CHAPTER 4

THE ROLE OF CULTURE IN INTERNATIONAL MANAGEMENT

General Outline
Culture and its Effects on Organizations
Cultural Variables and Dimensions
Developing Cultural Profiles
Culture and Management Styles Around the orld
I. Culture and Its Effects on Orani!ations
A critical s!ill for managing people and processes in other countries is cultural savvy"
that is# a $or!ing !no$ledge of the cultural variables affecting management decisions%
Cultural sensitivity &cultural empathy' is a sense of a$areness and honest caring about
another individual(s culture% Such sensitivity re)uires the ability to understand the
perspective of those living in other &and very different' societies and the $illingness to
put oneself in another*s shoes%
+he culture of a society comprises the shared values# understandings# assumptions# and
goals that are learned from earlier generations# imposed by present members of a
society# and passed on to succeeding generations% Culture results in a basis for living
grounded in shared communication# standards# codes of conduct# and e,pectations%
+hese differences result from the societal# or sociocultural# variables of the culture-
such as religion and language- in addition to prevailing national variables- such as
economic# legal# and political factors% .ational and sociocultural variables thus provide
the conte,t for the development and perpetuation of cultural variables% +hese cultural
variables# in turn# determine basic attitudes to$ard $or!# time# materialism#
individualism# and change% Such attitudes affect an individual*s motivation and
e,pectations regarding $or! and group relations# and they ultimately affect the
outcomes that can be e,pected from that individual%
II. Cultural "aria#les and $i%ensions
One $ay for managers to anticipate the probable effects of an unfamiliar culture on an
organization*s outcomes and processes is to develop a cultural profile%
Managers should never assume that they can successfully transplant America*s# or
/apan*s# or any other country*s styles# practices# e,pectations# and processes% 0nstead#
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they should practice contingency management% Contingency management re)uires
managers to adapt to the local environment and people and to manage accordingly%
A% Subcultures
Managers should recognize# of course# that generalizations in cultural profiles
$ill produce only an appro,imation# or stereotype# of national character% Many
countries also comprise diverse subcultures $hose people conform only in
varying degrees to the national character%
3ood managers treat people as individuals# and they consciously avoid any form
of stereotyping%
4% Cultural Variables
A !inship system is one adopted by a given society to guide family
relationships%
+he formal or informal education in a culture greatly affects e,pectations of
people in the $or!place# recruitment and staffing practices# training programs
and leadership styles%
A nation(s economic system is a po$erful influence on such organizational
processes as sourcing# distribution# incentive systems# and repatriation of capital%
+he system of government in a society imposes varying constraints on the
organization and its freedom to do business%
+he spiritual beliefs of a society are often so po$erful that they transcend other
cultural aspects% 5eligion commonly underlies both moral and economic norms%
Many and varied types of social associations arise in cultures out of formal and
informal groups%
+he system of health care in a country affects employee productivity# employee
e,pectations of $ho is responsible for their health programs# and attitudes
to$ard physical fitness%
5ecreation is the manner in $hich people use their leisure time and attitudes
to$ard leisure%
C% Value Dimensions
Cultural variables result from uni)ue sets of shared values among different
groups of people% Values are a society*s ideas a about $hat is good and bad#
right or $rong% Values $ill influence people to li!ely behave differently under
similar circumstances%
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D% 7ofstede*s Value Dimensions
One useful frame$or! for understanding ho$ basic values underlie
organizational behavior $as proposed by 7ofstede# the result of research on over
889#::: people in ;: countries% 7ofstede proposes four value dimensions< po$er
distance# uncertainty avoidance# individualism# and masculinity%
Po$er distance is the level of acceptance by a society of une)ual distribution of
po$er in institutions% +he e,tent to $hich subordinates accept une)ual po$er is
socially determined%
=ncertainty avoidance refers to the e,tent to $hich people in a society feel
threatened by ambiguous situations% 0n a business conte,t# this value results in
formal rules and procedures designed to provide more security and more career
stability%
0ndividualism refers to the tendency of people to loo! after themselves and their
immediate family only and neglect the needs of society%
Masculinity refers to the degree of typical >masculine> values# such as
assertiveness# materialism# and lac! of concern for others% ?emininity in a
society emphasizes concerns for others# relationships $ith others# and )uality of
life%
E% 0ntegration of Value Dimensions
+he results of 7ofstede*s research are sho$n in $hat 7ofstede calls @cultural
maps of the $orld%A +he significance of these cultural maps is that they sho$ us
at a glance $here there are similarities or differences in $or! values - and#
therefore# in potential employee behaviors - among various countries% E,hibit
1BC sho$s the abbreviations for those countries used in 7ofstede*s research% +he
four cultural value dimensions researched by 7ofstede do not operate in
isolation% +hey are interdependent and interactive in their effects upon $or!
attitudes and behaviors and# therefore# their implications for organizational
operations# such as leadership%
?% 3eographic Clusters
5onen and Shen!ar developed eight country clusters grouped according to the
similarities found in studies of employee attitudes to$ard the importance of
$or! goals# need fulfillment and Dob satisfaction# managerial and organizational
variables# and $or! role in interpersonal orientation%
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3% Critical Operational Value Differences
