likely hire those who share their vision. This develops the culture of the
firm
• Socialization - Newcomers learn norms and values
• Learn not only because ‘they have to’ but because they want to
• Organizational behavior, expectations, and background are presented
• Symbols - Anything visible representing a shared value: simplest, basic
cultural expression such as logos, architecture, parking priorities, uniforms,
office location/size, art on the wall etc.
Invisible culture
• Shared assumptions (e.g. time orientation) are the underlying
thoughts and feelings that members of a culture take for granted and
believe to be true. Societies differ in their assumptions about time. E.g.
In India, Hindus belief that time is everlasting and frequently arrive
late to meetings
• Values and norms inform workers about what goals they should
pursue and how they should behave to reach these goals – basic belief
about condition that is important. E.g. TQM to Toyota. Some
organizations work hard to create a culture that encourages and rewards
risk-taking eg. Microsoft, Oracle seek innovation. Others create an
environment of caution eg. Oil refineries, nuclear power plants must
focus on caution.
www.knust.edu.gh
2/7/2023 10
Levels of Culture
A culture starts developing in a context where a group of people have a shared
experience.
- Family members share a life together
- In a business context, culture can develop at different levels within a
department or at the various ranks of hierarchy.
- A company can develop its own culture provided it has ‘a sufficient shared
history’ (Schein, 1999).
- Applies also for a collection of companies within a particular business or sector
(e.g. airline companies, car making companies, public sector organizations etc.
- Regions of a country, regions across countries, or groupings of nations sharing
a commonexperience like language, religion, ethnic origins or a shared history in
development
E.g. Swahili is a Bantu
language spoken mainly in
Tanzania, Uganda and
Kenya, and also in
Burundi, Mozambique,
Oman, Somalia the
Democratic Republic of
the Congo and South
Africa by about 98 million
people. Swahili is an official
language of Tanzania,
Uganda and Kenya, and is
used as a lingua franca
throughout East Africa.
2/7/2023
K Ohene Djan
11
www.knust.edu.gh
2/7/2023 K Ohene Djan 12
3 Main Levels of Culture
1. Societal Culture
Tayeb (2003) argues that there is a constant thread through our lives which
makes us distinguishable from others, especially those in other countries: this
thread is our national culture.
Societies are organized politically into nations, but within this national unity
subcultures may exist with specific cultural characteristics.
These groups use the society in which they are embedded as their framework of
reference, and share their nationality, language and institutions, while being
delineated by their socio-economic, historic or geographic characteristics.
National variables + Sociocultural variables = Societal Culture
Environmental Variables Affecting Management
Functions
3-13
Copyright ©2017 Pearson Education, Inc.
2. Organizational Culture
1. Exists within and interacts with societal culture
2. Varies a great deal from one organization, company, institution, or group to another
3. Represents those expectations, norms, and goals held in common by members of
that group
4. Cultural elements affect the way strategy is determined, goals are established and
how the organization operates
• Organizational culture functions equivalently to societal culture, but varies a great
deal from one organization to another—even within a single societal culture.
Nonetheless, organizational culture is at least partially a function of and must
respond to societal culture.
2/7/2023 14
• Examples:
– IBM vs. Apple
– KLM
– McDonald’s in Russia
• IBM is considered a traditionally to be very formal, hierarchical, and rules- bound, and
with its employees usually in suits, and Apple Computer, whose organizational culture
is very organic or “loose” and informal with its employees typically wearing casual
clothes and interacting informally.
• Airline KLM responded to Dutch attitudes regarding families and norms regarding
relationships by extending its travel benefits policy to any couple who formally registered
as living together—regardless of whether the couple was heterosexual or homosexual,
formally married or not.
• McDonald’s provides more extensive training to employees in Russia than to those in the
US because Russians are less familiar with working within a capitalist system.
2/7/2023 15
TYPES OF ORGANISATIONAL CULTURE
• Bureaucratic culture
• Formalization, rules, hierarchy
• Clan culture
• Tradition, loyalty, personal commitment
• Entrepreneurial culture
• Risk-taking, dynamism, creativity
• Market culture
• Achievement of financial/market goals
3. Corporate Culture
• Corporate culture takes the question of organizational culture a step further
• If an organization develops into a multinational conglomerate, the culture at
headquarters may influence that of its subsidiaries abroad.
• Similarly, a firm involved in a joint venture with a company from another
country may well find that the presence of the foreign partners influences the
underlying culture of the firm
• What evolves over time in terms of ‘corporate culture’ can have as its basis
the ‘original’ organizational culture, or the national/regional culture- or a
combination of the two.
2/7/2023 17
www.knust.edu.gh
2/7/2023 18
The extent of influence of corporate culture is disputed among experts in the
field.
Some regard a clearly defined corporate culture as key to a (multi)national
company’s success.
