Chapter Two The Cultural Environments Facing Business

Chapter Objectives • To understand methods for learning about cultural environments • To analyze the major causes of cultural difference and change • To discuss behavioral factors influencing countries’ business practices • To understand cultural guidelines for companies that operate internationally 2-2 .

The People Factor • Culture refers to learned norms based on the values.pepsi co and IBM • Cultural collision(crash/smash)-happens coz not adjusting with foreign culture or not adjusting with co.policies • Sensitivity and Adjustment 2-3 .g. and beliefs of a group of people • Cultural diversity-e. attitudes.

Cultural Awareness • There is no foolproof way to build your awareness of culture • Hard to isolate culture from economic and political conditions • Education about a culture helps • Studies of cultures have shortcomings 2-4 .

The Nation as a Point of Reference • National boundaries act as proxy for culture • Not everyone in a country shares the same culture • Certain cultural attributes may link groups from different nations more closely than certain groups within nations 2-5 .

How Cultures Form and Change • Cultural values set early in life • Changes occur from:  Choice  Imposition(OBLIGATION/BURDEN) 2-6 .

tends to stabilize cultures. culture spreads more easily • Among nations that share a same language. • Some countries see language as being so important that they regulate the inclusion of foreign words and/or mandate the use of the country’s official language for business purposes.Language as a Cultural Stabilizer • When people from different areas speak the same language. especially because of language. commerce is easier • Isolation from other groups. 2-7 .

Religion as a Cultural Stabilizer • Centuries of profound religious influence continue to play a major role in shaping cultural values • Many religions influence specific beliefs that may affect business 2-8 .

Closed society • Attitude towards gender • Attitude towards age • Importance of family group • Prestige of occupation 2-9 .Issues in Social Stratification • Ascribed group memberships are determined at birth • Acquired group memberships are based on one’s choice of affiliation • Performance orientation of the society • Open vs.

Issues in Work Motivation • Materialism and Motivation • Expectation of Success and Reward • Assertiveness(forcefulness): The Masculinity(manliness)–Femininity Index • Hierarchies of Needs 2-10 .

collectivism: degree of dependence on organization 2-11 .Factors Affecting Relationship Preferences • Power distance: general relationship between superiors and subordinates. • Individualism vs.

Factors Affecting Risk-taking Behavior • • • • Uncertainty avoidance Trust Future orientation Fatalism 2-12 .

Factors Affecting Information and Task Processing • Perception of cues • Obtaining Information: Low-Context versus High-Context Cultures • Information Processing 2-13 .

Factors Affecting the Communication Process • Spoken and Written language • Silent language:      color associations conversational distance perception of time and punctuality body language and gestures prestige 2-14 .

management of change is also important here.Dealing with Cultural Differences • • • • Accommodation Cultural distance Culture shock Company and Management orientations    Polycentric-these type of organisation tends to believe business units in different countries should act like local co. they do not believe in changes.this system reflects the conviction that ones own culture is superior to that of other countries. Geocentric.s. 2-15 . because people do not accept the changes immediately.it is the hybrid of both home and foreign country culture . Ethnocentric.

Factors Affecting Strategies for Instituting Cultural Change • • • • • • • • Value systems Cost/benefits of change Resistance to too much change Participation Reward sharing Opinion leadership Timing Learning abroad 2-16 .

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