Welcome to class of

Sociocultural aspects of International Business

byDr. Satyendra Singh

University of WinnipegCanada

Learning 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

Objectives:

Rules of Thumb for Cross Culture Business

• Be preparedknow the country• Slow downdo 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

– Surfacefood, style..– Latentattitude, 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– 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

• 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

• 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