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Slide multinational management 3e cullen ch02

Chapter 2
Culture and Multinational
Management

Copyright© 2004 Thomson Learning All rights reserved


Learning Objectives
•• Define
Define culture
culture and
and understand
understand the
the basic
basic components
components
ofof culture
culture
•• Identify
Identify instances
instances ofof cultural

cultural stereotyping
stereotyping and
and
ethnocentrism
ethnocentrism
•• Understand
Understand how
how various
various levels
levels ofof culture
culture influence
influence
multinational
multinational operations
operations

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Learning Objectives
••
••

Understand
Understand the
the Hofstede
Hofstede and
and 7d
7d models
models
Appreciate
Appreciate the
the complex
complex differences
differences among
among cultures
cultures
and
and use
use these
these differences
differences for
for building
building better
better
organizations
organizations

Copyright© 2005 South-Western/Thomson Learning All rights reserved


What is Culture?
•• Pervasive
Pervasive and
and shared
shared beliefs,
beliefs, norms,
norms, values,
values, and
and
symbols
symbols that
that guide
guide everyday
everyday life.
life.
•• Cultural
Cultural norms:
norms: both
both prescribe
prescribe and
and proscribe
proscribe behaviors
behaviors
•• What
What we
we should
should do
do and
and what
what we
we cannot
cannot do.
do.
•• Cultural
Cultural values:
values: what
what isis good/beautiful/holy,
good/beautiful/holy, and
and what
what
are
are legitimate
legitimate goals
goals for
for life.
life.

Copyright© 2005 South-Western/Thomson Learning All rights reserved



What is Culture?
(cont.)
•• Cultural
Cultural beliefs:
beliefs: represent
represent our
our understandings
understandings about
about
what
what isis true.
true.
•• Cultural
Cultural symbols,
symbols, stories,
stories, and
and rituals:
rituals: communicate
communicate the
the
norms,
norms, values,
values, and
and beliefs
beliefs ofof aa society
society or
or aa group
group toto its
its
members.
members.
•• Culture
Culture isis pervasive
pervasive inin society
society
•• Affects
Affects all
all aspects
aspects ofof life
life
•• Not
Not all
all aspects
aspects are
are observable
observable
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Culture: Front Stage & Back
Stage
•• Front
Front stage
stage ofof culture:
culture: easily
easily observable
observable aspect
aspect ofof
culture
culture
•• e.g.,
e.g., Japanese
Japanese executive
executive bows
bows or
or North
NorthAmerican
American
robust
robust handshake.
handshake.
•• Back
Back stage
stage ofof culture:
culture: only
only insiders
insiders or
or members
members ofof the
the
culture
culture understand
understand other
other aspects
aspects ofof culture
culture
•• e.g.,
e.g., Japanese
Japanese saying
saying “it’s
“it’s difficult”
difficult” and
and twisting
twisting
head
head toto one
one side
side really
really means
means it’s
it’s impossible.
impossible.
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Three Levels of Culture
1.1.National
National culture:
culture: the
the dominant
dominant culture
culture within
within the
the
political
political boundaries
boundaries ofof the
the nation-state.
nation-state.
2.2.Business
Business culture:
culture: norms,
norms, values,
values, and
and beliefs
beliefs that
that
pertain
pertain toto business
business inin aa culture.
culture.
1.1. Tells
Tells people
people the
the correct,
correct, acceptable
acceptable ways
ways toto
conduct
conduct business
business inin aa society.
society.

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Three Levels of Culture
(cont.)
3.3.Occupational
Occupational and
and organizational
organizational culture
culture
3.Occupational
3.Occupational culture:
culture: the
the norms,
norms, values,
values, beliefs,
beliefs, and
and
expected
expected ways
ways ofof behaving
behaving for
for people
people inin the
the same
same
occupational
occupational group.
group.
4.Organizational
4.Organizational culture:
culture: the
the set
set ofof important
important
understandings
understandings that
that members
members ofof an
an organization
organization
share.
share.

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Cultural Differences and
Basic Values
•• Two
Two diagnostic
diagnostic models
models toto aid
aid the
the multinational
multinational
manager:
manager:
1.1. Hofstede
Hofstede model
model ofof national
national culture
culture
2.2. 7d
7d culture
culture model
model

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Hofstede’s Model of National
Culture
•• Five
Five dimensions
dimensions ofof basic
basic values
values
•• Power
Power distance
distance
•• Uncertainty
Uncertainty avoidance
avoidance
•• Individualism
Individualism
•• Masculinity
Masculinity
•• Long-term
Long-term orientation
orientation

