Using cultural differences

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Using cultural differences
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Approaches to Managing Cultural Diversity

• Multi Domestic
• Assumption diversity has no impact
• Each national unit is regarded as independent and
  autonomous with random rather than planned
  interaction between parts
• International
• Assumption diversity only causes problems.
  Homogeneity is desirable and is a source of
  efficiency
• Headquarters Corporate culture dominates

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• Multinational
• Assumption diversity can either cause problems
  or lead to benefits
• Geographical differentiation is considered
  indispensable. Cultural interaction is encouraged
  but a balance is maintained between diversity and
  uniformity

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Applications

• Negotiations
• Human Resources Management
• Motivation
• Leadership
• Strategic Planning
• Design of organisations
• Marketing
• Cultural differences
• Income differences

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Planning a negotiation strategy

• Characterise the parties
• Assess their interest and no deal alternatives
• Envision potential agreements and bargaining
  ranges
• Craft processes for creating value and claiming
  it
• Pay attention to sustainability of agreements
• Develop a negotiating strategy

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Negotiation Process

• Four stages
• Non task and relationship building
• Task related exchange of information
• Persuasion
• Making concessions and reaching agreement
• Context, duration and importance of each stage
  can differ significantly across cultures

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Negotiation Behaviour

• Differences
• Styles of persuasion
• Conflict resolution preferences (confrontational,
  discussion, referral to higher authority)
• Initial bargaining positions (low vs high initial
  offers)
• Concession patterns (viewing concessions as
  weakness or as acceptable)

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Marketing Socio Economic Differences

• Developing world gives opportunities for
  corporate growth
• Attitudes towards developing world must change
  and better understanding of their business
  environment is required
• It is not only about culture but other factors
  too have a role to play

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Key Issues

• Understand the specific needs of the local market
• Understand the state and the evolution of
  distribution networks
• Choose a mix of local/global leadership
• Decide if customised or standardised strategies
  are preferable
• Learning from local partners where possible