Cultural and Social Influences

1. Cultural and Social Influences International Business Chapter 2

2. Understanding Culture • Culture in International Business • Cultures of both trading partners can affect every aspect of a business relationship • Understanding Culture • Culture • The set of beliefs, customs and attitudes of a distinct group of people. • Corporate culture – shared values, beliefs, and goals of a company 2-1

3. Understanding Culture • Elements of Culture • Values • Strongly held concepts that are present in a culture • Ex: Freedom, democracy, loyalty, justice, truth, • Norms • Social rules that affect behaviors and actions, and represent cultural values • Folkways and mores • Folkways - Cultural customs that dictate how people act socially. • Mores – Customs that reflect moral standards in a culture • Role • The part a person plays in social situations

4. Understanding Culture • Value Dimensions of Culture • A management technique or philosophy that works in one culture may not be appropriate for another • Value Dimensions • Power Distance • Supervisors a always right = large power distance • People have more rights, collaborative = small power dis. • Individualism • How people value the individual vs. the group • Gender Differentiation • Reflects the extent to which a culture values assertiveness, acquisition of money and status, and achievement • Uncertainty Avoidance • High risk avoidance = less risk taking (can prevent progress) • Low risk avoidance = taking risks lead to success • Short-Term or Long Term orientation • Measure how businesspeople value short term vs. long term results

5. Understanding Culture • Understanding Subcultures • Subcultures • Smaller group or subset within a larger culture • Can be formed around music, religion, political affiliation, or similar interests. • Also age, race, gender • Single Culture and Multicultural Countries • Homogeneous – One group of people is dominant in the population • Heterogeneous – Many different groups of people • Multinational Companies • Business decisions are may be more inclusive and targeted to a variety of cultures 3-1

6. Participating in Culture • Social Influences in Cultural Adjustment • Identify social institutions of a country and recognize how they operate • Prepare for, adjust to, and participate in the culture of a new country • Social Institutions • The organizations that represent the patterns of activity that express the culture of a country 3-2

7. Participating in Culture • Social Institutions • Education System • Differ widely from country to country • Main difference is the access to education and type of education • Religious Organizations • Religious influence can be long lasting • Some countries are ruled by religious law • Other countries have the separation of church and state • Religious leaders are political forces in many countries, even ones with the separation

8. Participating in Culture • Gender Roles • Roles males and females have in certain cultures • Class System • Class differences are strong = Upper class have better access to education. Work and legal system • It is difficult to move from lower economic and social classes to upper class • Class differences are weak = moving upward socially or economically is possible for more people • Degrees of Mobility • Relates to where people live and how easily they can move to live in different places

9. Participating in Culture • Overcoming Culture Shock • Culture Shock • A Reaction that newcomers to a culture may experience • Cultural Baggage • Set of cultural attitudes that include the beliefs, values and assumptions that people carry with them throughout life • U.S. = Time is money, Other countries have a slower pace • Cultural Bias • A preconceived attitude of favoring or disliking a particular culture

10. Participating in Culture • Stereotyping • The practice of identifying a person or group by a single trait, or as a member of a certain group instead of as an individual • When adjusting to a new culture, it is vital to prevent cultural baggage, bias, or stereotyping. • Communication Skills • Can counteract negative attitudes and broaden your perspective about different cultures • Learn a few basic phrases as well as correct gestures • This will show respect for another culture

11. Participating in Culture • Concept of Time • Become familiar with how people view punctuality and pace • How do they value leisure time? • When do people work? • Calendars & Holidays vary by country, time at work varies • Directness in Communication • Get right to the point • Casual pleasantries first

12. Participating in Culture • Achievement and Work • How does a country value accomplishments • Job Prestige • How is a job viewed by the population • Change • Change may need to be implemented slowly and carefully

13. Cross Culture Literacy • Preparing yourself to the differences in culture • Makes you a more valued employee and enhances your experience • Ethnocentrism • The belief that one’s own culture is better than all other cultures • Those that become culturally literate replaces the idea of better with different • Exploring Cultures • To participate in another culture is to become involved in as many activities as possible. • Ex. Music, art, architecture, food, religious events, patterns of living