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Culture and Differences in Culture. Chapter Three. Last week: Political economy. Political systems: They differ radically from one country to the next The ease of doing business varies with the system You have to understand the rules where you are
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Culture and Differences in Culture Chapter Three
Last week: Political economy • Political systems: They differ radically from one country to the next • The ease of doing business varies with the system • You have to understand the rules where you are • Level and nature of economic development also differs radically from one place to the next • Gross National Income (GNI) and Purchasing Power Parity GNI measure the differences
What is Culture? “The collective programming of the mind which distinguishes one human group from another” - Hofstede
Components of Culture:One standard approach • Values – basic attitudes about what is important • Norms – social rules • Society
Culture, Society, and the Nation State • There is not a strict one-to-one correspondence between a society and a nation state • Nation State: • Is a political creation • May contain a single culture or several cultures • Canada • India • Multi-tribal African nations
Societies contain subcultures • ethnic cultures • business or professional cultures
Social Structure • Social structure refers to its basic social organization • Two dimensions that are particularly important include: • The extent to which society is group or individuallyoriented • Degree of stratification into castes or classes
Religious and Ethical Systems • Religion: a system of shared beliefs and rituals that are concerned with the realm of the sacred • Ethical systems: a set of moral principles, or values, that are used to guide and shape behavior • Most of the world’s ethical systems are the product of religions • Among the thousands of religions in the world today, four dominate in terms of numbers of adherents: • Christianity with 1.7 billion adherents • Islam with 1 billion adherents • Hinduism with 750 million adherents • Buddhism with 350 million adherents
Religions are hugely important, but Prof. Hill may not be too expert on them • I am not holding you responsible for the information about specific religions on pp.96-105 • But the sidebars on ‘Islamic capitalism’ and ‘McDonald’s and Hindu culture’ illustrate well how religion interacts with business
Language • Spoken • Verbal cues • Language structures perception of world • Unspoken • Body language • Personal space
Be alert for unexpected meanings of ‘silent language’ • Colors • Blacksymbolizes death in U.S. • White indicates death in Asia • Purple indicates death in (some situations in)Latin America • Gestures • Sideways head movement that means ‘yes’ in Greece looks like negative ‘no’ head shake in U.S.
Culture in the Workplace • Four dimensions of culture • Power distance – the extent to which people are comfortable with inequalities of power and wealth • Uncertainty avoidance - the extent to which people accept ambiguous situations and tolerate uncertainty • Individualism versus collectivism - this dimension focuses on the relationship between the individual and his/her fellows within a culture • Masculinity versus femininity - this dimension looks at the relationship between gender and work roles
Problems with Hofstede • Assumes one-to-one relationship between culture and the nation state • Research may have been culturally bound • Survey was of IBM employees, conducted by Europeans and Americans • Survey respondents were from a single industry (computer) and a single company (IBM)
Other scholars have proposed many other dimensions of culture, but none have been shown more significant than the first three Hofstede developed
Cultural Change • Culture evolves over time • Since 1960s American values toward the role of women have changed • Japan moved toward greater individualism in the workplace • Globalization will continue to impact cultures around the world
Managerial Implications • Cross-cultural literacy • You need to understand differences between cultures • Culture and competitive advantage • Some cultures make business easier than others • Culture and business ethics • As we’ll see, cultural differences create big ethical issues
Looking Ahead to Chapter 4 • Ethics in International Business • Ethical Issues in International Business • Ethical Dilemmas • The Roots of Unethical Behavior • Philosophical Approaches to Ethics • Ethical Decision Making