Some specific culturally based variables $hich cause fre)uent problems for
Americans in international management are time# change# material factors# and
individualism%
+ime< +o Americans# time is a temporal value &as opposed to
eternalFpermanent'# ma!ing it something to be saved# scheduled# and spent $ith
precision so that it is not $asted% 0n many parts of the $orld# people vie$ time
from different perspectives# often based on religious beliefs%
Change< +he value of change varies greatly across cultures% An accepted
estern attitude to$ard change is that an individual can e,ert some control over
the future and can manipulate events# particularly in business% 0ndividuals feel
they have some internal control% 0n many nonBestern societies# control is
considered e,ternal# and people generally believe in destiny or the $ill of Allah%
+hey therefore adopt a passive attitude and may have negative attitudes to$ard
change%
Material factors< Americans consume resources at a far greater rate than the rest
of the $orld% +he attitude of Americans to$ard nature is that it is there to be
used for their benefit% +his differs from the attitudes of 0ndians and Goreans#
$ho $orship nature as a part of their religious beliefs%
0ndividualism< 0n general# Americans tend to $or! and conduct their private
lives independently# valuing individual achievement# accomplishment#
promotion# and $ealth above group goals% 0n other countries# this individualistic
attitude is not valued# and a greater emphasis is placed on such things as
conformity# cooperation# and the strength of the family or community%
0nternational managers often face conflicts in the $or! situation as a result of
une,pected behaviors arising from differences in values held about time#
change# materialism# and individualism% +hese differences in values have
important implications for organizational behavior in such areas as
communication# $or! organization and scheduling# incentive systems# and
attitudes to$ard $or! in general%
III. $e&elo'in Cultural Profiles
Managers can gather considerable information on cultural variables from current
research# personal observation# and discussions $ith people% ?rom these sources#
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managers can develop cultural profiles of various countries - composite pictures of
$or!ing environments# people*s attitudes# and norms of behavior%
0t is relatively simple to pull together a descriptive profile for American culture# even
though there are regional and individual differences# because $e !no$ ourselves and
because researchers have thoroughly studied American culture% +he results of one such
study by 7arris and Moran are sho$n in E,hibit 1B2# $hich provides a basis of
comparison $ith other cultures on 8: dimensions and thus suggests the li!ely
differences in $or!place behaviors% 0t is not so easy# ho$ever# to pull together
descriptive cultural profiles of peoples in other countries unless one has lived there and
has been intricately involved $ith those people% 4ut managers can ma!e a start by using
$hat research and literature is available on a comparative basis%
A% /apan
Much of the /apanese culture - and the basis of $or!ing relationships - can
be e,plained by the principle of >$a#> meaning peace and harmony% +his
principle# imbedded in the value attributed to amae &indulgent love'# probably
originated in the Shinto religion%
/apan(s cultural roots have produced a very homogeneous managerial value
system# $ith strong middle management# strong $or!ing relationships# a strong
seniority system that stresses ran!# and an emphasis on loo!ing after
subordinates%
+he principle of >$a> places emphasis on participative management# consensus
problem solving# and decisionBma!ing $ithin a patient# longBterm perspective%
Ho$ emphasis is given to open e,pression of conflict%
4% 3ermany
+he reunited 3ermany is naturally fairly culturally diverse# since the country
borders several nations% 4ased on 7ofstede# 3ermans ran! high on
individualism &though less individualistic than the =%S%' high on uncertainty
avoidance and masculinity and have a relatively small need for po$er distance%
+hese cultural norms manifest themselves in 3erman*s preferences for being
around familiar people and situations and# also# in their propensity to do a
detailed evaluation of business deals before committing themselves%
Christianity dominates 3erman culture - E9I are either Protestant or Catholic%
+his may be $hy 3ermans prefer rule and order in their lives% 3ermans are
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assertive in business but not aggressive" they have a very strict sense and use of
time and follo$ hierarchical organizational structures $ith po$er at the top%
0n negotiations# 3ermans $ant detailed information before and during
discussions%
C% Gorea
Goreans ran! high on collectivism and pragmatism# fairly lo$ on masculinity#
moderate on po$er distance and )uite high on uncertainty avoidance% 0n Gorea#
priorities are family# respect for authority# formality# class# and ran!% Goreans
are aggressive and hard$or!ing# friendly# and hospitable%
4usiness is based on honor and trust" most contracts are oral%
I". Culture and Manae%ent (t)les around t*e +orld
As an international manager# it is useful then to apply information to develop an
understanding of the e,pected management styles and $ays of doing business that
predominate in that region# or $ith that type of business setting% +$o e,amples are
presented-that for Saudi Arabia# and for Chinese Small ?amily 4usinesses%
A% Saudi Arabia
+he Arab culture is intert$ined $ith the pervasive influence of 0slam% Even
though not all Middle Easterners are Arab# the Arab culture and management
style predominates in the 3ulf region% 0slam @permeates Saudi life-Allah is
al$ays present# controls everything# and is fre)uently referred to in
conversation%A
4% Chinese Small ?amily 4usiness
As put forth by Chen# the philosophy and structure of Chinese businesses
comprises paternalism# mutual obligation# responsibility# hierarchy# familialism#
personalism# and connections%

Autocratic leadership is the norm# $ith the o$ner
using his or her po$er# but also $ith a component of caring about other people
$hich may predominate over efficiency%
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