Others consider flexible culture to be the key to success because it can adapt to,
and respond more effectively to, a local/national environment.
Group Assignment to be submitted 3rd June, 2021.
Is it necessary for a Multinational company to change its organizational culture?
When and Why?
The Effect of Culture on Organizational Process
Copyright ©2017 Pearson Education, Inc.
3-19
U.S. Culture Alternative Function Affected
Individual influences future Life is preordained Planning, scheduling
The environment is
changeable
People adjust to the
environment
Morale, productivity
Hark work leads to success Wisdom and luck are also
needed
Motivation, rewards
Employment can be ended Employment is for a lifetime Promotions, recruitment
Culture and its Effects on Organizations
• An awareness
of and an
honest caring
about another
individual’s
culture
Cultural
Sensitivity or
Cultural
Empathy?
3-20
Copyright ©2017 Pearson Education, Inc.
Culture’s Effects on Management
• Convergence—the phenomenon of the shifting of individual management
styles to become similar to one another
• Self-Reference Criterion—the subconscious reference point of ones own
cultural values. Many people in the world understand and relate to others
only in terms of their own cultures
• Parochialism—occurs, for example, when a Frenchman expects those from
or in another country to automatically fall into patterns of behavior
common in France
• Ethnocentrism—describes the attitude of those who operate from the
assumption that their ways of doing things are best—no matter where or
under what conditions they are applied
3-21
Copyright ©2017 Pearson Education, Inc.
An example of the need to overcome the self-reference criterion is when
Japanese workers must put courtesy aside and interrupt conversations with
Americans when there are problems.
P & G demonstrated ethnocentrism when they ran a popular European
advert for Camay soap in Japan. The ad depicted a man walking in on his
wife in the bath. The commercial backfired in Japan because the Japanese
viewed the man’s behavior as bad manners.
2/7/2023 K Ohene Djan 22
Influences on National Culture
Subcultures Stereotyping
Copyright ©2017 Pearson Education, Inc. 3-23
 Many countries comprise diverse
subcultures whose constituents
conform only in varying degrees
to the national character.
Example: Canada
• A cultural profile that tends to
develop some tentative
expectations—some cultural
context—as a backdrop to
managing in a specific
international setting
Cultural Subsystems that Influence People and Their
Behavior
3-24
Copyright ©2017 Pearson Education, Inc.
Kinship
Education
System
Economic
System
Political
System
Health
System
Recreation
Religion
Cultural Value Dimensions
Values
Are a society’s
ideas about what
is good or bad,
right or wrong
Determine how
individuals will
probably respond in
any given
circumstances
Help managers
anticipate likely
cultural effects
Allow for contingency
management
Can vary across
subcultures
3-25
Copyright ©2017 Pearson Education, Inc.
2/7/2023 26
Values determine how individuals probably will act in given circumstances. They
are communicated via the eight subsystems just described and are passed down
through generations.
Contingency management requires managers to adapt to the local environment and
people and to adjust their management styles accordingly.
Value dimensions and resulting cultural profiles provide only an approximation of
national character. There may be variations in national culture—i.e., subcultures
may exist as well. For example, American tend to think of the Chinese as
culturally homogenous, but distinct ethnic groups within China have their own
customs and dialects.
GLOBE STUDIES (1993 by Robert J House )
 Global Leadership and Organizational Behavior Effectiveness Research
Project
 How culture influences leadership and organizational processes
 What cultural attributes affect societies’ susceptibility to leadership
influence
 To what extent do cultural forces influence the expectations that individuals
have for leaders and their behavior
 To what extent will leadership styles vary in accordance with culturally
specific values and expectations?
 What principles and laws of leadership and organizational processes
transcend cultures?
To understand and measure: cultures and
leadership
 62 countries
 170 investigators
 17,370 middle managers who worked in
 951 organizations
 Asked about culture, leadership and organization
 Tested 27 hypotheses
 Included archival data, media analysis, individual and group
interviews and unobtrusive measures
GLOBE studies: 9 cultural dimensions
 Dimensions drew on previous research
1. Uncertainty avoidance
2. Power distance
3. Collectivism I: societal collectivism
4. Collectivism II: In-group collectivism
5. Gender egalitarianism
6. Assertiveness
7. Future orientation
8. Performance orientation
9. Humane orientation
 Important to know:
 What the dimensions mean
 What high/low on a dimension means
 Where your country fits on the dimensions
www.knust.edu.gh
GLOBE studies: Defining the dimensions
1. Uncertainty avoidance
The extent to which a society, organization, or group relies on social
norms, rules, and procedures to alleviate unpredictability of future events
2. Power distance
The degree to which members of a collective expect power to be
distributed equally.