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Hofstede’s Model Applied to
Organizations and
Management
•• Management
Management practices
practices considered
considered inin the
the discussion
discussion ofof
Hofstede’s
Hofstede’s model
model include:
include:
1.Human
1.Human resources
resources management
management
•• Management
Management selection
selection
•• Training
Training
•• Evaluation
Evaluation and
and promotion
promotion
•• Remuneration
Remuneration
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Hofstede’s Model Applied to
Organizations and
Management (cont.)
2.Leadership
2.Leadership styles
styles
3.Motivational
3.Motivational assumptions
assumptions
4.Decision
4.Decision making
making and
and organizational
organizational design
design
5.Strategy
5.Strategy

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Power Distance
•• Power
Power distance
distance concerns
concerns how
how cultures
cultures deal
deal with
with
inequality
inequality and
and focuses
focuses on
on
•• Norms
Norms that
that tell
tell superiors
superiors (e.g.,
(e.g., bosses)
bosses) how
how much
much
they
they can
can determine
determine the
the behavior
behavior ofof their
their
subordinates
subordinates
•• Values
Values and
and beliefs
beliefs that
that superiors
superiors and
and subordinates
subordinates
are
are different
different kinds
kinds ofof people
people

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Power Distance (cont.)
•• High
High power
power distance
distance countries
countries have
have norms,
norms, values,
values,
and
and beliefs
beliefs such
such as
as
•• Inequality
Inequality isis fundamentally
fundamentally good
good
•• Everyone
Everyone has
has aa place:
place: some
some are
are high,
high, some
some are
are low
low
•• Most
Most people
people should
should be
be dependent
dependent on
on aa leader
leader
•• The
The powerful
powerful are
are entitled
entitled toto privileges
privileges
•• The
The powerful
powerful should
should not
not hide
hide their
their power
power
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.2: Managerial
Implications for Power
Distance

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Uncertainty Avoidance
•• Norms,
Norms, values,
values, and
and beliefs
beliefs regarding
regarding tolerance
tolerance for
for
ambiguity
ambiguity
•• Conflict
Conflict should
should be
be avoided
avoided
•• Deviant
Deviant people
people and
and ideas
ideas should
should not
not be
be tolerated
tolerated
•• Laws
Laws are
are very
very important
important and
and should
should be
be followed
followed
•• Experts
Experts and
and authorities
authorities are
are usually
usually correct
correct
•• Consensus
Consensus isis important
important
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.3: Managerial
Implications of Uncertainty
Avoidance

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Individualism/Collectivism
•• Focus
Focus isis on
on the
the relationship
relationship between
between the
the individual
individual and
and
the
the group
group
•• Countries
Countries high
high on
on individualism
individualism have
have norms,
norms, values,
values,
and
and beliefs
beliefs such
such as
as
•• People
People are
are responsible
responsible for
for themselves.
themselves.
•• Individual
Individual achievement
achievement isis ideal.
ideal.
•• People
People need
need not
not be
be emotionally
emotionally dependent
dependent on
on
organizations
organizations or
or groups.
groups.
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Individualism/Collectivism
•• Collectivist
Collectivist countries
countries have
have norms,
norms, values,
values, and
and beliefs
beliefs
such
such as
as
•• One’s
One’s identity
identity isis based
based on
on group
group membership.
membership.
•• Group
Group decision
decision making
making isis best.
best.
•• Groups
Groups protect
protect individuals
individuals inin exchange
exchange for
for their
their
loyalty
loyalty toto the
the group.
group.

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.4: Managerial
Implications of
Individualism/Collectivism

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Masculinity
•• Tendency
Tendency ofof aa culture
culture toto support
support traditional
traditional masculine
masculine
orientation
orientation
•• High
High masculinity
masculinity countries
countries have
have beliefs
beliefssuch
such as
as
•• Gender
Gender roles
roles should
should be
be clearly
clearly distinguished.
distinguished.
•• Men
Men are
are assertive
assertive and
and dominant.
dominant.
•• Machismo/exaggerated
Machismo/exaggerated maleness
maleness inin men
men isis good.
good.
•• Men
Men should
should be
be decisive.
decisive.
•• Work
Work takes
takes priority
priority over
over other
other duties.
duties.
•• Advancement,
Advancement, success,
success, and
and money
money are
are important.
important.
Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.5: Managerial
Implications of Masculinity

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Long-Term Orientation
••
••
••
••
••
••

Belief
Belief inin substantial
substantial savings
savings
Willingness
Willingness toto invest
invest
Acceptance
Acceptance ofof slow
slow results
results
Persistence
Persistence toto achieve
achieve goals
goals
Sensitivity
Sensitivity toto social
social relationships
relationships
Pragmatic
Pragmatic adaptation
adaptation

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.6: Managerial
Implications of Long-term
Orientation

Copyright© 2005 South-Western/Thomson Learning All rights reserved


Exhibit 2.7 Hofstede’s
Classification of Countries by
Clusters

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