IB Sociocultural Forces Module 3 PDF

Because learning changes everything.® Module 3 Sociocultural Forces © 2023 McGraw Hill, LLC. All rights reserved. Authorized only for instructor us...

Because learning changes everything.® Module 3 Sociocultural Forces © 2023 McGraw Hill, LLC. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw Hill, LLC.  Learning Objectives LO 3-1 Describe what culture is. LO 3-2 Identify the ways culture affects all business activity. LO 3-3 Describe how culture shows itself. LO 3-4 Describe four frameworks for analyzing culture. LO 3-5 Describe the global mind-set and the MBI model. LO 3-6 Discuss cautions for using cultural frameworks in business. © McGraw Hill, LLC 2  When in Rome, Should You “Do as the Romans Do”... and Feel Comfortable about It? Following local practices may not always feel right, particularly when they conflict with your culture’s moral or legal standards. To what extent should you follow local practices and conform to local customs? Are all actions that conform to local customs morally defensible? Where are the lines? What do you think? © McGraw Hill, LLC 3  What Is Culture and Why Is It Important? 1 Culture The sum total of the beliefs, rules, techniques, institutions, and artifacts that characterize human populations. Ethnocentricity: The belief that your own culture is superior to other cultures. © McGraw Hill, LLC 4  What Is Culture and Why Is It Important? 2 1. Culture is learned; we are not born with a culture. 2. The various aspects of culture are interrelated. 3. Culture is shared, patterned, and mutually constructed through social interaction. 4. Culture defines the boundaries of different groups. © McGraw Hill, LLC 5  What Is Culture and Why Is It Important? 3 International business managers must learn to live, work, and meet business goals in other cultures. Must accept that other cultures are different. Must learn characteristics of other cultures in order to adapt to them. © McGraw Hill, LLC 6  Culture Affects All Business Functions 1 Marketing Variations in attitudes and values across markets often require different marketing mixes to reach potential consumers. Companies must be sensitive to potential cultural issues related to product design, advertising, and pricing. © McGraw Hill, LLC 7  Culture Affects All Business Functions 2 Human Resources Culture plays key roles in motivating and evaluating employees. Must ask: “How is authority understood? Is manager a patron or first among equals?” © McGraw Hill, LLC 8  Culture Affects All Business Functions 3 Production and Procurement Values and attitudes toward change can influence acceptance of new production methods. Culture affects plant layout: linear assembly line versus more group-oriented patterns. Cultural norms structure the acquisition of resources: using social relationships or reliance on price. © McGraw Hill, LLC 9  Culture Affects All Business Functions 4 Accounting and Finance Accounting controls directly relate to assumptions about basic nature of people. Tight controls suggest lack of trust. Loose controls suggest people act honestly even without close monitoring. © McGraw Hill, LLC 10  Culture Affects All Business Functions 5 Preferred Leadership Styles Role and functions of leaders varies across cultures. Desired leadership traits vary by culture. Hierarchical or lateral relationships? Is leadership model paternalistic? Rise through the ranks, or reliant on family or status? Preferred communication style? Method of dealing with conflict? © McGraw Hill, LLC 11  How Culture Shows Itself 1 Aesthetics Refers to a culture’s sense of beauty and good taste. Expressed through art, drama, music, folklore, dance, etc. Also applies to ideas about body and physical beauty. Folklore conveys powerful connotations and emotions: must be used carefully in marketing. Tattoos add aesthetic appeal, or do they? © McGraw Hill, LLC ©Ryan McVay/Getty Images 12  How Culture Shows Itself 2 Religion Important component of culture; responsible for many attitudes and beliefs. Know basic tenets of religions represented in your business markets. Understand how products might conflict with religious beliefs and values. © McGraw Hill, LLC 13  Culture Is Reflected in Religion The Islamic Dome of the Rock in the Temple Mount, Old City of Jerusalem. © McGraw Hill, LLC ©Ryan McVay/Getty Images 14  Table 3.1 Followers of Five Major World Religions Number of Followers Religion (millions) Cultural Tradition Christianity 2,300 West Asian/Abrahamic Islam 1,800 West Asian/Abrahamic Hinduism 1,100 Indian Buddhism 500 Indian Judaism 14 West Asian/Abrahamic Sources: World Christian Database Gordon–Conwell Theological Seminary Centre for the Study of Global Christianity, http://worldchristiandatabase.org; Pew Research Center, “Christians Remain World’s Largest Religious Group, But They Are Declining in Europe,” http://www.pewresearch.org, accessed July 9, 2018; and CIA World Factbook, 2018; and C.L. Illsley, “Largest Religions of the World,” World Atlas, September 10, 