International Management 1 IM1 Intercultural Management Exam Charts PDF

© Mike Hoffmeister, Faculty of Business, Campus Wolfsburg INTERNATIONAL MANAGEMENT 1 IM1 Intercultural Management EXAM CHARTS Prof Dr Mike Hoffmeister Ostfalia University of Applied Sciences...

© Mike Hoffmeister, Faculty of Business, Campus Wolfsburg INTERNATIONAL MANAGEMENT 1 IM1 Intercultural Management EXAM CHARTS Prof Dr Mike Hoffmeister Ostfalia University of Applied Sciences Campus Wolfsburg - Germany Faculty of Business The Culture Iceberg © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Above waterline Visible behavior what you see, hear etc, Our Their examples: Dress, greetings, behavior behavior eating emotions shown in public, directness of speech in business, friendship, religion, punctuality, corruption Below waterline Invisible – values and believes about what is right to do and to say Our values Their values Definition-Stereotype © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Stereotypes are standardized and simplified conceptions of groups, based on some prior assumptions.  A stereotype is a preconceived (vorgefasste) idea that attributes certain characteristics (in general) to all the members of a class or society.  The term is often used with a negative connotation an oversimplified, exaggerated, or demeaning assumption that a particular individual possesses the characteristics associated with the class due to his or her membership in it.  A stereotype can be an oversimplified conception, opinion, or image based on the belief that there are attitudes, appearances, or behaviors shared by all members of a group.  Stereotypes are usually acquired in early childhood under the influence of parents, teachers, peers, and the media. Once one has sorted and organized  Once everyone is put into tidy categories, there is no incentive to learn new information about any individual within this group. Reasons for Stereotypes © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Categorization is an essential human capability because it enables us to simplify, predict, and organize our world.  One reason people stereotype is that it is too difficult to take in all of the complexities of other people.  Are usually employed to explain real or imaginary differences due to race gender religion ethnicity socio-economic class, disability, occupation, etc. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg foreign  Ethnocentric orientation Home market attitude domestic foreign  Polycentric orientation Host market orientation foreign domestic  Geocentric orientation World orientation foreign foreign  Regiocentric orientation Country groups orientation domestic foreign f f f f domestic f f f f *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Ethnocentric orientation Home market attitude — „This works at home; therefore, it must work in your country“ Export company — Each market is simular — Focus on home market foreign — Sourcing, production and marketing from home market perspective — Management decisions done locally — Manager for overseas are sent from home markets domestic foreign *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Polycentric orientation Host market orientation — „We want to be a good local company“ Multi-national company — Each host market is different — Foreign market adaptions foreign — Management decisions done in guest market — Acquisition of manager for guest market in that country domestic foreign *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Geocentric orientation World orientation Global company — Worldwide complex company structure — International management — Standardised, global objectives and strategies foreign — Recruitment of managers worldwide domestic foreign *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Regiocentric orientation Based on polycentric orientation — Considers increasing regionalisation of economies ie Europe — Base: not countries but country groups — Each country group is different while each country within a group is simular f f f f domestic f f f f *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Management Orientation: EPRG-Model* © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg foreign  Ethnocentric orientation Home market attitude domestic foreign  Polycentric orientation Host market orientation foreign domestic  Geocentric orientation World orientation foreign foreign  Regiocentric orientation Country groups orientation domestic foreign f f f f domestic f f f f *Heenan/ Perlmutter 1979, S. 17ff; Kreutzer 1989, S. 12ff.; Hünerberg 1994, S. 114; Becker 1990, S. 270ff. Introduction scene: Job assignment Strategic Gap © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  "Gap" between the professional competence / expertise of a manager and the ability to communicate them in an intercultural environment  One of the biggest challenges companies face with globalization is the "short-sighted" attitude that their managers can have towards customers, products, and offices.  This can mean that the strengths and capabilities of specific local offices, the learning and knowledge of specific international team members and the specific needs in specific local markets are simply ignored.  On the other hand, there is a gap between the international goals of a company and the skills of the executives who have to implement these goals. Hybrid-Model for developing the intercutural fit of HRM strategies © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Cultural Dominance “My Culture’s Way” Cultural Cultural Dominance Synergy Cultural Accommodation Cultural Compromise Cultural Cultural Avoidance Accommodation Cultural Synergy “Their Culture’s Way” Quelle: D. Schlunze, Ritsumeikan Business Journal 2011 Intercultural Competence © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Knowledge Cultural self awareness Culture specific knowledge of global issues and trends  Skills It is NOT about Listening Observing Patience good or bad View world from others’ perspective Right or wrong  Attitudes It is about Respect Openness being different Value other cultures Hofstede Five Cultural Dimensions © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Model that identifies four primary dimensions to assist in differentiating cultures: 1. Power Distance – PDI, 2. Uncertainty Avoidance – UAI, 3. Individualism – IDV and 4. Motivation towards Achievement and Success –  Hofstede added a fifth dimension after conducting an additional international study with a survey instrument developed with Chinese employees and managers That Dimension, based on Confucian dynamism, was applied to 23 countries. 