1. Differences in Culture
H. Michael Boyd, Ph.D.
International Business

2. “A system of values and norms that are shared
Culture
“A system of values and norms that are shared
among a group of people and that when taken together constitute a design for living.”
Hofstede, Namenwirth and Weber
H. Michael Boyd, Ph.D.
International Business

3. Different Components of Culture
Values and Norms
Folkways and Mores

4. Values Form the bedrock of a culture
Provide the context for establishing and justifying a society’s norms and attitudes toward:
individual freedom
democracy
truth and justice
honesty
loyalty
social obligations
role of women
love and sex
marriage
H. Michael Boyd, Ph.D.
International Business

5. Norms Social rules that govern people’s actions toward one and another
Folkways
routine conventions of everyday life
actions of little moral significance
dress code, eating habits, time orientation, rituals, etc.
violating folkways will not be considered evil or bad
Mores
norms seen as central to the functioning of a society
have much greater significance than folkways
violating mores can bring serious retribution
theft, adultery, incest, cannibalism
H. Michael Boyd, Ph.D.
International Business

6. Characteristics of Culture
Learned behavior through:
observation
sharing and transferring
Accumulation of solutions to common problems by:
accident
learning
borrowing (Cultural Diffusion)
All elements are interrelated
Composed of explicit and implicit layers
Dynamic and evolutionary
H. Michael Boyd, Ph.D.
International Business

7. Cultural Diffusion
Up to 90% of all cultures have their major origins from elsewhere
When two different cultures interact:
selective process
two-way process
borrowed items will be reinterpreted
H. Michael Boyd, Ph.D.
International Business

8. Culture, Society and Nation States
Society is a group of people who share a common culture
No one-to-one correspondence between society and a nation
nation states are political creations
many cultures can co-exist within a nation state
similarity among people is both a cause and effect of national boundaries
Nations composed of several cultures with no super- ordinate and uniting values are likely to split apart
Nations break up and yield smaller units allowing national cultures to emerge and solidify
H. Michael Boyd, Ph.D.
International Business

9. Determinants of Culture
Fig: 3.1
H. Michael Boyd, Ph.D.
International Business

10. Determinants of Culture
Fig: 3.1
H. Michael Boyd, Ph.D.
International Business

11. A society’s basic social organization
Social Structure
A society’s basic social organization
Two Dimensions
Degree to which basic social unit is the individual vs. the group
Degree to which society is stratified into
classes or castes
H. Michael Boyd, Ph.D.
International Business

12. Individualism Often prevalent in Western societies
Not only reflected in the political and economic organizations
How people perceive themselves and relate to each other in social and business settings
Social status of an individual is not a function of where they work but their individual performance
Often expressed in a high degree of entrepreneurship and managerial mobility
Makes team building more difficult
H. Michael Boyd, Ph.D.
International Business

13. The Group Often prevalent outside Western societies
Social status of an individual is determined by the standing of the group to which they belong to as much by their individual performance
Often expressed in a high degree of group affiliation and the lack of managerial mobility
H. Michael Boyd, Ph.D.
International Business

14. Social Stratification
All societies are stratified on a hierarchical basis into social categories (social strata)
Typically defined on the basis of:
family background
occupation
Income
Culture differ from each other with regard to the:
degree of social mobility between social strata
significance attached to social strata in business
H. Michael Boyd, Ph.D.
International Business

15. Social Mobility
The extent to which individuals can move out of the social strata into which they are born
Two Major Types
Caste System
Class System
H. Michael Boyd, Ph.D.
International Business

16. Caste System Most rigid form of stratification
Closed system in which social position is determined by the person’s family
Change is usually not possible for entire life
Caste position carries with is a specific occupation
H. Michael Boyd, Ph.D.
International Business

17. Class System Less rigid form of social stratification
Open system where social mobility is possible
both upward or downward
Person’s social position by birth can be changed through their achievements or luck
Degree of social mobility varies by society
H. Michael Boyd, Ph.D.
International Business

18. Class Consciousness
When people tend to perceive themselves in terms of their class background which shapes their relationships with members of other classes
Where class consciousness is high, the way individuals from different classes work together may be very prescribed and strained
H. Michael Boyd, Ph.D.
International Business

19. Determinants of Culture
Fig: 3.1
H. Michael Boyd, Ph.D.
International Business

20. Religion System of shared beliefs and rituals concerned
with the realm of the sacred
Shapes attitudes toward work and entrepreneurship
Relationship between religion, ethics and society is subtle and complex
Hazardous to make sweeping generalizations!
H. Michael Boyd, Ph.D.
International Business

21. Set of moral principles or values used to guide and shape behavior
Ethical Systems
Set of moral principles or values used to guide and shape behavior
Can affect the cost of doing business in a country
H. Michael Boyd, Ph.D.
International Business

