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Mgt 485CHAPTER 6

MANAGING ACROSS CULTURES

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Fundamental factors in designing Organizations

‚Underlying valuesObjectives‚StructureNumber of jobsMethods of communicationRelationships‚Planning and control(s)Planning, measurement, evaluation schemes‚Compensation / reward systemPay philosophy, promotions, raises, bonuses, etc.‚Workforce selectionCriteria for selection at different levels‚Training, technological adaptation‚Utilization of external “expertise”

Irwin/McGraw-Hill [Modified by EvS]

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Strategies for Managing Across Cultures

3 Central Management issues when considering going global:– Organizational Structure

Authority / AutonomyReporting relationships

– Planning, Measurement, Control schemes– Standardization / Adaptation

Irwin/McGraw-Hill [Modified by EvS]

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Strategies for Managing Across Cultures

Globalization - the production and distribution of products and services of a homogeneous type and quality on a worldwide basis

National responsiveness - the need to understand the different consumer tastes in segmented regional markets

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Strategies for Managing Across Cultures

Globalization - National responsiveness

–Why is this an issue?

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Strategies for Managing Across Cultures

Cultural differences making a difference– 6 Basic cultural variations

People’s NatureRelationship to natureRelationship to other peopleModality of human activityTemporal focus on human activityConception of space

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Strategies for Managing Across Cultures

Cultural differences making a difference– How they view time– The collectivist / individualistic dimension– Power Distance (also shows in language)– Attitude towards affection– Nature of business conversations– Negotiating styles– Protocol for meetings (whether business or

personal)– Eating behaviors– Dress / appearance

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Strategies for Managing Across Cultures

Why are MNCs committed to a “globalization imperative?”

Irwin/McGraw-Hill [Modified by EvS]

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Strategies for Managing Across Cultures

Why develop unique strategies?– Diversity of worldwide standards – Cell phones, Televisions, Household appliances– Continued demand by customers for

differentiated products– Importance of being perceived to be an "insider”

US Toyota– Difficulty of managing global operations – Issues of decentralization– Allow subsidiaries to use talants & abilities– Prevent "headquarters" from being a constraint

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Globalization Vs. National Responsiveness Matrix

National Responsiveness

High Low

High globalization Mixed

Low Mixed National

Responsiveness

Globalization

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Strategies for Managing Across Cultures

Globalization paradox– Impossibility of conducting business “one-way”– “Secret Hope”

Transportability of successful strategies & procedures

There are more cultural differences than similarities

Irwin/McGraw-Hill [Modified by EvS]

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Barriers to Effective Cross-Cultural Management

Parochialism- the tendency to view the world through one’s eyes and perspectives

Simplification- the process of exhibiting the same orientation toward different cultural

groups

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High Vs. Low Context Cultures

High Context long lasting

relationships implicit communication loyalty to people of

authority spoken agreements outsiders do not gain

entry easily

– JAPAN

Low Context relationships are short

in duration explicit communication authority is diffused written agreements ousiders are

encouraged to join inner circle

– U.S.

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General Similarities Across Cultures

Managerial behaviors in Russia– communication– HRM– traditional management– networking

Application of O.B. Mod. in Russia Organizational commitment in Korea

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General Differences Across Cultures

HRM activities– labor laws– wages– vacation time– maternity leave– compensation– group Vs. individual incentives

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Doing Business in China Emphasis on trust and

mutual connections Meetings start with small talk Host indicates when

meetings begin and end Slow in forming a an action

plan, but stick with decisions once made

Reciprocity is important Negotiations are often

carried out through intermediaries to reduce the risk of losing face

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Doing Business in India Punctuality is important No personal questions Titles are important No public displays of

affection Beckoning done with the

palm turned down When eating or accepting

things, use the right hand- the left is considered unclean

The namaste gesture can be used to greet people

Bargaining for goods and services is common

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Doing Business in Russia Build personal

relationships with partners Use local consultants Consider business ethics Be patient Stress exclusivity Face to face

communication is expected Keep financial information

personal Research the company Stress mutual gain Clarify terminology

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Doing Business in France Use a quick hand shake with some pressure in the

grip Punctuality is extremely important During a meal, small talk is acceptable, but personal

questions and the subject of money are never brought up

Great importance is placed on neatness and taste

France

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Doing Business in Arab Countries{Http://arab.net/}

Never display feelings of superiority

Do not take credit for joint efforts

Efforts to sidestep red tape can be regarded as disrespect for legal and government institutions

Connections are extremely important

Patience is critical to business transactions

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Globalizing e-Go What is at least ONE reason that Emeric-ian

Enterprises would be interested in pursuing marketing the e-Go in {your researched country}– Cost of Materials?– Quality of Materials?– Cost of Labor?– Quality of Labor?– Access to Natural Resources– Access to other resources?– Access to an available market?