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Lecture 5

AFM 333 Lecture 5: Chapter 5

6 Pages
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Department
Accounting & Financial Management
Course Code
AFM333
Professor
clarkhampton

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The Cultural Environment of IB
Culture and Cross-Cultural Risk
Culture the learned, shared & enduring orientation patterns in a society
o Demonstrated through values, ideas, attitudes, behaviours
Cross-cultural risk a situation/event where a cultural misunderstanding puts some human
value at stake
Cross-cultural risk is worsened by ethnocentric orientation (using our own culture as the
standard for judging others)
o Belief that oe’s o rae/religio is superior to others
Polycentric orientation a host-country mindset where the manager develops a strong affinity
with the country they conduct business with
Geocentric orientation a global mindset where the manager is able to understand a
business/market without regard to country boundaries
o Cognitive orientation that combines an openness & awareness of diversity
The cross-cultural integration of firms is another manifestation of globalization leading to
convergence of cultural values
o Also essential to IB: misunderstandings can ruin business deals, harm company image
Key Concepts of Culture
Captures how people live, how they act towards others & defines values in how people view life
What Culture is NOT
Not right or wrong culture is relative b/c people simply perceive the world differently
Not about individual behaviour ulture is aout groups / it’s a olletie ehaiour of eah
society
Not inherited ulture is deried fro the soial eiroet / people are’t or ith a
shared set of values or attitudes
Socialization and Acculturation
Socialization the proess of learig the rules & ehaioural patters appropriate to oe’s
society
o Subtle process; we adapt our behaviour unconsciously
Acculturation the process of adjusting & adapting to a culture other tha oe’s o
o Experienced by people who live in other countries for extended periods
The Many Dimensions of Culture
High culture ultural akeup that’s highly isile
o Fine arts, drama, literature, classical music
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Folk culture cultural makeup we are aware of
o Humour, religion, cooking, popular music, dress, diet
Deep culture cultural makeup we are unaware of
o Gender roles, family relationships, nonverbal communication, beliefs on rights vs wrong,
concepts of beauty, methods of problem solving
National, Professional and Corporate Culture
Employees are socialized into these 3 cultures
The Role of Culture in IB
Developing products & services necessary to adapt marketing activities to suit market needs
o KFC added Beijig hike alls to eu i China
Organizational structure firms can be decentralized, autocratic, bureaucratic, etc.
Teamwork cooperating with partners in other countries to achieve common goals is critical
Pay for performance system erit is’t the priary asis for prootig eployees i soe
countries
o Perso’s age is the ost iportat fator i Chia/Japa
Lifetime employment
o Workers in Asian countries enjoy a paternalistic relationship with their employers
whereas Western firms struggle to motivate employees who expect this
Union-management relationships
o Workers have relatively equal status to top level management in Europe
Attitude towards ambiguity nationals possess a unique capacity to tolerate ambiguity
Cultural Metaphors
A distinctive tradition strongly associated with a particular society
o Guide to deipherig people’s attitudes, alues & ehaiours
o Eg. American football is a cultural metaphor for traditions in US, such as being team
player & having a strong leader
Cultural Stereotypes
Generalizations about a group of people that may or may not be true; often overlooking real,
deeper differences
o Eg. aaa sydroe = stereotype that Lati Aerias ted to prorastiate
Cultural Idioms
An expression whose symbolic meaning is different from its literal meaning
o to roll out the red arpet = eloig guest ut o atual arpet
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Description
The Cultural Environment of IB Culture and Cross-Cultural Risk Culture the learned, shared & enduring orientation patterns in a society o Demonstrated through values, ideas, attitudes, behaviours Cross-cultural risk a situation/event where a cultural misunderstanding puts some human value at stake Cross-cultural risk is worsened by ethnocentric orientation (using our own culture as the standard for judging others) o Belief that ones own race/religion is superior to others Polycentric orientation a host-country mindset where the manager develops a strong affinity with the country they conduct business with Geocentric orientation a global mindset where the manager is able to understand a business/market without regard to country boundaries o Cognitive orientation that combines an openness & awareness of diversity The cross-cultural integration of firms is another manifestation of globalization leading to convergence of cultural values o Also essential to IB: misunderstandings can ruin business deals, harm company image Key Concepts of Culture Captures how people live, how they act towards others & defines values in how people view life What Culture is NOT Not right or wrong culture is relative b/c people simply perceive the world differently Not about individual behaviour culture is about groups b/c its a collective behaviour of each society Not inherited culture is derived from the social environment b/c people arent born with a shared set of values or attitudes Socialization and Acculturation Socialization the process of learning the rules & behavioural patterns appropriate to ones society o Subtle process; we adapt our behaviour unconsciously Acculturation the process of adjusting & adapting to a culture other than ones own o Experienced by people who live in other countries for extended periods The Many Dimensions of Culture High culture cultural makeup thats highly visible o Fine arts, drama, literature, classical music Folk culture cultural makeup we are aware of o Humour, religion, cooking, popular music, dress, diet Deep culture cultural makeup we are unaware of o Gender roles, family relationships, nonverbal communication, beliefs on rights vs wrong, concepts of beauty, methods of problem solving National, Professional and Corporate Culture Employees are socialized into these 3 cultures The Role of Culture in IB Developing products & services necessary to adapt marketing activities to suit market needs o KFC added Beijing chicken balls to menu in China Organizational structure firms can be decentralized, autocratic, bureaucratic, etc. Teamwork cooperating with partners in other countries to achieve common goals is critical Pay for performance system merit isnt the primary basis for promoting employees in some countries o Persons age is the most important factor in China/Japan Lifetime employment o Workers in Asian countries enjoy a pa
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