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The Role of Culture

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If the venture in Spain is successful, the US manufacturer plans to use this ... Incubator culture. Organizations as incubators for self-expression and self ... – PowerPoint PPT presentation

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Title: The Role of Culture


1
The Role of Culture
  • Managing Across National and Organizational
    Cultures

Mark McKenna BUS 162 (6), International and
Comparative Management San Jose State University
Chapters 5 and 6, Hodgetts, Luthans and Doh,
International Management Culture, Strategy and
Behavior , 6th edition (New York McGraw-Hill
Irwin, 2006) Adapted from PowerPoint slides by
R. Dennis Middlemist, Professor of Management,
Colorado State University
2
Overview
  • Applying Hofstedes Cultural Dimensions
  • Organizational Cultures
  • Multiculturalism

3
Applying Hofstedes Cultural Dimensions
  • Cross-Cultural Differences and Similarities
  • Six Basic Cultural Variations
  • Exercise A Jumping Off Place

4
Differences and Similarities
  • Challenges for effective cross-cultural
    management
  • Parochialism the tendency to view the world
    through ones own eyes and perspective
  • Simplification the process of exhibiting the
    same orientation toward different cultural groups
  • Similarities across cultures
  • In US and Russian firms organizational behavior
    modifications led to performance improvements
  • Antecedents of organizational commitment were
    similar in US and Korea firms

5
Differences and Similarities
  • Differences across cultures
  • In the criteria used in evaluating personnel

Netherlands France Germany Britain
Reality Analysis Helicopter Leadership Imagination
Imagination Analysis Leadership Helicopter Reality
Leadership Analysis Reality Imagination Helicopter
Helicopter Imagination Reality Analysis Leadership
  • In the norms and rules regulating wages,
    compensation, pay equity, and maternity leave
  • In labor relations, job design, and the design of
    employee training programs

6
Basic Cultural Variations
  • What is the nature of people?
  • What is the persons relationship to nature?
  • What is the persons relationship to other
    people?
  • What is the modality of human activity?
  • What is the temporal focus of human activity?
  • What is the conception of space?

7
A Jumping Off Place
  • A successful, mid-sized Ohio-based US
    manufacturing firm decides to open a plan near
    Madrid, Spain.
  • Factors in the decision include
  • The end of its licensing agreement with a German
    firm
  • New patents and technology
  • Lower labor costs in Spain
  • The Spanish partner will provide on-site support
    the US firm will provide capital, technology and
    training

8
A Jumping Off Place
  • If the venture in Spain is successful, the US
    manufacturer plans to use this experience to open
    plants first in Italy, then in France
  • Put yourself in the position of an international
    consultant or manager
  • What differences would you anticipate between
    Spain and the US?
  • How might lessons learned in Spain need to be
    adapted for operations in Italy?
  • How would France differ from both, and from the
    U.S.?

9
Figure 4-5 A Power-Distance and
Individualism-Collectivism
10
Figure 4-6 A Power-Distance and
Uncertainty-Avoidance
11
Figure 4-7 A Masculinity-Femininity and
Uncertainty-Avoidance
12
A Jumping Off Place
13
Caveats and an Observation
  • Caveats…
  • What is typical?
  • How discrete are subcultures?
  • Are values and beliefs fixed or fluid?
  • What are the significant dimensions?
  • Are attributes generalizable or situation
    specific?
  • Observation…
  • Understanding the properties and prospects of
    nations requires openness to the richness and
    diversity of national practices and institutions
    (Brendan McSweeney, http//geert-hofstede.internat
    ional-business-center.com/mcsweeney.shtml)

14
Organizational cultures
  • Definition
  • Interactions between National and Organizational
    Cultures
  • Strategic Predispositions of International
    Organizations
  • A Typology of Organizational Cultures

15
Definitions
  • Hodgetts, Luthans and Doh (p. 154)
  • shared values and beliefs that enable members to
    understand their roles and the norms of the
    organization.
  • Edgar Schein (1997, p. 12)
  • a pattern of shared basic assumptions that the
    group learned as it solved its problems of
    external adaptation and internal integration, and
    that has worked well enough to be considered
    valid and, therefore, to be taught to new members
    as the correct way to perceive, think and feel in
    relation to those problems.

