these slides are for the international business students.

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EVALUATING CULTURAL DIFFERENCES
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OVERVIEW
u Introduction Reasons to study
Culture
u Culture
u Values and Norms
u Culture Society and the Nation
u Culture and Business
u Hofstede Cultural Dimensions
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Introduction
u Differences in culture across and
within countries can affect
international business, its strategies
and operations.
u Relationship may exist between
culture and international business the
cost of doing business in a country or
region.
u Globalization and its effect (culture,
society, business).
u Culture evolve and somehow
changed overtime (cultural invasion)
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Culture
Culture
“ the collective programing of the mind
that distinguishes the members of one
group or people from another”
(Hofstede, 2001)
A system of values and norms that are
shared among a group of people and
that when taken together constitute a
design for living.
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Values, Norms and
Society
u Values is a belief system of a society
about good, right and wrong and
desirable vs undesirable.
u Norms Social rules and guidelines that
prescribe appropriate behavior in
particular situations
u Society Group of individuals (people)
who share a common set of values and
norms.
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Culture Norms & Value
System
Education
Language
Religion
Political
Orientation
Economic System
Social Structure
A system of shared beliefs
and rituals concerned with
the realm of the sacred.
Basic structure and
organization of a society.
Individual or group society
Classes and casts
Main mode of
communication. Spoken
and unspoken mode of
communication
Vital in a society. Way of
learning. language,
conceptual, and technical
skills
A system of shared beliefs
that connect with structure
and system of government
in a country, state or
nation.
ystem of production,
resource allocation and
distribution of goods and
services within a society or
a given geographic area.
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Culture and
Business
u The shared belief, norms and
value system- shape the wants
and preferences (demand) and
Supply, commercial culture
u How a society’s culture affects
the values found in the
marketplace and workplace
u Management process and
practices may need to vary
according to culturally
determined work-related values
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Hofstede's Six
Cultural Dimensions
1.Power distance (High vs Low)
2.Individualism vs Collectivism
3.Masculinity vs Femininity
4.Uncertainty avoidance (High
vs Low)
5.Long-term orientation vs
Short term orientation
6. Indulgence vs Restrain
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Hofstede's Six Cultural
Dimensions
1. Power Distance (High vs Low)
u Degree of inequality among people, which are
acceptable in societies.
u CUSTOMER/BOSS IS ALWAYS RIGHT
CULTURE…?
u High power distance societies tolerate high social
inequalities (power, economic etc.)
u Vertical vs Horizontal organizational structure
u Everyone has its place in a society according to his
status
u Status Symbol plays vital role in the Society
u Malaysia, Philippines, China, Pakistan, Arab
countries vs USA, Germany, Scandinavia, Israel
u Consumers: high status, role model, hero etc.
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Hofstede's Six Cultural Dimensions
u This refers to how much uncertainty a society or culture is
willing to accept.
u It can also be considered an indication of the risk propensity
of people from a specific culture.
u Members of high uncertainty avoidance cultures placed a
premium on job security, career patterns, retirement benefits.
u Stability and what is known are preferred rather than
instability and the unknown. Company cultures in these
countries may show a preference for low-risk decisions.
Japan, Pakistan and France vs Norway, Sweden, Denmark,
Israel.
u Lower uncertainty avoidance cultures were characterized by a
greater readiness to take risks and less emotional resistance to
change.
u Innovation, risk taking and entrepreneurial orientation
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Hofstede's Six Cultural
Dimensions
3. Individualism vs Collectivism
Individualism
u The extend to which a person prefer to act as
individual rather than as a group member (me vs
we)
u Presence for a loosely knitted interaction
u Individualism focus on own interest and his
immediate ones.
u Limited loyalty towards a group
Collectivism
u Group centric, differentiate themselves through
their affiliation in groups
u Expect protection form groups and loyal with
groups
u USA, Australia, Britain vs Pakistan, South
Korea, Japan, Taiwan etc.
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Hofstede's Six Cultural Dimensions
4. Masculinity vs Femininity
u Men dominant- Men tend to be more focused on
performance, ambition, and material success.
u They cut tough and independent personas, while
women cultivate modesty and quality of life.
Cultures in Japan and Latin American are examples
of masculine-oriented cultures.
u Women dominant- In a feminine culture the
difference between gender roles is minimized, with
both sides placing value on caring, interpersonal
relationships, and quality of life.
u Feminine cultures are thought to emphasize
“feminine” values: concern for all, an emphasis on
the quality of life, and an emphasis on relationships.
In feminine-oriented cultures, both genders swap
roles, with the focus on quality of life, service, and
independence.
u The Scandinavian, Switzerland and New Zealand
cultures rank as feminine cultures
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Hofstede's 6 Dimensions
5. Long-term vs Short-term Orientation
u Worries about FUTURE
u Pragmatic approach towards future and long
run
u LT- Encourage thrift and efforts to prepare for
the future (investments, adopting modern
education, technology etc.) and focus on
relation
u ST- concerned about PRESENT
u Maintaining time-based traditions and norms,
and focus on transactional aspect
u Suspicious about future (timely investment and
adoption).
u Think on House, Health, education, Car etc.
u China, Japan, India, Pakistan, vs USA, Britain,
Canada, Norway
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Hofstede's 6 Dimensions
6. Indulgence VS Restraint
Indulgence- societies that allows relative free
gratification of basic and natural human derived
related to enjoying life and fun.
Restraint-Societies that suppress gratification of
such needs and drive through strict social norms
and standards.
Think on travel agencies, holidays maker, junk
food etc.
Pakistan, Afghanistan, Bangladesh Saudi Arab VS
Scandinavia, Germany, Holland, USAetc.
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Why We Do
the Cultural
Analysis?
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