CH 04

Chapter 4
International Management and

Cross-Cultural Competence
4-1
Copyright © Houghton Mifflin Company. All rights reserved.
Chapter Outline
Global Organizations for a Global

Economy
• The Internationalization Process
• From Global Companies to Transnational
Companies
4-2
Chapter Outline
(continued)
Toward Greater Global Awareness and

Cross-Cultural Competence
• Travelers versus Settlers
• Contrasting Attitudes Toward International
Operations
• The Cultural Imperative
4-3
Chapter Outline
(continued)
Comparative Management Insights

• Applying American Management Theories
Abroad
• Ouchi’s Theory Z: The Marriage of American and
Japanese Management
• A Cross-Cultural Study of Work Goals
• An International Contingency Model of
Leadership
4-4
Chapter Outline
(continued)
Staffing Foreign Positions

• Why Is the U.S. Expatriate Failure Rate So High?
• Cross-Cultural Training
• What about North American Women on Foreign
Assignments?
• Relying on Local Managerial Talent
4-5
GLOBAL ORGANIZATIONS FOR A
GLOBAL ECONOMY
The Six-Stage Internationalization
Process
Stage 1: Licensing
Stage 2: Exporting
Stage 3: Local warehousing and selling
Stage 4: Local assembly and packaging
Stage 5: Joint ventures
Stage 6: Direct foreign investments
4-6
GLOBAL ORGANIZATIONS FOR A
GLOBAL ECONOMY
(continued)
Global company: a multinational venture centrally

managed from a specific country.
Transnational company: a global network of
productive units with a decentralized authority
structure and no distinct national identity.
For Discussion: Why are some people alarmed at
the development of transnational companies?
What is your opinion?
4-7
CONTRASTING ATTITUDES TOWARD
INTERNATIONAL OPERATIONS
Ethnocentric attitude: home-country oriented

(“My culture and ways are superior.”)
Polycentric attitude: host-country oriented

(“When in Rome, do as the Romans Do.”)
Geocentric attitude: world-oriented (“Search the

globe for the best talent.”)
4-8
CONTRASTING ATTITUDES TOWARD
INTERNATIONAL OPERATIONS
(continued)
For Discussion:
1. What evidence of an ethnocentric attitude have
you observed lately?
2. What problems will ethnocentric managers have

in the new global economy?
4-9
Figure 4.1 The Evolution of Theory Z
Organizations (a)
Source: From Theory Z: How American Business Can Meet the Japanese Challenge by William Ouchi. Copyright
© 1981. Reprinted by permission of Perseus Books Publishers, a member of Perseus Books, L.L.C.
4-10
Figure 4.1 The Evolution of Theory Z
Organizations (b)
Source: From Theory Z: How American Business Can Meet the Japanese Challenge by William Ouchi. Copyright
© 1981. Reprinted by permission of Perseus Books Publishers, a member of Perseus Books, L.L.C.
4-11
THE CULTURAL IMPERATIVE
Culture: the pattern of taken-for granted

assumptions about how a given collection
of people should think, act, and feel as they
go about their daily affairs.
For Discussion: What are the largely
unspoken “cultural rules” for student
behavior in the typical classroom in your
native country?
4-12
THE CULTURAL IMPERATIVE
(continued)
High-context cultures: people rely heavily on