5. Long-Term Orientation – LTO 6. NEW: Indulgence IND (Genuss) versus Restraint (Zurückhaltung) Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions 1. Power Distance Index PDI © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Focuses on the importance of status differences and social hierarchies Extent to which the less powerful members of organizations and institutions are accept It is expect that power is distributed unequally This represents inequality (more versus less), but defined from below, not from above  High PDI people accept a particular social order or hierarchy believe that recognized authorities should not be challenged or questioned those people with preferred social status have a right to use their power for whatever purposes  Low PDI people believe in the importance of social equality – reducing hierarchical structures minimizing social or class inequities questioning or challenging authorities Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions 2. Uncertainty Avoidance Index UAI © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Society's tolerance to adopt for uncertainty and ambiguity  Indicates to what extent a cultures feels either uncomfortable or comfortable in unstructured situations Unstructured situations are unknown, surprising, different from usual  Cultures with high UAI (not accepting uncertainty) Try to minimize the possibility of such situations by — strict laws and rules, rituals — safety — security measures — resist change  Cultures with low UAI (uncertainty accepting cultures ) are more tolerant of opinions different from what they are used to people live day-to-day try to have as few rules as possible on the philosophical and religious level they are relativist and allow many currents to flow side by side people within these cultures are more phlegmatic Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions 3. Individualism IDV © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Individualism vs. Collectivism  Degree to which individuals are integrated into groups  HIGH IDV Individual (Individualist) Orientation ‘I’ identity societies in which the ties between individuals are loose everyone is expected to look after him/herself and his/her immediate family preference of personal motivation and personal goals over group concerns and interests values of freedom, honesty, self-actualisation individual responsibility trust in yourself need to personally compete/win examples: USA, UK, Netherlands, Sweden, Germany Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions 3. Individualism IDV © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Low IDV Group (Collectivist) Orientation ‘WE’ identity societies in which people from birth onwards are integrated into strong, cohesive in-groups often extended families (with uncles, aunts and grandparents) which continue protecting them in exchange for unquestioning loyalty absolute loyalty to the groups values of harmony, face-saving group goals group responsibility trust in your group empathy with the unfortunate need for consensus/harmony the word 'collectivism' in this sense has no political meaning: it refers to the group, not to the state. Examples: India, China, Japan, Mexico, Arab Countries Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions Exercise to IDV © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Please think about how those with  Please focus on the possible a more individualistic orientation negative judgements of might negatively evaluate the collectivists towards individualists behavior of more collectivist orientated colleagues Individualists could consider Collectivists, on the other hand, could collectivists as: consider individualists as:  eg: How Germans would evaluate  eg: How Indians would evaluate Indians Germans Hofstede's five Cultural Dimensions OLD former dimsion Masculinity MAS © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Masculinity vs. Femininity  Refers to the roles between the genders Men: tough, material oriented, like to fight, ambitious Women: sensitive, social, modest, service to others  Research results women's values differ less among societies than men's values men's values differ more strongly among societies; from very assertive and competitive to women's values on the one side (modest, caring)  The assertive pole has been called 'masculine' and the modest, caring pole 'feminine‘  High feminine countries women have the same modest, caring values as the men  High masculine countries women are not as assertive and competitive as the men these countries show a gap between men's values and women's values  Hofstede: https://www.youtube.com/watch?v=uSHeIBtj9gs Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions Changed: Motivation towards Achievement and Success © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  The degree to which we focus on goal achievement and work or quality of life and caring for others.  The fundamental issue here is what motivates people, wanting to be the best (Decisive) or liking what you do (Consensus-oriented).  HIGH score (Decisive - ability to make decisions quickly and confidently- determinative) indicates that the society will be driven by competition, achievement and success, with success being defined by the winner / best in field - a value system that starts in school and continues throughout organisational life. Status is often shown, especially by cars, watches, and technical devices.  