Welcome to class of Sociocultural aspects of International Business by Dr. Satyendra Singh University of Winnipeg Canada

Learning Objectives Objectives: Explain the significance of culture for international business Identify the sociocultural components of culture Discuss the importance of unspoken language in international business Discuss Hofstede’s four cultural value dimensions

Rules of Thumb for Cross Culture Business Be preparedknow the country Slow downdo not watch time Establish trust avoid American style Understand the importance of language Respect the culture  host is not a foreigner Understand the components of culture Surfacefood, style.. Latentattitude, values, beliefs…

What is Culture The sum total of beliefs, rules, techniques, institutions, and artifacts that characterize human populations Learned Interrelated Shared Defines the boundaries

Ethnocentricity Ethnocentricity Belief in the superiority of one’s own ethnic group Country of origin effect

Sociocultural Components Culture is: Aesthetics Attitudes and beliefs Religion Material Culture Language Societal organization

Aesthetics Culture’s sense of beauty and good taste Music and Folklore Art conveys meaning Colors and numbers have different meanings Architectural style differences feng shui  Objects should be in harmony Music and Folklore Musical tastes vary Folklore discloses way of life

Attitudes and Beliefs… Attitudes Toward Time Vary across cultures Difficult area for some Americans Directness and drive Perceived to be rudeness (rather than being efficient) Deadlines Liability abroad

Attitudes and Beliefs Some put leisure first and work second The demonstration effect Result of having seen others with desirable goods Job Prestige The distinction between blue-collar workers and office employees Upward mobility in society

Religion… Responsible for many of the attitudes and beliefs affecting human behavior Work ethics

Religion

Material Culture Material Culture All human-made objects concerned with how people make things (technology) and who makes what and why (economics)

Language… Most apparent cultural distinction Spoken languages demarcate cultures Many cultures avoid saying anything disagreeable Technical words do not exist in all languages Many languages can exist in a single country, but one usually serves as communication vehicle Lingua franca or link language English primary language of business?

Language Nonverbal communication Gestures vary from one region to another Closed doors convey different meanings Office size has different meanings Conversational distance small in East Gift giving has specific etiquette in each culture Gift or bribe? Questionable Payments

Societal Organization Associations Age is important market segment criterion Gender As nations industrialize, more women enter the job market and assume greater importance in the economy Free association people joined together by a common bond: political, occupational, religious or recreational

Understanding National Cultures Hofstede’s Dimensions of Culture Individualism versus Collectivism Large versus Small Power Distance Strong versus Weak Uncertainty Avoidance Masculinity versus Femininity

Individualism versus Collectivism Collectivistic cultures people belong to groups that are supposed to look after them in exchange for loyalty Individualistic cultures People look after only themselves and the immediate family

Large versus Small Power Distance the extent to which members of a society accept the unequal distribution of power among individuals In large-power-distance societies employees believe their supervisors are right; employees do not take any initiative in making non-routine decisions

Strong versus Weak Uncertainty Avoidance Degree to which members of a society feel threatened by ambiguity and are rule-oriented Employees in high uncertainty-avoidance cultures tend to stay with their organizations Japan, Greece, and Portugal Those from low uncertainty-avoidance nations are more mobile United States, Singapore, and Denmark

Masculinity versus Femininity the degree to which the dominant values in a society emphasize assertiveness, acquisition of money and status Masculinity achievement of visible and symbolic organizational rewards Femininity emphasize relationships, concern for others, and the overall quality of life

Scores for Hofstede’s Value Dimensions

Plot of Nations: Power distance and Uncertainty Avoidance

Plot of Nations: Individualism and Power Distance