2018, https://www.worldatlas.com (accessed October 21, 2020). © McGraw Hill, LLC 15  How Culture Shows Itself 3 Material Culture or Artifacts All the human-made objects of a culture. People who study material culture are concerned with how people make things (technology) and who makes what and why (economics). © McGraw Hill, LLC 16  How Culture Shows Itself 4 Language Most obvious and distancing cultural distinction; both spoken and nonspoken. Nonverbal communication reveals a lot about social interactions and values. Gestures vary and their meanings vary between cultures. Spatial relationships also differ. © McGraw Hill, LLC 17  Figure 3.2 Major Languages of the World Access the text alternative for slide images. © McGraw Hill, LLC 18  How Culture Shows Itself 5 Societal Organization The institutionalized structures of social relationships. Two types: kinship and free association. Family is basic unit based on kinship. Free associations may be formed by commonalities such as age, gender, or common interests. Social structures influence behavior at a fundamental level; rules and organization vary across cultures. © McGraw Hill, LLC 19  How Culture Shows Itself 6 Gift Giving in Business Way to acknowledge interrelationships and social obligations. Exchange of gifts creates a social bond that requires you to be a giver, receiver, and holder of an obligation. Managers should learn the patterns of relevant cultures. © McGraw Hill, LLC 20  Critical Thinking Question Your company has a policy of no gift giving or accepting. You are representing the company in negotiations in China for design of a multi-phased manufacturing facility. Discuss the role of gift giving you might expect in a culture such as China and how you plan to approach this issue. © McGraw Hill, LLC 21  Culture Frameworks 1 Hall’s High and Low Context Classifies cultures based on communication styles and role of context. In high context cultures, much of communication is conveyed by context. Japan, China, many other Asian, Latin American, and African cultures. Social ties are long-standing and close; communication tends to be implicit and indirect. Tend to be polychronic. © McGraw Hill, LLC 22  Culture Frameworks 2 Hall’s High and Low Context In low context cultures, most communication carried in words. Germany, the Scandinavian cultures, and the United Kingdom and former British colonies, including Canada, the United States, and Australia. Relationships are shorter duration; communication is explicit. Tend to be monochronic. © McGraw Hill, LLC 23  Figure 3.3 High- and Low-Context Cultures High Context Less verbally explicit communication; less written/formal information. More internalized understandings of what is communicated. Multiple cross-cutting ties and intersections with others. Long-term relationships. Strong boundaries—insider/outsider. Knowledge is situational, relational. Decisions and activities focus around personal face-to-face relationships, often around a central authority person. Low Context Rule oriented, people play by external rules. More knowledge is codified, public, external, and accessible. Sequencing, separation—of time, of space, of activities, of relationships. More interpersonal connections of shorter duration. Knowledge is more often transferable. Task-centered; decisions and activities focus around what needs to be done; division of responsibilities. Access the text alternative for slide images. © McGraw Hill, LLC 24  Figure 3.4 Examples of High- and Low-Context Cultures and Occupations High Context High Context Japanese Human Resources Chinese Arab Marketing/Sales Greek Management ↕ Mexican Spanish Manufacturing Italian Products French French Canadian R&D English Technical English Canadian American (U.S.) Information Systems Scandinavian Engineers German German-Swiss Finance Low Context Low Context © McGraw Hill, LLC 25  Culture Frameworks 3 Kluckhohn and Strodtbeck’s Cultural Orientations Framework Classification system for cultures based on five universal problems: 1. What relationship should people have to nature? That is, how should they think about their activities with regard to nature? 2. What sorts of relationships should exist among individuals? 3. What are the preferred forms or modes of human activity? 4. What is the best way to think about time? 5. What is the basic nature of humans? © McGraw Hill, LLC 26  Culture Frameworks 4 Hofstede’s Six Dimensions Identified six dimensions to help managers understand how cultural differences affect organizations and management methods. Concerned primarily with work values. © McGraw Hill, LLC 27  Culture Frameworks 5 Hofstede’s Six Dimensions continued Individualism-collectivism dimension measures degree to which people in the culture are integrated into groups. People in highly collectivistic cultures belong to strong, cohesive in-groups that look after them in exchange for loyalty. People in highly individualistic cultures are more loosely connected and look after themselves and their immediate family. © McGraw Hill, LLC 28  Culture