LOW score (Consensus-oriented) dominant values in society are caring for others and quality of life. quality of life is the sign of success and standing out from the crowd is not admirable. Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede's five Cultural Dimensions 5. Long Term Orientation LTO © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Long vs. Short Term Orientation  Values associated with Long Term Orientation are: future oriented thrift – save money not everything has to be explainable – it comes as it comes results will be meet slowly perseverance and persistence recognize status differences in interpersonal relationships  Values associated with Short Term Orientation are: focus on the past and present fulfilling social obligations use of analytic thinking expect short term results spend money – do not save Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Hofstede New 6th Cultural Dimension Indulgence IND (Genuss) versus Restraint © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Indulgence (high IND)  High IND allows relatively free gratification of basic and Latin America natural human drives related to enjoying life parts of Africa and having fun. the Anglo world being optimistic Nordic Europe; easy rules and regulations  Low IND Restraint mostly found in East Asia self-fulfillment Eastern Europe perception of personal life control the Muslim world. freedom of speech seen as important  Restraint (low IND) limits freedom of movement, action, or growth suppresses gratification of needs and regulates it by means of strict social norms. being serious strong social and religious rules freedom of speech is not a primary concern man lives for his society – family first Fons Trompenaars Cultural dimensions – overview © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Relationship with other people 1. Universalism vs. Particularism (rules versus relationships) 2. Individualism vs. Communitarianism (the individual versus the group) 3. Neutral vs. Emotional (the range of feelings expressed) 4. Specific vs. Diffuse (the range of involvement | compartmentalise vs generalise) 5. Achievement vs. Ascription (how status is accorded) and 6. Time : Sequential vs. Synchronic 7. Environment: to what extend do we control our environment Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Fons Trompenaars Universalist vs. Particularist © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg UNIVERSALISTS: Based on Rules PARTICULARISTS: Based on Relationship  Belief  Belief The belief that ideas and practices can be applied The belief that circumstances dictate how ideas everywhere in the world without modification and practices should be applied and that Common standards and rules should be followed something cannot be done the same and everywhere everyone should be treated the same. Obligations to particular people and special Exceptions weaken the system we depend on circumstances come before abstract rules. Without exceptions, we weaken the human ties we depend on.  Characteristics  Characteristics Trust placed in systems and models Trust placed in networks of relationships There is only one truth or reality There are several perspectives of truth People are assigned to tasks Tasks are assigned to people Core business focus Flexible customer focus Standardisation & globalisation Customisation & localisation Fairness & consistency Particular circumstances & requirements Transparency & simplification Appropriateness & contextualisation Objective measurement Subjective measurement Black & white photo – facts convince Oil painting – opinions convince Analytical marketing Personal networking Science of management Art of management  Example  Example Anglo-Saxon Southern Europe Northern Europe South America Middle East Asia Fons Trompenaars Universalist vs. Particularist © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg subtly = geschickt/raffiniert Fons Trompenaars Neutral vs. Emotional © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  The range of feelings expressed  Should the nature of our interactions be objective and detached, or is expressing emotion acceptable?  Neutral culture A culture in which emotions are held in check The brain checks emotions because these are believed to confuse the issues We become nervous and uneasy once we stop talking The moment of silence is interpreted as a failure to communicate North America and North-West Europe  icecold with no heart  Emotional (affective/communitarianism) A culture in which emotions are expressed openly and naturally Loud, laughter, banging your fist on the table or leaving a conference room in anger during a negotiation is all part of business Asia, Arab World  out of control and inconsistent Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Fons Trompenaars Neutral vs. Emotional © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Practical tips for doing business in neutral and affective cultures © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Neutral Affective Do not reveal what they are thinking or Reveal thoughts and feelings verbally feeling and non-verbally May (accidentally) reveal tension in face Transparency and expressiveness and posture release tensions Emotions often dammed up will Emotions flow easily, effusively, occasionally explode vehemently and without inhibition Cool and self-possessed conduct is Heated, vital, animated expressions admired admired Physical contact, gesturing or strong Touching, gesturing and strong facial facial expressions often taboo expression common Statements often read out in monotone Statements declaimed fluently and dramatically Practical tips for doing business in neutral and affective cultures © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Doing Business with Neutrals Doing Business with Affectives (tips for affectives) (tips for neutrals) Ask for time-outs from meetings and Do not put off your stride when they negotiations where you can