Cultural Influences on Global Business

1. 3 CHAPTER Cultural Influences on Global Business 3-1 Culture Around the World 3-2 Culture and Social Organizations 3-3 Communication Across Cultures 3-4 Values Around the World

2. LESSON 3-1Culture Around the World GOALS • Describe influences of culture on global business activities. • Explain the role of subcultures. 3

3. Cultural Influences in International Business • A culture- Is a system of learned, shared, unifying, and interrelated beliefs, values, and assumptions. • Like an Iceberg. 3

4. The Subcultures within a Society • A SubCulture- Is a subset of a larger culture. • Examples???? 3

5. The Subcultures within a Society **Influences of cultures and subcultures: Cultural Baggage- the idea that you carry your beliefs, values, and assumptions with you at all times • Subculture of U.S. business -Core of common beliefs -“don’t count your chickens before they hatch” or “if at first you don’t succeed,try, try again” 3

6. The Subcultures within a Society **Variations in business subcultures worldwide. -U.S. trades with Canada and United Kingdom…one reason for this trade is that the business subcultures are similar. -U.S. won’t trade with Vietnamese or Kenyan businesses b/c business subculture are much different. 3

7. LESSON 3-2Culture and Social Organizations GOALS • Describe how family relationships can affect culture. • Explain the role of societal influences on culture. 3

8. Family Relationships • Family units • Nuclear family • Extended family • Family-work relationships 3

9. Society’s Institutions • Education • Gender roles • Mobility • Class system 3

10. LESSON 3-3Communication Across Cultures GOALS • Understand the importance of knowing another language for global business success. • Compare direct and indirect communication. • Describe the influence of nonverbal communication. 3

11. Language Differences • English is widely considered the language of international business • More people use English to conduct business than any other language • Advantages of using English • Understood by many • Ideas can be expressed in many ways • Large number of business-related words • Concise and precise 3

12. Learning a Second Language • Consider learning language of dominant trading partners. *Japanese, Chinese, French, German, or Spanish • Learning a country’s language helps you understand the culture. *You learn the beliefs, values, and assumptions of that society. 3

13. Direct and Indirect Communication • Contexting- refers to how direct or indirect communication is. • A low-contextculture- is one that communicates very directly. (Germany & United States)- Direct and Explicit.** Embarrassment not a concern • A high-context culture- is one that communicates indirectly. (Japan & Saudi Arabia)- Indirect and Implicit. **Embarrassment must be avoided at all costs. 3

14. Nonverbal Communication • Body language – Crossing your legs in Japan • Appearance- Well groomed. • Eye contact- U.S. eye to eye contact; South Korea look away from person speaking. • Touching- Arab cultures hug and kiss, possibly hold hands as they discuss business matters. Latin Americans engage in more touching behaviors than U.S. & Canada. • Personal space- Jordanians operate in close proximity, U.S. at least arms length. • Color- U.S. white is associated with weddings, Japan it is associated with death. • Numbers- UK, 1st floor is the floor above the ground floor, U.S. it is the ground floor. • Emblems- Cross necklace in Canada, not appropriate in Islamic cultures. • Smells- Natural body odors are socially unacceptable in the U.S., not the case in African & Middle Eastern countries…body odors are seen as natural and distinctive. No market for deodorants or Colognes. 3

15. LESSON 3-4Values Around the World GOALS • Identify and explain five major types of values that vary from culture to culture. • Describe the two major reactions to cultural differences. 3

16. Values Vary Among Cultures • Individualism- The belief in the individual and her or his ability to function relatively independently. **Self-Reliance, independence, and freedom are closely related to individualism in the U.S. (Negative aspects include self-centeredness & selfishness). • Collectivism- The belief that the group is more important than the individual. (Japanese Culture) 3

17. Values Vary Among Cultures • Technology- *Most developed countries have business subcultures that view improvements as positive for more material objects. *Less developed countries have business subcultures that view advances in tech as a negative and resist change due to cultural or religious reasons. France(Positive), India (Mixed), People’s Republic of China (some internet content banned by government). 3

18. Values Vary Among Cultures • Leadership, power, and authority- *Different cultures have different values relating to leadership, power, and authority. --In the U.S. the power is divided among the legislative, judicial, and executive branches so that 1 individual does not have to much power. --In authoritarian societies only a few have leadership, power, and authority. (People’s Republic of China…”wisdom of age” is a major cultural value). 3

19. Values Vary Among Cultures • Religion- *Religious beliefs can regulate behaviors of business organizations. Some cultures are dominated by 1 religion (Iran and Islam); some have several religions (U.S.); for some religion is not a powerful social force (U.K.). 3

20. Values Vary Among Cultures • Time- *In developed countries time is a valuable resource that must be carefully spent…appointments, agendas, schedules, and deadlines. (U.S. & Canada) *In less developed countries time is viewed as unending cycles of day and night and seasons. **Businesses are generally more successful in cultures where time is viewed as a valuable resource. 3

21. Adjusting to Cultural Differences • Ethnocentrism- The belief that one’s culture is better than other cultures. **This is a difficult obstacle in international business and must be overcome to be successful. • Reactions to cultural differences • Culture shock- A normal reaction to all the differences of another culture. • Reverse culture shock- Your reaction to becoming reacquainted with your own culture after having accepted another culture. 3