3. Collectivism I: societal collectivism
The degree to which organizational and societal institutional practices
encourage and reward collective distribution of resources and collective
action.
4. Collectivism II: In-group collectivism
The degree to which individuals express pride, loyalty, and cohesiveness
in their organizations or families.
5. Gender egalitarianism
The degree to which a collective minimizes gender inequality.
6. Assertiveness
The degree to which individuals are assertive, confrontational, and aggressive in their
relationships with others.
7. Future orientation
The extent to which individuals engage in future-oriented behaviors such as delaying
gratification, planning, and investing in the future.
8. Performance orientation
The degree to which a collective encourages and rewards group members for performance
improvement and excellence.
9. Humane orientation
The degree to which a collective encourages and rewards individuals for being fair, altruistic,
generous, caring, and kind to others.
GLOBE Research Project Dimensions
• Low: Russia, Argentina, Italy
• High: Netherlands, Switzerland,
Singapore
Future
Orientation
• Low: Germany, Spain, France
• High: Malaysia, Ireland,
Philippines
Humane
Orientation
3-33
Copyright ©2017 Pearson Education, Inc.
GLOBE Research Project Dimensions
• Low: Sweden, Japan, Switzerland
• High: Greece, Austria, Germany
Assertiveness
• Low: Russia, Argentina, Italy
• High: U.S., Hong Kong, Singapore
Performance
Orientation
3-34
Copyright ©2017 Pearson Education, Inc.
Hofstede (1983)
• Hofstede’s research, which was conducted prior to the
GLOBE project, is based on 116,000 people in 50
countries. Nonetheless, all of the research was conducted
in a single firm—IBM. As such, the result should be
interpreted with caution.
2/7/2023 35
Hofstede’s Value Dimensions
Power Distance
The level of acceptance by a
society of the unequal
distribution of power in
institutions
Uncertainty Avoidance
The extent to which people in
a society feel threatened by
ambiguous situations
Individualism
The tendency of people to
look after themselves and
their immediate families only
and to neglect the needs of
society
Collectivism
The desire for tight social
frameworks, emotional
dependence on belonging to
“the organization,” and a
strong belief in group decisions
3-36
Copyright ©2017 Pearson Education, Inc.
Hofstede’s Value Dimensions
Copyright ©2017 Pearson Education, Inc. 3-37
Power Distance
MAL PHI MEX IND FRA ITA JPN SPA ARG US GER UK DEN ISR AUT
Uncertainty Avoidance
GRE JPN POR KOR ARA GER AUL CAN US UK IND DEN SIN
High Orientation Toward Authority Low
High Desire for Stability Low
Hofstede’s Value Dimensions
Copyright ©2017 Pearson Education, Inc. 3-38
Individualism
AUL US UK CAN FRA GER SPA JPN MEX ITA KOR SIN
Masculinity
JPN MEX GER UK US ARA FRA KOR POR CHC DEN SWE
Individualism Collectivism
Assertive/Materialistic Relational
Hofstede’s Value
Dimensions
Copyright ©2017 Pearson Education, Inc. 3-39
Long-term/Short-term Orientation
CHI HK JPN TAI VIE BRA IND US CAN UK E/W AFR
High Low
Trompenaar’s (1993) value dimension
• He used 15,000 managers from 28 countries and they are as follows
:
1. Universalism vs. Particularism – many ways / one right way
2. Individualism vs. Communitarianism – Individual / group
3. Specific vs. Diffuse cultures – Extroversion / Introversion
4. Affective vs. Neutral cultures – Openly on emotions
5. Achievement vs. Ascription – Societal standing on effort towards
success and vice versa
6. Sequential vs. Synchronic cultures – Systematic and simultaneous
7. Internalistic vs. Externalistic – Power over nature and vice versa
Trompenaar’s Dimensions
Copyright ©2017 Pearson Education, Inc. 3-41
Obligation
High Low
US GER SWE UK ITA FRA JPN SPA SIN
Emotional Orientation in Relationship
High Low
JPN UK GER SWE USA FRA SPA ITA CHI
Universalistic Particularistic
Neutral Affective
Trompenaar’s Dimensions
Copyright ©2017 Pearson Education, Inc. 3-42
Privacy in Relationship
High Low
UK US FRA GER ITA JPN SWE SPA CHI
Source of Power and Status
High Low
US UK SWE GER FRA ITA SPA JPN CHI
Specific Diffuse
Personal Society
Critical Operational Value Differences
• Time—differences in temporal values
• Change—control and pace of change
• Material Factors—physical goods and status symbols versus
aesthetics and the spiritual realism
• Individualism—“me/I” versus “we”
3-43
Copyright ©2017 Pearson Education, Inc.
Developing Cultural Profiles
Managers can gather
considerable information on
cultural variables from
current research, personal
observation, and discussion
with people.
