The cultural environments facing business An overview

Definition of Culture 1. Acc. To Geert Hofstede, “ the collective programming of the mind which distinguishes the members of one human group from another…. Culture, in this sense includes system of values; and values are among the building blocks of culture”. 2. The specific learned norms based on attitudes, values and beliefs that exist in every nation.

Cultural Awareness Culture can’t be isolated from economic & political conditions. Culture can’t be isolated from economic & political conditions. People ‘ve culturally ingrained responses to given situations. People ‘ve culturally ingrained responses to given situations. Success depends on improved cultural awareness and sensitivity. Success depends on improved cultural awareness and sensitivity. Research should be representative Research should be representative Degree of cultural awareness may differ, as co increase foreign ops over time. Degree of cultural awareness may differ, as co increase foreign ops over time.

Identification and Dynamics of Culture. 1. The Nation 2. Cultural formation and dynamics 3. Language 4. Religion

1.Nation Basic similarity among people, both a cause & effect of national boundaries Basic similarity among people, both a cause & effect of national boundaries People share attributes like values, language and race. People share attributes like values, language and race. National identity perpetuated through symbols – flags, parades. National identity perpetuated through symbols – flags, parades. Human, behavioral & demographic characteristics : National Identity. Human, behavioral & demographic characteristics : National Identity. Groups : urban/rural, managers/workers Groups : urban/rural, managers/workers

2.Culture formation & dynamics Transmission of culture: parent to child, teacher to pupil, peer to peer. Transmission of culture: parent to child, teacher to pupil, peer to peer. By age 10, children ‘ve value system in place – evil/good, dirty/clean, rational/ irrational, ugly/ beautiful By age 10, children ‘ve value system in place – evil/good, dirty/clean, rational/ irrational, ugly/ beautiful Individual, societal values evolve over time Individual, societal values evolve over time Change by choice v/s by imposition. Change by choice v/s by imposition.

3.Language Affects cultural stability. Affects cultural stability. Easy spread of culture in areas speaking same language. Easy spread of culture in areas speaking same language. Easy business with nations sharing same language, avoiding translation. Easy business with nations sharing same language, avoiding translation. Product names. Product names. Learning of new languages. Learning of new languages.

4.Religion Strong shaper of values. Strong shaper of values. Specific beliefs of religions affect business. Specific beliefs of religions affect business. Areas where rival religion vie for political control, the strife can cause unrest and disruption of business. Areas where rival religion vie for political control, the strife can cause unrest and disruption of business. E.g. Mc. D doesn’t serve beef or pork in India ; Friday a nonworking day in Muslim nations. E.g. Mc. D doesn’t serve beef or pork in India ; Friday a nonworking day in Muslim nations.

Behavioral practices affecting business 1) Social Stratification System  Ascribed (Birth) – gender, family, age, caste, racial, nat.  Acquired – religion, political, professional  Performance orientation  Gender based groups  Age based groups  Occupation 2) Motivation  Materialism and leisure  Expectation of success and reward  Assertiveness  Need hierarchy

3) Relationship preference  Power distance  Individualism V/S collectivism 4) Risk taking behavior  Uncertainty avoidance  Trust  Future orientation  Fatalism 5) Information and Task Processing  Perception of cues  Obtaining information  Information processing

Strategies for dealing with cultural differences 1) Making little or no adjustments. 2) Communications –  spoken & written language;  silent language 3) Culture shock 4) Company and management orientation.  Polycentrism,  Ethnocentrism  Geocentrism. 5) Strategy for instituting change – Value system, Cost benefit of change, Resistance to too much change, Participation, Reward sharing, opinion leaders, timing, Learning abroad