cultural issues in management in the international context

1

CULTURAL ISSUES IN MANAGEMENT IN THE

INTERNATIONAL CONTEXT

Sharon M MBG1505032

MBA (Gen) ,IMK

SHARON M, INSTITUTE OF MANAGEMENT IN KERALA

SHARON M, INSTITUTE OF MANAGEMENT IN KERALA 2

GROUP MEMBERSAneesha PJGopikrishnan M VNithin Chandran RSharon MMuhammed Abdul Wali Muhammed Saleh Al-Shaibah


INTRODUCTION Facilitated by rapid technological advances in communication and transport, globalization has brought about growing interconnectedness between people, organizations and governments in global network.

In this era of international business, where people from different and often conflicting cultures have to interact with each other, cultural issues and clashes are common.

Through this presentation, we are aiming to explain some of the key areas where cultural differences can be a cause of conflict. And to better understand these conflicts, we shall explore the underlying essence of culture, various assumptions and values associated with it. We shall also look into the international context of subcultures.

The key areas of cultural issues explained are communication, negotiation and decision making.


UNDERSTANDING CULTUREClothing, food, language, buildings, literature are often the ‘symbols of culture’

Prima facie, the cultures of different regions vary, but on closer observation, similarities can be found

Culture is not purely inherited, but learned through experiences

Cultures emerge when a group of persons face and respond to challenges of life

Responses to challenges change with change in circumstances over time-adaptive nature of culture

Cultures are symbolically expressed and transferred from one generation to another


3 LEVELS OF CULTURECulture can be thought of as having three levels. They are:

-Artifacts-Values-Assumptions

They can be represented as the “Cultural Iceberg”


ARTIFACTSTangible aspects of cultureManifestations of underlying values and assumptions


VALUESInvisible rules that causes the artifactsInfluenced by assumptions, but not always acknowledgedAccompanied by rewards/punishments


ASSUMPTIONSCauses values and artifactsInvisible as the air we breathe, but plays a vital role (sub-conscious)Accompanied by rewards/punishments


MATRIX OF CULTUREAssumptions can vary within the culture, in different ways depending on the cultureIllustrated in the ‘Matrix of Culture’

Narrowly shared , deeply held

Widely shared, deeply held

Narrowly shared,

shallowly held

Widely shared,

shallowly held

WideNarrow

Deep

Shallow


(I)NARROWLY SHARED ,DEEPLY HELDNot every one has these assumptionsViolations usually result in informal but significant punishmentsExample:

(i) Using left hand to receive a gift in India

(ii) Burping after a meal in USA


(II)WIDELY SHARED, DEEPLY HELDEverybody believes in itViolations results in formal and significant punishments

Examples: (i)Kissing in public in India(ii) Talking alone in public in USA


(III)NARROWLY SHARED, SHALLOWLY HELDNot everyone believes in itViolations do not result in uniform reactions, but are more idiosyncratic

Examples(i) Some families of India give importance to astrological

findings, while others don’t


(IV)WIDELY SHARED, SHALLOWLY HELDEveryone believes in itPunishments are rather mild, non frequent violations have no punishments

Example(i) Not interrupting someone who is talking to you


ASSUMPTIONS AND THEIR MANAGEMENT IMPLICATIONSAssumptions vary from culture to cultureHas differing implications of management

Basic Assumptions are :(i)Assumptions on environment(ii)Assumptions on human nature(iii)Assumptions about relationships(iv)Assumptions about activity(v)Assumptions about truth & reality


(I)ASSUMPTIONS ABOUT ENVIRONMENTAssumptions about relationships between humans and environmentSpecific Assumptions & Implication

(i) People are meant to dominate the environment>Strategic plans should be developed to enable the firm to

dominate the industry

(ii) People must be submissive to the environment>Firms should seek positions that allows them to coexist with

others


(II)ASSUMPTIONS ABOUT HUMAN NATURERegarding the behavior of humansSpecific assumptions and their implications

