Name: Huy Mai

ID number: 1566837

Term Project

MGT 4478: Managing in a Global Environment

Troy University

Before deciding to invest in Vietnam, we need to find out as well as understand Vietnamese
culture. The aim is to avoid the unexpected actions and optimize effectiveness in business
behaviors, marketing contents, organizational structure and culture…. These are the socio-
culture factors and cultural issues we need to deeply understand for building the very first
basement in our organization’s culture and structure.

 Demographic Trends
o Population growth (worldpopulationreview, 2021)

Even throughout the lengthy years of the Vietnam War, which was thought to
have a detrimental influence on the Vietnamese people. In reality, growth
continued at a comparable rate during the second part of the twentieth century,
and has persisted to the point that the Vietnam population in 2014 is just under
of 93 million. From 1955 through 1990, Vietnam saw positive annual population
changes of more than 2%, and even up to 3% in certain years. However, since
then, the proportion of rise has dropped to little under 1%.

o Vietnam Age structure & median age

As of the beginning of 2021 according to our estimates Vietnam had the
following population age distribution:

0-14 years: 22.61% (male 11,733,704/female 10,590,078)

15-24 years: 15.22% (male 7,825,859/female 7,202,716)
 25-54 years: 45.7% (male 22,852,429/female 22,262,566)
55-64 years: 9.55% (male 4,412,111/female 5,016,880)
65 years and over: 6.91% (male 2,702,963/female 4,121,969) (2020 est.)

The age accounts for the most percentage is from 25 to 54 years old with 45.7%.
This will be the ideal portion the company should consider to serve these target
customers.

Vietnam Median age:

As of 2020, according to the World factbook, the total median age of Vietnam is 31.9 years in
which the age of male is 30.8 years and female is 33 years.

o Life expectancy (countrymeters, 2021)

Life expectancy at birth is one of the most important demographic indicators. It

shows the number of years a newborn infant would live assuming that birth and
death rates will remain at the same level during the whole lifetime.

Generally, life expectancy in Vietnam keeps increasing through years from 1955
to present. As of 2020, life expectancy of males is 71.7 years, while, the females
live longer than with 79.9 years. Finally, both sexed have average life expectancy
which is 75.8 years
o Literacy
 According to our estimates 69,283,647 persons or 94.52% of adult population
(aged 15 years and above) in Vietnam are able to read and write. Accordingly,
about 4,016,314 adults are illiterate.

Literacy rate for adult male population is 96.28% (34,614,272 persons).

1,338,523 are illiterate.
Literacy rate for adult female population is 92.83% (34,669,374 persons).
2,677,792 are illiterate.

Youth literacy rates are 98.15% and 97.96% for males and females accordingly.
The overall youth literacy rate is 98.06%. Youth literacy rate definition covers the
population between the ages of 15 to 24 years.

 Cultural Analysis
According to the EF report, Denmark is the best English-speaking country among
non-native English-speaking countries, followed by the Netherlands and Sweden.
Vietnam is ranked 33 out of 63 countries and is in the group of the world's
fastest progressing countries in terms of English communication ability as
surveyed by EF. However, the level of English proficiency among adults in
Vietnam is still low, although skill levels have improved rapidly over the past
seven years. In HCMC, adult English proficiency has improved slightly to 53.44%
and in Hanoi to 51.76%, similar to other major cities around the world. The
survey also shows that Vietnamese women speak English much better than men.
In addition, Vietnamese people can also use many other popular languages such
as Korean, Japanese, and German.

For traditions and customs, these are some major ones we need to consider to
understand the Vietnamese culture.

1. Ancestor Worship
Vietnamese ancestors are believed to continue to live in another realm, and that
it is the duty of the living beings to meet their needs. In return, the ancestors
give advice and bring good fortune. A small altar is placed in almost every house
in Vietnam; it is used to commune with the departed loved ones.

2. Burning votive paper

“Votive papers” which can be houses, clothes, fake money, cars, motorbikes...
made of paper. They represent gifts for their ancestors. After being burnt, a little
wine is sprinkled upon the ashes so that the spirits can ascend to heaven and
bring the gifts for the ancestors to use them.

3. God of Wealth Worship in business

 According to Vietnamese conception, Than Tai (God of Wealth) is a sort of
"benefactor" to bring fortune into a business. In principle, the altar should be
placed in a well-ventilated position, in a corner of the house or in front of the
entrance. That is why you will find a small altar like this one in almost every
shop, boutique, restaurant, hotel in Vietnam.

4. Lunar New Year reunion (Tet holiday)

The Vietnamese New Year (Tet) takes place from the first day of the first month
of the Lunar calendar (around late January or early February) for at least three
days. It is a joyful family reunion full of smiles and blessings to express the filial
piety, the family bonds and the desire for an upcoming year full of happiness,
prosperity and goodness.

