Differences in

Culture
CHAPTER 3
 What is Culture?
 “A system of values and norms that are
shared among a group of people and that
when taken together constitute a design for
living.” -Hofstede, Namenwirth and Weber
 “Different countries, different customs.”
-Peachy, The Man Who Would Be King.
 The Cultural Iceberg
 Figure 3.2 Hodge, Sheila. Global
Smarts, New York: Wiley & Sons,
2000, page 32
COMPONENTS OF CULTURE
 Values: abstract ideas/assumptions about
what a group believes to be good, right,
and desirable.

 Norms: social rules and guidelines that

prescribe appropriate behavior in
particular situations.
 DIFFERENT TYPES of NORMS
 Folkways: Routine conventions of everyday life.
 Little moral significance
 General social conventions such as dress codes, manners, and
attitude towards time.
 Mores: serious standards of behavior, usually tending to
address appropriate behaviors in areas such as sex,
religion, family, etc.
 norms central to the functioning of society and social life
 Greater significance than folkways
 Violation can bring serious retribution; negative mores are
“taboos”
 e.g. Theft, adultery, incest and cannibalism
Culture, society and nation states
 Society is a group of people who share a
common culture.
 No one-to-one correspondence between
society and a nation state.
 Nation states are political creations (“imaginary
lines drawn on the earth”)
 Many cultures can co-exist within one nation state.
 Determinants of culture
 Social structure
 Economic philosophy
 Political philosophy
 Religion
 Language
 Education
Fig. 3.1 p 93
 Social Structure
 Two dimensions
 Extent to which society is group or individually
oriented
 Degree of stratification into castes or classes
 Social mobility
 Significance to business
 Social Structure:
Individual vs. Group Orientation
 Individual societies tend to view
individual attributes and
achievements as being more
important than group membership.
 Emphasis on individual
performance can be both beneficial
and harmful:
 Encourages entrepreneurship
 Can lead to high degree of
managerial mobility
 Group societies see groups as the
primary unit of social organization
 Group members
 Often form deep emotional
attachments
 See group membership as all
important
 Emphasis on the group can be
both beneficial and harmful:
 Strong group identification
creates pressure for mutual
self-help and collective action
 Discourages managers and
workers from moving from
company to company
 Discourages entrepreneurship
Social Structure: Social Stratification
 Social stratification refers to the fact that all societies are stratified on
a hierarchical basis of social categories.
 Strata are typically defined on the basis of characteristics such as
family background, occupation, and income.
 Societies are all stratified to some degree but they differ in two
related ways:
 Social mobility refers to the extent to which individuals can
move out of the strata into which they are born
 Class consciousness refers to a condition where people
tend to perceive themselves in terms of their class
background and this shapes their interaction and
relationship with others.
 Religious and Ethical Systems

 Religion: a system of shared beliefs and rituals that are concerned

with the realm of the sacred
 Ethical systems: a set of moral principles, or values, that are used
to guide and shape behavior
 Most of the world’s ethical systems are the product of religions
 Christianity (1.7 billion)
 Economic implications: Protestant “work ethic” considered

one of the foundations of capitalism; emphasis on individual religious freedom a

possible force in development of concepts of individual economic and political
freedom.
 Islam (Inshallah-if God is willing) (1 billion)
 Economic implications: pro-free enterprise but it must be done in a righteous,

socially beneficial and prudent way.

