9/10/2018

International Business: The Challenges

of Globalization Learning Objectives
Eighth Edition
2.1 Explain culture and the need for cultural knowledge.
2.2 Summarize the cultural importance of values and
behavior.
Chapter 2
2.3 Describe the roles of social structure and education in
culture.
Cross-Cultural
2.4 Outline how the major world religions can influence
Business business.
2.5 Explain the importance of personal communication to
international business.
2.6 Describe how firms and culture interact in the global
workplace.
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Hold the Pork, Please! What Is Culture? (1 of 4)

• Germany-based Haribo National Culture
(www.haribo.com)

• Cultural Challenge and • Culture: Set of values, beliefs, rules, and institutions held
Blunders: by a specific group of people
– Pork-based product:
off-limits to Muslims • Nation-states support and promote the concept of national
and Jews culture
– Not meeting the needs – Building museums and monuments to preserve the
of a globally dispersed
subculture legacies of important events and people.
– Potentially worth $2
• Nation-states intervene in business to preserve treasures
billion annually
– Printing on packages:
of national culture
Backward, but Hebrew – Regulate culturally sensitive sectors of the economy
is read from right to left
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What Is Culture? (2 of 4) What Is Culture? (3 of 4)

Subcultures Physical Environment
• Subculture: a group of • Land features affect personal communication in a culture.
people who share a unique
way of life within a larger, • Physical environment affects consumers’ product needs.
dominant culture
• Climate can play a role in determining work habits.
• A subculture can differ from
the dominant culture in
language, race, lifestyle,
values, attitudes, or other
characteristics
• Subcultures sometimes exist
across national borders

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What Is Culture? (4 of 4) Quick Study 1

Need for Cultural Knowledge • How might a subculture differ from the dominant culture?
• A visual depiction of culture would resemble an iceberg. • What do we call the belief that one’s own culture is
superior to that of others?
• Avoiding Ethnocentricity:
– Ethnocentricity is the belief that one’s own ethnic group • What do we call detailed knowledge about a culture that
or culture is superior to that of others. enables a person to work happily and effectively within it?
– Ethnocentricity can seriously undermine international
business projects.
• Developing Cultural literacy:
– Cultural literacy: detailed knowledge about a culture
that enables a person to work happily and effectively
within it.
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Values and Behavior (1 of 5) Values and Behavior (2 of 5)

Figure 2.1 Components of Culture Values
• Values: Ideas, beliefs, and customs to which people are
emotionally attached.
• Values include concepts such as honesty, freedom, and
responsibility.
• Values are important to business because they affect a
people’s work ethic and desire for material possessions.
• The influx of values from other cultures can be fiercely
resisted.

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Values and Behavior (3 of 5) Values and Behavior (4 of 5)

Attitudes Aesthetics
• Attitudes reflect a people’s underlying values. • Aesthetics: what a culture considers “good taste” in the
arts, the imagery evoked by certain expressions, and the
• Attitudes are positive or negative evaluations, feelings,
symbolism of certain colors.
and tendencies that individuals harbor toward objects or
concepts. • Aesthetics includes the art, images, symbols, colors, and
so on.
• Attitudes are learned from role models, including parents,
teachers, and religious leaders. • Aesthetics are important when a company does business
in another culture.
• Attitudes differ from one country to another because they
are formed within a cultural context. • The importance of aesthetics is just as great when going
international using the Internet.
• A “European” attitude
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Values and Behavior (5 of 5) Quick Study 2

Appropriate Behavior • What are examples of values?
• Manners: Appropriate ways of behaving, speaking, and dressing in a • What type of custom might a conservative group oppose
culture are called manners.
in a culture?
• Customs: Habits or ways of behaving in specific circumstances that
are passed down through generations in a culture. • The law that restricts the gift giving by U.S. firms at home
• Folk Custom: Behavior, often dating back several generations, that is
and abroad is called what?
practiced by a homogeneous group of people.
• Popular Custom: Behavior shared by a heterogeneous group or by
several groups.
• Gift Giving Customs
– Proper type of gift varies
– Legal and ethical rules
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2-15 2-16

