CHAPTER 2 CULTURE AND MULTINATIONAL MANAGEMENT
What Is Culture? • Culture is the pervasive and sharedbeliefs, norms, values, and symbols that guide everyday life • transmitted by symbols, stories and rituals • often taken-for-granted
NATIONAL CULTURE BUSINESS CULTURE
NATIONAL CULTURE BUSINESS CULTURE ORGANIZATION OCCUPATIONAL CULTURE CULTURE
NATIONAL CULTURE BUSINESS CULTURE ORGANIZATION OCCUPATIONAL CULTURE CULTURE MULTINATIONAL MANAGEMENT
Caveats and Cautions • Stereotyping • Ethnocentrism • Cultural relativism
Two Diagnostic Models to Aid the Multinational Manager • Hofstede’s Model of National Culture • 7d Cultural Dimensions Model
Hofstede’s Model of National Culture • Issues of equality - “power distance” • What is different and dangerous - “uncertainty avoidance”
Hofstede’s Model of National Culture, continued • The individual and the group in society - “collectivism/individualism” • Gender roles - “masculinity” • Confucian values - “long term orientation”
POWER DISTANCE • Inequality is good • Everyone has a place • People should depend on a leader • The powerful are entitled to privileges • The powerful should not hide their power
Uncertainty Avoidance • Avoid conflict • Low tolerance of deviant people and ideas • Respect for laws and rules • Experts and authorities are usually correct • Consensus is important
Individualism • People are responsible for themselves • Individual achievement is ideal • People are not emotionally dependent on organizations or groups
Collectivism • Self identity based on group membership • A belief that group decision making is best • A belief that groups protect you in exchange for loyalty
Masculinity • Clear definitions of gender roles • Men are assertive and dominant • Support for Machismo • Men should be decisive • Work is priority • Growth, success, and money are important
Long Term (Confucian) Orientation • Belief in substantial savings • Willingness to invest • Acceptance of slow results • Persistence to achieve goals • Sensitivity to social relationships • Pragmatic adaptation
Hofstede’s Dimensions By Countries Exhibit 2.4 • Anglo cultures (US, GB, Australia) • high on individualism and masculinity, low on power distance and uncertainty avoidance
Latin European • high uncertainty avoidance • Nordic • low masculinity • Far Eastern • high power distance, low individualism
The 7d Model of Culture Cultural Dimensions and Critical Questions • Relationships with People: • universalism vs. particularlism • Do we consider rules or relationships more important?
The 7d model, continued • individualism vs. communitarianism • Do we act mostly as individuals or as groups? • specific vs. diffuse • How extensively are we involved with the lives of other people?
The 7d model, continued • emotional vs. neutral • Are we free to express our emotions or are we restrained? • achievement vs. ascription • Do we achieve status through accomplishment or is it part of our situation in life (e.g., gender, age, social class)?
The 7d model, continued • Perspective on Time: • sequential vs. snchronic • Do we do tasks in sequence or several tasks at once? • Relationship with the Environment: • internal vs. external control • Do we control the environment or does it control us?
Exhibit 2.9 Universalism versus Particularism: Differences and Managerial Implications
Exhibit 2.10 Individualism versus Collectivism: Differences and Managerial Implications
Exhibit 2.11 Neutral versus Affective: Differences and Managerial Implications
Exhibit 2.12 Specific versus Diffuse: Differences and Managerial Implications
Exhibit 2.13 Achievement versus Ascription: Differences and Managerial Implications
Exhibit 2.15 Internal versus External Control: Differences and Managerial Implications
Conclusions • Culture has a variety of levels that affect multinationals • Models provide starting point to understand culture • Learning another culture is a never ending process