Managers can develop
cultural profiles of various
countries.
Managers can use these
profiles to anticipate drastic
differences that may be
encountered in a given
country.
It is difficult to pull together
descriptive cultural profiles in
other countries unless one
has lived there and been
intricately involved with
those people.
3-44
Copyright ©2017 Pearson Education, Inc.
• Though profiles have their limitations, managers can use them to anticipate
differences in the level of motivation, communication, ethics, loyalty, and
individual and group productivity that may be encountered in a given
culture. This Comparative Management in Focus section illustrates how to
synthesize information from Hofstede and others to gain a sense of the
character of a society.
• Much of Japanese culture and working relationships can be explained by
the principle of wa. Wa is embedded in the value of indulgent love, which
leads to mutual confidence, faith, and honor necessary for business
relationships. As such, the workplace is characterized by a mix of
authoritarianism and humanism—much like a family. Management systems
stress rank and looking after employees. There is devotion to work,
collective responsibility, and a high degree of employee productivity.
2/7/2023 45
Comparative Management in Focus
Japan Germany
Copyright ©2017 Pearson Education, Inc. 3-46
• “Wa”—peace and harmony
• A mix of authoritarian and humanism in the
workplace
• Emphasis on participative management,
consensus, and duty
• Open expression and conflict discouraged
• Preference for rules and order,
privacy
• Dislike of inefficiency and
tardiness
• Assertive, but not aggressive
• Organizations are centralized but
still favor consensus decision
making
Comparative Management in Focus
Latin America
Copyright ©2017 Pearson Education, Inc. 3-47
• Not homogenous, but common similarities
• “Being-oriented” compared with “doing-oriented”
• Work and private lives are more closely integrated
• Very important to maintain harmony and save face
Copyright ©2017 Pearson Education, Inc. 3-48
Under the Lens: Doing Business in Brazil
 Almost everyone has a combination of European, African, and indigenous
ancestry
 Individual relationships are important
 Brazilians take time when negotiating
 Brazilian business is hierarchical, and meetings are required
 Avoid confrontations
 Dress well and conservatively
 Business cards are exchanged
 Having your business card printed in Portuguese on the opposite side is a good idea.
Developing Management Styles and Ways of
Doing Business: Saudi Arabia
3-49
Tribalism
Paternalism,
nepotism
Close
friendships
Person-orientation,
Theory Y management
(treat workers with
freedom and respect)
Honor,
shame
Conflict avoidance,
positive reinforcement
Copyright ©2017 Pearson Education, Inc.
Developing Management Styles and Ways of
Doing Business: Chinese Family Business
• Small, family businesses predominate
• “Guanxi” connections
• People are put ahead of business – human centered
management style
• Globalization has resulted in more competitive management
styles: the new generation manager is more individualistic,
more independent and takes more risks
3-50
Copyright ©2017 Pearson Education, Inc.
Copyright ©2017 Pearson Education, Inc. 3-51
Summary of Key Points
 Each society has its own unique culture
 Managers must develop cultural sensitivity
 Researchers such as Hofstede and Trompenaar have created studies which
help describe cultural profiles; GLOBE study created a body of data on
cultural dimensions
 Managers can use research results and personal observations to develop
cultural profiles of countries

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MCS 358 INT CULT MGT.pptx

  • 1. Kwame Nkrumah University of Science & Technology, Kumasi, Ghana MCS 358 INTERCULTURAL MANAGEMENT Kwame Ohene Djan (BSc, MSc, PhD) Department of Marketing & Corporate Strategy KNUST School of Business 2/7/2023 1
  • 2. www.knust.edu.gh 2/7/2023 K Ohene Djan 2 Course Outline Introduction to Intercultural Management Unit 1: Role of Culture in International business management 2.1 Culture and its effects on Organizations 2.2 Cultural Value Dimensions 2.3 Project GLOBE Cultural Dimensions 2.4 Hofstede’s Cultural Dimensions 2.5 Trompenaars’s Value Dimensions 2.6 Developing Cultural Profiles 2.7 Culture and Management Styles around the world Unit 2: Communication Across Cultures 3.1 The Communication Process 3.2 The Culture-Communication Link 3.3 Managing Cross-Cultural Communication
  • 3. www.knust.edu.gh 2/7/2023 K Ohene Djan 3 Course Outline Cont’d Unit 3: Motivating and Leading 3.1 Global Leader’s Role and Environment 3.2 Cross Cultural Research on Motivation 3.3 Cross-cultural research on leadership 3.4 Contingency leadership: The Culture Variable Unit 4: International Human Resource Management 4.1 Expatriation and Repatriation
  • 4. www.knust.edu.gh 2/7/2023 K Ohene Djan 4 Introduction to Intercultural Management Origin of the concept Intercultural management as a concept assumed an identity on its own in the mid 1980s. It gained considerable ground during the 1990s from international diversity perspective. Intercultural management concerns itself with the management of workforces functioning in culturally different operating contexts. These differences can be either ‘external’, where an organization operates across national and ethnic cultures, or ‘internal’, where an organization operates across different branches or regions. Intercultural management may be viewed as a subset of international management.
