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INTRODUCTION
When doing business abroad, a company
first should determine whether a usual
business practice in a foreign country
differs from its home-country experience.
Understanding the cultures of groups of
people is useful because business
employs, sells to, buys from, is regulated
by, and is owned by people.
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The Concept Of Culture

Culture: consists of specific learned norms

based on attitudes, values, and beliefs, all of
which exist in every society.
A system of values and norms shared among
a group of people and, when taken together,
constitute a design for living.
Culture cannot easily be isolated from such factors
as economic and political conditions.
Isolation tends to stabilize a culture, whereas contact
tends to create cultural borrowing
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What is culture?
Culture is everything that people have,
think or do as members of their society
shared by two or more people
transmitted by a learning process
___________________________

CULTURE CONSISTS OF:

Material objects
Ideas, values and attitudes
Normative or expected patterns of behaviour
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Norms and Values

Norms:
Social
rules
and
guidelines that prescribe
appropriate behaviour in
particular situations.
Folkways:
Routine conventions
of everyday life.
Mores:
Central to functioning
of society and its
social life.

Values:
Abstract ideas about
what
a
group
believes to be good,
right, and desirable.
The
bedrock
of
culture.
Have
emotional
significance.
Freedom.

Cultural Awareness in International Business

Building cultural awareness is not an easy task.
Business people agree that cultural differences exists
but disagree on what they are.
Problems areas that can hinder managers cultural
awareness are:
Subconscious reactions to circumstances
The assumption that all societal subgroups are
similar.
A companys need for cultural knowledge increases as Its number of foreign functions increases
The number of countries of operations increases
It moves from external to internal handling of
operations.
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Nations and Culture

National culture
Nation states build museums and monuments to
preserve the legacies of important events and people

Subculture
Group of people that share a unique way of life within a
larger culture (language, race, lifestyle, attitudes, etc.)

Components of Culture

Aesthetics
Physical
environments
Education

Values &
attitudes

Culture

Personal
communication

Manners &
customs
Social structure

Religion
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01. Aesthetics
Music
Painting
Dance
Drama
Architecture

02. Values and Attitudes

Values
The Ideas, beliefs and
customs
to
which
people are emotionally
attached

Freedom
Responsibility
Honesty

Attitudes
Positive
or
negative
evaluations, feelings and
tendencies people hold
toward objects or concepts

Time
Work
Cultural change
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03. Manners and Customs

Manners

Customs

Appropriate behavior,
speech and dressing
in general

Traditional ways or
behavior in specific
circumstances

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04. Social Structure

Social structure
Cultures groups, institutions, social
positions and resource distribution

Social stratification
Process of ranking people into social layers

Social mobility
Ease of moving up or down a culture's
"social ladder"

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05. World Religions

Christianity
Islam
Hinduism
Buddhism
Confucianism

Origin of
Human Values

Judaism
Shinto
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06. Language Blunders

Braniff Airlines English-language slogan Fly in Leather was
translated into Fly Naked in Spanish.
Sign in English on a Majorcan storefront read, English welltalking and Here speeching American.
Sign for non-Japanese-speaking guests in a Tokyo hotel read,
You are respectfully requested to take advantage of the
chambermaids.
English sign in a Moscow hotel read, If this is your first visit to
the USSR, you are welcome to it.
Japanese knife manufacturer labeled its exports to the United
States with Caution: Blade extremely sharp! Keep out of
children.
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Mixed Signals
"Okay"

"Vulgar gesture"

"Crazy"

"It's a secret"

"Very nosey"

"

Very Clever "

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07. Education
Cultures pass on traditions, customs, and values through
schooling, parenting, group memberships, etc.

Education level
Well-educated attract high-paying jobs, while poorly educated
attract low-paying manufacturing jobs

Brain drain
Departure of highly educated people from one profession,
geographic region or nation to another

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08. Physical and Material Culture

These influence a cultures development and pace of change
Topography
Physical features characterizing the surface of a geographic region
Climate
Weather conditions of a geographic region
Material Culture
Technology used to manufacture goods and provide services

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1.
2.
3.
4.
5.
6.
7.
8.
9.

Global Business
Etiquette/Protocol/Manner

Dress code
Punctuality
Non-verbal greetings
Forms of address
Verbal greeting
Exchange business cards
Gifts
Refreshments
Wining and dining

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Identification and Dynamics of Cultures

The nation as a point of reference

Cultural formation and dynamics
Language as a Cultural Stabilizer
Religion as a Cultural Stabilizer

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Religion
Shared beliefs and rituals concerned with
the realm of the sacred.
Ethical Systems:
Moral principles or values used to guide and
shape behavior.

