Chapter-3 Differences in Culture

What Is Cross-Cultural Literacy?

• Cross-cultural literacy is an understanding of
how cultural differences across and within
nations can affect the way in which business is
practiced
• A relationship may exist between culture and
the costs of doing business in a country or
region

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 What Is Culture?
• Culture is a system of values and norms that are
shared among a group of people and that when
taken together constitute a design for living
where
– values are abstract ideas about what a group believes to
be good, right, and desirable
– norms are the social rules and guidelines that prescribe
appropriate behavior in particular situations
• Society refers to a group of people who share a
common set of values and norms

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 What Are Values And Norms?
• Values provide the context within which a
society’s norms are established and justified
and form the bedrock of a culture
• Norms include
– folkways - the routine conventions of everyday life
– mores - norms that are seen as central to the
functioning of a society and to its social life

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 How Are Culture, Society,
And The Nation-State Related?
• The relationship between a society and a
nation state is not strictly one-to-one
• Nation-states are political creations
– can contain one or more cultures
• A culture can embrace several nations

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 What Are The
Determinants Of Culture?
• The values and norms of a culture evolve over
time
• Determinants include
– religion
– political and economic philosophies
– education
– language
– social structure

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 What Is A Social Structure?
• Social structure refers to a society’s basic
social organization
• Consider
– the degree to which the basic unit of social
organization is the individual, as opposed to the
group
– the degree to which a society is stratified into
classes or castes

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 How Are Individuals
And Groups Different?
• A group is an association of two or more people who have a
shared sense of identity and who interact with each other in
structured ways on the basis of a common set of expectations
about each other’s behavior
• In Western societies, there is a focus on the individual
– individual achievement is common
– dynamism of the U.S. economy
– high level of entrepreneurship
• But, creates a lack of company loyalty and failure to gain
company specific knowledge
– competition between individuals in a company instead of than team
building
– less ability to develop a strong network of contacts within a firm

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 How Are Individuals
And Groups Different?
• In many Asian societies, the group is the
primary unit of social organization
– discourages job switching between firms
– encourages lifetime employment systems
– leads to cooperation in solving business problems
• But, might also suppress individual creativity
and initiative

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 What Is Social Stratification?
• All societies are stratified on a hierarchical basis into social
categories, or social strata
• Must consider
1. The degree of social mobility - the extent to which individuals can
move out of the strata into which they are born
• caste system - closed system of stratification in which social position is
determined by the family into which a person is born
– change is usually not possible during an individual's lifetime
• class system - form of open social stratification
– position a person has by birth can be changed through achievement or luck
2. The significance attached to social strata in business contacts
• Class consciousness is a condition where people tend to perceive
themselves in terms of their class background, and this shapes their
relationships with others

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 How Do Religious
And Ethical Systems Differ?
• Religion is a system of shared beliefs and rituals that are
concerned with the realm of the sacred
• Religion and ethics are often closely intertwined
• Four religions dominate society
1. Christianity
2. Islam
3. Hinduism
4. Buddhism
• Confucianism is also important in influencing behavior and
culture in many parts of Asia
• Ethical systems are a set of moral principles, or values, that
are used to guide and shape behavior

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 What Is Christianity?
• Christianity
– the world’s largest religion
– found throughout Europe, the Americas, and
other countries settled by Europeans
– the Protestant work ethic (Max Weber, 1804)
• hard work, wealth creation, and frugality is the driving
force of capitalism

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 What Is Islam?
• Islam
– the world’s second largest religion
– extends the underlying roots of Christianity to an all-embracing way of
life that governs one's being
– Islamic fundamentalism is associated in the Western media with
militants, terrorists, and violent upheavals, but in fact Islam teaches
peace, justice, and tolerance
– fundamentalists, who demand rigid commitment to religious beliefs
and rituals, have gained political power in many Muslim countries, and
blame the West for many social problems
– people do not own property, but only act as stewards for God
• people must take care of that which they have been entrusted with
– supportive of business, but the way business is practiced is prescribed

