global Business

• Culture


  Learned, shared, and enduring orientation patterns demonstrated through values, ideas, attitudes, behaviors, and symbols
• Culture


  • It is learned
  • It is interrelated
  • It is shared
  • Acquired by people over time
  • Transmitted from one generation
  • Acquired in the early years of life (e.g. language, negotiation, conflicts)
• One element of culture is deeply connected with other elements
• Cultural values


  Passed between group members: parents, Other adults, school
• Unlike political, legal, economic systems, culture is rather difficult to identify and analyze
• Individualism


  Individuals are expected to take care of only themselves and their immediate families
• Collectivism


  Individuals can expect their relatives or members of a particular ingroup to look after them in exchange for unquestioning loyalty
• Performance Orientation


  • Degree to which a collective does and should encourage as well as reward group members for performance improvement, achievement and excellence
  • High-performance orientation cultures emphasize success and outcomes, while low-performance orientation cultures may focus on effort and participation
• Assertiveness


  • Extent to which individuals are assertive, confrontational and aggressive in their relationship with others
  • High assertiveness cultures value competitiveness and direct communication, while low assertiveness cultures emphasize cooperation and harmony
• Future Orientation


  • Extent to which individuals engage in future-oriented behaviors such as long-term planning, investing in the future, and delaying gratification
  • Cultures with high future orientation prioritize investment in the future and are willing to delay rewards for long-term gains
• Humane Orientation


  • Degree to which a collective encourages and rewards individuals for being fair, altruistic, generous, caring & kind to others
  • High humane orientation cultures: Corporate social responsibility & community involvement might be highly valued
  • Low humane orientation cultures: Individual success might be prioritized over community welfare
• Institutional Collectivism


  • Degree to which organizational & societal institutional practices encourage & reward collective action and distribution of resources
  • High institutional collectivism cultures: Companies might prioritize teamwork & group achievements
  • Low institutional collectivism cultures: Individual contributions might be more emphasized
• In-group Collectivism


  • Degree to which individuals express pride, loyalty & cohesiveness in their organizations, families or friends
  • In high in-group collectivism cultures: Employees may have strong loyalty to their work teams
  • Low in-group collectivism cultures: Individual goals might be more prominent
• Gender Egalitarianism


  • Degree to which a society minimizes gender inequality
  • Societies with high gender egalitarianism minimize gender-based discrimination & value equal opportunities for men & women
• Power Distance


  • Extent to which the community accepts and endorses authority, power differences & status privileges
  • High power distance cultures emphasize hierarchical relationships & centralized decision-making, while low power distance cultures promote more egalitarian & participatory leadership styles

  
• Uncertainty Avoidance


  • Extent to which a society, organization or group relies on social norms, rules & procedures to alleviate unpredictability of future events
  • Cultures with a stronger desire to avoid uncertainty tend to seek order, consistency, structure, formal procedures & laws
• Context


  Refers to the differing methods by which cultures construct meaning, employing varying ratios of context and information (Low vs. High Context Cultures)

  
• Time


  Delineates how diverse cultures orient themselves temporally, perceiving time as either monochronic or polychronic
• Space


  Encompasses various cultural constructs in defining and organizing space, ingrained unconsciously in individuals (Intimate, Personal, Social & Public Space)
• Low Context Cultures


  People communicate their intended messages very directly and clearly through verbal expressions (e.g. Germany, USA or Scandinavian Countries)
• High Context Cultures

  Message can only be decoded by combining the verbal expression with the context in which the communication takes place (e.g. Japan, Korea, Brazil or Saudi Arabia)
• Monochronic

  Time is used in a linear way: One activity at a time (e.g., Northern Europe, North America)
• Polychronic


  People tend to focus on multiple tasks (e.g., Latin America, Mediterranean, Middle East)
• Verbal Communication

  Words spoken or written convey explicit messages
• Non-Verbal Communication


  Gestures, expressions, and body language convey meaning without words
• Paraverbal Communication

  Vocal aspects like tone, speed, and pauses accompany verbal communication
• Extraverbal Communication


  Contextual factors and visuals complement verbal communication for enhanced understanding
• Effective communication involves understanding and utilizing these various dimensions reflecting a deeper comprehension beyond verbal and written exchanges
• Language barriers

  Knowledge of the language used at headquarters is not enough, fluency, technical knowledge, and writing skills are also important, misinterpretations often result from unskilled use of a language
• Cultural barriers in language


  Geographic (dialect) and cultural distance challenge managers, written communications are heavily influenced by culture
• Perception

  How others see us may be different than we think – Perceptions affect the way managers interact and communicate with their counterparts
• Risks in international Business include Commercial Risk, Currency Risk, Country Risk, and Cross-cultural Risk
• Cross-cultural Risk

  A situation or event in which a cultural misunderstanding puts some human value at stake
• Culture of a Society can affect Management Approaches in areas like centralized vs decentralized decision making, safety vs. risk, individual vs. group rewards, and informal vs. formal procedures
• Equating culture with nation states is criticized as country boundaries may be arbitrary, better alternatives may need to be considered, and culture is not homogeneous within countries

  
• Over time, existing culture dimensions need to be revised, and the time dimension of culture must not be overlooked
• No culture is static or completely homogenous, cultures change and individuals differ from each other
• No culture is absolutely individualistic or collectivistic, every culture is on a spectrum
• Cultural dimensions are not opposites, a culture with a big power distance should not be thought of as the opposite of a culture with a small power distance

  
• Don't confuse individual with group values, if a culture is individualistic, it does not mean every person in that culture is an individualist