Shapes attitudes toward work and

entrepreneurship and can affect the cost of
doing business.

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Religion and Economic Implications

Christianity
Protestant Work Ethic and The Spirit of Capitalism.

Islam
Favors market-based systems.
No payment or receipt of interest.

Hinduism
Asceticism may have an impact.
Caste (Racial) system plays a role.

Buddhism
Little emphasis on entrepreneurial behavior.

Confucianism
Loyalty, reciprocal obligations, and honesty in dealings.

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Behavioral Practices Affecting Business

1.
2.
3.
4.
5.

Social Stratification Systems

Motivation
Relationship Preferences
Risk Taking Behavior
Information and Task Processing

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01. Social Stratification Systems

Group memberships
Performance orientation
Gender-Based Groups
Age-Based Groups
Family-Based Groups
Occupation

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Behavioral Practices Affecting Business ..

1. Group Affiliation: a persons affiliations
reflecting class or status.
2. Role of Competence: rewarded highly in some
societies. Seniority in Japan
3. Gender Based Groups: there are strong countryspecific differences in attitudes towards males
and females.
4. Age-Based Groups: many cultures assume that
age and wisdom are correlated
5. Family-Based Groups:
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Behavioral Practices Affecting Business

6. Importance of Work: protestant ethic, belief in success
and reward; work as a habit, high-need achiever.
7. Need Hierarchy: people try to fulfill lower-order
needs sufficiently before moving on to higher ones.
The hierarchy of needs theory is helpful for
differentiating the reward preferences of employees.
8. Importance of Occupation: The importance of
business as a profession
9. Self-Reliance: uncertainty avoidance, trust, fatalism,
individual versus group
10. Preference for Autocratic versus Consultative
Management
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Social Stratification.
Typically defined by
family background,
occupation, and income.

Caste:
Virtually no mobility

Class:
some social
mobility

Class Consciousness:
May play a role in
a firms operations

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02. Motivation

Materialism and Leisure

Expectation of Success and Reward
Assertiveness
Need Hierarchy

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03. Relationship Preferences

Power Distance
Individualism versus Collectivism

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04. Risk-Taking Behavior

Uncertainty Avoidance
Trust
Future Orientation
Fatalism

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05. Information and Task Processing

Perception of Cues
Obtaining Information
Information Processing

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Strategies for Dealing with Cultural Differences

Making Little or No Adjustment

Communications

Spoken and Written Language

Silent Language

Cultural Shock
Company and Management Orientation

Polycentrism
Ethnocentrism
Geocentrism

Strategies for Instituting Change

Value system
Cost Benefit of Change
Resistance to Too Much Change
Participation
Reward Sharing
Opinion Leaders
Timing
Learning Abroad

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Language
Language: all languages are complex and
reflective of Environment
Translating one language into another.
Silent Languages: color associations, sense of
appropriate distance, time, body language.
Low-Context cultures, High-context cultures
Monochronic versus Polychronic

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Language
Allows people to communicate.
Structures the way the world is
perceived.
Directs attention to certain features of the
world rather than others.
Helps define culture.
Creates separatist tendencies?

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Spoken Language

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Language dimensions

The spoken language

The written language
The official language
Linguistic pluralism
Language hierarchy
International language
Mass media language
The non-spoken language/ body- language
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Nonspoken Language
Nonverbal cues:

eyebrows
fingers/thumbs
hand gestures
feet
personal space
body gestures

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Education
Formal education
supplements family role
in teaching values
and norms

For intl business, it is a

determinant of national
competitive advantage
Medium to learn
language, conceptual,
and math skills

Cultural norms such as

respect, obedience, honesty
Value of personal
achievement and
competition

Focus on facts of social

and political nature
of society
Obligations of
citizenship

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Reconciliation Of International Differences

1.
2.
3.
4.
5.

Stereotypes
Cultural Shock
Polycentrism
Ethnocentrism
Geocentrism

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Preparation
Define Culture. Discuss different components
of Culture that affect the international
business.
How do the Religion and Language influence
international business? Discuss different
types of language in brief.
Explain different types of Strategies for
Dealing with Cultural Differences for
managing international Business.
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