Chapter 5

Culture, Management Style, and Business Systems

 Required Adaptation
•• Adaptation
Adaptation is
is aa key
key concept
concept inin international
international marketing
marketing
•• To
To successfully
successfully deal
deal with
with individuals,
individuals, firms,
firms, or
or authorities
authorities in
in
foreign
foreign countries,
countries, managers
managers should
should exhibit:
exhibit:
1. open tolerance,
2. flexibility,
3. humility,
4. justice/fairness,
5. ability to adjust to varying tempos,
6. curiosity/interest,
7. knowledge of the country,
8. liking for others,
9. ability to command respect, and
10. ability to integrate oneself into the environment
 Cultural Imperatives, Electives
and Exclusives
•• Cultural
Cultural imperatives
imperatives are
are the
the business
business customs
customs and
and expectations
expectations
that
that must
must be
be met,
met, conformed,
conformed, recognized
recognized and
and accommodated
accommodated ifif
relationships
relationships are
are to
to be
be successful
successful

•• Cultural
Cultural electives
electives relate
relate to
to areas
areas ofof
behavior
behavior or
or to
to customs
customs that
that cultural
cultural
aliens
aliens may
may wish
wish toto conform
conform to to or
or
participate
participate in
in but
but that
that are
are not
not
required
required

•• Cultural
Cultural exclusives
exclusives are
are those
those customs
customs oror behavior
behavior patterns
patterns
reserved
reserved exclusively
exclusively for
for the
the locals
locals and
and from
from which
which the
the foreigner
foreigner
is
is barred
barred and
and must
must not
not participate
participate
 The Impact of American Culture

•• Ways
Ways in
in which
which U.S.
U.S. culture
culture has
has influenced
influenced management
management style
style
include,
include, but
but are
are not
not limited
limited to,
to, the
the following:
following:

1. “Master of destiny” viewpoint

2. Independent enterprise as the instrument of
social action
3. Personnel selection and reward based on
merit
4. Decisions based on objective analysis
5. Wide sharing in decision making
6. Never-ending quest for improvement
7. Competition yielding efficiency
 Management Styles Around the World

•• Cross-cultural
Cross-cultural differences
differences influence
influence management
management styles
styles in
in the
the
following
following areas:
areas:

1. Authority and Decision Making

2. Management Objectives and
Aspirations
3. Communication Styles
4. Formality and Tempo
5. P-Time versus M-Time
6. Negotiations Emphasis
 Management Styles
Around the World
1.
1. Authority
Authority and
and Decision
Decision Making
Making
•• InIn high-PDI
high-PDI countries
countries subordinates
subordinates are
are not
not likely
likely to
to contradict
contradict bosses,
bosses, but
but in
in
low-PDI countries they often do
low-PDI countries they often do
Three typical patterns exist:
 top-level management decisions -found in situations where family or close ownership gives absolute control.
 decentralized decisions -allows executives at different levels to exercise authority over their functions .
 committee or group decisions -making is by group or consensus, and in Asian cultures, group decision making
predominates.

2.
2. Management
Management Objectives
Objectives and
and Aspirations
Aspirations towards:
towards:
• Security especially of lifetime employment
• Affiliation and Social Acceptance by neighbors and fellow
workers
• Power and Achievement Orientation sought by managers
• Importance of personal/family life over work and profit
 Management Styles
Around the World

3.
3. Communication
Communication Styles
Styles
 According to Edward T. Hall, the symbolic meanings of time,
space, things, friendships, and agreements, vary across cultures
 “In some cultures, messages are explicit; the words carry most of
the information. In other cultures ... less information is contained
in the verbal part of the message since more is in the context”
 Communication in a high-context culture depends heavily on the
contextual (who says it, when it is said, how it is said) or
nonverbal aspects of communication
 Communication in a low-context culture depends more on
explicit, verbally expressed communications
 Hall places eleven cultures along a high-context/low-context
continuum
 4

Contextual Background of Various Countries

Japanese High
Context
Arabian
Implicit
5-4 Latin American

Spanish
Italian

English (UK)
French
North American (US)
Scandinavian
German
Low Swiss
Context
Explicit

Irwin/McGraw-Hill Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
 Management Styles
Around the World
4.
4. Formality
Formality and
and Tempo
Tempo
 Level of formality in addressing business clients by first name
 Level of formality in addressing your boss by first name
 Tempo or speed in getting “down to business”
 Perception of time varies in many cultures

5.
5. Negotiations
Negotiations Emphasis
Emphasis
•• Differences
Differences with
with respect
respect toto the
the product,
product, its
its price
price and
and terms,
terms,
services
services associated
associated with
with the
the product,
product, and
and finally,
finally, friendship
friendship
between
between vendors
vendors and
and customers
customers
 Differences in Management Styles
Around the World

6.
6. P-Time
P-Time versus
versus M-Time
M-Time

• M-time, or monochronic time, typifies most North Americans,

Swiss, Germans, and Scandinavians
• Most low-context cultures operate on M-time concentrating on
one thing at a time
• P-time, or polychronic time, is more dominant in high-context
cultures
• P-time is characterized by multi-tasking and by “a great
involvement with people”
 Differences in Management Styles
Around the World

6.
6. Marketing
Marketing Orientation
Orientation

• Approach wherein the processes of product development and

creation are focused on satisfying the needs of consumers.
• Identifying and meeting the needs and preferences of customers
in the marketplace.
• It also emphasizes establishing rapport with clients and
delivering a satisfying customer experience.
 Gender Bias in International Business

•• The
The gender
gender bias
bias against
against women
women managers
managers exists
exists in
in some
some
countries
countries

•• Women
Women areare not
not accepted
accepted inin upper
upper level
level
management
management roles
roles in
in Asian,
Asian, Middle
Middle Eastern,
Eastern,
and
and Latin
Latin American
American

•• Gender
Gender bias
bias poses
poses significant
significant challenges
challenges in
in cross-cultural
cross-cultural
negotiations
negotiations
 Business Ethics

Business
Business ethics
ethics is
is complex
complex in
in the
the international
international marketplace
marketplace
because
because value
value judgments
judgments differ
differ widely
widely among
among culturally
culturally diverse
diverse
groups
groups
Corruption
Corruption varyingly
varyingly defined
defined from
from culture
culture to
to
culture
culture

Existence
Existence of
of different
different levels
levels of
of corruption,
corruption,
bribery,
bribery, and
and fraud
fraud

The
The Foreign
Foreign Corrupt
Corrupt Practices
Practices Act
Act 1997:
1997:
Imprisonment
Imprisonment for
for bribery
bribery

Bribery
Bribery creates
creates aa major
major conflict
conflict between
between ethics
ethics and
and profitability
profitability
 Ethical and Socially Responsible Decisions

•• Areas
Areas of
of decision
decision making
making where
where ethical
ethical issues
issues arise:
arise:

1. employment practices and policies,

2. consumer protection,
3. environmental protection,
4. political payments and involvement
in political affairs of the country,
and
5. basic human rights and fundamental
freedoms
 4

Three Ethical Principles

Principle Question
5-8
Utilitarian Ethics Does the action optimize the
"common good" or benefits of all
constituencies?
Rights of the Parties Does the action respect the rights
of the individuals involved?
Justice or Fairness Does the action respect the
canons of justice or fairness to all
parties involved?

Irwin/McGraw-Hill Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
 Culture’s Influence on Strategic Thinking
 It involves considering various factors such as the organization's
goals, resources, and external environment.
 A company is managed and strategic decisions are made using
the same values, beliefs and principles set through the
organizational culture.
Differences of IO AND RO