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1Culture,ManagementStyle,andBusinessSystemsChapter5McGraw-Hill/Irwin?2005TheMcGraw-HillCompanies,Inc.Allrightsreserved.2IntroductionRecognizebusinessculture,managementvalues,andbusinessmethodsandbehaviorsasimportantforsuccessininternationalmarketThus,managementstylehastobeadaptedininternationalmarketingImportanceofdevelopingfriendship,humanrelations,andattainingaleveloftrustbeforebeginningbusinessnegotiationsKnowledgeofforeignbusinesspracticesandsuccessfulbusinessrelationsNeedtorecognizethatpatternsofthinking,localbusinesstempo,religiouspractices,politicalstructure,andfamilyloyalty,aredifferentandimpactbusinesstransactions3Culture,Managementstyle,andBusinesssystemsCulturaladaptation

1)Culturalimperatives2)Culturalelectives3)Culturalexclusives

4RequiredAdaptationAdaptationisakeyconceptininternationalmarketingTosuccessfullydealwithindividuals,firms,orauthoritiesinforeigncountries,managersshouldexhibit:opentolerance,flexibility,humility,justice/fairness,abilitytoadjusttovaryingtempos,curiosity/interest,knowledgeofthecountry,likingforothers,abilitytocommandrespect,andabilitytointegrateoneselfintotheenvironment5CulturalImperatives,ElectivesandExclusivesCulturalimperativesarethebusinesscustomsandexpectationsthatmustbemet,conformed,recognizedandaccommodatedifrelationshipsaretobesuccessfulCulturalelectivesrelatetoareasofbehaviorortocustomsthatculturalaliensmaywishtoconformtoorparticipateinbutthatarenotrequiredCulturalexclusivesarethosecustomsorbehaviorpatternsreservedexclusivelyforthelocalsandfromwhichtheforeignerisbarredandmustnotparticipate6Culture,Managementstyle,andBusinesssystemsMethodsofdoingbusiness

Becauseofthediversestructures,managementattitudes,andbehaviorsencounteredninternationalbusiness,thereisconsiderablelatitudeinthewaysbusinessisconducted.Nomatterhowthoroughlypreparedamarketermaybewhenapproachingaforeignmarket,acertainamountofculturalshockoccurswhendifferencesinthecontactlevel,communicationemphasis,tempo,andformalityofforeignbusinessareencountered.SeeChap.5PPT97Culture,Managementstyle,andBusinesssystemMoreexplanationformanagementstyle8DifferencesinManagementStylesAroundtheWorld1. DifferencesinAuthorityandDecisionMakingInhigh-PDIcountriessubordinatesarenotlikelytocontradictbosses,butinlow-PDIcountriestheyoftendo2. DifferencesinManagementObjectivesandAspirationstowards:Threetypicalpatternsexist:top-levelmanagementdecisions,decentralizeddecisions,andcommitteeorgroupdecisionsSecurityespeciallyoflifetimeemploymentAffiliationandSocialAcceptancebyneighborsandfellowworkersPowerandAchievementOrientationsoughtbymanagersImportanceofpersonal/familylifeoverworkandprofit910DifferencesinManagementStylesAroundtheWorld3. DifferencesinCommunicationStylesAccordingtoEdwardT.Hall,thesymbolicmeaningsoftime,space,things,friendships,andagreements,varyacrosscultures“Insomecultures,messagesareexplicit;thewordscarrymostoftheinformation.Inothercultures...lessinformationiscontainedintheverbalpartofthemessagesincemoreisinthecontext”Communicationinahigh-contextculturedependsheavilyonthecontextual(whosaysit,whenitissaid,howitissaid)ornonverbalaspectsofcommunicationCommunicationinalow-contextculturedependsmoreonexplicit,verballyexpressedcommunicationsHallplaceselevenculturesalongahigh-context/low-contextcontinuum1112DifferencesinManagementStylesAroundtheWorld4. DifferencesinCommunicationStylesLevelofformalityinaddressingbusinessclientsbyfirstnameLevelofformalityinaddressingyourbossbyfirstnameTempoorspeedingetting“downtobusiness”Perceptionoftimevariesinmanycultures5. DifferencesinNegotiationsEmphasisDifferenceswithrespecttotheproduct,itspriceandterms,servicesassociatedwiththeproduct,andfinally,friendshipbetweenvendorsandcustomers13DifferencesinManagementStylesAroundtheWorld6. P-TimeversusM-TimeM-time,ormonochronictime,typifiesmostNorthAmericans,Swiss,Germans,andScandinaviansMostlow-contextculturesoperateonM-timeconcentratingononethingatatimeP-time,orpolychronictime,ismoredominantinhigh-contextculturesP-timeischaracterizedbymulti-taskingandby“agreatinvolvementwithpeople”14ComparisonofM-timeandP-time

