Chapter 3:

The Cultural Environment

of International Business
 Cultural and cultural Risk
2

CULTURE
oValues, beliefs, costums, arts and other product
of human thoughts and worl that characterize the
people.
oShapes and behaviours

oAffects the common rituals on daily life.

oDefines values and attitude.

oThe way we perceive the meaning of life.

 Cultural and cultural Risk
3

CROSS – CULTURAL RISK

oSituation or events in which a cultural
misunderstanding put some human value at
stake.
oCan ruin business deals, hurt sales, or harm the

corporate image.
 Framework on the essential
Elements of Culture
Cross Cultural Risk

Language Dimensions

Models and Explaination Religion

4
 “
◈ We can change
culture if we change
behavior.
◈
◈ — Dr. Daniels
Aubrey, Founder of
ADI
 1

What Culture Is Not?

 1. Not right or wrong
•Culture is relative.
7 •People with different nationality perceive the world
differently.
•Each culture has acceptable and unacceptable
behavior.
2. Not about individual behavior
•Culture is not about groups.
•Collective phenomenon of shared values and
meanings.
•Culture collective behavior of a society, individuals
often behave differently.
8
3. Non inherited
•Culture comes from people invironment.
•No one is born with a shared set of values and
attitudes.
•Children gradually aquire specific way of thinking and
behaving as they were raise in a society.
 MEGAMIND
9
Socialization and
Acculturation
10
 Socialization
11
Process of learning the rules and behavioral patterns
appropriate in living in one’s own society.

Acculturation
Process of adjusting and adapting to a culture other
than one’s own.
Dimentions of Culture

12
 Values and Attitudes
13 VALUES
A persons judgement about what is good and bad.
Acceptable or unacceptable, important or unimportant, normal
or abnormal.
Basis for our motivation and behavior
Guides the development of our attitudes and references.
ATTITUDES
Similar to opinion but are oftenly unconciously held and may not
be base on facts.
e.g Prejudice rigidly held attitude.
 Manners and Costums
Ways of behaving and conducting oneself in public and
14
business situation.
Perception of time
Time has a strong influence in business. E.g.planning,
scheduling, decision making, work and meeting.
Monochronic – rigid orientation on time. Focus on schedules,
punctuality and time as a resource.
◈ Not tolerate lateness or interruptions. One at a time.

Polychronic – a flexible, a nonlinear orientation to time. To

do multiple things.
15 Perception of Space
We have our own sense of personal sense and feel
uncomfortable if others violate it.

Symbolic Productions
Can be letters, figures, colors, or other characteristic that
communicate meaning.
Can represent nations, religions or corporation, and they can
help to unite people.
16 Material Production and Creative Expressions
MATERIAL PRODUCTION – artifacts and objects and
technological system.

CREATIVE EXPRESSIONS – culture, arts, folklore, music,

dance theater and high cuisine.

Education
Lessons and behaviors aquired from parents, family and
peers, participation on groups (socia, business and
religious) and formal schooling.
 Social Structure
Pattern on social arrangement and organize relationships that
17 characterize a society.
How a society is organized in terms of individuals, family,
groups and socioeconomic strata.

Individuals – Western cultures emphasize individualism and

individual success, social status often determined by individual
performance.

Family – immidiate and extended family holds particular

importance in the nations social structure.
 Reference Groups – peoples social status is defined by
18 group or employer affiliation rather than by individual
performance.

Social Stratification – individuals are classified within classes

and social layers depending on their occupation, income level
or family history.
Higher social strata – senior business and government
Middle Strata – business managers, medical or scientific
professionals.
Lowest Strata – work in manual labor, retailing or lower
administrative position.
19

Social Mobility
Refers to the ease with which a person can move up within
social strata.