  • 5. www.knust.edu.gh 2/7/2023 K Ohene Djan 5 Unit 1: Culture and Intercultural Management What is culture? Over 160 definitions of culture were uncovered in the research of Kroeber and Kluckholm (1985), cited by North and Hort, (2002). There is no universally satisfactory definition of the domain of culture (Daniels, 2004). Culture represents a complex pattern of beliefs, expectations, ideas, values, attitudes and behaviors shared by members of a group or team (Hellriegel and Slocum, 2004) who come from the same village, town, country or region – or from the same work unit, department, division or organization. Hofstede (1984, p.13) sees culture as “the collective programming of the mind, which distinguishes members of one human group from another Culture consists of people with shared attitudes, values and beliefs. Cultural activities could be national or organizational.
  • 6. www.knust.edu.gh 2/7/2023 K Ohene Djan 6 Culture also refers to … A set of shared values, understandings, assumptions, and goals that are learned from earlier generations, imposed by present members of a society, and passed on to succeeding generations (Deresky, 2017)
  • 7. Visible and Invisible cultures • There are two dimensions to culture: visible and invisible. • The visible dimensions of culture include:  Language: that spoken language in different countries, organizations which reveals the existence and non-existence of certain concepts;  Short vs long term orientation: different cultural attitude toward time, either short-term thinking and pressure on time, or a more unhurried, longer- term perspective;  Use of space: it varies among different cultures, in terms of comfort in being close; physically to strangers or not;  Religion: that most people follow in each country or a group of countries, and it is the most influential part that can affect the society as whole.
  • 8. Visible cultures Cont’d • Founders’ values - are critical as they hire the first set of managers • Founders likely hire those who share their vision. This develops the culture of the firm • Socialization - Newcomers learn norms and values • Learn not only because ‘they have to’ but because they want to • Organizational behavior, expectations, and background are presented • Symbols - Anything visible representing a shared value: simplest, basic cultural expression such as logos, architecture, parking priorities, uniforms, office location/size, art on the wall etc.
  • 9. Invisible culture • Shared assumptions (e.g. time orientation) are the underlying thoughts and feelings that members of a culture take for granted and believe to be true. Societies differ in their assumptions about time. E.g. In India, Hindus belief that time is everlasting and frequently arrive late to meetings • Values and norms inform workers about what goals they should pursue and how they should behave to reach these goals – basic belief about condition that is important. E.g. TQM to Toyota. Some organizations work hard to create a culture that encourages and rewards risk-taking eg. Microsoft, Oracle seek innovation. Others create an environment of caution eg. Oil refineries, nuclear power plants must focus on caution.
  • 10. www.knust.edu.gh 2/7/2023 10 Levels of Culture A culture starts developing in a context where a group of people have a shared experience. - Family members share a life together - In a business context, culture can develop at different levels within a department or at the various ranks of hierarchy. - A company can develop its own culture provided it has ‘a sufficient shared history’ (Schein, 1999). - Applies also for a collection of companies within a particular business or sector (e.g. airline companies, car making companies, public sector organizations etc. - Regions of a country, regions across countries, or groupings of nations sharing a commonexperience like language, religion, ethnic origins or a shared history in development
  • 11. E.g. Swahili is a Bantu language spoken mainly in Tanzania, Uganda and Kenya, and also in Burundi, Mozambique, Oman, Somalia the Democratic Republic of the Congo and South Africa by about 98 million people. Swahili is an official language of Tanzania, Uganda and Kenya, and is used as a lingua franca throughout East Africa. 2/7/2023 K Ohene Djan 11
  • 12. www.knust.edu.gh 2/7/2023 K Ohene Djan 12 3 Main Levels of Culture 1. Societal Culture Tayeb (2003) argues that there is a constant thread through our lives which makes us distinguishable from others, especially those in other countries: this thread is our national culture. Societies are organized politically into nations, but within this national unity subcultures may exist with specific cultural characteristics. These groups use the society in which they are embedded as their framework of reference, and share their nationality, language and institutions, while being delineated by their socio-economic, historic or geographic characteristics. National variables + Sociocultural variables = Societal Culture
  • 13. Environmental Variables Affecting Management Functions 3-13 Copyright ©2017 Pearson Education, Inc.
