Comparative & Cross-Cultural Management 2: Culture Lecture 2 PDF
Document Details
Uploaded by Deleted User
Tilburg University
2024
Dr. Gerwin van der Laan
Tags
Summary
This lecture from Tilburg University explores comparative and cross-cultural management, focusing on the concept of culture. Defining and characterizing culture, the lecture covers various elements and approaches, including the work of Hofstede. It also analyses how culture impacts economic factors and different clusters of countries. A range of relevant examples and specific business scenarios are included in the presentation.
Full Transcript
Comparative & Cross-Cultural Management 2: Culture Dr. Gerwin van der Laan 28 Augustus, 2024 Plan for Today Organizational announcements Re-cap from last week Culture What is culture? Examples of culture and their relevance for international business...
Comparative & Cross-Cultural Management 2: Culture Dr. Gerwin van der Laan 28 Augustus, 2024 Plan for Today Organizational announcements Re-cap from last week Culture What is culture? Examples of culture and their relevance for international business Culture and the economy Organizational Announcements Link to LibGuide about how to approach academic articles Links to course material yet to be included in the Course Syllabus (except this week for which the full-text is on canvas) Presentation Lecture 1 is on Canvas One apparently hard aspect explained in a bit Supporting extra knowledge clip (not mandatory) Enroll for a tutorial in Osiris If you need to first deregister and then reregister on Osiris Plenty of places, but quite a few groups are full already Recap Link from MNEs to institutions Any business needs to satisfy key stakeholders needs to survive Stakeholder = those who have an interest in the firm = not all are key (will the firm collapse if one withdraws support?) Managers’ task: figure out which decisions will not lead to withdrawal Hard because stakeholder needs conflict Link from MNEs to institutions Some stakeholder needs are formal rules Labour laws (employees), product standards (consumers), taxation (government) Some needs are informal (cognitive-cultural-normative) Expectations w.r.t. treatment at work (employees), metaphors/symbols recognized in marketing campaigns (consumers), corruption (government) Together, these ‘social structures’ that are ‘resilient’ and ‘produce stability’ are called institutions. Complying with these needs enhances firm legitimacy. Cultural-cognitive-normative vs regulative elements Cultural-cognitive- Regulative normative Examples Norms, symbols Laws, rules, contracts Origins & change Evolving through repeated Rational choice interactions (naturalistic) Compliance perspective Avoid guilt, belong to a Sanctions, cost-benefit group, taken for granted analysis Focus in research Process Property Link from MNEs to institutions Multinational Enterprises are active in multiple countries Either they outsource a step in the production process to an abroad subsidiary; or they have a ‘copy’ of the value chain in multiple countries; or a combination of these vertical and horizontal MNEs They also need to balance stakeholder needs between countries Rules and cognitions/cultures/norms differ What is legitimate in one country, is not in another. One-size-fits-all?? Or adjustment to local needs? Culture: What is it? Definitions “Attitudes, values, and beliefs” (Porter) “The collective programming of the mind which distinguishes the members of one group or category of people from those of another” (Hofstede) “[continuum from]…unintended adaptations of a group or category of people to their environment. […to…] behaviors and beliefs that are cumulative creations of the mind” (Noorderhaven) Some characteristics Learnt (programming) as well as inherited Unintended adaptations as well as intended behaviors To align (within) as well as distinguish (between) collectives Norms, values, and beliefs are core elements Belief: something we hold (assume) to be true Value: something we deem important Norms: behavior we feel supports our values Approaches to studying culture Emic – focuses on the uniqueness of cultures Understand culture from within Rich descriptions Etic – focuses on similarities between cultures [our focus] Large representative samples Equivalent research instruments Level of analysis Ecological fallacy Reverse ecological fallacy (Observable) elements of culture Language Religion Values and attitudes (/as displayed in behavior) Customs Material culture (social/economic infrastructure) Aesthetics Education Examples Illustrating level issues: environmerntalism European Value Survey Illustrating level issues: environmerntalism European Value Survey Environmentalism Focus on Western Europe? Beware of the gender gap (female – male) Environmentalism Focus on Western Europe Beware of the gender gap (female – male) … and the education gap (high – low educated) Environmental consciousness and GDP High GDP seems a necessity for high consciousness Beyond some level, it also seems a guarantee But there is considerable variation at each level. Environmental consciousness and GDP High GDP seems a necessity for high consciousness Beyond some level, it also seems a guarantee But there is considerable variation at each level. Suppose you sell solar panels… In countries with GDP above 40k/capita seems ok In countries with lower GDP, only if cheaper than other energy sources In Scandinavia, campaigns targeted to female consumers But go for males in Portugal In France, target the highly educated Expect more interest in Estonia than in Lithuania; more in Sweden than in Denmark. And beware… GDP and education are related You cannot simply combine categories Women/men & High/low educated does not imply high-educated men / low-educated men, f.i. Categories may not be representative of consumer groups rr employee groups, etc. Hofstede’s dimensions Etic Enormous international sample IBM employees Four dimensions (+later additions) Power distance, masculinity, individualism, uncertainty avoidance Clusters of countries But do you want/need them? Hofstede’s dimensions Power distance The degree to which people without power accept that power is unequally distributed Collectivism-Individualism Tendency of people to belong to groups that look after fellow members vs. tendency of people to look after themselves and their immediate family. Uncertainty Avoidance Degree to which people feel threatened by ambiguous situations Feminimity-Masculinity Extent to which dominant values are caring for others and the quality of life vs. success, money, and things Hofstede’s dimensions: Power Distance Power distance The degree to which people without power accept that power is unequally distributed Hofstede’s dimensions: Collectivism/Individualism Tendency of people to belong to groups that look after fellow members vs. tendency of people to look after themselves and their immediate family. Hofstede’s dimensions: Uncertainty Avoidance Degree to which people feel threatened by ambiguous situations Hofstede’s dimensions: Feminimity vs. Masculinity Extent to which dominant values are caring for others and the quality of life vs. success, money, and things Clusters Scandinavian countries (feminime, uncertainty avoidant) Latin-American countries (masculine, uncertainty-ok) Anglo-American countries (masculine, uncertainty avoiding) Suppose McDonalds designs a reward system for staff… 29 Clusters Some Anglo-American companies extremely individualistic and low power distance Many Asian countries high collectivism, high power distance Suppose VDL negotiates with TSMC about chips deliveries… 30 Clusters Many Latin American countries high on power distance and uncertainty avoidance Scandinavian and Anglo-Saxon companies smaller power distance and uncertainty-ok Suppose PepsiCo has a Spanish CEO (it does; Ramon Laguarta)… 31 How does culture affect the economy Sources of competitive advantage Factor (input) conditions Local demand conditions Local context for strategy and rivalry Strength of related and supporting industries Government task Maintain stable policy Set conditions for competition Support cluster formation Culture and competitive advantage (according to Porter) Beliefs Productivity and private property are at the root of prosperity Potential for wealth is limitless Values Innovation, competition, accountability, regulatory standards, networks Question: is this really the only road to prosperity? Why do unproductive cultures persist? Economic culture influenced by ideas about how the economy works Note: this is a circular argument absent an objective superior model Path dependence Culture embedded in wider institutional context Note: culture and institutions reproduce itself through iterations. This produces slow and path dependent change Question: Porter (in 2000!) assumes opinions will converge around the productivity paradigm and wipe out many differences. Do you agree? Next week Institutions Comparing countries on institutional variables Hang around if you have a question. Otherwise: o u ! y ek e e e S tw e x n Thank you!