Establishing Export Firms
International Business Cultures
“It is critically important that we turn our
transmitters off, and turn our receivers
on to better understand different
cultures.”
∞ Chuck Hagel
What is culture?
Culture is the sum total of beliefs,
rules, techniques, institutions, and
artifacts that characterize human
populations. It includes the
individual worldviews, social rules
and interpersonal dynamics
characterizing a group of people set
in a particular time and place.
Culture as an Iceberg
What is Stereotyping?
Source: http://www.simplypsychology.org/katz-braly.html
Culture Affects all Business Functions
• Marketing:
– What motivates people to buy and what do they prefer to buy?
• Human Resources:
– What are the local Sociocultural motivators of employees?
• Production:
– How do people work in groups? How do groups acquire resources?
• Accounting & Finance:
– Controls are based on the perception of trust in people
– Formal controls – compliance through rules and sanctions
– Informal controls – compliance through social norms
• Preferred Leadership Styles:
– Relationship between leader and followers
• Hierarchical? Lateral? Paternalistic? Heroic?
4-7
The Hofstede Cultural Dimensions Model
The dimensions:
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Individualism – Collectivism
Power Distance
Uncertainty avoidance
Masculine cultural characteristics
Feminine cultural characteristics
Indulgence – Restraint
IndividualismIndividualismcollectivism
collectivism
Indulgencerestraint
Power
Distance
Culture
MasculineFeminine
Uncertainty
Avoidance
Hofstede’s Five Dimensions
• Individualism-Collectivism
– Degree of group integration
• Power Distance
– Expectation and acceptance of unequal power distribution
• Uncertainty Avoidance
– Comfort with uncertainty
• Masculinity-Femininity
– Distribution of roles between genders
• Long-Term Orientation/Confucian Dynamism
– Level of perseverance in overcoming obstacles not overcome
with will or strength
4-9
United States
Germany
China
Ghana
Brazil
Italy
Denmark
India
Israel
International Business Cultures
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Country Background
Advocate
Highest Priority
Time Orientation
Data Needs
Negotiating
Entertainment
The “no” dilemma
Gender Bias
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Protocol
Gestures
Gifts
Dress
Status Needs
Greetings
Titles/Forms of Address
Business Card Exchange
Let your host lead
Resources
www.geert.hofstede.com
Kiss, Bow, or Shake Hands, Terri Morrison and
Wayne A. Conaway
What are the Key characteristics
of culturally fluent
business leaders?
Traits of Successful Cross-Cultural Leaders
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Adapting Socially
Demonstrating Creativity
Possessing an Even Disposition
Respecting Beliefs
Instilling Trust
Navigating Ambiguity
2012 Research Study “Leading Across Cultures in the Human Age”
by Tucker International and Right Management
CHINA
20 Tips on Chinese Culture for Successful Business
Confucianism Worldview
• A system of behaviors and ethics
• Stresses obligations based up relationship:
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Ruler and subject
Husband and wife
Parents and children
Brothers and sisters
Friend and friend
 Values duty, sincerity, loyalty, honor, filial
piety, respect for age all leading to a stable
society.
Doing Business with the Chinese
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Guanxi Reciprocity – the art of doing favors
Handshakes common
Chinese may look down when greeting
Address by title and last name
Patience
Long and numerous meetings
Long-term orientation
Doing Business with the Chinese
• Gift giving and wrapping (love food baskets)
 Huge fear of losing “face” (reputation & respect)
• Directness with subordinates
• Local Communist Party Leaders
• Chinese Patriotism
 Entertainment Critical
• Mostly Non-Religious
 Never Frown
Doing Business with the Chinese
• No touching
• Eye contact brief
 Superstitions
 Questions – salary, age, marital status
• Compliment Group
• Punctuality
• Even demeanor
 Learn to use chop sticks
Doing Business with the Chinese
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Don’t assume comprehension
Chinese won’t say “no”
Only a “yes” is a “yes” maybe.
Read facial expressions, tone of voice and
posture
 Terrific sense of humor – laugh at themselves
when comfortable with you.