  • 14. 2. Organizational Culture 1. Exists within and interacts with societal culture 2. Varies a great deal from one organization, company, institution, or group to another 3. Represents those expectations, norms, and goals held in common by members of that group 4. Cultural elements affect the way strategy is determined, goals are established and how the organization operates • Organizational culture functions equivalently to societal culture, but varies a great deal from one organization to another—even within a single societal culture. Nonetheless, organizational culture is at least partially a function of and must respond to societal culture. 2/7/2023 14
  • 15. • Examples: – IBM vs. Apple – KLM – McDonald’s in Russia • IBM is considered a traditionally to be very formal, hierarchical, and rules- bound, and with its employees usually in suits, and Apple Computer, whose organizational culture is very organic or “loose” and informal with its employees typically wearing casual clothes and interacting informally. • Airline KLM responded to Dutch attitudes regarding families and norms regarding relationships by extending its travel benefits policy to any couple who formally registered as living together—regardless of whether the couple was heterosexual or homosexual, formally married or not. • McDonald’s provides more extensive training to employees in Russia than to those in the US because Russians are less familiar with working within a capitalist system. 2/7/2023 15
  • 16. TYPES OF ORGANISATIONAL CULTURE • Bureaucratic culture • Formalization, rules, hierarchy • Clan culture • Tradition, loyalty, personal commitment • Entrepreneurial culture • Risk-taking, dynamism, creativity • Market culture • Achievement of financial/market goals
  • 17. 3. Corporate Culture • Corporate culture takes the question of organizational culture a step further • If an organization develops into a multinational conglomerate, the culture at headquarters may influence that of its subsidiaries abroad. • Similarly, a firm involved in a joint venture with a company from another country may well find that the presence of the foreign partners influences the underlying culture of the firm • What evolves over time in terms of ‘corporate culture’ can have as its basis the ‘original’ organizational culture, or the national/regional culture- or a combination of the two. 2/7/2023 17
  • 18. www.knust.edu.gh 2/7/2023 18 The extent of influence of corporate culture is disputed among experts in the field. Some regard a clearly defined corporate culture as key to a (multi)national company’s success. Others consider flexible culture to be the key to success because it can adapt to, and respond more effectively to, a local/national environment. Group Assignment to be submitted 3rd June, 2021. Is it necessary for a Multinational company to change its organizational culture? When and Why?
  • 19. The Effect of Culture on Organizational Process Copyright ©2017 Pearson Education, Inc. 3-19 U.S. Culture Alternative Function Affected Individual influences future Life is preordained Planning, scheduling The environment is changeable People adjust to the environment Morale, productivity Hark work leads to success Wisdom and luck are also needed Motivation, rewards Employment can be ended Employment is for a lifetime Promotions, recruitment
  • 20. Culture and its Effects on Organizations • An awareness of and an honest caring about another individual’s culture Cultural Sensitivity or Cultural Empathy? 3-20 Copyright ©2017 Pearson Education, Inc.
  • 21. Culture’s Effects on Management • Convergence—the phenomenon of the shifting of individual management styles to become similar to one another • Self-Reference Criterion—the subconscious reference point of ones own cultural values. Many people in the world understand and relate to others only in terms of their own cultures • Parochialism—occurs, for example, when a Frenchman expects those from or in another country to automatically fall into patterns of behavior common in France • Ethnocentrism—describes the attitude of those who operate from the assumption that their ways of doing things are best—no matter where or under what conditions they are applied 3-21 Copyright ©2017 Pearson Education, Inc.
  • 22. An example of the need to overcome the self-reference criterion is when Japanese workers must put courtesy aside and interrupt conversations with Americans when there are problems. P & G demonstrated ethnocentrism when they ran a popular European advert for Camay soap in Japan. The ad depicted a man walking in on his wife in the bath. The commercial backfired in Japan because the Japanese viewed the man’s behavior as bad manners. 2/7/2023 K Ohene Djan 22
  • 23. Influences on National Culture Subcultures Stereotyping Copyright ©2017 Pearson Education, Inc. 3-23  Many countries comprise diverse subcultures whose constituents conform only in varying degrees to the national character. Example: Canada • A cultural profile that tends to develop some tentative expectations—some cultural context—as a backdrop to managing in a specific international setting
  • 24. Cultural Subsystems that Influence People and Their Behavior 3-24 Copyright ©2017 Pearson Education, Inc. Kinship Education System Economic System Political System Health System Recreation Religion
  • 25. Cultural Value Dimensions Values Are a society’s ideas about what is good or bad, right or wrong Determine how individuals will probably respond in any given circumstances Help managers anticipate likely cultural effects Allow for contingency management Can vary across subcultures 3-25 Copyright ©2017 Pearson Education, Inc.