Frameworks 6 Hofstede’s Six Dimensions continued Power distance is extent to which members of a society expect power to be distributed unequally and accept it. Similar to inequality, but defined from below, not from above; suggests that a society’s level of inequality is endorsed by followers as well as by leaders. In large-power-distance societies, seniority, age, rank, and title are important; formality is emphasized. In small-power-distance environments, a consultative style of leadership predominates; informality tends to be the norm. © McGraw Hill, LLC 29  Culture Frameworks 7 Hofstede’s Six Dimensions continued Uncertainty avoidance describes a society’s level of comfort with uncertainty. Strong uncertainty avoidance cultures resist change; they expect clear procedures and preserve the status quo. Weak uncertainty avoidance culture see conflict as having positive aspects; they expect innovation, encourage risk taking and reward change. © McGraw Hill, LLC 30  Culture Frameworks 8 Hofstede’s Six Dimensions continued Masculinity-femininity dimension describes the distribution of roles between the sexes. Women’s roles across cultures vary less than men’s; men’s values vary widely. Dimension addresses the gap between men’s and women’s roles in a culture. In feminine cultures, quality of work life is important; in masculine cultures, economic growth is central and business performance is primary goal. © McGraw Hill, LLC 31  Culture Frameworks 9 Hofstede’s Six Dimensions continued Indulgence versus restraint describes a culture’s tendency either to allow relatively free gratification of human desires or suppress human drives though strict social norms. In indulgent cultures, people believe they have personal control over their lives. In restraining cultures, much more energy is dedicated to establishing order and structure, and individuals are not “indulged.” © McGraw Hill, LLC 32  Culture Frameworks 10 Hofstede’s Six Dimensions continued Pragmatic versus normative dimension is measure of how people deal with the unexplainable in their lives. In normative societies, there is strong desire to explain and to know the absolute truth. Respect for tradition, a low propensity to save, and a focus on quick results and personal stability. A pragmatic orientation suggests people are not concerned with understanding so much because life as a complex process is a given. Live a virtuous life; truth depends on context, time, and situation; save and persevere. © McGraw Hill, LLC 33  Global Debate Explores the question, How to Address Cultural Differences when Selecting International Managers? This debate explores the experience of an American company negotiating with an Indian one. The issue of castes threatened to interfere with the deal. How important is it to adjust business practices to conform with local traditions and expectations in other nations? Should factors such as a person’s social status be weighted more heavily than education and job performance in deciding who is selected for a position? What would you recommend that Simpson do, and why? © McGraw Hill, LLC 34  Culture Frameworks 11 Trompenaars’ Seven Dimensions Universalism versus particularism (rules vs. relationships) addresses whether rules or relationships regulate behaviors. People in universalist cultures apply rules across the board, to all people, in all situations. People in particularist cultures consider context before they apply the rule. © McGraw Hill, LLC 35  Culture Frameworks 12 Trompenaars’ Seven Dimensions continued Individualism versus communitarianism is whether people plan their actions with reference to individual benefits or group benefits. Neutral versus affective (unemotional versus emotional) refers to withholding of emotion contrasted with its expression. People in neutral cultures tend to withhold emotional expression, while people in affective cultures are much more expressive. © McGraw Hill, LLC 36  Culture Frameworks 13 Trompenaars’ Seven Dimensions continued Specific versus diffuse dimension distinguishes among cultures based on their differentiation between private life and public or work life. © McGraw Hill, LLC 37  Table 3.4 Characteristics of Specific and Diffuse Dimensions Specific Diffuse Communication is direct, to the Communication is indirect, seemingly point, purposeful “aimless” Style is precise, blunt, definitive, Style is evasive, tactful, ambiguous, Transparent Opaque Principles and moral stands tend Morality is situational (person and to be universal context) Source: Adapted and modified from “Multicultural Impact: Specific vs. Diffuse,” Stanford Chinese Institute of Engineers, https://web.stanford.edu/group/scie/Career/Wisdom/spec_dif.htm, accessed July 9, 2018. © McGraw Hill, LLC 38  Culture Frameworks 14 Trompenaars’ Seven Dimensions continued Achievement versus ascription considers what a person does contrasted with who a person is. Ascription cultures consider who a person is in terms of family lineage, age, or other attributes. Achievement cultures are