 Social Institutions
o Where does the country lie within Hofstede’s dimensions (hofstede-insights,
2021)
POWER DISTANCE
Vietnam scores high on this dimension (score of 70) which means that people
accept a hierarchical order in which everybody has a place and which needs no
further justification. Hierarchy in an organization is seen as reflecting inherent
inequalities, centralization is popular, subordinates expect to be told what to do
and the ideal boss is a benevolent autocrat. Challenges to the leadership are not
well-received.

INDIVIDUALISM
Vietnam, with a score of 20 is a collectivistic society. This is manifest in a close
long-term commitment to the “member” group, be that a family, extended
family or extended relationships. Loyalty in a collectivist culture is paramount
and overrides most other societal rules and regulations. Such a society fosters
strong relationships, where everyone takes responsibility for fellow members of
their group.

MASCULINITY
Vietnam scores 40 on this dimension and is thus considered a Feminine society.
In Feminine countries the focus is on “working in order to live”, managers strive
for consensus, people value equality, solidarity and quality in their working lives.
Conflicts are resolved by compromise and negotiation. Incentives such as free
time and flexibility are favored. Focus is on well-being, status is not shown. An
effective manager is a supportive one, and decision making is achieved through
involvement.

UNCERTAINTY AVOIDANCE
Vietnam scores 30 on this dimension and thus has a low preference for avoiding
uncertainty. Low UAI societies maintain a more relaxed attitude in which practice
 counts more than principles and deviance from the norm is more easily
tolerated. In societies exhibiting low UAI, people believe there should be no
more rules than are necessary and if they are ambiguous or do not work they
should be abandoned or changed.

LONG TERM ORIENTATION

Vietnam scores 57, making it a pragmatic culture. In societies with a pragmatic
orientation, people believe that truth depends very much on situation, context
and time. They show an ability to adapt traditions easily to changed conditions, a
strong propensity to save and invest. thriftiness and perseverance in achieving
results.

INDULGENCE
A low score of 35 on this dimension indicates that the culture of Vietnam is
characterized as Restrained. Societies with a low score in this dimension have a
tendency to cynicism and pessimism. Also, in contrast to Indulgent societies,
Restrained societies do not put much emphasis on leisure time and control the
gratification of their desires. People with this orientation have the perception
that their actions are Restrained by social norms and feel that indulging
themselves is somewhat wrong.

o Family structure (vietnamonline, 2021)

Relationships in Vietnamese family are more complicated than those of Western
countries. The majority of families in Vietnam are extended families as many
generations co-live to take care of each other. Family in Vietnam looks similar to
a system of mini society with the most elderly having the strongest voice and
taking charge of most activities in house.
Each family has its own rules and values that members are supposed to conform
with. The younger generation shows respect for the older generation and vice
versa, the old generation tolerates the young. In the relationships between
parents and children, and between husband and wife as well, traditional
Vietnamese retain much of their long-established customs and values.
Although influenced by Confucianism, in the eyes of children, Vietnamese
mothers still have the same status as their counterparts. They are the
embodiments of love, of self-denial and of sacrifice. For Vietnamese parents,
their children are their most valuable assets; therefore, within their financial
capacity, most of them are eager to have as many children as they can.

o Religious structure (itourvn, 2021)

There are several major religions, including Buddhism, Catholicism,
Protestantism, and Islam, along with several folk religions. Folk Religions include
worship towards ancestors, national heroes, and gods of nature. Buddhism in
Vietnam is a combination of Mahayana and Theravada branches. Catholicism
came to Vietnam in the 16th century when the Westerners discovered new
 lands. Along with the religion's development, Western cultural influence also
makes Vietnamese see Christmas as a celebrating event, even though it is not a
national holiday. Protestantism only came to Vietnam at the end of the 19th and
beginning of the 20th century. From those early times, the missionaries had put
much effort into evangelizing to ethnic minorities in the Central Highland of
Vietnam, especially around the Da Lat area. Islam came to Southeast Asian
countries in the 11th and 12th centuries. The religion was popular in Champa
(present Southern Vietnam) and divided into two branches. One is the Cham
Bani (a combination of Islam and Brahmin which had been the main religion in
Champa before Islam), and the second one is Cham Islam, which is similar to
Islam around the world.

