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Ryerson University
Global Management Studies
GMS 200
Shavin Malhotra

Lecture 5 Time: A culture thing Does it change from one culture to another some culture val time than others “Time is money” = US Jap culture vs. Western culture “those who rush arrive first at the grave” – spain “the clock did not invent man” – Nigeria “b4 the time, it is not yet the time; after the time, Time is standard but looked at diff Europe – later you are = more imp Global mindset – many ppl assert that cultures around the world conve rging impact how org work o Ppl are same everywhere – ppl travel o They wear jeans and European designer fashion -> make same product and sell aross couintry’s o Time lag wats acceptable in America and Europe o No matter where you are there are still differene o May make local ppl hold down on to their cultures more o Pepsi example – marketing it in other countri esnot acceptable in other cultures (catch phrases) o Ads are different (localized) but same product (standardized) o Coke (ex) tastes different in diff countrespesticides high in europe o Mcdonalds has specialized foo d halal meat o Parmasuticles differ in diff cultures o Ppl eat at mcdonalds,talk on nokia phones www.notesolution.com o Mcdonaldsadapted to culture, and religion, taste, and different region, countries o High prepimum items high end scotch wiskey, and swiss watc hes usually standardized o Middle class/ low clas usually not standardised We hear countries becoming more standardized but were also becoming more adaptingHong knond becoming westernised and us becoming easternized Hofstede’s culture dimestions How do we mesausre cul;ture Have variables that measure cultures help promote products Find measures that help compare cultures across diff countries Ran survey in 40 diff countries in IBM offs took 10 years Landmark study Found 5 factors to distinguish and compare diff cultures o Indiv vs. Collectivism degree ppl prefer to act as indiv rather than members of group o High vs. Low power dist degree inequality ampong ppl which populations of country considers normal = vice pres and low level engineer = high = has to go through many levels to meet vice pres (put in request) Canada has low paower dis t walk in vice pres office o Masculine vs. Feminine degree to tough val like assertiveness,competition (assorciated w/ men) prevail over tender val like quality of life (associated w/ women) How masculine/ feminine culture male/ female dominate culture o Uncertainty avoidance degree ppl in country structured over unstructured Avoid any uncertainty Europe Want to know wat is happening today,tomrw, want to be sure of every element = high on avoiding uncertiainty www.notesolution.com More creativity, innovation = low uncertainty avoidance o Long term vs. Short term orientatio n degree val oriented to future, persistence prevail over val prientated toward immediate/shorter Look for immediate results next quarter = short term Saving for future, long term successlong term Culture and discision making “process time” vs.”implementation time” US - spend little time on process and more on implementa tdnecide broadly what process, solve prob in implementation stage Japan – spend more time on process than implementa tioanvoid any uncertainty Audience reaction – American spoke to jap through interpreter, American began by telling a joke jap wouldn’t understand but told audience to fake laugh atamerican joke Will north American concepts work well everywhere Managment by obj (MBO) – share obj w/ supervisions, let employee to make own obj o Compare performace w/obj set by them o May not work in other countries but works in US o Spain prefer supervisors make decisions for them = MBO not work in spain o Taiwan prefer to have manager to assess group performance rather than indiv = MBO not work Stock equities in Japna o Huge market potentia l allowing international countries to help sell stock equities o Most investors are long term deposits (2%) o Doesn’t have a huge market poten tialavoid any risk stock equity not good option o Amount of stock trading in Japan is 1/6b/c want to avoid risks o Maj don’t know wat a mutual fund is www.notesolution.com o Most comp cutting back staff Multinational corps and forms of international business Form of international busiess Types of market entry strategies o Non-equity mode s doesn’t involve any investment in that country, exporting = simplestti,e up with distributer in another count,ry minimal risk • direct = actively involvedtnkes product to market place and sold todiff retailers in count, nd give knowledge of country exporting to • indirect = go to export commotion boa dodall distribution • new firms need to overcome fear about new markets • min international market and political risks • helps to obtain knowledge • learning curve = more knowledge = risk in international decrease risk licencing/ franchising agreemento= ffering firms know – how for other intangible assetto forign comp for a fee, royalty, and/or other type of payment • only sending trademarks or know-hows • Advantages o need for local market research is reduced o licence may support the product strongly in the new market • disadvantages o less control given to licencsy o put company’s image at risk www.notesolution.com o licesence become a new competitor to firm = if franchise decides to break ties and create a new comp o equity modes or direct investment strategiemake investment in that country joint ventures (JV) – “corp child” = new eitven birth and owned by 2/ more parent companies, equites invested by both comp • 3 possibliites o Minority owned(less than 50% equity) o 50/50 JV = both comp have equal rites, both must make
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