 Special case: the riba (interest) not permitted; employ other techniques of

mudarabah (sharing ownership) or murabaha (the bank buys the product and
sells it to the firm for a price having a mark-up).
 Religious and Ethical Systems

 Hinduism (750 million)

 Economic implications: focuses on importance of achieving spiritual
growth and development (progression to nirvana), so sources of
motivation may be different. Residual ideas of caste concept may
remain in older employees.
 Buddhism (350 million)
 Economic implications: focuses on spiritual growth, following the

Noble Eightfold Path, and the afterlife, so sources of motivation

may be different.
 Confucianism (200 million)
 Economic implications: principles of loyalty, reciprocal obligations,

and honesty may lead to reduction of business costs in Confucian

societies.
 World Religions
Map 3.1
p 99
 Other components of Culture
 Other influences
 Political philosophy: democracy vs. totalitarianism
 Economic philosophy: Market economy vs.
Command economy
 Language
 Spoken – Written
 Unspoken
 Language structures one’s perception of the world

Hill, Charles. International

Business, 5th edition
 Language
 In some cultures, the
words convey most of Meaning less direct;
subject to more
the meaning of a interpretation

message; in other
cultures, language only
partially convey the
meaning.
 Good communication Meaning more direct;
is critical to success in subject to less
interpretation
international business
Cateora, Philip R. International
Marketing. Homewood, Illinois: Richard
Irwin, 1983, page 135.
 SPOKEN LANGUAGE-
Do you speak English?
 Australian English  American English
 New chum  Newly arrived immigrant
 Yankee shout  Dutch treat
 Dinkum  Genuine, honest
 Sink the slipper  To kick someone when they are
 British English down
 Ring me up.  Give me a call.
 Bonnet of the car
 Hood of the car
 Come down.
 Graduate.
 Form
 Grade level
 “Fancy a cuppa and
 “ Would you like to have a cup
a bit of a chin-wag?”
of tea and talk a bit?
 Language Problems
 Spoken and Written
 Spoken: If you are not sure that you understand or
are being understood:
 Avoid slang
 Speak slowly
 Paraphrase
 Repeat
 Demonstrate
 Test understanding of other person
 Language Problems
 Spoken and Written
 Written: Verify the quality of written
messages, especially in contracts and
advertising.
 Use qualified translators
 Test the meaning of written communications
through:
 Back translations
 Parallel translations
 Language
 Unspoken (“the silent language”)*
 Body language: gestures, eye contact
 Space: Physical distance required to

maintain psychological distance

 public, social, personal spaces vary
considerably among different cultures.

*Concept pioneered by E.T. Hall

 Language
 Unspoken
 Time: Time is one concept that is highly culturally bound.
Different cultures view time differently. Time is: 1) actual time
2) Timing (“right moment”) 3) Tempo (rate or pace)
e.g. -U.S.: “Time is money.”
-Mexico:manana is “tomorrow, or sometime soon
-Arabic speaking countries bukara is “tomorrow or
some time in the future.”
-Nigeria: “The clock did not invent man.”
-France: “Before the time, it is not yet the time; after the

time, it’s too late.”

 How a culture values time affects its business conduct. e.g.
Punctuality in appointments, timeframes and deadlines for
getting things done, delivery dates, etc.
Sequential vs. Synchronous Time
 Sequential time
perspective views time
as a giant cosmic clock
ticking away.
 Synchronous views time
as recurrent or cyclical
time, good timing.
SOURCE: Charles Hampden-Tirner and Fons
Trompenaars, BUILDING CROSS-CULTURAL
COMPETENCE. New Haven, Conn: Yale University
Press, 2000. page 316
 Education

 Education can be a source of competitive

advantage if a country can offer skilled or
training employees. e.g. India, Singapore, Malaysia
 Schools are a part of the social structure of
any society. Norms and Values are
reinforced in formal education.
 Education
 Formal education plays a key role in a society

 Formal education: the medium through which individuals learn many

of the language, conceptual, and mathematical skills that are
indispensable in a modern society.
 Also supplements the family’s role in socializing the young into the
values and norms of a society.

 Schools teach basic facts about the social and political nature of a
society, as well as focusing on the fundamental obligations of
citizenship.

