II Country Factors

1. II Country Factors

2. Collectivism vs. Individualism Collectivism • A political system that stresses the primacy of collective goals over individual goals. • Advocated by Plato in the “Republic.” • In modern times, the Socialists advocate Collectivism.

3. Socialism • Trace intellectual roots to Karl Marx. • Argued that the pay of workers does not reflect the full value of their labor. • Advocated state ownership of production, distribution, and exchange (businesses), thereby ensuring that workers were fully compensated for their labor. • Two Approaches for Socialism • Communists: Socialism is achieved through violent revolution. • Social Democrats: Socialism is achieved through democratic means.

4. Individualism • Opposite of Collectivism. • Individual should have freedom in political and economic pursuits. • Advocated by Aristotle: Private property is more highly productive than communal property and will thus stimulate progress. • Revived during the 16th century in England and the Netherlands. • Hume (1711-1776) • Adam Smith (1723-1790) • John Stuart Mill (1806-1873) • Embodied in the U.S. Declaration of Independence

5. Democracy and Totalitarianism • Democracy: Government by the people, exercised either directly or through elected representatives. • Totalitarianism:Government in which one person or political party exercises absolute control over all spheres of human life and opposing political parties are prohibited.

6. 4 major forms of Totalitarianism • Communism • Collectivism is achieved through total dictatorship. • Theocratic • Political power is influenced by religious principles. • Tribal • A political party representing the interests of a particular tribe monopolizes power. • Right-wing • Generally permits individual economic freedom, but restricts political freedom to prevent the rise of communism.

7. Economic Systems • Market Economy: • All productive activities are privately owned. • Command Economy: • Goods and services produced, their quantity, and prices are determined by the government. • Mixed Economy: • Parts of the economy are left to private ownership and free market mechanisms while other sectors are state-owned and have government planning. • State-Directed Economy: • The state plays a significant role through its “industrial policy” and setting national goals.

8. Legal Systems: Rules, or laws, that regulate behavior and the processes by which laws are enforced and grievances redressed. • Property Rights: thelegal rights over theuse of a resource and the income derived from it. • Property rights can be violated by two ways • Private Action: Theft, piracy, blackmail and the like by private individuals and groups. • Public Action and Corruption: Violation of property rights by public officials, such as politicians and government officials, by extorting income or resources from property holders.

9. What is Culture? • A system of values and norms shared among a group of people and, when taken together, constitute a design for living. • Norms: • Social rules and guidelines that prescribe appropriate behavior in particular situations. • Folkways: Routine conventions of everyday life. • Mores: Central to functioning of society and its social life. • Values: • Abstract ideas about what a group believes to be good, right, and desirable. • The bedrock of culture. • Have emotional significance: Freedom.

10. Economic Philosophy Education Political Philosophy Culture: Norms and Value Systems Language Social Structure Religion Determinants of Culture

11. Class Consciousness: May play a role in a firm’s operations Social Stratification Typically defined by family background,occupation, and income. Class: some social mobility Caste: Virtually no mobility

12. Religion • Shared beliefs and rituals concerned with the realm of the sacred. • Ethical Systems: • Moral principles or values used to guide and shape behavior. • Shapes attitudes toward work and entrepreneurship and can affect the cost of doing business.

13. World’s Religions

14. Religion and Economic Implications • Christianity • “Protestant Work Ethic” and “The Spirit of Capitalism”. • Islam • Favors market-based systems. • No payment or receipt of interest. • Hinduism • Asceticism may have an impact. • Caste system plays a role. • Buddhism • Little emphasis on entrepreneurial behavior. • Confucianism • Loyalty, reciprocal obligations, and honesty in dealings.

15. Language • Allows people to communicate. • Structures the way the world is perceived. • Directs attention to certain features of the world rather than others. • Helps define culture. • Creates separatist tendencies?

16. Spoken Language

17. 不瞭解當地語言可能犯下致命錯誤 • Sunbeam 公司在德國推出一款捲髮器產品， 命名為 “Mist-Stick” ，“mist”為朦朧或薄霧之意，然而這個字在德國卻有「排泄物 」之意。 • GM 在 Purto Rico 推出新款 Chevrolet Nova，”Nova” 翻譯成西班牙文 ，意義為 “star” ，然而發因類似 “no va” ，西班牙文的意思為 “it doesn’t go” 。

18. Nonspoken Language • Nonverbal cues: • eyebrows • fingers/thumbs • hand gestures • feet • personal space • body gestures

19. 無聲的語言 • 用拇指與食指作一圓的手勢在美國是友善，但在希臘和土耳其卻是一種粗俗的性邀請。 • 大多數美國人和歐洲人舉起大拇指表示 “good”，在希臘表示淫穢之意。 • 私人空間：美國企業雙方討論的習慣舒適距離是5~8步，拉丁美洲是3~5步。

20. Hofstede • Study (IBM) is a general way to look at differences between cultures. • 4 dimensions: • Power distance. • Individualism versus collectivism. • Uncertainty avoidance. • Masculinity versus femininity. • But: • Assumption of one-to-one relationship between culture and nation-state. • Research may be culturally bound. • Respondents worked within a single company. • Work is beginning to look dated (1967-1973).

21. Work Related Values for Selected Countries

22. Hofstede later added the fifth dimension: long-term orientation. • A culture with a long-term orientation is based on stability, persistence, order & thrift. • The success of Japanese companies in 1970s to early 1990s: Focus on long-term investment, commitment to their workers, and building of relationships with their customers. • A culture with a short-term orientation will expect immediate returns and will focus on satisfaction of immediate needs and wants. • U.S. & U.K. companies are often criticized for their focus on short-term goals (maintain share prices).

23. Trompenaars’ dimensions of culture framework • It comprises three groupings of cultural factors: • Relationships with people • Time • Relating to natural (the natural environment) • Relationships with people can be considered in five subdivisions: • Universalism vs. particularism • Individualism vs. communitarianism (collectivism) • Affective vs. neutral cultures • Specific vs. diffuse relationships • Achieving vs. ascribing status

24. Organizational culture • Each organization will have its own distinctive culture or way of working. • The intangible nature of culture makes cultural change difficult to manage. • The culture of an organization is made up of the distinctive values, attitudes, beliefs and norms which influence the way in which it conducts its business. • Peters and Waterman (1982) found that organizational culture was related to performance

25. Determinants of Organizational Culture • National culture • Industry culture • Size of the organization • Organization history • Management and leadership style • Nature of the employees