 Informal Trade Barriers

o Communication styles
Vietnamese names are usually given in the order of family name, middle name,
given name. When addressing people, use Mr. /Ms. plus the family name. If
unsure how to pronounce a name, inquire upfront, or smile apologetically and
ask the person. [Hint: the most common Vietnamese name, Nguyen, is
pronounced like the English ‘when. Gestures are usually subtle in Vietnam. It is
advisable to restrict your body language. Non-verbal communication is
important, though, so carefully watch for others’ small hints, just as they will be
watching you. Avoid touching other people. Eye contact should be infrequent.
While it is beneficial to make some eye contact when meeting a person for the
first time, the Vietnamese consider frequent eye contact intrusive and rude. It is
generally considered respectful to look down when speaking with senior and/or
older people.
When responding to a direct question, people may answer ‘yes’ only to signal
that they heard what you said, not that they agree with it. Open disagreement
should be avoided and any kind of direct confrontation is discouraged. People
rarely respond to a question or request with a direct ‘no.’ Instead, you may
receive seemingly ambiguous answers, such as ‘I am not sure,’ ‘we will think
about it,’ or ‘this will require further investigation.’ Each of these could mean
‘no.’
o Negotiating tactics
In Vietnam, the primary approach to negotiating is to employ distributive and
contingency bargaining. While the buyer is in a superior position, both sides in a
business deal own the responsibility to reach agreement. They expect long-term
commitments from their business partners and will focus mostly on long-term
benefits. Do not confuse the sometimes-aggressive style with bad intentions.
Keeping relationships intact throughout your negotiation is vital. It is best to
remain calm, friendly, patient, and persistent, never taking anything personally.
It will also be very important to maintain continuity in the objectives you pursue,
the messages you deliver, and the people you include in the negotiation.
 Should a dispute arise at any stage of a negotiation, you may be able to reach
resolution through emphasizing the benefits to both sides, remaining flexible
and showing willingness to compromise. Show your commitment to the
relationship and refrain from using logical reasoning or becoming argumentative
since this will only make matters worse. Patience and creativity will pay strong
dividends. In extreme situations, leverage your local relationships to influence
your negotiation counterpart’s decisions, or use a mediator, ideally the party
who initially introduced you.

o Ethical concerns
 Employment practices (vietnambusinessgateway, 2021)
When hiring new employees, Vietnamese law requires employers to draft
written employment contracts. Contracts should be concise and strongly
worded, outlining an employee’s compensation, benefits, job responsibilities,
and any termination rules.

Furthermore, employment contracts and letters of offer should be written in

both Vietnamese and English. Salary and benefits should be stated in
Vietnamese dong (VND) rather than a foreign currency.

Employees in Vietnam are usually not allowed to work more than eight hours
per day and 48 hours per week. Employers are required by law to provide
one day off per week to their employees. Sundays are usually designated as a
day off in most workplaces. In Vietnam, a typical workweek is Monday
through Friday, with eight hours per day.

Every year, there are a number of public holidays in Vietnam. Tet Lunar New
Year is a week-long celebration. On National Day, international employees in
Vietnam are entitled to a paid day off.

Generally, standard insurance is provided by the national system in Vietnam.

Employers are required by law to provide health insurance to their
employees. Employers must also provide employees with annual health
checks on a regular basis.
 Human rights
Human rights in Vietnam have long been a matter of much controversy
between the Government of Vietnam and some international human rights
organizations and Western governments, particularly that of the United
States. Under the current constitution, the Communist Party of Vietnam is
the only one allowed to rule, the operation of all other political parties being
outlawed. Other human rights issues concern freedom of association,
freedom of speech, freedom of the press, and the right to a healthy
environment.
 References
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Graphs). (n.d.). Retrieved November 21, 2021, from
https://worldpopulationreview.com/countries/vietnam-population.

2. Countrymeters.info. (n.d.). Vietnam population. Countrymeters. Retrieved November 21,

2021, from https://countrymeters.info/en/Vietnam.
3. Vietnam. Hofstede Insights. (n.d.). Retrieved November 21, 2021, from
https://www.hofstede-insights.com/country/vietnam/.
4. Family relationship in Vietnam. Vietnamonline.com. (n.d.). Retrieved November 21,
2021, from https://www.vietnamonline.com/culture/family.html.
5. An overview of religions in Vietnam. i Tour Vietnam. (n.d.). Retrieved November 21,
2021, from https://www.itourvn.com/blog/an-overview-of-religions-in-vietnam.

6. Understanding vietnam employment practice, law and Culture – Vietnam Business

Gateway. Vietnam Business Gateway – vietnambusinessgateway.com. (2021, September
12). Retrieved November 21, 2021, from
https://vietnambusinessgateway.com/understanding-vietnam-employment-practice-law-
and-culture/.
7. Central Intelligence Agency. (n.d.). Central Intelligence Agency. Retrieved October 24,
2021, from https://www.cia.gov/the-world-factbook/countries/vietnam/#economy