Chapter 5

Culture, Management Style, and Business Systems

Required Adaptation
Adaptation
Adaptation is
is aa key
key concept
concept in
in international
international marketing
marketing
To
To successfully
successfully deal
deal with
with individuals,
individuals, firms,
firms, or
or authorities
authorities in
in
foreign
foreign countries,
countries, managers
managers should
should exhibit:
exhibit:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

open tolerance,
flexibility,
humility,
justice/fairness,
ability to adjust to varying tempos,
curiosity/interest,
knowledge of the country,
liking for others,
ability to command respect, and
ability to integrate oneself into the environment

Cultural Imperatives, Electives

and Exclusives
Cultural
Cultural imperatives
imperatives are
are the
the business
business customs
customs and
and expectations
expectations
that
that must
must be
be met,
met, conformed,
conformed, recognized
recognized and
and accommodated
accommodated ifif
relationships
relationships are
are to
to be
be successful
successful
Cultural
Cultural electives
electives relate
relate to
to areas
areas of
of
behavior
behavior or
or to
to customs
customs that
that cultural
cultural
aliens
aliens may
may wish
wish to
to conform
conform to
to or
or
participate
participate in
in but
but that
that are
are not
not
required
required

Cultural
Cultural exclusives
exclusives are
are those
those customs
customs or
or behavior
behavior patterns
patterns
reserved
reserved exclusively
exclusively for
for the
the locals
locals and
and from
from which
which the
the foreigner
foreigner
is
is barred
barred and
and must
must not
not participate
participate

The Impact of American Culture

Ways
Ways in
in which
which U.S.
U.S. culture
culture has
has influenced
influenced management
management style
style
include,
include, but
but are
are not
not limited
limited to,
to, the
the following:
following:
1.
2.
3.
4.
5.
6.
7.

Master of destiny viewpoint

Independent enterprise as the instrument of
social action
Personnel selection and reward based on
merit
Decisions based on objective analysis
Wide sharing in decision making
Never-ending quest for improvement
Competition yielding efficiency

Management Styles Around the World

Cross-cultural
Cross-cultural differences
differences influence
influence management
management styles
styles in
in the
the
following
following areas:
areas:
1.
2.
3.
4.
5.
6.

Authority and Decision Making

Management Objectives and
Aspirations
Communication Styles
Formality and Tempo
P-Time versus M-Time
Negotiations Emphasis

Differences in Management Styles

Around the World
1.
1. Differences
Differences in
inAuthority
Authority and
and Decision
Decision Making
Making
In
In high-PDI
high-PDI countries
countries subordinates
subordinates are
are not
not likely
likely to
to contradict
contradict bosses,
bosses, but
but in
in
low-PDI
low-PDI countries
countries they
they often
often do
do

Three typical patterns exist:

top-level management decisions,
decentralized decisions, and
committee or group decisions
2.
2. Differences
Differences in
in Management
Management Objectives
Objectives and
and Aspirations
Aspirations towards:
towards:

Security especially of lifetime employment

Affiliation and Social Acceptance by neighbors and fellow
workers
Power and Achievement Orientation sought by managers
Importance of personal/family life over work and profit

Differences in Management Styles

Around the World
3.
3. Differences
Differences in
in Communication
Communication Styles
Styles

According to Edward T. Hall, the symbolic meanings of time,

space, things, friendships, and agreements, vary across cultures
In some cultures, messages are explicit; the words carry most of
the information. In other cultures ... less information is contained
in the verbal part of the message since more is in the context
Communication in a high-context culture depends heavily on the
contextual (who says it, when it is said, how it is said) or
nonverbal aspects of communication
Communication in a low-context culture depends more on
explicit, verbally expressed communications
Hall places eleven cultures along a high-context/low-context
continuum

Contextual Background of Various Countries

Japanese
Arabian

5-4

High
Context
Implicit

Latin American
Spanish
Italian
English (UK)
French
North American (US)
Scandinavian

Low
Context
Explicit
Irwin/McGraw-Hill

German
Swiss

Copyright 2002 by The McGraw-Hill Companies, Inc. All rights reserved.