Clip

Why is culture knowledge important? Statement

• Culture is an integral part of a nation’s operating • Companies need to decide when to make
environment cultural adjustments
– every business function is subject to potential
cultural differences • Fostering cultural diversity can allow
a company to gain a global competitive
advantage by bringing together people of
diverse backgrounds and experience

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2-17 2-18

Cultural Awareness

• Problem areas that can hinder managers’ cultural

awareness…
– Subconscious reactions to circumstances
– The assumption that all societal subgroups are
similar
• Managers that educate themselves about other
cultures have a greater chance of succeeding
abroad

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Cultural Awareness

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Social Structure Education (1 of 3)

Social Group Associations Table 2.1 Illiteracy Rates of Selected Countries
• Collection of two or more people who identify and interact with each
Country Adult Illiteracy Rate (% of People Age 15 and Up)
other
Burkina Faso 71
• Family: Nuclear vs. Extended
Pakistan 45
• Gender Nigeria 39
Social Status Morocco 33
• Positions within the structure Cambodia 26
• Social Stratification Egypt 26

Social Mobility Zimbabwe 16

Saudi Arabia 13
• Ease with which individuals can move up or down a culture’s “social
ladder” Brazil 10
Peru 10
• Caste System
• Class System
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Education (2 of 3) Education (3 of 3)
Table 2.1 [continued] The “Brain Drain” Phenomenon
Country Adult Illiteracy Rate (% of People Age 15 and Up) Brain Drain
Colombia 6
Mexico 6 • Departure of highly educated people from one profession,
Portugal 5 geographic region, or nation to another
Jordan 4
Philippines 4

Source: Based on The World Factbook 2013-14. Washington, DC: Central Intelligence Agency,
(https://www.cia.gov/library/publications/the-world-factbook/index.html).

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Quick Study 3 Religion (1 of 11)

1. Social structure embodies a culture’s fundamental Christianity
organization, including what?
• Christianity was born in Palestine around 2,000 years ago.
2. A person and his or her immediate relatives including
parents and siblings, is called a what? • Christianity boasts more than 300 denominations:
– Most Christians belong to the Roman Catholic,
3. The departure of highly educated people from one Protestant, or Eastern Orthodox churches.
profession, region, or nation to another is called what?
• With 2 billion followers, Christianity is the world’s single
largest religion.

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Religion (2 of 11) Religion (3 of 11)

• The Roman Catholic Islam
– Refrain from placing material possessions above God • With 1.3 billion adherents, Islam is the world’s second-
and others largest religion.
• Protestants • Islam thrives in north Africa, the Middle East, Central Asia,
– Salvation comes from faith in God Pakistan, and some Southeast Asian nations, including
– Hard work gives glory to God—a tenet known widely Indonesia.
as the “Protestant work ethic”
• Muslim concentrations are also found in most European
 Development of capitalism and free enterprise in and U.S. cities.
nineteenth-century Europe
• The prophet Muhammad founded Islam around A.D. 600
• Christian organizations sometimes get involved in social in Mecca.
causes that affect business policy.
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Religion (4 of 11) Religion (5 of 11)

• Islam means “submission to Allah,” and Muslim means Hinduism
“one who submits to Allah.”
• Hinduism formed around 4,000 years ago in present-day
• Islam revolves around the “five pillars”: India.
1. Reciting the shahada (profession of faith) • More than 90 percent of Hinduism’s 900 million adherents
2. Giving to the poor live India.

