Culture, Management Style, and Business Systems PDF

Culture, Management Style, and Business Systems  Outline Imperatives, Electives, and Exclusives Management Styles around the world. – Authority and Decision Making – Formality and Tempo – P-Time versus M-Time – Marketing Orientation Business Ethics...

Culture, Management Style, and Business Systems  Outline Imperatives, Electives, and Exclusives Management Styles around the world. – Authority and Decision Making – Formality and Tempo – P-Time versus M-Time – Marketing Orientation Business Ethics – Corruption – The Western Focus on Bribery – Bribery: Variations on a Theme Ethical and Socially Responsible Decisions 2  Imperatives, Electives, 5 and Exclusives Cultural Imperatives – Business customs and expectations that must be met and conformed to or avoided if relationships are to be successful – In some cultures a person’s demeanor is more critical than in others – Imperatives vary from culture to culture 3  Imperatives, Electives, 5 and Exclusives, Cont … Cultural Electives – Relate to areas of behavior or to customs that cultural aliens may wish to conform to or participate in but that are not required – A cultural elective in one county may be an imperative in another Cultural Exclusives – Customs or behavior patterns reserved exclusively for the locals 4  5 Management Styles around the world. Roy Philip 5  5 Authority and Decision Making Influencers of the authority structure of business: – High Power Distance Index (PDI) Countries Employees Seldom Contradict their Boss Knowing the Rank of your Business Partner is Crucial – Low PDI Countries Three typical authority patterns: – Top-level management decisions (Centralized ) – Decentralized decisions – Committee or group decisions 6  Formality and Tempo 5 Breezy informality and haste characterize American business relationships Europeans not necessarily similar to Americans Higher differences on the Power Distance Index (PDI) May lead to business misunderstandings Haste and impatience most common mistakes made by Americans in the Middle and Far East For Sealing successful Deals marketers must deal with foreign executives in Considerate ways 7  5 Communication Style High Context Culture – Depends heavily on Contextual (Who says it, When and How), and Nonverbal Communication. Low Context Culture – Depends heavily on Explicit and verbal Communication  Contextual Background 5 of Various Countries Exhibit 5.2 9  5 P-Time versus M-Time Monochronic time – Tend to concentrate on one thing at a time – Divide time into small units and are concerned with promptness – Most low-context cultures operate on M-Time Polychronic time – Dominant in high-context cultures – Characterized by the simultaneous occurrence of many things – Allows for relationships to build and context to be absorbed as parts of high-context cultures Most cultures offer a mix of P-time and M-time behavior As global markets expand more businesspeople from P-time cultures are adapting to M-time. 10  5 Marketing Orientation The extent of a company’s market orientation has been shown to relate positively to profits – Profits as a by-product of Customer Satisfaction. Firms in Several countries have not been able to move from the traditional production, product, and sales orientation to the marketing orientation Research has shown that sometimes in can be difficult to encourage a marketing orientation across diverse business units in global companies 11 Gender Bias in International5 Business Roy Philip 12  5 Business Ethics Roy Philip 13  5 Corruption What is Corruption? Criticisms of Barbie – Sales of Barbie declined worldwide after the global standardization 14  5 Culture and Bribery The decision to pay a bribe creates a major conflict between what is ethical and proper and what is profitable and sometimes necessary for business – Gifts as Part of the Culture – Some Companies put a Limit on the Value of the Gift. The Organization for Economic Corporation and Development (OECD) and Transparency International (TI) are combating the bribery of foreign public officials in international business transactions 15 Transparency International 5 Bribe Payers Index 16  5 Bribery: Variations on a Theme Bribery and Extortion – Bribery is a voluntarily offered payment by someone seeking unlawful advantage – Extortion takes place only if payments are extracted under duress by someone in authority from a person seeking only what he or she is lawfully entitled to Subornation and Lubrication – Lubrication (Greasing the Palm) involves a relatively small sum of cash, a gift, or a service given to a low- ranking official in a country where such offerings are not prohibited by law – Subornation involves giving large sums of money, frequently not properly accounted for, designed to entice an official to commit an illegal act on behalf of the one offering the bribe 17  Bribery – 5 Variations on a Theme, Cont … Agent’s Fees – When a businessperson is uncertain of a country’s rules and regulations, an agent may be hired to represent the company in that country – Change will come only from more ethically and socially responsible decisions by both buyers and sellers and by governments willing to take a stand 5-18  Ethical and Socially 5 Responsible Decisions Difficulties arise in making decisions, establishing policies, and engaging in business operations in areas such as: – Employment Practices and Policies (under-age) – Consumer Protection (Companies take advantage of its Lack in certain countries) – Environmental Protection Laws were set to Prevent past behavior that society has deemed unethical or socially irresponsible from Reoccurring Ethical principles to help the marketer distinguish between right and wrong, determine what ought to be done, and justify actions – Utilitarian Ethics (Does it achieve a common good?) – Rights of the Parties (Does the actions respect Human Rights?) – Justice or Fairness (Does the action represent fairness for all?) 19  Dimensions of Culture – 5 A Synthesis Exhibit 5.7 20