(i)People are generally lazy>Implement procedures for monitoring behavior and establish clear

punishments for undesired behavors

(ii)Work is as natural as play for people>Provide people with opportunities and responsibilities and

encourage their development


(III)ASSUMPTIONS ABOUT RELATIONSHIPSAssumptions about how humans should relate to each otherSpecific assumptions and their implications

(i)Individuals have certain freedoms>Individual performance should be measured and rewarded

(ii)People exist because of others and owe and obligation to them

>Cooperation with and contributions to the group should be rewarded


(IV)ASSUMPTIONS ABOUT ACTIVITYAssumptions about the proper types and targets of human activitySpecific assumptions and their implications

(i) People create their own destinies and must plan for future>People who fail to plan should plan to fail

(ii)People should react to and enjoy whatever the present provides

>Planning the future only gets in the way of enjoying the culture


(V)ASSUMPTIONS ABOUT TRUTH & REALITYAssumptions about the nature of truth and realitySpecific assumptions and their implications

(i)Truth objectively exists>Facts and statistics are presented to convince and influence

people

(ii)Truth is what is socially accepted>Opinion leaders are utilized to influence decisions


PURPOSE OF UNDERSTANDING ASSUMPTIONSTo understand the source of values & behaviors

To better understand the visible artifacts of culture

To uncover and understand the fundamental assumptions, which are invisible and take for granted


IMPACT OF CULTURE ON MANAGERIAL BEHAVIORSCulture affects managerial behavior and can create counterproductive clashes when managers from different areas interactThe vital areas of managerial behavior affected by culture are:

(i) Communication(ii)Negotiation(iii) Decision making


(I)COMMUNICATIONTwo aspects of communication differ dramatically with culture:

(i)Context of sayings-high context v/s low context “High context” cultures (Eg:Japan) changes what is said & how its is said significantly depending on the context

“Low context” cultures (Eg:USA) will not vary what is said or how it is said dramatically in response to a situation

High context culture individuals view the low context culture ones as ‘immature’ or ‘unsophisticated’, whereas low-context culture individuals see others as ‘insincere’ or ‘chameleon’ type.


(I)COMMUNICATION (CONTD.)(ii)Explicit language V/s Implicit languageIn explicit language culture, communication is clear cut and directVague directions and instructions are viewed as poor communicationIn implicit language, speaker and listener both share the burden of effective communicationThis helps avoid unpleasant & direct confrontations and disagreements

******************************************************************************For global managers, trying to determine what is better-low context or high context, explicit or implicit is not relevant. But they should understand and respect the significant variations by cultures in communications


NEGOTIATIONNegotiations around the world has some similarities as well as differencesNegotiations around the world broadly consists of 5 stages:(i)Planning-background study, information gathering, deciding what to give & gain prior to face-to-face negotiations

(ii)Non-task time-Introductions and acquaintances

(iii)Exchanging information-provide background, establish common facts, context of negotiation

(iv)Influence-Parties tries to influence each other on quantity/quality

(v)Agreement-Mutually acceptable exchange is agreed upon


NEGOTIATION (CONTD.)Though 5 stages are common across cultures, there’s differences in their context and timings(i)Timing of stages:

Americans prefer to ‘get straight to the point’ and spend less time on non-task stageOn the contrary, Japanese and Mexicans spend significant time on non-task stage, as agreements are a function of relationship in these culturesAmericans have long and detailed contracts, whereas in Japan, where relationships play a major role, the contracts are brief showing only the general termsIts therefore important to understand to research norms of culture before entering into a discussion with individuals from a different background


NEGOTIATION (CONTD.) (ii)Location of StagesIn US, almost all stages will take place in a formal setting, like offices or conference roomsIn Japan, at least some portion of non-task stage will take place in a informal environment, like a golf course or restaurantIn Korea, the final contract is likely to be signed in a formal and public style than in someone’s office(iii)ParticipantsIn rank & status sensitive cultures (India, Japan) both parties must have similarity in terms of rank, authority and ageCountries like USA likes to have small teams (mistaken for lack of importance), whereas countries like Taiwan like to have larger teams (mistaken for intimidating with numbers)In some countries, buyers have only slightly more power (USA) whereas in some, like Japan, buyers enjoy more power and status


