Differences in Culture

Differences in Culture
 Societies’ differ along cultural dimensions
 What is culture?
 How/why do social structure, religion, language
influence cultural differences?
 What are differences between culture and values
in the workplace (corporate culture)?
 Culture changes over time. What are some reasons
behind this?
 Implications for business managers
Cultural Appreciation
Values

Customs
Aspects of
culture
Symbols

Language
 What is Culture?
 Culture: a society’s (group’s) system of
shared, learned values and norms; these
are the society’s (group’s) design for living
– Values: abstract ideas about the good, the
right, the desirable
– Norms: social rules and guidelines; guide
appropriate behavior for specific situations
 Folkways: norms of little moral significance
dress code; table manners; timeliness
 Mores: norms central to functioning of social life
– bring serious retribution: thievery, adultery, alcohol
Basic U.S. Business Values
 Cultural Diversity
 Values represent personal or socially
preferable modes of conduct or states
of existence that are enduring.

Why doesn’t McDonald’s sell

hamburgers in India?
 Cultural Diversity
 Customs are norms and expectations
about the way people do things in a
specific country.

Why were 3M executives perplexed

concerning lukewarm sales of Scotch-
Brite floor cleaner in the Philippines?
 What is Culture?

“the collective programming of the mind

which distinguishes the members of one
human group over another…

Culture, in this sense, includes systems of

values; and values are among the building
blocks of culture”

Geert Hofstede
 National Culture
“Nation” is a useful:
– Definition of society
 similarity among people a cause -- and effect -- of national
boundaries
– Way to bound and measure culture for conduct of
business
 culture is a key characteristic of societ
 can differ significantly across national borders
– also within national borders
 laws are established along national lines
 Culture is both a cause and an effect of economic
and political factors that vary across national
borders
 Social Structure and Culture
Unit of social organization: individual or group?
Society may be stratified into classes or castes
High-low stratification
High-low mobility between strata
The individual: building block of many Western societies
Entrepreneurship
Social, geographical and inter-organizational mobility
The group:
Two or more associated individuals with a shared identity
Interact with each-other in specific ways on the basis of a
common set of expectations.
 Individual vs Group
Societal Characteristics
 Individual  Group
– Managerial mobility – Loyalty and commitment to
between companies company
– Economic dynamism, – In-depth knowledge of
innovation company
– Good general skills – Specialist skills
– Team work difficult, – Easy to build teams,
non-collaborative collaboration
 Exposure to different – Emotional identification with
ways of doing business group or company
– e.g., Japanese companies
– e.g., U.S. companies
 Religion, Ethics and Culture
 Religion: system of shared beliefs about the sacred
 Ethical systems: moral principles or values that shape
and guide behavior; often products of religion
 Major religious groups and some economic
implications
– Christianity protestant work ethic
– Islam Islamic economic principles
– Hinduism anti-materialistic, socially stratified
– Buddhism anti-materialistic, social equality
– Confucianism hierarchy, loyalty, honesty
 Language: Culture Bound
Language, spoken
– “private” does not exist as a word in many
languages
– Eskimos: 24 words for snow
– Words which describe moral concepts can be
unique to countries or areas
– Spoken language precision important in low-
context cultures
Language, unspoken
– Context... more important than spoken word in
high context cultures
Non-Verbal Gestures
Non-Verbal Gestures
Non-Verbal Gestures
Non-Verbal Gestures
Cultural Diversity – “Chevy Nova Award”

 Dairy Association’s huge success with

the campaign “Got Milk?” prompted
them to expand advertising to Mexico

 It was brought to their attention the

Spanish translation read, “Are you
lactating?”
Cultural Diversity – “Chevy Nova Award”

 Clairol introduced the “Mist

Stick”, a curling iron into Germany

 Only to find out that “mist” is

German slang for manure.
 Cultural Diversity
Chevy Nova Award
When Gerber started selling baby food
in Africa, they used US packaging with
the smiling baby on the label.

In Africa, companies routinely put

pictures on labels of what’s inside, since
many people can’t read.
 Cultural Diversity
Chevy Nova Award
Pepsi’s “Come Alive With the Pepsi
Generation” in Chinese translated
into
“Pepsi Brings Your Ancestors Back
From the Grave”
 Cultural Diversity
Chevy Nova Award
Coca-Cola’s name in China was first read as
“Kekoukela”, meaning “Bite the wax tadpole”
or “female horse stuffed with wax”, depending
on the dialect.

