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International Business

Part Two

Comparative EnvironmentalFrameworksChapter Two

The Cultural Environments FacingBusiness

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2-2Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Chapter Objectives

• To understand methods for learning about

cultural environments

• To analyze the major causes of cultural

difference and change

• To discuss behavioral factors influencing

countries’ business practices 

• To understand cultural guidelines for

companies that operate internationally

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The People Factor

• Culture refers to learned norms based on

the values, attitudes, and beliefs of a

group of people

• Cultural diversity

• Cultural collision

• Sensitivity and Adjustment

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Cultural Awareness

• There is no foolproof way to build your

awareness of culture

• Hard to isolate culture from economic and

political conditions

• Education about a culture helps

• Studies of cultures have shortcomings

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2-5Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

The Nation as a Point of Reference

• National boundaries act as proxy for

culture

• Not everyone in a country shares the

same culture

• Certain cultural attributes may link groups

from different nations more closely than

certain groups within nations

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2-6Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

How Cultures Form and Change

• Cultural values set early in life

• Changes occur from:

Choice Imposition

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Language as a Cultural Stabilizer

• When people from different areas speak thesame language, culture spreads more easily

•  Among nations that share a same language,commerce is easier

• Isolation from other groups, especially becauseof language, tends to stabilize cultures.

• Some countries see language as being soimportant that they regulate the inclusion of

foreign words and/or mandate the use of thecountry’s official language for businesspurposes.

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Religion as a Cultural Stabilizer

• Centuries of profound religious influence

continue to play a major role in shaping

cultural values

• Many religions influence specific beliefs

that may affect business

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Issues in Social Stratification

•  Ascribed group memberships are determined atbirth

•  Acquired group memberships are based onone’s choice of affiliation 

• Performance orientation of the society• Open vs. Closed society

•  Attitude towards gender

•  Attitude towards age

• Importance of family group

• Prestige of occupation

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Issues in Work Motivation

• Materialism and Motivation

• Expectation of Success and Reward

•  Assertiveness: The Masculinity –FemininityIndex

• Hierarchies of Needs

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Factors Affecting Relationship

Preferences

• Power distance: general relationship

between superiors and subordinates.

• Individualism vs. collectivism: degree of

dependence on organization

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Factors Affecting Risk-taking

Behavior

• Uncertainty avoidance

• Trust

• Future orientation• Fatalism

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Factors Affecting Information and

Task Processing

• Perception of cues

• Obtaining Information: Low-Context versus

High-Context Cultures

• Information Processing

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Factors Affecting the

Communication Process

• Spoken and Written language

• Silent language:

color associations

conversational distance

perception of time and punctuality

body language and gestures

prestige

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Dealing with Cultural Differences

•  Accommodation

• Cultural distance

• Culture shock• Company and Management orientations

polycentric

ethnocentric geocentric

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Factors Affecting Strategies for

Instituting Cultural Change

• Value systems

• Cost/benefits of change

• Resistance to too much change• Participation

• Reward sharing

• Opinion leadership• Timing

• Learning abroad