NEGOTIATION (CONTD.) (iv)Influence tacticsBrazilians tend to make lesser promises and commitments than AmericansJapanese use silence as a means of respondingBrazilians are twice as likely than Americans or Japanese to begin talking before the other party has finished

These general tendencies and differences is not valid for all individuals from a specific culture

But, before entering into negotiations with individuals from an alien culture, the differences in the five stages must be studies with respect to that culture


DECISION MAKINGCultures can have an impact on by whom and how decisions are madeWho makes the decision?- Collectivist oriented cultures like Japan arrives at decision through consensus, opposed to individualistic countries like USA

How decisions are made?- Countries like USA & Sweden relies on rationality and quantitative information, whereas French, Italians and Argentinians rely on past experience and qualitative information

Managers from USA, Germany are more tolerant in taking decisions during uncertainties whereas managers from Japan are less tolerant


SUBCULTURES IN INTERNATIONAL CONTEXTSubcultures refers to a group of people within a culture differentiating

themselves from others in their parent culture with their peculiar characteristics and traitsSubcultures often maintains some aspects of its parent culturesWe will look into two dimensions of subcultures:

1. Business subcultures-Specific traits of businessmen from different nations

2.Subculture as a business- The international business opportunities offered by subcultures


1.BUSINESS SUBCULTURESWe’ve seen cultural traits and behaviors that are generally applicable to whole population of a nation previouslyIn business subcultures, we will see traits exclusive to businessmen from various regionsExamples:

1.Europeans give priority to dress codes and attitudes. They are likely to come in full formal attire, complete with coat and tie, and will address with courtesy titles than first name (‘Mr.Bill Gates)

2.Americans give priority to punctuality. They comparatively casual in relationships and are comfortable in addressing each other using first names (‘Bill’)

3. Asians give priority to politeness, calling someone by name or a direct no may be considered offending. Also, giving gifts to the families of clients is a normal practiceIt is not necessary that all individuals of the business subculture behave according to the above said pattern of their respective regions, but its important to understand these differences to make inter-cultural business interactions productive.


2.SUBCULTURE AS A BUSINESSSubcultures in the general population is often symbolism attached to movies, music, sports, clothing etc and can be often conflicting with the parent culture

Identifying subcultures within parent cultures can often open ‘niche of markets’, giving an opportunity for international tradeExample:

1.India is a poor performer in international football. National team has very less active supporters. But despite this, in states like Kerala, there is a fairly large subculture of football fans, supporting foreign clubs (Manchester United) and soccer nations (Brazil) more actively than the national team. This has created a good market for authentic merchandise, which has to come from abroad. Widespread and cheap internet combined with social media platforms like facebook has given raise to a online subculture (Netizens,Trollers)


2.SUBCULTURE AS A BUSINESS (CONTD.)This has been used by businesses around the world to reach people over the internet, transcending borders and cultural differencesExample:When Apple launched Iphone 6, it was plagued with the issue of the cellphone ‘bending’ in the pocket of the users. This incident was used not only by Apple’s competitors (Samsung, LG) but a variety of other companies to ‘troll’ Apple and thereby reach millions of ‘Netizens’ around the globe.


CONCLUSION Thus we have seen and understood the various elements that forms the culture of a region, the values and assumptions associated with it and how it can vary from region to region. We have seen the possible issues that can rise from cross-culture interactions. The subcultures in the international context has also been looked into.Differences in communications, negotiations and decision making can have grave consequences unless they are understood and compensated for.

There is no rigid guidelines that can be formulated to avoid cultural clashes in international business environment. The best that can be done is that, the essence and underlying differences of culture be understood and treated with mutual respect.


THANK YOU

cultural issues in management in the international context

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