P-timeM-timeDoonethingatatimedomanythingatonceconcentrateonthejobareeasilydistractedandsubjecttointerruptiontaketimecommitmentsconsidertimecommitment(deadline,schedules)seriouslyasanobjectivetobeachieved,ifpossibleArelowcontextandneedinformationarehighcontext15ArecommittedtothejobarecommittedtothepeopleandhumanrelationsAdheretoplansChangeplansoftenandeasilyAreaccustomedtoshorttermedrelationshiphaveastrongtendencytobuiltlifetimerelationshipAreconcernedaboutnotdisturbingaremoreconcernedwithOtherswithpeopleclosetothem1617GenderBiasinInternationalBusinessThegenderbiasagainstwomenmanagersexistsinsomecountriesGenderbiasposessignificantchallengesincross-culturalnegotiationsWomenarenotacceptedinupperlevelmanagementrolesinAsian,MiddleEastern,andLatinAmerican18InternationalBusiness:Strategy,Management,andtheNewRealities19Dealvs.RelationshipOrientationDeal-orientedcultures-managersfocusonthetaskathand,areimpersonal,typicallyusecontracts,andwanttojust“getdowntobusiness.”Examples-Australia,NorthernEurope,andNorthAmerica

Relationship-orientedcultures-managersvalueaffiliationswithpeople,rapport,andgettoknowtheotherpartyinbusinessinteractions;relationshipsaremoreimportantthanthedeal-trustishighlyvaluedinbusinessagreements.Examples-China,Japan,LatinAmericancountries-ittooknineyearsforVolkswagentonegotiateanautomobilefactoryinChina.

19BusinessEthicsBusinessethicsiscomplexintheinternationalmarketplacebecausevaluejudgmentsdifferwidelyamongculturallydiversegroupsTheForeignCorruptPracticesAct1997:ImprisonmentforbriberyExistenceofdifferentlevelsofcorruption,bribery,andfraudCorruptionvaryinglydefinedfromculturetocultureBriberycreatesamajorconflictbetweenethicsandprofitability20TransparencyInternationalOurvision

Aworldinwhichgovernment,politics,business,civilsocietyandthedailylivesofpeoplearefreeofcorruption21Culture,Managementstyle,andBusinesssystemBusinessethic

Ethicsreferstothemoralbehaviorofpeople,firms,orgovernments-issuesoftenarise,ormaybeexacerbated,bydeficienciesinlegalsystems.

22Bribery:VariationsonaThemeBribery:VoluntarilyofferedpaymentbysomeoneseekingunlawfuladvantageExtortion:Paymentsareextractedunderduressbysomeoneinauthorityfromapersonseekingonlywhattheyarelawfullyentitled23Bribery:VariationsonaThemeLubrication:Involvesarelativelysmallsumofcash,agift,oraservicegiventoalow-rankingofficialinacountrywheresuchofferingsarenotprohibitedbylawSubornation:Involvesgivinglargesumsofmoney—-frequentlynotproperlyaccountedfor—designedtoenticeanofficialtocommitanillegalactonbehalfoftheoneofferingthebribe;involvesbreakingthelaw24EthicalandSociallyResponsibleDecisionsAreasofdecisionmakingwhereethicalissuesarise:employmentpracticesandpolicies,consumerprotection,environmentalprotection,politicalpaymentsandinvolvementinpoliticalaffairsofthecountry

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