Chapter 14 Cultural Influences

Every organization exists in an external culture and perpetuates its own internal culture

Organizational Culture The shared values and norms that exist in an organization that are taught to incoming employees Involves common beliefs and feelings, regularities in behavior, historical process for transmitting values and norms –“The way we do things around here”

Organizational Culture (cont.) Rituals and stories play key roles in maintaining organizational cultures Stories or myths may convey beliefs of company’s founder, or other major values

Measurement and Change of Organizational Culture Discuss it with a motivated insider Observe it as an employee Survey employees

Creation and Maintenance of Organizational Culture There are at least four influences Beliefs and values of the organization’s founder Societal norms of firm’s native/host country

Creation and Maintenance of Org. Culture (cont.) Problems of external adaptation and survival Problems of internal integration

Creation and Maintenance of Org. Culture (cont.) Reinforcement of culture can be best understood by knowing: –What managers consider important; what they measure and control –The manner in which top management reacts to crises and critical events –Deliberate role modeling provided by managers

Creation and Maintenance of Org. Culture (cont.) –Criteria for distributing rewards and status –Criteria for hiring, firing, promotion

A Framework for Understanding Organizational Culture According to Smith and Vecchio, origin, maintenance, and modification of culture can be understood in terms of the six central concepts: –Critical decisions of the entrepreneur or founding members –Guiding ideas and mission –Social structure

A Framework for Understanding Organizational Culture (cont.) –Norms and values –Remembered history and symbolism –Institutionalized arrangements

Studies of Organizational Culture Indicate that applicants with greater “fit” to the organization’s value system may experience greater commitment and job satisfaction and less turnover Dominant culture Subcultures Strong culture

Cross-Cultural Research Explores the differences and similarities among members of different societal cultures Cultural Differences Dimensions of cultural differences Japanese management

Cultural Differences Research on pace of life in various countries suggest that Westerners have fairly precise measures of time and a stronger concern for punctuality than most other people –Monochronic style individuals focus on one thing at a time; characteristic of USA

Cultural Differences (cont.) –Polychronic style individuals focus on several things at one time; characteristics of Latin American countries Research has shown that countries differ significantly in terms of interpersonal trust

Cultural Differences (cont.) Managers often have many common views on business-related activities regardless of national affiliation Clusters of similarities are found in some groupings of countries, e.g., United States, Canada, Australia, Britain hold fairly similar attitudes

Cultural Differences (cont.) Clusters of countries often differ on attitudes toward sharing information and belief that individuals have capacity for leadership and initiative Americans object to elitist conduct and class distinction, while in many other countries social rank is readily invoked

Dimensions of Cultural Differences Power-distance Avoidance of uncertainty Individualism v. Collectivism Masculinity v. Femininity

Japanese Management Characterized by consensus in decision making, commitment of workers to the organizations that employs them, and rewards based on seniority, rather than on merit Focus on productivity and quality –Reliance on informal approach to controlling behavior of employees

Japanese Management (cont.) –Japan’s industrial strength lies in only a few areas, e.g, machine tools, steel, and automobiles –Many students of Japanese management feel it’s not reasonable to think in terms of transplanting many features of Japanese management into the US

Components of Japanese Management Informal control of employees Consensus seeking Emphasis on quality and production Commitment to the worker Intensive socialization Slow evaluation and promotion

Doing Business Overseas Integration of the world economy is increasing and has produced a large demand for internationally skilled managers First step in learning to relate with people from other cultures, it is useful to consider how we are seen by others

Doing Business Overseas (cont.) Functioning as a manger in another country requires an understanding of the traditions, customs, and business practices of the host country

Tips on doing business in: Latin America East Asia (Japan, Korea, China) Russia Middle East

Latin America Few people rush into business Men and women still congregate into separate groups at social functions Latin Americans stand more closely to each other than North Americans when in conversation Men may embrace

Latin America (cont.) Guests are expected to arrive late, with exception of American guests Little concern about deadlines Machismo - expectation that businessmen will display forcefulness, self-confidence, leadership with flourish Fatalism

East Asia Japan, Korea, China Meetings devoted to pleasantries; serving tea, engaging in chitchat Seniors and elders command respect Consciously use slow down techniques as bargaining ploys Business cards should be bilingual

Russia Protocol-conscious Do business only with highest ranking executives Appear stiff and dull More expressive in private than in public Hard to draw up contracts due to language barriers

Russia (cont.) Have no advertising experience

Middle East Prefer to act through trusted third parties Personal honor given high premium Avoid shame Fatalism Emotionally expressive Intense eye contact

Middle East (cont.) Guests should avoid discussing politics, religion, host’s family and personal professions

Methods of Cross-Cultural Training Created to teach members of one culture ways of interacting effectively with another Programs vary from lectures and readings to role-playing exercises, simulations, and practice in functioning within the host country itself

Methods of Cross-Cultural Training (cont.) Two techniques of cross-cultural training –Culture Assimilator –Simulation

Culture Assimilator Designed by social scientists at the University of Illinois under the direction of Harry Triandis Culture-specific Provides the learner with immediate feedback on his/her response to a hypothetical situation

Culture Assimilator (cont.) Not only tells whether response is correct or not, but also gives an explanation regarding why it is correct or is not correct Has been studied extensively, possibly more than any other cross-cultural training method Data suggests that it reduces interpersonal and adjustment problems between trainees and members of the host country

Simulation A situation is created through which individuals experience certain elements of behavior they may encounter in another country Learning is primarily inductive Role-play to learn (example is the game Bafa, Bafa)

Simulation (cont.) Post-role-playing debriefing helps learners understand their own and others’ behavior Participants are led to realize that fully understanding the subtleties of another culture requires experience

Simulation (cont.) Participants learn that: –what is accepted as sensible and reasonable in one country may seem irrational or unimportant to an outsider –Differences among people are often seen as potentially threatening –Stereotyping is a fairly natural process