nonverbal and subtle situational messages when
communicating with others.
Low-context cultures: spoken and written words are
used to convey primary meaning.
For Discussion: How much emphasis do you put on
precise wording, formal contracts, and legal
obligations in your business affairs? How is this an
expression of your culture?
4-13
OTHER SOURCES OF CULTURAL
DIVERSITY
• Time
monochronic time: perception of time as a
straight line broken into standard units. (“Time is
money. It is spent, saved, or wasted.”)
polychronic time: perception of time as flexible,
elastic, and multidimensional.
4-14
DIVERSITY
(continued)
• Interpersonal space
• Language
• Religion
4-15
DIVERSITY
(continued)
For Discussion:
1. Do you tend to be monochronic or polychronic?
Explain. How well do you deal with people who
have the opposite orientation toward time?
4-16
DIVERSITY
(continued)
For Discussion:
2. How close is “too close” when you are carrying
on a business conversation with a stranger?
4-17
DIVERSITY
(continued)
For Discussion:
3. How important is it to have a mastery of the local
language when doing business in a foreign
country?
4-18
SURVEY OF HOFSTEDE’S CULTURAL
DIMENSIONS
Instructions: Rate yourself on each of the four dimensions by
circling a response. Next, rate your native culture by drawing
an X through the appropriate response.
• Power distance: How readily do individuals accept the
unequal distribution of power in organizations and
institutions?
Low power distance (equality) High Power distance (rank)
1----2----3----4----5----6----7----8----9----10
4-19
DIMENSIONS
(continued)
• Uncertainty avoidance: How threatening are uncertain

and ambiguous situations, and how important are rules,
conformity, and absolute truths?
Avoid uncertainty (rules) Accept uncertainty (chance)
1----2----3----4----5----6----7----8----9----10
4-20
DIMENSIONS
(continued)
• Individualism-collectivism: Are people

responsible for their own welfare within a
loosely knit social framework, or does the group
look out for individuals in exchange for loyalty?
 Personal responsibility Collective responsibility
1----2----3----4----5----6----7----8----9----10
4-21
DIMENSIONS
(continued)
Masculinity-femininity: How important are masculine

attitudes (assertiveness, money and possessions, and
performance) versus feminine attitudes (concern for
people, the quality of life, and the environment)?
Masculine attitudes Feminine attitudes
1----2----3----4----5----6----7----8----9----10
4-22
DIMENSIONS
(continued)
For Discussion:
1. How well does your personal profile match your
native culture profile?
2. How will your personal profile help (or hinder)
your career as a manager?
4-23
WORK GOALS SURVEY
Instructions: Rank the following eleven work-

related goals from 1 = most important to you to 11
= least important to you.
Rank
Interesting work ____
Pay ____
Job Security ____
Match between person and the job ____
4-24
WORK GOALS SURVEY
(continued)
Rank
Opportunity to learn ____
Variety ____
Interpersonal relations ____
Autonomy ____
Convenient work hours ____
Opportunity for promotion ____
Working conditions ____
4-25
WORK GOALS SURVEY
(continued)
For Discussion:
1. Which national profile in Table 4.5 most closely
matches your rankings? Is there a cultural
connection?
2. What sort of career does your work goals profile
suggest would be best for you? Explain.
4-26
CROSS-CULTURAL TRAINING
TECHNIQUES
• Documentary programs
• Culture assimilator
• Language instruction
• Sensitivity training
• Field experience
4-27
TECHNIQUES
(continued)
For Discussion:
1. If you were going on an 18-month
assignment in a country where something
other than your native language is spoken,
which of these training programs would
you want? Why?
4-28
TECHNIQUES
(continued)
For Discussion:
2. Could you transact a complex business
negotiation in two or more languages? How
much of an advantage are your foreign-language
skills in the job market today?
4-29
RECENT RESEARCH INSIGHTS
ABOUT NORTH AMERICAN WOMEN ON
FOREIGN ASSIGNMENTS
• Enjoyed above average success
• Greatest barriers are self-disqualification and
prejudice among home-country managers
• Culture is a bigger hurdle than gender (foreigner
first, woman second)
For Discussion (Women): Does this evidence
increase your desire to pursue a foreign
assignment? Explain.
4-30

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CH 04

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Chapter 4

International Management and

Global Organizations for a Global

Toward Greater Global Awareness and

Comparative Management Insights

Staffing Foreign Positions

Global company: a multinational venture centrally

Ethnocentric attitude: home-country oriented

Polycentric attitude: host-country oriented

Geocentric attitude: world-oriented (“Search the

2. What problems will ethnocentric managers have

Culture: the pattern of taken-for granted

High-context cultures: people rely heavily on

• Uncertainty avoidance: How threatening are uncertain

• Individualism-collectivism: Are people

Masculinity-femininity: How important are masculine

Instructions: Rank the following eleven work-

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