1. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Chapter Three Global Cultural Analysis

2. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 1 1. HOW TO DO BUSINESS (“SUPPLY-SIDE” EFFECT) 2. WHAT CUSTOMERS PREFER (“DEMAND-SIDE” EFFECT) Culture’s Two Main Effects

3. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 2 INDIANS WILL INDICATE “YES” BY SHAKING THEIR HEADS -- THE SAME GESTURE IN THE WEST SIGNIFIES “NO” AMERICANS LIKE EYE CONTACT -- JAPANESE WANT TO AVOID DIRECT GLANCES CONTINENTAL EUROPEANS LIKE TO HAVE SUPPER AROUND 10 P.M. Examples of Cultural Differences

4. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 3 CULTURE: IS AN UNDERLYING FRAMEWORK THAT GUIDES AN INDIVIDUAL’S PERCEPTIONS OF OBSERVED EVENTS AND PERSONAL INTERACTIONS. THESE PERCEPTIONS HELP TO FORMULATE SELECTION OF APPROPRIATE RESPONSES IN SOCIAL SITUATIONS. IT IS MANIFESTED IN LEARNED BEHAVIOR. Culture as Behavioral Skills

5. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 4 CULTURE (cont’d): IT CREATES A REPERTOIRE OF BEHAVIORAL SKILLS. DIRECTLY INFLUENCES WHAT PEOPLE WILL DO AND WHAT THEY CAN DO. IN THE GLOBAL MARKETING CONTEXT THIS SUGGESTS THAT MANAGERS NEED TO CONCENTRATE MORE ON HOW TO DECIDE RATHER THAN WHAT TO DECIDE. CULTURE AFFECTS IMPLEMENTATION AND EXECUTION OF STRATEGIES MORE THAN THEIR FORMULATION.

6. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 5 THERE ARE FIVE DIFFERENT SILENT LANGUAGES: SPACE MATERIAL POSSESSIONS FRIENDSHIP PATTERNS AGREEMENTS ACROSS CULTURES TIME Silent Languages

7. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 6 SPACE THIS PERTAINS TO SUCH MATTERS AS THE DISTANCE BETWEEN TWO PEOPLE CONVERSING. FOR EXAMPLE, IN THE MIDDLE EAST MEN WILL MAINTAIN AN INTIMATE DISTANCE WHICH BY WESTERN STANDARDS WOULD BE TOO CLOSE FOR COMFORT

8. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 7 MATERIAL POSSESSIONS “THE ONE WITH THE MOST TOYS WINS” THE QUALITY OF YOUR POSSESSIONS SIGNALS YOUR POSITION IN SOCIETIES THAT ADHERE TO THE CONCEPT OF SOCIAL HIERARCHY. FOR EXAMPLE, THE EMPHASIS ON WELL-KNOWN BRANDS IN ASIAN MARKETS REFLECTS A NEED TO CLEARLY IDENTIFY ONE’S POSITION WITH SIGNALS OTHER PEOPLE UNDERSTAND.

9. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 8 FRIENDSHIP PATTERNS THOSE PEOPLE YOU TREAT AS FRIENDS IS REFLECTIVE OF YOUR CULTURAL UPBRINGING AS WELL AS YOUR VIEW TOWARDS TRUST AND RESPONSIBILITY. AMERICANS TEND TO TAKE THE VIEW IN A BUSINESS DEAL THAT THEY CAN SPEAK FOR SOMEONE BECAUSE OF FRIENDSHIP. JAPANESE DO NOT FEEL THAT THEY CAN SPEAK FOR SOMEONE BECAUSE THE RESPONSIBILITY IS TOO GREAT.

10. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 9 AGREEMENTS ACROSS CULTURES EASTERN CULTURES RELY MORE ON GENERAL AGREEMENT AND THE BASIC INTENT OF THE PARTNERS. WESTERNERS LIKE TO HAVE EXPLICIT WRITTEN CONTRACTS AND PREFER TO FOLLOW “THE LETTER OF THE LAW”.

11. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 10 TIME “TIME IS MONEY” PERCEPTION OF TIME VARIES FROM CULTURE TO CULTURE. FOR EXAMPLE, “ON TIME” IN LATIN AMERICAN CAN MEAN UP TO 30 MINUTES LATE IN ARRIVING FOR A MEETING. ON THE OTHER HAND, BEING 30 MINUTES EARLY IN EASTERN ASIA IS CONSIDERED ON TIME.

12. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 11 High vs Low Context Cultures

13. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 12 Hofstede’s Dimensions INDIVIDUALISM VS COLLECTIVISM HI/LO POWER DISTANCE MASCULINE VS FEMININE WEAK/STRONG UNCERTAINTY AVOIDANCE CONFUCIANIST DYNAMICS (LONG RUN ORIENTATION)

14. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 13 Power Distance and Individualism Scales Exhibit 3.1 ARGArgentina BRABrazil CHL Chile COL Columbia GRE Greece HOKHong Kong IND India IRA Iran JAP Japan MEXMexico PAK Pakistan PER Peru PHI Philippines POR Portugal SIN Singapore TAI Taiwan THA Thailand TUR Turkey VEN Venezuela YUG Yugoslavia Small Large Power Distance Individualism Collectivist 12 50 30 Small power distance collectivist Large power distance collectivist Reprinted by permission of the author from Culture’s Consequences, published by Sage Publications. ©1990 by Gert Hofstede PAK COL VEN TAI PER THA SIN CHL POR HOK YUG MEX PHI GRE TUR BRA IRA ARG JAP IND +11+28+44+64+77+94

15. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 14 Power Distance and Individualism Scales Exhibit 3.1 cont. AULAustralia AUTAustria BELBelgium CAN Canada DEN Denmark FIN Finland FRA France GERGermany GBR Great Britain IREIreland ISRIsrael ITA Italy NET Netherlands NZLNew Zealand NOR Norway SAF South Africa SPASpain SWE Sweden SWISwitzerland USAUnited States Small Large Power Distance Individualism Individualist 53 91 71 Small power distance individualist Large power distance individualist Reprinted by permission of the author from Culture’s Consequences, published by Sage Publications. ©1990 by Gert Hofstede SPA SAF FRA BEL ITA AUT ISR FIN GER NOR SWI SWE IRE DEN NZL CAN NET GBR USA AUL +11+28+44+64+77+94

16. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 15 Uncertainty Avoidance and Masculinity Scales Exhibit 3.2 Reprinted by permission of the author from Culture’s Consequences, published by Sage Publications. ©1990 by Gert Hofstede Feminine Masculine Masculinity Uncertainty Avoidance Strong 8 56 32 Weak uncertainty avoidance/feminine Weak uncertainty avoidance /masculine Weak SIN HOK IND PHI AULAustralia CAN Canada DEN Denmark FIN Finland GBR Great Britain HOK Hong Kong INDIndia IREIreland NET Netherlands NZLNew Zealand NOR Norway PHIPhilippines SINSingapore SAF South Africa SWE Sweden SWISwitzerland USAUnited States DEN SWE NOR NET FIN GBR IRE USA SAF AUL NZL CAN +23+44+59+77+95

17. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 16 Uncertainty Avoidance and Masculinity Scale Exhibit 3.2 cont. Reprinted by permission of the author from Culture’s Consequences, published by Sage Publications. ©1990 by Gert Hofstede Feminine Masculine Masculinity Uncertainty Avoidance Strong 59 112 84 Strong uncertainty avoidance/feminine Strong uncertainty avoidance/masculine Weak ARGArgentina AUTAustria BELBelgium BRABrazil CHL Chile COL Columbia FRAFrance GERGermany GRE Greece IRA Iran ISRIsrael ITAItaly JAP Japan MEXMexico PAK Pakistan PER Peru POR Portugal SPASpain SWISwitzerland TAI Taiwan THA Thailand TUR Turkey VEN Venezuela YUG Yugoslavia JAP GRE BRA THA IRA VEN COL MEX ARG TUR PER CHL YUG POR PAK TAI ISR SPA FRA BEL ITA SWI GER AUT FIN +23+44+59+77+95

18. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 17 Hofstede’s Classification of Triad Countries Note: “Context” added. Source: Adapted from Hofstede, 1980 Exhibit 3.4

19. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 18 Gannon’s Metaphors 1.American football: Individualism and competitive speculation; huddling; ceremonial celebration of perfection. 2.The British house: Laying the foundations; building the brick house; living in the brick house. 3.The German Symphony: 0rchestra; conductors; performance society; education, and politics. 4.The French wine: Purity; classification; composition; compatibility; maturation. 5.The Italian family opera: Pageantry and spectacle; voice expression; chorus and soloists. 6.The Swedish summer house: Love of nature; individualism through self- development; equality. 7.The Japanese garden: Wa and shitaki, harmony and form; seishin, spirit of self-discipline; combining droplets. 8.The Chinese family altar: Confucianism and Taoism; roundness, harmony and fluidity. 9.India: cyclical Hindu philosophy: The cycle of life; the family cycle; the social cycle; the work cycle. Source: Martin Gannon, “Cultural Metaphors,” Understanding Global Cultures, pp. v-vii, ©1994 by Martin Gannon. Reprinted by permission of Sage Publications. Exhibit 3.3

20. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 19 Universal Traits in Local Form 1.Consumers are goal oriented. 2.Consumers are influenced by hidden motivators. 3.Consumers behave within their own sociocultural context 4.Consumers seek some degree of emotional gratification. 1.Consumers are goal oriented. 2.Consumers are influenced by hidden motivators. 3.Consumers behave within their own sociocultural context 4.Consumers seek some degree of emotional gratification.

21. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 20 JAPANUSEUROPE IMAGERISK REDUCTIONRECOGNITION/ENVY “FEEL GOOD”TIME SAVERACHIEVEMENT EMOTIONALPEER DOMINATIONHIGH ASPIRATIONS “BELONGING”DISTINCT PEER RECOGNITIONINDIVIDUAL _________________________________________________ ______________________________ “VALUE ADDED” AFFECTCONVENIENT AND SURE CALCULATED SOCIAL VALUE __________________________________________________ _____________________________ DEFINES THE GROUPIDENTIFIES THE INDIVIDUALHIGH-LOW STATUS Role of Brands: Cultural Differences

22. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 21 Culture’s Impact on the Three Global Marketing Tasks FOREIGN ENTRY CORRECT INTERPRETATION OF CULTURAL SIGNALS AND A FAIR KNOWLEDGE OF LOCAL MIDDLEMEN IN A PARTICULAR COUNTRY IS IMPORTANT. LOCAL MARKETING THE SPECIFIC CULTURE NEEDS TO BE UNDERSTOOD AT A DEEPER LEVEL SINCE CUSTOMER NEEDS AND PREFERENCES HAVE TO BE INTERPRETED.

23. Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Irwin/McGraw-Hill ©The McGraw-Hill Companies,, Inc., 2000 Slide 3- 22 Culture’s Impact on the Three Global Marketing Tasks (Con’t.) GLOBAL MARKETING CULTURAL ISSUES REVOLVE BROADLY AROUND THE QUESTION OF THE EXTENT TO WHICH ADAPTATION IN THE MARKETPLACE IS NECESSARY. IN SUM KNOWING AND USING CULTURE AND ITS MANY DIMENSIONS IS ONE KEY INGREDIENT IN DOING BUSINESS IN THE GLOBAL ECONOMY TODAY.