SOCIAL/ CULTURAL ENVIRONMENT

Meaning of Culture

 As Geert Hofstede, a noted Dutch writer and

academic has nicely put it, culture is the Software of
the mind-the social programming that runs the way
we think, act and perceive ourselves and others.
 As Mitchell observes, culture “is a set of learned core
values, beliefs, standards, knowledge morals ,laws
and behaviors shared by individuals and societies
determination how an individual acts, feel, and views
oneself and others.
 Francis Merill formulates the concept
culture as follows:

 Is the characteristically human product of social interaction;

 Provides socially acceptable patterns for meeting biological
and social needs;
 Is cumulative, for it is handed down from generation in a given
society;
 Is meaningful to human beings because of its symbolic quality;
 Is learned by each person in the course of his development in
a particular society;
 Is therefore, basic determinant of personality ; and
 Depends for its existence upon the continued functioning of
society but is independent of any individual or group.
Elements of culture
 Language
verbal
non-verbal
 Religion
 Values and attitudes
 Manners and customs
 Material elements
 Aesthetics
 Education
 Social institutions
LANGUAGE

Language capability serves four distinct roles

in international business:-

 Language aids information.

 Language provides access to local society
 Language capability is increasingly important in company
communication, whether within the corporate family or with
channel members.
 Language provides more than the ability to communicate. It
extends beyond mechanics to the interpretation of context that
may influence business operation.
Nonverbal language

 International body language must be

included in the nonverbal language of
international business.
For example: An American manager may,
after successful completion of negotiations,
impulsively give a finger-and-thumb OK sign.
RELIGION

 Religion defines the ideals for life, which in

turn are reflected in the values and attitudes
of societies and individuals. Such values and
attitudes shape the behavior and practices of
institution and members of cultures.
 Religion has an impact on international
business that is seen in a culture’s values
and attitudes towards entrepreneurship,
consumption, and social organization.
VALUES AND ATTITUDES

 DIFFERENCES IN CULTURAL VALUES

AFFECT THE WAY PLANNING IS
EXECUTED, DECISIONS ARE MADE,
STRATEGY IS IMPLEMENTED, AND
PERSONNEL ARE EVALUATED.
MANNERS AND CUSTOMS

 Changes occurring in manners and customs

must be carefully monitored, especially in
cases that seem to indicate a narrowing of
culture differences among peoples.
MATERIAL ELEMENTS

 ECONOMIC INFRASTRUCTURE
 SOCIAL INFRASTUCTURE
 FINANCIAL AND MARKETING
INFRASTUCTURES
 TECHNOLOGIES ADVANCED
AESTHETICS

 EACH CULTURE MAKES A CLEAR

STATEMENT CONCERNING GOOD
TASTE, AS EXPRESEED IN THE ARTS
AND IN THE PARTICULAR SYMBOLISM OF
COLORS, FORM AND MUSIC.
EDUCATION

 International firms also need to know about

the qualitative levels of education, namely
varying emphases on particular skills and the
overall level of the education provided.
Social Institutions

 The family unit

 Social organization also determines the roles
of managers and subordinates and how they
relates o one another.
SOURCES OF CULTURAL
KNOWLEDGE

 EXPERIENTIAL KNOWLEDGE
 WRITTEN MATERIAL
 TRAVEL
Culture and organizational behavior

 Centralized vs. Decentralized decision making

 Safety vs. Risk
 Individual vs. Group Reward
 Informal vs. Formal procedure
 High vs. low organizational loyalty
 Cooperation vs. Competition
 Short-term vs. Long-term Horizon
 Stability vs. Innovation
Making culture work for business
success

 Embrace local culture

 Build relationship
 Employ locals in order to gain cultural
knowledge
 Help employee understand you.
 Adapt product and processes to local
markets.
 Coordinate by region.