Differences in Management Styles

Around the World
4.
4. Differences
Differences in
in Communication
Communication Styles
Styles

Level of formality in addressing business clients by first name

Level of formality in addressing your boss by first name
Tempo or speed in getting down to business
Perception of time varies in many cultures

5.
5. Differences
Differences in
in Negotiations
Negotiations Emphasis
Emphasis
Differences
Differences with
with respect
respect to
to the
the product,
product, its
its price
price and
and terms,
terms,
services
services associated
associated with
with the
the product,
product, and
and finally,
finally, friendship
friendship
between
between vendors
vendors and
and customers
customers

Differences in Management Styles

Around the World
6.
6. P-Time
P-Time versus
versus M-Time
M-Time

M-time, or monochronic time, typifies most North Americans,

Swiss, Germans, and Scandinavians
Most low-context cultures operate on M-time concentrating on
one thing at a time
P-time, or polychronic time, is more dominant in high-context
cultures
P-time is characterized by multi-tasking and by a great
involvement with people

Gender Bias in International Business

The
The gender
gender bias
bias against
against women
women managers
managers exists
exists in
in some
some
countries
countries

Women
Women are
are not
not accepted
accepted in
in upper
upper level
level
management
management roles
roles in
in Asian,
Asian, Middle
Middle Eastern,
Eastern,
and
and Latin
Latin American
American

Gender
Gender bias
bias poses
poses significant
significant challenges
challenges in
in cross-cultural
cross-cultural
negotiations
negotiations

Business Ethics
Business
Business ethics
ethics is
is complex
complex in
in the
the international
international marketplace
marketplace
because
because value
value judgments
judgments differ
differ widely
widely among
among culturally
culturally diverse
diverse
groups
groups
Corruption
Corruption varyingly
varyingly defined
defined from
from culture
culture to
to
culture
culture
Existence
Existence of
of different
different levels
levels of
of corruption,
corruption,
bribery,
bribery, and
and fraud
fraud
The
The Foreign
Foreign Corrupt
Corrupt Practices
Practices Act
Act 1997:
1997:
Imprisonment
Imprisonment for
for bribery
bribery
Bribery
Bribery creates
creates aa major
major conflict
conflict between
between ethics
ethics and
and profitability
profitability

Ethical and Socially Responsible Decisions

Areas
Areas of
of decision
decision making
making where
where ethical
ethical issues
issues arise:
arise:
1.
2.
3.
4.

5.

employment practices and policies,

consumer protection,
environmental protection,
political payments and involvement
in political affairs of the country,
and
basic human rights and fundamental
freedoms

Three Ethical Principles

Principle
5-8

Question

Utilitarian Ethics

Does the action optimize the

"common good" or benefits of all
constituencies?

Rights of the Parties

Does the action respect the rights

of the individuals involved?

Justice or Fairness

Does the action respect the

canons of justice or fairness to all
parties involved?

Irwin/McGraw-Hill

Copyright 2002 by The McGraw-Hill Companies, Inc. All rights reserved.

A Decision Tree for Incorporating Ethical and Social

Responsibility Issues into Multinational Business Decisions
Does the decision efficiently optimize the
common good or benefits of:

The Business firm?

5-9

Stockholders
Management
Profits
Growth
Other

The Economy?
Economic growth
Allocation of resources
Production and
distribution of goods
and services
Other

NO

YES

Society

YES

Culture
Order
Justice
The good life
Other

Are there critical factors that

justify suboptimizing these
goals and satisfactions?

NO
Does the decision
respect the rights of
individuals involved.

The Individual?
Freedom
Health and welfare
Self-realization
Human dignity
Opportunity
Other

NO

Are there critical

factors that justify the
abrogation of a right.

YES

YES

Does the corporate

decision respect the
canons of justice or
fairness to all parties
involved?

YES

YES

Reject
decision

NO
NO

Reject
decision

Are there critical factors

that justify the violation
of a canon of justice?

NO
Accept
decision

Irwin/McGraw-Hill

Reject
decision

Copyright 2002 by The McGraw-Hill Companies, Inc. All rights reserved.