 Cultural norms are also taught indirectly at school

 Examples include: respect for others, obedience to authority,

honesty, neatness, being on time

 Part of the “hidden curriculum”
Adult Literacy Rates

Hill, Charles. International Business, 5th edition

CULTURE and the WORKPLACE
 Study of the relationship between culture
and the workplace: Geert Hofstede 1967-73
 40 countries
 100,000 individuals
 HOFSTEDE’S: CULTURAL
DIMENSION
 Four dimensions of culture
 Power distance
 Individualism versus collectivism
 Uncertainty avoidance
 Masculinity versus femininity
 Power Distance
Individualism vs. collectivism

 Cultures are ranked high or low on this

dimensions based on that society’s ability
to deal with inequalities, power, authority.
 Cultures are ranked on their orientation
towards intersocietal relationships:
 Individualistic societies: loose ties, individual
achievement and freedom
 Collectivist societies: tight ties, tend to be more
relationship-oriented
 Individual Behaviors Across Cultures
HIGH LOW
Social
Individualism Orientation Collectivism
Relative importance
The interests of of the interests of The interests of
the individual take the individual vs. the group take
precedence the interests of precedence
the group

LOW
HIGH
Power Tolerance
Power Respect Power
Orientation Individuals assess
Authority is inherent authority in view of
in one’s position The appropriateness its perceived right-
of power/authority ness or their own
within a hierarchy
within organi- personal interests
zations

Source: Adapted from R. W. Griffin,/M. Pustay, International Business, (figure 14.1, page 479)
© 1996 Addison Wesley Longman. Reprinted by permission of Addison Wesley Longman. Figure 5.4
 Uncertainty Avoidance
Masculinity vs. Femininity
 Cultures are ranked on extent that they
accept ambiguous situations and tolerate
uncertainty: risk issues.
 Cultures view relationship between gender
and work role: goal orientation
 Individual Behaviors Across Cultures
(cont’d)
LOW HIGH
Uncertainty Uncertainty Uncertainty
Acceptance Orientation Avoidance
Positive response An emotional Prefer structure
to change and new response to and a consistent
opportunities uncertainty and routine
change

HIGH LOW

Goal Feminine:
Masculine:
Orientation Passive Goal
Aggressive Goal
What motivates Value social
Value material relevance, quality
possessions, money, people to achieve
different goals of life, and the
and assertiveness welfare of others

Source: Adapted from R. W. Griffin,/M. Pustay, International Business, (figure 14.1, page 479)
© 1996 Addison Wesley Longman. Reprinted by permission of Addison Wesley Longman. Figure 5.4
Work related values for twenty countries

P 113
Problems with Hofstede’s Findings
 Assumes one-to-one relationship between culture
and the nation-state.
 Research may have been culturally bound.
 Survey respondents were from a single industry
(company) and a single company (IBM)
 Hofstede eventually added a fifth dimension:
Confucian dynamism (short vs. long-term
orientation).
 CULTURE CHANGE
 Culture is not a constant; it evolves over
time.
Examples: role of women in U.S.
rise of individualism in Japan
e.g. Matsushita’s changing employment policies
 Effects of globalization: merging of cultures.
 Changing values
Fig: 3.2 P 115

SHIFT
TOWARDS
SECULAR/
RATIONAL
VALUES
AND MOVE
FROM
SURVIVAL
VALUES
TO WELL-
BEING
VALUES.
 Managerial Implications
 Cross cultural literacy: understanding how the culture of a
country affects the way business is practiced in this
country. Cross cultural literacy is required to counter
ethnocentrism (belief in superiority of one’s own culture).
 Relationship of Culture and Competitive Advantage: the
values and norms of a country can influence the
competitiveness of that country.
 Impacts attractiveness of a country
 Impacts potential costs of investment
 Culture is an important factor which influences the decisions
made by multinational businesses to conduct international trade
and foreign direct investment.
 Culture and business ethics
 Cultural Issues affect Business
Decisions
 Cultural issues can
cost money, time, and
resources
 Solutions may not
always be complete;
research and careful
consideration are
required to manage
cultural issues.

San Jose Mercury News: Monday, May 23, 2005 3A

 Culture Affects How You Conduct
Business
 M2 Reports In: How to prepare for a Business
Trip