3. Praying five times daily • It is also the majority religion of Nepal and a secondary
religion in Bangladesh, Bhutan, and Sri Lanka.
4. Fasting during the holy month of Ramadan
5. Making the hajj (pilgrimage) to Mecca • Considered by some to be a way of life rather than a religion.
• Hinduism recalls no founder and recognizes no central
• Religion strongly affects the kinds of goods and services
authority or spiritual leader.
acceptable to Muslim consumers.
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Religion (6 of 11) Religion (7 of 11)

• Hindus believe in reincarnation—the rebirth of the human Buddhism
soul at the time of death.
• Buddhism was founded about 2,600 years ago in India.
– Highest goal of life is moksha
• Buddhism has around 380 million followers, mostly in China,
– Moksha: escaping from the cycle of reincarnation and Tibet, Korea, Japan, Vietnam, and Thailand.
entering a state of eternal happiness called nirvana
• Unlike Hinduism, Buddhism rejects the caste system of
• Hindus tend to disdain materialism. Indian society.
• Strict Hindus do not eat or willfully harm any living creature • Like Hinduism, Buddhism promotes a life centered on
because it may be a reincarnated human soul. spiritual rather than worldly matters.
• In a formal ceremony, Buddhists take refuge in the “three
jewels”:
– Buddha, Dharma, and Sangha
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Religion (8 of 11) Religion (9 of 11)

• They seek nirvana through Confucianism
– Charity • Confucius began teaching his ideas in China nearly 2,500
– Modesty years ago.
– Compassion for others
• China is home to most of Confucianism’s 225 million
– Restraint from violence followers.
– General self-control
• Confucian thought is also ingrained in the cultures of
Japan, South Korea, and nations with large numbers of
ethnic Chinese.
• South Korean business practice reflects Confucian thought
in its organizational structure.

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Religion (10 of 11) Religion (11 of 11)

Judaism Shinto
• More than 3,000 years old, Judaism was the first religion to • Shinto (meaning “way of the gods”) arose as the native
preach belief in a single God. religion of the Japanese.
• Judaism has roughly 18 million followers worldwide. • Shinto can claim only about 4 million strict adherents in
Japan.
• Important days in the Jewish faith:
– Sabbath, Rosh Ha-Shanah, Yom Kippur, Passover, and • Shinto teaches sincere and ethical behavior, loyalty and
Hanukkah respect toward others, and enjoyment of life.

• Marketers must take into account foods that are banned • Shinto beliefs are reflected in the workplace.
among strict Jews.

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Quick Study 4 Personal Communication

• Which denomination of Christianity has a “work ethic” • Communication: System of
named after it? conveying thoughts, feelings,
knowledge, and information
• India is home to more than 90 percent of the adherents of
through speech, writing, and
which religion?
actions
• The Dalai Lama is the spiritual and political head of which
religion? • Forms of Communication:
– Spoken and Written Language
 Implications for managers
 Language blunders
 Lingua franca
– Culture’s Body Language
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Language Blunders Quick Study 5

• An English-language sign in a Moscow hotel read, “You are • Every culture has a communication system that it uses to
welcome to visit the cemetery where famous Russian composers, convey what?
artists, and writers are buried daily except Thursday.”
• A special language understood by two parties who speak
• A sign for English-speaking guests in a Tokyo hotel read, “You are
different native languages is called what?
respectfully requested to take advantage of the chambermaids.”
• An airline ticket office in Copenhagen read in English, “We take • An interesting fact about body language is what?
your bags and send them in all directions.”
• A Japanese knife manufacturer labeled its exports to the United
States with “Caution: Blade extremely sharp! Keep out of
children.”
• Braniff Airlines’ English-language slogan “Fly in Leather” was
translated into “Fly Naked” in Spanish
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Culture in the Global Workplace (1 of 2) Culture in the Global Workplace (2 of 2)

• Perception of Time Studying Culture in the Workplace

• View of Work Kluckhohn-Strodtbeck Hofstede Framework
• Material Culture Framework
• Individualism versus
• Relation to nature collectivism
• Cultural Change
– Cultural Trait • Time orientation • Power distance
– Cultural Diffusion • Trust and control • Uncertainty avoidance
– Cultural Imperialism • Material or spiritual • Masculinity vs. femininity
• Responsibility to others • Long-term orientation
• View of personal space • Indulgence versus restraint

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Quick Study 6
Copyright
1. People living in different cultures often have different
views regarding their what?
2. What is an example of cultural imperialism?
3. The Kluckhohn-Strodtbeck framework does not directly
investigate whether people do what?
4. In the Hofstede framework the term “power distance”
refers to what?

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