[국제경영론] Differences in culture_cultural dimension of hofstede, Cross-cultural, Ethnocentric, Polycentric approach

국제경영론 International Business

Chapter. Differences in culture 

 

Cross-cultural literacy

• an understanding of how cultural differences across and within nations can affect the way in which business is practiced
• relationship between culture and the costs of doing business in a country or region
• Culture is not static
  • actions of MNEs can contribute to cultural change

 

culture

culture is a system of

• values
  • abstract idea about what a group believes to be good, right, desirable
  • provide context within which society’s norms are established and justified (often reflected in political and economic system)
• norms
  • social rules and guidelines that prescribe appropriate behavior in particular situation
  • govern the actions of people toward one another and can be further subdivided into
    • folkways: routine conventions of everyday life
    • mores: seen as central to the functioning of society and to its social life
• that are shared among group of people and when taken together constitute a design for living

• society
  • a group of people who share a common set of values and norms
  • not strict one to one correspondence between society and nation state
    • nation - states are political creations that can contain single culture or several culture (미국: 인디안 흑인 영국 등 )
    • some cultures embrace several nations
• determinatns of culture
  • value and norms of culture are evolutionary product of a number of factors at work in society including
    • prevailing political and economic philosophy
    • society’s social structure
    • dominant religion, language, education

 

cultural dimension of hofstede

• culture and workplace
  • how does society’s culture affect values found in business workplace?
  • most influential study : Geert Hofstede , isolated four dimensions
  • power distance, individualism vs collectivism, uncertainty avoidance, masculinity vs femininity
  • based on survey of IBM employees around the world
    • 64 countries, 160K employees, Large scale survey
  • Cultures and Organizations: Software of the Mind
    • First data collected 1967-1973, Recollected in 1990-2002
• power distance
  • Focuses on how a society deals with the fact that people are unequal in physical and intellectual capabilities
    • The extent to which the less powerful members of organizations accept and expect that power is distributed unequally.
    • It suggests that a society’s level of inequality is endorsed by the followers as much as by the leaders.
  • In countries with high power distance,
    • Prefer little consultation between tiers (superior-subordinate)
    • Autocratic or paternalistic management style
    • Values difference in power
    • Respect for authority
  • low power distance
    • Prefer consultative styles
    • Less emphasis on inequality
    • More direct communication with boss
• individualims vs collectivism
  • Focuses on the relationship between the individual and his or her fellows
    • The degree to which individuals are integrated into groups
    • The word‘ collectivism has no political meaning: it refers to the group,not to the nation-state
  • high individualism country
    • Prefer personal decision making and on-the-job training
    • Individual achievement and freedom are valued
    • Self-actualization opportunity is prime motivator
  • high collectivism
    • Value group’s goal and relationship
    • Dependence on the organization regarding training, working condition, benefits
    • Security needs are prime motivator
• uncertainty avoidance
  • Focuses on a society’s tolerance for uncertainty and ambiguity
    • the extent to which a culture programs its members to feel either uncomfortable or comfortable in unstructured situations
  • high
    • Prefer to follow set rules
    • Long-time employment
    • Need for rules, regulations, and clear instructions
    • Consumers are less prepared as an early product adopters
  • low
    • Greater acceptance to uncertainty
    • Less resistance to change
• masculinity vs femininity
  • This dimension is less about gender and more about gender roles
  • high masculinity
    • Gender roles are sharply differentiated
    • Emphasis on ‘masculine’ values including achievement, power, success, and competition
    • Credit for successful achievement
    • Money-and-thing orientation
  • high femininity
    • Gender roles are less sharply differentiated
    • Emphasis on values relationships and concern for others
    • Employee and social welfare
    • People orientation
• newly added : long-term orientation
  • =confucian dynamism, captures attitude toward time, persistence, ordering by status, protection of face, and respect for tradition
  • long-term
    • take long term view in life, work, etc.
    • asian values (confucius), discipline, loyalty, harmony
  • short-term
    • immediate result or success
    • direct and immediate reard or compensation
• newly added: indulgence vs restraint
  • indulgence is about good things in life
  • in an indulgent culture, it is good to be free. doing what your impluses want you to do, is good. friends are important and life makes sense.
  • in a restrained culture, the feeling is that life is hard and duty, not freedom, is the normal state of being
• critiques
  • it is subject to braod criticism
  • Assumes a one-to-one relationship between culture and nation-state
  • Research may be culturally bound
  • Informants only worked within a single industry – computers – and within one company – IBM.
  • Certain social classes excluded from research
  • Is culture static?

cultural dimension

• universlaims / particularism
  • emphasis on rules and policies that apply to everyone
  • vs emphasis on circumstaces (relationship) that pose exception to the rule
• formality / informality
  • emphasis on respect for custom and tradition
  • vs informal dress, etiquette, relationships, informality in speaking
• communication
  • language reflects and shapes values
  • Explicit = communication is direct and unambiguous (low context)
  • Implicit = language is more ambiguous, and implicit (high context)
  • Importance of nonverbal context
  • Face saving (many ways of saying “No”)
• silent language
  • body language
    • Differences in way people walk, touch, or move
    • Universal gesture?
  • distance
    • Accustomed distance people should maintain during conversation or business
    • Distance may vary
  • color
    • Distinct connotations in different countries
    • Different preference
• distance & space orientation
  • public
    • space around individual is public anyone can enter it
    • (Large rooms, few partitions, managers interspersed with employees)
  • private
    • space around individual is private so others must ask for per mission
    • (Closed door meetings, private offices)

• cultural change
  • Culture evolves over time, although changes in value systems can be slow and painful for a society
    • Social turmoil is an inevitable outcome of cultural change
    • As countries become economically stronger, cultural change is particularly common
    • As countries get richer, there is a shift from “traditional values” to “secular rational” values and from “survival values” to “well-being values”

 

implication and management

• implications for manager
  • Individuals and firms must develop cross-cultural literacy (an understanding of how cultural differences across and within nations can affect the way in which business is practiced)
  • International businesses that are ill informed about the practices of another culture are unlikely to succeed in that culture
  • Individuals must also beware of ethnocentric behavior (a belief in the superiority of one's own culture)
• management orientation
  • Ethnocentric Approach
    • “What works at home will work abroad.”
    • Transfers most or all home country practices, objectives, etc. to foreign subsidiaries.
  • Polycentric Approach
    • “Managers at headquarters have no idea what will work abroad.”
    • Control decentralized so that local managers can adapt fully to local conditions.
  • A Geocentric approach attempts to balance home and host country cultures, needs, capabilities, and constraints.
  • transfer practices that are critical to strategy and potentially successful
  • Customize less-strategic, and more culturally-sensitive areas to local environment