Coke then researched 40,000 characters to

find a phonetic equivalent “kokou kole”,
translating into “happiness in the mouth.”
 Cultural Stereotypes
Cultural stereotypes: values and behaviors
considered typical of a culture

Are they valuable?

Yes, if they reduce uncertainty about what
expatriate can expect.

No, if used to label an individual unlike the

stereotype
 High/Low Context Cultures
High-Context Low-Context
Crucial to Communications:
external environment, situation, non-verbal behavior explicit information, blunt communicative
style
Relationships:
long lasting, deep personal mutual involvement short duration, heterogeneous populations
Communication:
economical, fast because of shared "code" explicit messages, low reliance on non -
verbal
Authority person:
responsible for actions of subordinates, loyalty at a diffused through bureaucratic system,
premium personal responsibility tough to pin down
Agreements:
spoken, flexible and changeable written, final and binding, litigious, more
lawyers
Insiders vs outsiders: very distinguishable difficult to identify, foreigners can adjust
Cultural pattern change: slow faster
 Education and Culture

 Education
– Medium through which people are acculturated
– Language, “myths,” values, norms taught
– Teaches personal achievement and competition
– Critical to national competitive advantage
 Education system may be a cultural outcome
Culture and the workplace (Hofstede)
Finds national culture dimensions meaningful to
business
Basis:
– Work related values not universal
– National values may persist over MNC efforts to create
corporate culture
– Home country values often used to determine HQ
policies
– MNC may create morale problems with uniform moral
norms
Purpose: understanding of business situations
across-cultures
MUST understand own culture AND other culture(s)
 Culture and the workplace
 Geert Hofstede – sampled 100,000 IBM
employees 1963-1973
 Compared employee attitudes and values
across 40 countries
 Isolated 4 dimensions summarizing
culture:
1. Power distance
2. Individualism vs. collectivism
3. Uncertainty avoidance
4. Masculinity vs. feminity
 Power Distance -- (Hofstede)

 Degree of social inequality considered

normal by people
 Distance between individuals at
different levels of a hierarchy
 Scale: from equal (small power
distance) to extremely unequal (large
power distance)
Individualism Vs. Collectivism (Hofstede)

 Degree to which people in a

country prefer to act as
individuals rather than in
groups
 Describes the relations between
the individual and his/her
fellows
Uncertainty Avoidance (Hofstede)

 Degree of need to avoid uncertainty about

the future
 Degree of preference for structured versus
unstructured situations
– Structured situations: have tight rules may
or may not be written down
 High uncertainty avoidance: people with
more nervous energy (vs easy-going), rigid
society, "what is different is dangerous."
Masculinity Vs. Femininity (Hofstede)

 Division of roles and values in a

society
 Masculine values prevail:
– assertiveness, success, competition
 Feminine values prevail:
– quality of life, maintenance of warm
personal relationships, service, care
for the weak, solidarity
Confucian Dynamism (Hofstede)

 Attitudes towards
– Time
– Persistence
– Status in society
– “Face”
– Respect for tradition
– Gifts and favors
 Cultural Change Over Time

Change is slow and often painful

Shifts away from “traditional
values” towards “secular values”
Changes with shift from
“survival values” to “self-
expression values”
 Cultural Distance

 Geographic and cultural (or

pshychic) distance among countries
may not be the same
 Key concept which can affect IB
strategy and conduct
 Managerial Implications
 Ethnocentrism vs Polycentrism
 Must a company adapt to local
cultures or can corporate -- often
home-country dominated -- culture
prevail?
 Cross-cultural literacy essential
 Do some cultures offer a national
competitive advantage over others?
 Applying Cultural Analysis
1. Describe culture using Hofstede’s Model
2. Estimate cultural impact on management
• Strategic planning: Futile? How much
information needed?
• Employee motivation: Security or money
reward? Immediate or long-term rewards
• Employee monitoring and control: Rules o
trust?
• Decision making: overcoming problems o
seizing opportunities?