Comp Exam Study Guide - Dr. Reza
What are some similarities between Hofstede’s culture dimensions and the 7d cultural dimensions?
Which of the 7d cultural dimensions are unique compared to Hofstede’s model?
1. Hofstede – 5 dimensions of basic cultural values
a. Power Distance
i. expectations regarding equality among people
b. Uncertainty avoidance
i. typical reactions to situations considered different and dangerous
c. Individualism/Collectivism
i. relationship between individual & the group in society
d. Masculinity
i. expectations regarding gender roles
e. Long-term orientation
i. basic orientation towards time
2. 7d Cultural Dimensions Model – 5 dimensions deal with relationships among people
a. Universalism vs. particularism
i. do we consider relationships or rules more important?
b. Collectivism vs. individualism
i. do we act mostly as individuals or as groups?
c. Neutral vs. affective
i. are we free to express our emotions or are we restrained/controlled?
d. Diffuse vs. specific
i. types of involvement people have with each other
e. Achievement vs. ascription
i. Status based on performance or hostage
3. 7d - 2 dimensions deal with time and how it deals with nature
a. Past, present & future, or a mixture
i. do we do tasks in sequence or several tasks at once?
ii. Do we glorify the past,
iii. enjoy the moment or
iv. plan for the future?
b. Control of vs. “accommodation with” nature
i. nature viewed as something to be controlled vs. something to be accepted.
ii. Beliefs regarding whether one controls one’s own fate.
Compare & contrast ethical relativism & ethical universalism. What are some of the dangers of
adopting either ethical relativism or ethical universalism when making decisions? 155
1. Ethical relativism
a. Each society’s view of ethics must be considered legitimate & ethical
i. Can become “convenient relativism” – companies use as an excuse to behave
badly, citing cultural differences
2. Ethical universalism
a. Basic moral principles transcend cultural/national boundaries.
i. How do you agree on which morals are universal?
b. Particularly dangerous with large MNC in developing world
i. Mgrs assume they know the correct, ethical behaviors
1. Can view those of developing countries as inferior, immoral
Discuss the conditions when a transnational or international firm is likely to out-compete a multidomestic or regional strategist. Contrast this with the opposite situation where the multi-domestic is
most likely to be successful.
1. Transnational/international more competitive
a. Majority of company’s competitive advantages come from upstream in value chain
i. Low-cost or high-quality design, engineering or mfg (Toyota
ii. Company can often generalize these advantages worldwide
2. Multi=domestic more competitive
a. Majority of company’s value generated downstream
i. Marketing, sales, service
1. Better for multi-domestic strategy
a. Serves each market individually
i. Co offers products/services designed for local/cultural
needs/expectations
Discuss some of the key questions multinationals need to ask when picking an alliance partner. Pick 2
questions and describe how answering these questions can help the alliance succeed.(427-428)
A.” Make-or-break” questions – avoid alliance if the partner answers “no” to any of them
1. can the partner deliver as required to make the alliance successful?
2. Can both partners agree on clear goals & objectives for the strategic alliance?
3. Have there been attempt to minimize potential for competition and friction with the partner?
Does the potential partner have any alliances with your competitors?
4. Does the potential partner share with you a vision about how the cross-border strategic alliance
might evolve?
5. Is the partner willing and able to contribute the necessary skills & resources to ensure that the
alliance is successful?
6. Does the partner have a history of success with previous strategic alliances?
7. Have you compared the potential partner with other partners in terms of value creation?
8. Does the cross-border alliance fit with your vision of your alliance network in the future?
B. key criteria
1. strategic complementarity
a. Have a good understanding of each others strategic objectives for the venture
b. what do you hope to achieve from the venture? ST & LT
i. not necessary to have same objectives; they can be complementary
2. complementary skills, products or markets
a. enhance but don’t duplicate
i. partners must contribute more than $$
ii. typical: one contributes technical skills, one contributes marketing skills
3. compatible management styles
4. balanced dependency
a. Each partner relied upon to contribute to relationship (like marriage)
b. Partners feel mutual need to supply their unique gifts to the alliance
i. Both see their contribution as critical to the success of relationship/alliance
5. Avoid the “anchor” partner
a. Can’t or won’t provide share of funding.
b. Potential partners should study carefully each other’s financial position/investment plan
i. Partner with weak division/expansion in other areas could drain $$ from alliance
6. “elephant and ant” complex – Co’s greatly unequal in size
a. Larger firm likely to dominate smaller
i. Control mgt/strategies
b. Different cultures
i. Bureaucratic vs. entrepreneurial
7. Assess operating-policy differences with potential partners
a. Accounting/HR/financial/reporting, etc.
i. Closing during national holidays
ii. Respect age hierarchy of mgt
8. Assess difficulty of cross-cultural comm. With a likely partner
a. Expect slower comm. & more errors of understanding
What are some of the major factors a company needs to take into consideration when setting up a
global e-business? Why do companies with already established international brick and mortar
units have an advantage in setting up global e-business compared to firms with no international
presence?