16
Interactions
  • The values and beliefs employees bring to the
    workplace affect their behavior within the
    workplace
  • Working for MNC may accentuate rather than
    moderate or erase cultural differences
  • Cultural differences across subsidiaries often
    cause coordination problems
  • Important dimensions of cultural difference
    within organizations include motivation,
    relationship, identity, communication, control,
    and conduct

17
Europeans Perceptions of Cultural Dimensions of
U.S. Operations/Same MNC
Adapted from Figure 61 Europeans Perception of
the Cultural Dimensions of U.S. Operations (A)
and European Operations (B) of the Same MNC
18
Europeans Perceptions of Cultural Dimensions of
European Operations/Same MNC
Adapted from Figure 61 Europeans Perception of
the Cultural Dimensions of U.S. Operations (A)
and European Operations (B) of the Same MNC
19
Strategic predispositions
  • Ethnocentric
  • Polycentric
  • Regiocentric
  • Geocentric

20
Strategic Predispositions
Philosophies of Management
  • Ethnocentric predisposition
  • A nationalistic philosophy of management whereby
    the values and interests of the parent company
    guide strategic decisions.

Ethnocentric predisposition
21
Strategic Predispositions
Philosophies of Management
  • Polycentric predisposition
  • A philosophy of management whereby strategic
    decisions are tailored to suit the cultures of
    the countries where the MNC operates.

Ethnocentric predisposition
Polycentric predisposition
22
Strategic Predispositions
  • Regiocentric predisposition
  • A philosophy of management whereby the firm tries
    to blend its own interests with those of its
    subsidiaries on a regional basis.

Philosophies of Management
Ethnocentric predisposition
Polycentric predisposition
Regiocentric predisposition
23
Strategic Predispositions
Philosophies of Management
  • Geocentric predisposition
  • A philosophy of management whereby the company
    tries to integrate a global systems approach to
    decision making.

Ethnocentric predisposition
Polycentric predisposition
Regiocentric predisposition
Geocentric predisposition
24
Typology of Organizational Cultures
Adapted from Figure 62 Organizational Cultures
25
Typology of Organizational Cultures
  • Family culture
  • Power oriented and headed by a leader who is
    regarded as a caring parent
  • Management looks after employees, ensures they
    are well-treated
  • May promote loyalty and commitment or lead to
    support for an ineffective leader
  • Eiffel tower culture
  • Jobs are well defined
  • Everything is coordinated from the top
  • Relationships are specific and job-related
  • Status remains with the job

26
Typology of Organizational Cultures
  • Guided missile culture
  • Work is typically undertaken by teams or project
    groups
  • Individual expertise is more important than
    formal hierarchies
  • Team members are interdependent and (at least
    potentially) equal
  • Incubator culture
  • Organizations as incubators for self-expression
    and self-fulfillment
  • Little formal structure
  • Focus is on development of an innovative product
    or service

27
MULTICULTURALISM
  • The Evolution of International Corporations
  • Problems and Advantages of Diversity
  • Putting It All Together

28
The Evolution of International Corporations
Phase1 Domestic firms
Phase2 International firms
Phase3 Multinational firms
Phase4 Global firms
Source Nancy J. Adler, International Dimensions
of Organizational Behavior, 2nd ed. (Boston
PWS-Kent Publishing, 1991), p. 123.
29
Phases of Multiculturalism
  • Domestic firms
  • Focus on delivering a product or service in a
    domestic market
  • Ethnocentric perspective one good way
  • Multicultural challenge is to manage
    intra-national cultural diversity
  • International firms
  • Multidomestic market-oriented strategy
  • Polycentric or regiocentric perspective many
    good ways
  • Multicultural challenge is to manage
    cross-cultural relationships with clients and
    employees

30
Phases of Multiculturalism
  • Multinational firms
  • Focus is on lower costs and increasing efficiency
  • Multinational perspective one least-cost way
  • Multicultural challenge is to manage
    intra-organizational cultural diversity
  • Global firms
  • Global dominance through mass customization
  • Geo/multicentric perspective many good ways
  • Multicultural challenge is to manage both
    internal and external diversity

31
Problems and Advantages
  • Problems associated with diversity
  • Lack of group cohesion
  • Mistrust of others
  • Erroneous or biased perceptions
  • Miscommunication
  • Advantages of diversity
  • Enhanced creativity
  • Better decision making preventing groupthink
  • More effective and productive performance
  • Cross-cultural groups are better at innovation
    single culture groups are more effective
    performing routine tasks

32
Putting It All Together
  • Complexity in organizational culture
  • Interface between national and organizational
    culture
  • Types of organizational culture
  • Degree of multiculturalism
  • Implications for managers
  • National cultural values
  • Impact on employee behavior
  • Are not easily changed
  • Particularly important when considering
  • The management of human resources
  • Mergers and acquisitions
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