  • 26. 2/7/2023 26 Values determine how individuals probably will act in given circumstances. They are communicated via the eight subsystems just described and are passed down through generations. Contingency management requires managers to adapt to the local environment and people and to adjust their management styles accordingly. Value dimensions and resulting cultural profiles provide only an approximation of national character. There may be variations in national culture—i.e., subcultures may exist as well. For example, American tend to think of the Chinese as culturally homogenous, but distinct ethnic groups within China have their own customs and dialects.
  • 27. GLOBE STUDIES (1993 by Robert J House )  Global Leadership and Organizational Behavior Effectiveness Research Project  How culture influences leadership and organizational processes  What cultural attributes affect societies’ susceptibility to leadership influence  To what extent do cultural forces influence the expectations that individuals have for leaders and their behavior  To what extent will leadership styles vary in accordance with culturally specific values and expectations?  What principles and laws of leadership and organizational processes transcend cultures?
  • 28. To understand and measure: cultures and leadership  62 countries  170 investigators  17,370 middle managers who worked in  951 organizations  Asked about culture, leadership and organization  Tested 27 hypotheses  Included archival data, media analysis, individual and group interviews and unobtrusive measures
  • 29. GLOBE studies: 9 cultural dimensions  Dimensions drew on previous research 1. Uncertainty avoidance 2. Power distance 3. Collectivism I: societal collectivism 4. Collectivism II: In-group collectivism 5. Gender egalitarianism 6. Assertiveness 7. Future orientation 8. Performance orientation 9. Humane orientation
  • 30.  Important to know:  What the dimensions mean  What high/low on a dimension means  Where your country fits on the dimensions
  • 31. www.knust.edu.gh GLOBE studies: Defining the dimensions 1. Uncertainty avoidance The extent to which a society, organization, or group relies on social norms, rules, and procedures to alleviate unpredictability of future events 2. Power distance The degree to which members of a collective expect power to be distributed equally. 3. Collectivism I: societal collectivism The degree to which organizational and societal institutional practices encourage and reward collective distribution of resources and collective action. 4. Collectivism II: In-group collectivism The degree to which individuals express pride, loyalty, and cohesiveness in their organizations or families.
  • 32. 5. Gender egalitarianism The degree to which a collective minimizes gender inequality. 6. Assertiveness The degree to which individuals are assertive, confrontational, and aggressive in their relationships with others. 7. Future orientation The extent to which individuals engage in future-oriented behaviors such as delaying gratification, planning, and investing in the future. 8. Performance orientation The degree to which a collective encourages and rewards group members for performance improvement and excellence. 9. Humane orientation The degree to which a collective encourages and rewards individuals for being fair, altruistic, generous, caring, and kind to others.
  • 33. GLOBE Research Project Dimensions • Low: Russia, Argentina, Italy • High: Netherlands, Switzerland, Singapore Future Orientation • Low: Germany, Spain, France • High: Malaysia, Ireland, Philippines Humane Orientation 3-33 Copyright ©2017 Pearson Education, Inc.
  • 34. GLOBE Research Project Dimensions • Low: Sweden, Japan, Switzerland • High: Greece, Austria, Germany Assertiveness • Low: Russia, Argentina, Italy • High: U.S., Hong Kong, Singapore Performance Orientation 3-34 Copyright ©2017 Pearson Education, Inc.
  • 35. Hofstede (1983) • Hofstede’s research, which was conducted prior to the GLOBE project, is based on 116,000 people in 50 countries. Nonetheless, all of the research was conducted in a single firm—IBM. As such, the result should be interpreted with caution. 2/7/2023 35
  • 36. Hofstede’s Value Dimensions Power Distance The level of acceptance by a society of the unequal distribution of power in institutions Uncertainty Avoidance The extent to which people in a society feel threatened by ambiguous situations Individualism The tendency of people to look after themselves and their immediate families only and to neglect the needs of society Collectivism The desire for tight social frameworks, emotional dependence on belonging to “the organization,” and a strong belief in group decisions 3-36 Copyright ©2017 Pearson Education, Inc.
