Culture and Societies

• How cultural and social environments impact on international

business.
• What is culture?
• Cultural theories
• Organizational culture
• Changing societies
• Challenges and responsibilities
What is culture?

• Culture – a shared way of life of a group of socially interacting people

• How do we view other cultures?

• Ethnocentrism
• Polycentrism
Facets of Culture
Culture Theories: Hofstede’s Cultural
Dimensions

How would this be useful for

business?
Learn more

Country comparisons
Approaching culture through curiosity
https://www.youtube.com/watch?v=YMyofREc5Jk

Group exercise:

What are the main ideas in this TED talk (provide 1 or 2)? Why,
according to the speaker, is understanding cultural differences
important to global business? What are some cultural differences
you’ve experienced or observed?
Cultural Intelligence
• The ability to interpret and adapt successfully to different national,
organizational, and professional cultures
• Three components to the development and use of cultural
intelligence:
• Cognitive – knowledge of economic, legal, ethical and social systems
prevalent in different cultures and subcultures
• Motivational – the intrinsic desire to learn about different cultures and
subcultures and the confidence to function effectively in situations where
differences are present
• Behavioral – the ability to use appropriate verbal and nonverbal actions when
interacting with people from different cultures and subcultures
Changing Societies: migration, urbanization,
and changing demographics
• Migration is the movement of people from one place to another
• Ideas, values, traditions, languages and customs also migrate
• Urbanization is movement of people from rural to urban areas
• In fast industrializing countries, issues of security, poor housing,
unemployment, poor health provision
• Demographic change refers to changes in whole populations brought
about by rises and falls in birth rate and death rate, and migration
• Aging society
• Any culturally diverse work group will have a set of common
experiences and another set of differences that must be managed.
Mattel Misses Playtime in
China
• In March 2009, Mattel hoped to hawk its skinny fashionista
Barbie to the kids of China.
• The goal – build a giant 36,000-square-foot Barbie
stronghold with six floors, a staircase lined with 875 Barbies
and a Barbie-themed bar in the midst of Shanghai’s flashy
retail district.
• The store closed within 2 years.
• Why?
Walmart Creeps Out the Germans
• Like Home Depot, U.S. big box
retailer Walmart failed to take
into account cultural nuances
when it opened up shop in
Germany in 1997.
• The chain opened 85 stores in
an attempt to tap into the frugal
country’s lucrative discount
department market.
• In 2006, Walmart pulled out, at
a cost of US$1 billion.
• Why?
The golden arches
lose their shine
• Why did McDonalds not spot the changes
taking place in consumer tastes?
• Why are the fast casual restaurants
proving more popular than fast food?
• McDonald’s has had a poor reputation in
employee relations. Why?
• What changes should Mr. Easterbrook
introduce that would win customers back
and improve employee relations?
What Fast Food Looks Like Around the Worl
d
Measure your cultural literacy
• Doing Business in Other Countries
An Alternative Model: Global Dexterity
https://hbr.org/video/2363497345001/reaching-across-cultures-withou
t-losing-yourself

Takeaways?