meritocracies that reward what you do. © McGraw Hill, LLC 39  Culture Frameworks 15 Trompenaars’ Seven Dimensions continued Time dimension has two aspects: Where the primary focus is (past, present, or future) as a lens to view the present. Whether actions are sequential (monochronic) or synchronous (polychronic). © McGraw Hill, LLC 40  Culture Frameworks 16 Trompenaars’ Seven Dimensions continued Internal versus external dimension reflects attitude toward controlling nature. In internal direction cultures, people believe they control nature. In external direction cultures, people believe the natural world controls them, and they need to work with their environment. © McGraw Hill, LLC 41  Figure 3.5 Examples of Country Rankings on Trompenaars’s Dimensions Access the text alternative for slide images. © McGraw Hill, LLC 42  When Does Culture Matter? The Global Mind-Set Culture matters all the time, but in different ways at different times. Global mind-set involves an openness to diversity along with an ability to synthesize across diversity. Map-Bridge-Integrate model (MBI) is useful for discerning what matters across cultures. © McGraw Hill, LLC 43  Going Forward: Cultural Paradoxes and a Caution Cultural Paradox Contradictions between culture’s values and what is actually observed. Managers must be able to identify paradoxes within cultures. © McGraw Hill, LLC 44  Rules of Thumb for Managers Doing Business Across Cultures 1. Be prepared when you approach a foreign market. 2. Slow down. 3. Establish trust. 4. Understand the importance of language. 5. Respect the culture. 6. Understand the components of culture—surface and deep. © McGraw Hill, LLC 45  Get That Job! From Backpack to Briefcase Mallory Wedeking Mallory Wedeking describes her beginning international experience in Uganda and Rwanda, the challenges she faced, and how she overcame them. Contradictions between culture’s values and what is actually observed. © McGraw Hill, LLC Courtesy of Mallory Wedeking 46  MiniCase The minicase “Who Will Staff Up the China Operations?” explores an HR challenge frequently encountered in international assignments. Several people want the assignment to China. The task is to choose the candidate who is most likely to do the best for the company. This assignment gives students an opportunity to apply the culture frameworks in the selection process as well as to think about what is best for the firm in the long and short term. 1. Drawing on the cultural dimensions that we have reviewed, along with your business knowledge, whom would you recommend for the position? 2. What would be your reasoning for this choice? 3. Whom would you suggest for a backup candidate, if the first selection declined the position? © McGraw Hill, LLC 47  Because learning changes everything. ® www.mheducation.com © 2023 McGraw Hill, LLC. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw Hill, LLC.  Accessibility Content: Text Alternatives for Images © McGraw Hill, LLC 49  Figure 3.2 Major Languages of the World – Text Alternative Return to parent-slide containing images. The language families shown are Indo-European, which includes Germanic, Romance, Slavic, Baltic, Iranian, Indo-Aryan, Celtic, Greek, Armenian, as well as the following: Eskimo-Aleut, Native American, Hamito-Semitic, Niger-Congo, Nike-Saharan, Austronesian, Australian, Samoyed, Finno-Ugric, Basque, Khoisan, Ural-Altaic, Caucasian, Sino-Tibetan, Paleo-Siberian, Korean, Japanese, Burnshaski, Austro-Asiatic, Vietnamese, Thai-Kadai, Papuan, Dravidian. Unpopulated regions are also indicated. North and South America as well as Europe are dominated by the Indo-European languages. Africa mostly contains a mix of Hamito-Semitic, Nile-Saharan, Niger-Congo languages. Asia contains a broad mixture of languages. Return to parent-slide containing images. © McGraw Hill, LLC 50  Figure 3.3 High- and Low-Context Cultures – Text Alternative Return to parent-slide containing images. The first figure contains three sets of clustered boxes with multiple interconnections. Each cluster is independent of the others. The second figure contains a central box with multiple boxes surrounding it. Each box is connected to the central one, and a few of the remaining boxes are connected to each other. Return to parent-slide containing images. © McGraw Hill, LLC 51  Figure 3.5 Examples of Country Rankings on Trompenaars’s Dimensions – Text Alternative Return to parent-slide containing images. The first section ranks China on Trompenaars’s dimensions. China is ranked as more particularist, and collectivist, and trending toward affective, diffuse, ascription. The second section shows Mexico as more particularist and affective. It is closer to individualist and trending to specific. It trends higher to ascription than to achievement. The third section ranks the United States as more universal, individualist, and achievement oriented. It is higher in affective than neutral, and closer to specific than diffuse. Return to parent-slide containing images. © McGraw Hill, LLC 52