  • 37. Hofstede’s Value Dimensions Copyright ©2017 Pearson Education, Inc. 3-37 Power Distance MAL PHI MEX IND FRA ITA JPN SPA ARG US GER UK DEN ISR AUT Uncertainty Avoidance GRE JPN POR KOR ARA GER AUL CAN US UK IND DEN SIN High Orientation Toward Authority Low High Desire for Stability Low
  • 38. Hofstede’s Value Dimensions Copyright ©2017 Pearson Education, Inc. 3-38 Individualism AUL US UK CAN FRA GER SPA JPN MEX ITA KOR SIN Masculinity JPN MEX GER UK US ARA FRA KOR POR CHC DEN SWE Individualism Collectivism Assertive/Materialistic Relational
  • 39. Hofstede’s Value Dimensions Copyright ©2017 Pearson Education, Inc. 3-39 Long-term/Short-term Orientation CHI HK JPN TAI VIE BRA IND US CAN UK E/W AFR High Low
  • 40. Trompenaar’s (1993) value dimension • He used 15,000 managers from 28 countries and they are as follows : 1. Universalism vs. Particularism – many ways / one right way 2. Individualism vs. Communitarianism – Individual / group 3. Specific vs. Diffuse cultures – Extroversion / Introversion 4. Affective vs. Neutral cultures – Openly on emotions 5. Achievement vs. Ascription – Societal standing on effort towards success and vice versa 6. Sequential vs. Synchronic cultures – Systematic and simultaneous 7. Internalistic vs. Externalistic – Power over nature and vice versa
  • 41. Trompenaar’s Dimensions Copyright ©2017 Pearson Education, Inc. 3-41 Obligation High Low US GER SWE UK ITA FRA JPN SPA SIN Emotional Orientation in Relationship High Low JPN UK GER SWE USA FRA SPA ITA CHI Universalistic Particularistic Neutral Affective
  • 42. Trompenaar’s Dimensions Copyright ©2017 Pearson Education, Inc. 3-42 Privacy in Relationship High Low UK US FRA GER ITA JPN SWE SPA CHI Source of Power and Status High Low US UK SWE GER FRA ITA SPA JPN CHI Specific Diffuse Personal Society
  • 43. Critical Operational Value Differences • Time—differences in temporal values • Change—control and pace of change • Material Factors—physical goods and status symbols versus aesthetics and the spiritual realism • Individualism—“me/I” versus “we” 3-43 Copyright ©2017 Pearson Education, Inc.
  • 44. Developing Cultural Profiles Managers can gather considerable information on cultural variables from current research, personal observation, and discussion with people. Managers can develop cultural profiles of various countries. Managers can use these profiles to anticipate drastic differences that may be encountered in a given country. It is difficult to pull together descriptive cultural profiles in other countries unless one has lived there and been intricately involved with those people. 3-44 Copyright ©2017 Pearson Education, Inc.
  • 45. • Though profiles have their limitations, managers can use them to anticipate differences in the level of motivation, communication, ethics, loyalty, and individual and group productivity that may be encountered in a given culture. This Comparative Management in Focus section illustrates how to synthesize information from Hofstede and others to gain a sense of the character of a society. • Much of Japanese culture and working relationships can be explained by the principle of wa. Wa is embedded in the value of indulgent love, which leads to mutual confidence, faith, and honor necessary for business relationships. As such, the workplace is characterized by a mix of authoritarianism and humanism—much like a family. Management systems stress rank and looking after employees. There is devotion to work, collective responsibility, and a high degree of employee productivity. 2/7/2023 45
  • 46. Comparative Management in Focus Japan Germany Copyright ©2017 Pearson Education, Inc. 3-46 • “Wa”—peace and harmony • A mix of authoritarian and humanism in the workplace • Emphasis on participative management, consensus, and duty • Open expression and conflict discouraged • Preference for rules and order, privacy • Dislike of inefficiency and tardiness • Assertive, but not aggressive • Organizations are centralized but still favor consensus decision making
  • 47. Comparative Management in Focus Latin America Copyright ©2017 Pearson Education, Inc. 3-47 • Not homogenous, but common similarities • “Being-oriented” compared with “doing-oriented” • Work and private lives are more closely integrated • Very important to maintain harmony and save face
  • 48. Copyright ©2017 Pearson Education, Inc. 3-48 Under the Lens: Doing Business in Brazil  Almost everyone has a combination of European, African, and indigenous ancestry  Individual relationships are important  Brazilians take time when negotiating  Brazilian business is hierarchical, and meetings are required  Avoid confrontations  Dress well and conservatively  Business cards are exchanged  Having your business card printed in Portuguese on the opposite side is a good idea.
  • 49. Developing Management Styles and Ways of Doing Business: Saudi Arabia 3-49 Tribalism Paternalism, nepotism Close friendships Person-orientation, Theory Y management (treat workers with freedom and respect) Honor, shame Conflict avoidance, positive reinforcement Copyright ©2017 Pearson Education, Inc.
  • 50. Developing Management Styles and Ways of Doing Business: Chinese Family Business • Small, family businesses predominate • “Guanxi” connections • People are put ahead of business – human centered management style • Globalization has resulted in more competitive management styles: the new generation manager is more individualistic, more independent and takes more risks 3-50 Copyright ©2017 Pearson Education, Inc.
  • 51. Copyright ©2017 Pearson Education, Inc. 3-51 Summary of Key Points  Each society has its own unique culture  Managers must develop cultural sensitivity  Researchers such as Hofstede and Trompenaar have created studies which help describe cultural profiles; GLOBE study created a body of data on cultural dimensions  Managers can use research results and personal observations to develop cultural profiles of countries