The Cultural Environment Facing Business

Chapter Objectives
To understand methods for learning about cultural environments To analyze the major causes of cultural difference and change To discuss behavioral factors influencing countries business practices To understand cultural guidelines for companies that operate internationally
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The People Factor

Culture refers to learned norms based on the values, attitudes, and beliefs of a group of people Cultural diversity

How Cultures Form and Change

Cultural values set early in life Changes occur from:
Choice Imposition

Language as a Cultural Stabilizer

When people from different areas speak the same language, culture spreads more easily Among nations that share a same language, commerce is easier

Isolation from other groups, especially because of language, tends to stabilize cultures.
Some countries see language as being so important that they regulate the inclusion of foreign words and/or mandate the use of the countrys official language for business purposes.
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Religion as a Cultural Stabilizer

Centuries of profound religious influence continue to play a major role in shaping cultural values
Many religions influence specific beliefs that may affect business

Issues in Social Stratification

Performance orientation of the society Open vs. Closed society Attitude towards gender Attitude towards age Importance of family group Prestige of occupation
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Issues in Work Motivation

Materialism and Motivation Expectation of Success and Reward Assertiveness: The MasculinityFemininity Index Hierarchies of Needs

Factors Affecting Relationship Preferences

Power distance: general relationship between superiors and subordinates. Individualism vs. collectivism: degree of dependence on organization

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Factors Affecting Information and Task Processing

Perception of cues Obtaining Information: Low-Context versus High-Context Cultures Information Processing

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Factors Affecting Risk-taking Behavior

Uncertainty avoidance Trust Future orientation Fatalism

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Factors Affecting the Communication Process

Spoken and Written language Silent language:
color associations conversational distance perception of time and punctuality body language and gestures prestige

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Dealing with Cultural Differences

Accommodation Cultural distance Culture shock

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Factors Affecting Strategies for Instituting Cultural Change

Value systems Cost/benefits of change Resistance to too much change Participation Reward sharing Opinion leadership Timing Learning abroad
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