2. chapter Differences in Culture McGraw-Hill/Irwin Global Business Today, 5e © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. 3

3. 3 - 3 Chapter 3: Differences in Culture INTRODUCTION Operating a successful international business requires cross- cultural literacy (an understanding of how cultural differences across and within nations can affect the way in which business is practiced). A relationship may exist between culture and the costs of doing business in a country or region.

4. 3 - 4 Chapter 3: Differences in Culture WHAT IS CULTURE? The fundamental building blocks of culture are values (abstract ideas about what a group believes to be good, right, and desirable) and norms (the social rules and guidelines that prescribe appropriate behavior in particular situations). Society refers to a group of people who share a common set of values and norms.

5. 3 - 5 Chapter 3: Differences in Culture Values and Norms Culture, Society, and the Nation-State The Determinants of Culture

6. 3 - 6 Chapter 3: Differences in Culture SOCIAL STRUCTURE A society's social structure is its basic social organization. Two dimensions to consider: the degree to which the basic unit of social organization is the individual, as opposed to the group the degree to which a society is stratified into classes or castes

7. 3 - 7 Chapter 3: Differences in Culture Individuals and Groups Social Stratification

8. 3 - 8 Chapter 3: Differences in Culture RELIGIOUS AND ETHICAL SYSTEMS Religion can be defined as a system of shared beliefs and rituals that are concerned with the realm of the sacred. Ethical systems refer to a set of moral principles, or values, that are used to guide and shape behavior.

9. 3 - 9 Chapter 3: Differences in Culture Christianity Islam Hinduism Buddhism Confucianism

10. 3 - 10 Chapter 3: Differences in Culture LANGUAGE Language, both spoken and unspoken, is one of the defining characteristics of culture. Spoken Language Unspoken Language

11. 3 - 11 Chapter 3: Differences in Culture EDUCATION Formal education is the medium through which individuals learn many of the language, conceptual, and mathematical skills that are indispensable in a modern society. The knowledge base, training, and educational opportunities available to a country's citizens can also give it a competitive advantage in the market and make it a more or less attractive place for expanding business.

12. 3 - 12 Chapter 3: Differences in Culture CULTURE AND THE WORKPLACE How does a society's culture impact on the values found in the workplace?

13. 3 - 13 Chapter 3: Differences in Culture Hofstede’s four dimensions of culture: Power Distance Individualism Versus Collectivism Uncertainty Avoidance Masculinity Versus Femininity

14. 3 - 14 Chapter 3: Differences in Culture CULTURAL CHANGE Culture evolves over time, although changes in value systems can be slow and painful for a society. Social turmoil is an inevitable outcome of cultural change. As countries become economically stronger, cultural change is particularly common.

15. 3 - 15 Chapter 3: Differences in Culture IMPLICATIONS FOR MANAGERS What do cultural differences mean for managers? Cross-Cultural Literacy Culture and Competitive Advantage