patch each create scenes and get histrionic; take other up and rest between games of time-outs for sober reflection and hard poker with the Impassive Ones assessments Put as much as you can on paper When they are expressing goodwill, beforehand respond warmly Their lack of emotional tone does not Their enthusiasm, readiness to agree or mean they are disinterested or bored, vehement disagreement does not mean only that they do not like to show their that they have made up their minds hand The entire negotiation is typically The entire negotiation is typically focused on the object or proposition focused on you as person, not so much being discussed, not so much on you as on the object or proposition being persons discussed Fons Trompenaars Specific vs. Diffuse © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Specific culture A culture in which individuals have — a large public space they readily share with others and — a small private space they guard closely and share with only close friends and associates  Diffuse culture A culture in which public space and private space are similar in size Individuals guard their public space carefully, because entry into public space affords entry into private space as well In diffuse cultures, everything is connected to everything Your business partner may wish to know — where you went to school, — who your friends are, — what you think of life, — politics, — art literature and music This is not „a waste of time“ because such preferences reveal character and form friendship Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Fons Trompenaars Specific vs. Diffuse © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Fons Trompenaars Achievement vs. Ascription © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg People’s status based on ….  Achievement culture … how well they perform their functions … what you have recently accomplished and on your record The first question in an achievement culture is likely to be: „What did you study?“  Ascription culture … who or what a person is That status is attributed to you, by — birth, kinship (blood relationship), — gender or age, — your connections (who you know) and — your education record While in a more ascriptive culture the question will more likely be: „Where did you study?“ Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Fons Trompenaars Achievement vs. Ascription © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Fons Trompenaars Time © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Two ways how people deal with the concept of time:  Sequential time is perceived as passing in a straight line, people tend to do only one activity at a time keep appointments strictly show a strong preference for following plans as they are laid out and not deviating from them cultures like the American, Swedish and Dutch,  Synchronous other cultures think of time more as moving in a circle, the past and present together with future possibilities people tend to do more than one activity at a time, appointments are approximate and may be changed at a moment’s notice schedules generally are subordinate to relationships Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Fons Trompenaars Environment © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  The ways in which people deal with their environment  Managers were asked to choose between the following statements: 1. What happens to me is my own doing Managers who believe in controlling their own environment 2. Sometimes I feel that I do not have enough control over the directions my life is taking Managers who believe they are The countries which believe controlled by their environment and that what happens to them cannot do much about is their own doing Source: International Management / Luthans & Doh/ 7. edition/ McGraw-Hill Edward Hall a. High and low context culture © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg message TEXT message CONTEXT Lower Context Higher Context Edward Hall a. High and low context culture © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  Low-context culture messages are explicit words carry most of the information in communication deals are made with much less information about the — character, — background and — values of the participants business is more likely to be based on the words and numbers  Examples of low-context cultures: United States Central and Northern Europe Source: Global Marketing Management, p. 681 Edward Hall a. High and low context culture © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg  High-context culture less information is contained in the verbal part of a message much more information resides in the context of communication, including — the background, — associations and — basic values of the communicators function with much less legal paperwork than is deemed essential in low-context cultures business based on — a person‘s values and position or — place in society — who you are than on formal analysis — a person‘s word is his or her bond less need — to anticipate contingencies (das Unvorhergesehene) and — to provide for external legal sanctions (shared feelings and obligation and honour take the place of impersonal legal sanctions) because the culture emphasises obligations and trust as important values job is given to the person who will do the best work and whom you can trust and control  Examples of high-context cultures: Asian, Arabian und South European Countries Source: Global Marketing Management, p. 681  Edward Hall b. Time © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Monochronic vs. Polychronic culture (sacrosanct = unanstastbar) Source: http://stephan.dahl.at/research/online-publications/intercultural-research/halls-classicpatterns/ Edward Hall 2. Space © Mike Hoffmeister, Faculty of Business, Campus Wolfsburg Public space Social space Personal space Intimate space 1,5 feet 4 feet  E. Hall distance model: Intimate: 0- 1,8' 12 feet Personal: 1,8'- 4' Social: 4'- 10' Public Distance: 10' & more 25 feet