22. World Religions
Map 3.1
H. Michael Boyd, Ph.D.
International Business

23. Religion and Economic Implications
Christianity
“Protestant Work Ethic & the Spirit of Capitalism”
Islam
favors legitimate profit and market-based systems
important to keep one’s word or contractual obligations
no payment or receipt of interest (mudarabah, murabaha)
Hinduism
ascetic, non-material principles inhibit entrepreneurship
caste system plays a role
Buddhism
little emphasis on entrepreneurial behavior
Confucianism
loyalty, reciprocal obligations, and honesty in dealings
H. Michael Boyd, Ph.D.
International Business

24. Determinants of Culture
Fig: 3.1
H. Michael Boyd, Ph.D.
International Business

25. Education Can be a source of national competitive advantage
provides a pool of skilled and educated workers
Key determinant for location of FDI
Impacts the kind of products/services that are consumed and the related promotional programs
Education can be a source of social classes
H. Michael Boyd, Ph.D.
International Business

26. Adult Literacy Rates Map 3.3 H. Michael Boyd, Ph.D.
International Business

27. Determinants of Culture
Fig: 3.1
H. Michael Boyd, Ph.D.
International Business

28. Language Enables people to communicate with each other and
structures the way we perceive the world
Spoken
verbal cues
language structures our perception of world
Unspoken
body language
personal space

29. Spoken Mother Language
H. Michael Boyd, Ph.D.
International Business

30. Non-Spoken Language 70% of all communication Nonverbal cues: eyebrows
fingers/thumbs
hand gestures
feet
personal space
body gestures
H. Michael Boyd, Ph.D.
International Business

31. Culture and the Workplace
Study on the relationship between culture and the workplace by Geert Hofstede
40 countries
100,000 individuals

32. Hofstede’s Cultural Dimensions
Four Dimensions of Culture
Power Distance
Individualism versus Collectivism
Uncertainty Avoidance
Masculinity versus Femininity
H. Michael Boyd, Ph.D.
International Business

33. Power Distance
Dimension focused on how a society dealt with the fact that people are unequal in physical and intellectual capabilities
High Power Cultures
societies that let inequalities (power and wealth) grow over time
Low Power Cultures
societies that tried to play down such inequalities
H. Michael Boyd, Ph.D.
International Business

34. Individualism versus Collectivism
Dimension focused on the relationship between the individual and his/her fellows within a culture
Individualistic Societies
loose ties between individuals
individual achievement & freedom highly valued
Collectivist Societies
tight ties between individuals
tend to be more relationship oriented
H. Michael Boyd, Ph.D.
International Business

35. Uncertainty Avoidance
Dimension measured the extent to which different cultures socialized their members into accepting ambiguous situations and tolerating uncertainty
High Uncertainty Cultures
job security, career patterns, retirement benefits are very important
need for rules and regulations and clear instructions and tight control from superior are important
Low Uncertainty Cultures
readiness to take risks and less resistance to change
H. Michael Boyd, Ph.D.
International Business

36. Masculinity versus Femininity
Dimension focused on the relationship between gender and work roles
Masculine Cultures
sex roles were sharply differentiated and traditional ‘masculine values” were cultural ideals
Feminine Cultures
sex roles were less sharply distinguished and little differentiation was made between gender in the same job
H. Michael Boyd, Ph.D.
International Business

37. Work-Related Values for 20 Countries
H. Michael Boyd, Ph.D.
International Business

38. Problems with Hofstede’s Findings
Assumes one-to-one relationship between culture and the nation-state
His research may have been culturally bound
Survey respondents were from a single industry (computer) and a single company (IBM)
Findings are becoming dated ( )
Revised his initial research and included a fifth dimension “Confucian dynamism”
attitudes towards time, persistence, “face”, tradition
H. Michael Boyd, Ph.D.
International Business

39. Cultural Change Culture is not a constant; it evolves over time
American values toward the role of women
American college students values about work and careers
Japan moves toward greater individualism in the workplace and is impacted by aging society
Effects of economic advancement and globalization
Economic progress is accompanied by a shift in values away from:
collectivism towards individualism
“traditional values” towards “secular rational values”
“survival values” towards “self-expression” and “well-being” values

40. Changing Values
H. Michael Boyd, Ph.D.
International Business

41. Managerial Implications
Culture and competitive advantage
Which nations might be competitors
Which nations might be a resource (HR, R &D)
Which nations might be a market (early adopters)
Which nation might be a production site
Culture and business ethics
Many ethical principles are universal, others are culturally bound
Cross cultural literacy
Observe and study foreign cultures
H. Michael Boyd, Ph.D.
International Business