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Causes of cultural differences and change


Affect of Cultures on Business Practices

Causes of cultural differences and change:

Cultural value systems are set early in life and are difficult to change. By the age of ten most children
have their basic value system in place, such as;
evil vs good
dirty vs clean
ugly vs beautiful
unnatural vs natural
abnormal vs normal
paradoxical vs logical
irrational vs rational

Culture is transmitted by various patterns:

from parent to child
from teacher to pupil
from social leader to follower
from one age peer to another

Change in culture may come through

choice or imposition
contact with other cultures
Isolation tends to stabilize a culture and contact tends to create cultural borrowing
Language and religion also affect cultural stability

Behavioral practices affecting businesses:

In any culture a variety of behavioral practices affect the way businesses are conducted. Some of the
common behavioral practices affecting businesses are given below;
group affiliations
role of competence
attitudes towards gender, age & family
importance of occupation
language, context
silent language
attitudes towards work
other behavioral differences
degree of self-reliance
preference for autocratic vs consultative management
attitudes towards self-determination vs fatalism

Some management styles:

Scholars like Herzberg have researched cultures of countries around the world and have categorized
countries according to business practices;
• Theory “X” - workers are generally irresponsible, unwilling to work and must be persuaded to
perform their obligations
• Theory “Y” - given an appropriate work environment and in absence of exceptional disincentives,
workers are dedicated to their tasks, are generally self motivated
Decision making
USA - authoritarian
Western Europe - limited co-determination
Japan - with consensus
Latin America – paternalistic
Corporate emphasis
North America - short-term profit
Western Europe - employee & corporate interests
Japan - close cooperation between govt. & business
Latin America - highly govt. regulated

Hofstede’s dimensions of national culture:

• Power distance - extent to which power in organizations is unequally distributed
– high power distance - centralized tall, pyramid organizations, people at lower strata with lower
qualifications (Philippines, Mexico, South Korea, India)
– Low power distance - less centralized, flatter organizations, people at lower strata with higher
qualifications (Austria)
• Uncertainty avoidance - extent to which society feels threatened by uncertain or ambiguous
high uncertainty avoidance - structured organizational activities, more written rules, less risk
taking by managers, lower labor turnover, less ambitious employees (Germany, Japan & Spain)
low uncertainty avoidance (Denmark & Great Britain)
• Individualism - Collectivism
– individualism - tendency of people to look after themselves and their immediate family (normally
high in wealthy countries)

– collectivism - people belong to groups or collectives and look after each other in exchange for
loyalty (normally high in poor countries)
• Masculinity - Femininity
– masculinity - dominant values of society are success, money, advancement (large-scale
enterprises and economic growth considered important, situations of higher job stress and
employees kept under higher degree of control - Japan)
– femininity - dominant values of society are caring for others and quality of life (greater
importance on cooperation, friendlier atmosphere, employment security, low job stress and
employees allowed considerable freedom - small scale enterprises and emphasis on conservation
of environment - more women hold higher level jobs - Norway)
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Culture is a human medium:

• there is not one aspect of human life that is not touched and altered by culture
• this means personality
• how people express themselves (including shows & emotions)
• the way they think
• how they walk
• how problems are solved
• how their cities are planned & laid-out
• how transportation systems function & are organized
• how economics & government systems work & are put together

Cultural influences on consumer behavior:

• Hierarchy of needs, which distorts demand across product categories.
• Culture based values, especially on individualistic or collective orientations, which influence
purchase behavior and decision process (individual vs family)
• Institutions which influence consumer behavior
• Influences through cultural variations in personal factors of consumer behavior, brand loyalty,
consumer involvement, perceived risk, cognitive style.

Level of context needed:


Impact of national cultures on marketing
• Material culture & marketing
types of products suitable for individual markets
types of media available
distribution systems / storage facilities
• Imperialism
alien products are agents of change in host culture
• Language as a culture mirror
most obvious difference between cultures
English has large vocabulary of commercial & industrial words
Eskimo has many words to describe snow
• Cultural events & marketing opportunities
Eid, Christmas, Chinese New Year etc.
• Cultural sensitivities to products , colors etc.

Reconciliation of cultural differences by international marketer:

Cultural awareness

managers must be aware of what cultural differences are and how these differences would
influence basic functions of management
managers must decide carefully whether and to what extent they should adopt home-country
practices to foreign environment
international managers need to identify the roles that individuals play in process of cultural
change and in acceptance of change
cultural elements which may resist change should be identified and understood before planning
any organizational change
products, services and advertising should also fit needs and perceptions of host culture
grouping countries together

fitting needs to company position

not all companies need to have same degree of cultural awareness
the more a change upsets important cultural values, the more resistance it will face
cost of change may exceed the benefits gained

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