Response submitted by Jorge & Habib:
1.
2.
3.
4.
5.
6.
7.
8.
Leadership: CEO should strongly believe in the benefits of an e-commerce.
Build on current business models and experiment with new e-commerce models.
Meet the challenge of developing an e-commerce organization
Allocate resources to the e-commerce business
Build a superior e-commerce infrastructure as basis of a differentiation strategy
Have an e-commerce strategy
Develop appropriate e-commerce system
Measure success
For e-businesses that also require a physical infrastructure in the countries where they operate, large
multinational firms that enter e-commerce with an existing global presence often have an advantage.
They have resources to establish a physical base in each country of operation to maintain localized web
sites. Smaller firms and firms new to the complexities of multinational commerce face more challenges in
establishing an international presence.
Compare and contrast appraisal and compensation system in the US and more collective cultures.
Discuss legal and cultural problems multinational managers might face using a collective approach to
these systems in the US and using a US approach in more collective cultures (585)
U.S.
1.
appraisals
i. Individual rights
ii. Duties & rewards
iii. Legal systems – everyone must be treated equally & fairly
iv. Must be highly rational, logical, legal
v. 4 elements
1. Performance standards
2. Performance measures
3. Performance feedback
4. Human-resource decisions
2. compensation
i. External (national/local wage, legislation, unions)
ii. Internal
1. Job importance
2. Co’s willingness to pay
3. Employee’s worth to company
iii. Raises generally due to merit
3. Benefits
i. Pension, healthcares, vacation, insurance, sick leave, holidays
Collective cultures
Appraisals
4. HR decisions consider personal background characteristics more than achievement
5. Age, in-group status more important than performance
6. Appraisal focuses on evaluating/developing “whole man”: including loyalty, sincerity,
attitude
Compensation
7. No significant diff between collective & individual countries
8. Emphasis on success of the whole so individual performance not rewarded
i. You’re expected to perform your best so everyone benefits
Summarize the major findings of the Meaning of Work Study. What are some implications for
motivation in different cultures? 689-90, 695
A. Findings
a. Work centrality
i. Importance of work in a person’s life when compared with other activities
(leisure, family, community, religion)
ii. Uncertainty avoidance & masculinity = negative effects on work centrality
iii. Individualism = positive effects on work centrality
B. Implications
i. Post-industrialized societies – people more concerned with quality-of-life issues
& individual self-expression
ii. People from countries with more avg work hours have higher work centrality
iii. Less-developed societies may also have high work centrality
iv. Money isn’t everything. Benefits people hope to get from their job vary by
national context
1. MNC’s must understand motivating factors for different countries
As a professional management consultant working for a new international venture you have been
asked to design the appropriate training seminars for a cadre of expatriate managers who are about
to embark on their first 5-year assignments to manage one of the subsidiaries strategically located in
Vancouver, Sao Paulo, Dublin and Bombay. Describe the type of leadership training you would
provide to the prospective expatriates and the reason for such training. Why is the understanding of
subordinate expectations crucial to effective leadership?
A. Subordinate’s expectations
a. Who can be a leader
b. What a leader should do
c. What a leader may or may not do
B. Cultural influences
a. National
b. Business
c. Occupational
d. Organizational
C. Subs’ expectations under 3 levels of power distance
Low power
med power distance
high power distance
distance
Leadership issue
(great Britain)
(US)
(Mexico)
Subs needs
weak dep on superiors
moderate dependence
heavy dependence
On superiors
on superiors
strongly expected as part
expect consult but will accept
expect autocratic leadership
Of superior’s role
autocratic leadership
a democrat
a moderate democrat
Consultation
Ideal superior
benevolent autocratic or
Paternalistic father figure
Laws and rules
Status symbols
apply to superior/subordinates
inappropriate
apply to all, but superiors
superiors above the law and take
Have some privileges
advantage of privileges
accepted as symbols of authority
very important contrib. to
Superior’s authority