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 What Is Hinduism?
• Hinduism
– practiced primarily on the Indian sub-continent
– focuses on the importance of achieving spiritual
growth and development, which may require
material and physical self-denial
– Hindus are valued by their spiritual rather than
material achievements
– promotion and adding new responsibilities may
not be important, or may be infeasible due to the
employee's caste

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 What Is Buddhism?
• Buddhism
– has about 350 millions followers
– stresses spiritual growth and the afterlife, rather
than achievement while in this world
– does not emphasize wealth creation
– entrepreneurial behavior is not stressed
– does not support the caste system, individuals do
have some mobility and can work with individuals
from different classes

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 What Is Confucianism?
• Confucianism
– ideology practiced mainly in China
– teaches the importance of attaining personal
salvation through right action
– high morals, ethical conduct, and loyalty to others
are stressed
– three key teachings of Confucianism - loyalty,
reciprocal obligations, and honesty - may all lead
to a lowering of the cost of doing business in
Confucian societies

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 What Is The Role
Of Language In Culture?
• Language - the spoken and unspoken (nonverbal
communication such as facial expressions, personal space,
and hand gestures ) means of communication
• One of the defining characteristics of culture
– countries with more than one language often have more than one
culture
– English is the most widely spoken language in the world
– Chinese is the mother tongue of the largest number of people
– English is also becoming the language of international business
– knowledge of the local language is still beneficial, and in some cases,
critical for business success
– failing to understand the nonverbal cues of another culture can lead to
communication failure

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 What Is The Role
Of Education In Culture?
• Formal education is the medium through
which individuals learn many of the language,
conceptual, and mathematical skills that are
indispensable in a modern society
– important in determining a nation’s competitive
advantage
– general education levels can be a good index for
the kinds of products that might sell in a country

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 How Does Culture
Impact The Workplace?
• Management processes and practices must be adapted to
culturally-determined work-related values
• Geert Hofstede identified four dimensions of culture
1. Power distance - how a society deals with the fact that
people are unequal in physical and intellectual capabilities
2. Individualism versus collectivism - the relationship
between the individual and his fellows
3. Uncertainty avoidance - the extent to which different
cultures socialize their members into accepting ambiguous
situations and tolerating ambiguity
4. Masculinity versus femininity -the relationship between
gender and work roles

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 Does Culture Change?
• Culture evolves over time
– changes in value systems can be slow and painful
for a society
• Social turmoil - an inevitable outcome of
cultural change
– as countries become economically stronger,
cultural change is particularly common

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 What Do Cultural Differences
Mean For Managers?
1. It is important to develop cross-cultural literacy
– companies that are ill informed about the practices of
another culture are unlikely to succeed in that culture
– managers must beware of ethnocentric behavior, or a
belief in the superiority of one's own culture
2. There is a connection between culture and
national competitive advantage
– suggests which countries are likely to produce the most
viable competitors
– has implications for the choice of countries in which to
locate production facilities and do business

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 Review Question
Abstract ideas about what a group believes to be
good, right, and desirable are called

a) norms
b) values
c) folkways
d) mores

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 Review Question
The basic social organization of a society is its
a) culture
b) social structure
c) social strata
d) caste system

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 Review Question
The group is the primary unit of social
organization in
a) the United States
b) Japan
c) Switzerland
d) Mexico

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 Review Question
Which of the following is not characteristic of
individualism?

a) individual achievement
b) low managerial mobility
c) low company loyalty
d) entrepreneurial behavior

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 Review Question
Which religion promotes the notion that a
moral force in society requires the acceptance
of certain responsibilities called dharma?

a) Islam
b) Hinduism
c) Buddhism
d) Confucianism

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 Review Question
The most widely spoken language in the
world is

a) Spanish
b) Chinese
c) Hindi
d) English

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 Review Question
_______ focuses on how society deals with the
fact that people are unequal in physical and
intellectual capabilities.

a) individualism versus collectivism

b) power distance
c) uncertainty avoidance
d) masculinity versus femininity

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