50

CHAPTER 4 The Role of Culture

After studying this chapter, students should be able to:

> Discuss the primary characteristics of culture.

> Describe the various elements of culture and provide examples of how
they influence international business.
> Identify the means by which members of a culture communicate with
each other.
> Discuss how religious and other values affect the domestic environments
in which international businesses operate.
> Describe the major cultural clusters and their use to international
managers.
> Explain Hofstede’s primary findings about differences in cultural values.
> Explain how ethical conflicts may arise in international business.

LECTURE OUTLINE

OPENING CASE: E-culture

The opening case illustrates the impact of the Internet on the world's business cultures.
Some cultures seem more suited to the Internet environment than others. Cultures that
promote risk taking, for example, might be more likely to engage in providing capital for
dotcoms.

Key Points

• Internet related businesses require managers that are not risk-averse and
structures that allow quick response to changing conditions.

• Cultures which are more accustomed to tall decision-making hierarchies may

find the transition to decision-making in an environment as dynamic as the Internet
more challenging than it would be for cultures less hierarchically oriented.

• Cultures that reward creativity may also be more suited to success in the
dotcom environment.
51 > Chapter 4

• Even cultural attitudes toward compensation affect a culture's attitudes toward

e-commerce. Some cultures will be more receptive to compensation in the
uncertain form of stock options than others.

CHAPTER SUMMARY

Chapter Four explores the issue of culture. It begins with a discussion of what
comprises culture, then moves on to consider how culture affects international
business. The chapter provides many specific examples of cultural differences.

Teaching Note:
Instructors may want to begin their lecture on culture with a
discussion of cross-cultural differences experienced by students.
Students can be asked to describe some differences in culture
they experienced on trips to other countries, when living in another country, or simply
as a result of interaction with a foreigner. This type of discussion is particularly
interesting if foreign students relate their initial reactions to living in this country.
Alternatively, the Wiring the World box ties in nicely with the opening case.

Discuss Wiring the World:

The Internet, National Competitiveness and Culture.
This Box follows naturally from the opening case. It evaluates what it
takes to succeed in the Internet Age. Attitudes toward compensation, group decision
making, risk and trust all affect the likelihood of success in the Internet environment.

I. CHARACTERISTICS OF CULTURE

• Culture is the collection of values, beliefs, behaviors, customs, and attitudes

that distinguish a society. Culture is important to companies because it determines
the rules within which businesses operate.
• Culture is a learned behavior that may be transmitted intergenerationally or
intragenerationally. Culture’s elements are interrelated, and may change to adapt
to external forces. Culture is shared by members of a society.

II. ELEMENTS OF CULTURE

The basic elements of culture are social structure, language, communication, religion,
and values and attitudes. The way in which the elements interact affects the local
environment in which international businesses operate. Show Figure 4.1 (which depicts
the basic elements of culture) here.

Social Structure

The overall framework that determines the roles of individuals within a society, the
stratification of a society, and individuals’ mobility within a society is its social structure.

• Individuals, Families, and Groups. Societies differ in terms of how family is

defined. In the U.S., the term is usually used to describe the nuclear family (father,
mother, and offspring), while in other societies the term refers to an extended
 The Role of Culture > 52

family. In others, the term takes an even broader definition. The importance of
family to business is determined in part by a culture’s social attitudes.
• The importance of an individual to a group also reflects cultural differences. In
the U.S., individualism is stressed, while in other cultures (for example, China and
Japan) the role of the group is emphasized.

Discuss Going Global:

The Impact of Japanese Culture on Business
This Going Global Box examines how Japan’s culture impacts
its business practices. In particular, the Box explores how four
elements of Japanese culture, hierarchical structure, groupism, wa, and obligation,
affect the way business is conducted in Japan. The Box also raises the question of
whether Western firms should adopt Japanese business techniques. The Box fits in
well with a discussion of social structure, as well as with Review Questions 3, 8, and
10.

• Social Stratification. The importance of social stratification (the categorizing of

people on the basis of their birth, occupation, educational achievements, and/or
other attributes) differs by society. MNCs must be aware of the level of social
stratification in a particular country when making personnel decisions and also
when developing advertising campaigns.
• Social mobility, the ability of individuals to move from one stratum of society to
another, is higher in less stratified societies. Individuals’ attitudes and behaviors
towards labor relations, capital formation, risk taking, and entrepreneurship may be
determined in part by social mobility.

Language

• Language is a primary means by which members of a society communicate with

each other. It filters observations and perceptions and thus affects the messages
that are sent. In fact, it has been shown by researchers that language itself alters
the nature of the information that is being conveyed. Show Map 4.1 here.
• Language also provides information about the cultural values of a society and
helps in the acculturation process. In countries such as India where more than one
language is spoken, language provides information about a country’s population
and suggests that there may be differences in income, work ethic, and/or
educational achievement. This information can be used by international
businesspeople as they develop their marketing and business practices.
• Major linguistic groups within a country may also be an indicator of potential
political conflicts between groups. The text provides examples of such conflict.
• Countries that share a language may not share a culture. For example, the text
notes that while the U.S. and the U.K. share a language, there are actually many
differences between the two countries. However, because cultural similarities
facilitate the task of doing business internationally, many domestic firms will initially
seek countries that speak the firm’s home language when expanding abroad.
• Language as a Competitive Weapon. Linguistic ties may create important
competitive advantages because the ability to communicate is so important in
conducting business transactions. The text notes that commerce among Australia,
Canada, New Zealand, the U.K., and the U.S. is facilitated by a common language.
53 > Chapter 4

Indeed, countries such as France and Britain frequently trade with former colonies
that share cultural and linguistic ties. Show Map 4.2 here.

• Lingua Franca. English has emerged as the predominant common language, or

lingua franca, of international business. Consequently, some countries such as
India and Singapore have adopted English as an official language, and some
companies (i.e., Philips and Asea Brown Boveri) have adopted English as their
corporate language.
• Even though English has become a lingua franca, it is important to recognize
that communication problems may still exist because the meaning of some common
English words vary among English-speaking countries.

Teaching Note:
Some students may have encountered differences in the
English language in their travels. Instructors may wish to
ask for some examples of such differences. Some of the
more common responses include the British use of bonnet and boot to refer to a
car’s engine compartment and trunk, and loo or W.C. to refer to a toilet. Even
students who have not traveled to Britain may be aware of differences in some
terms that exist within the U.S. such as the use of poor boy, hoagie or sub to refer
to a long sandwich, or the use of soda, pop, or cold drink to refer to a carbonated
beverage.

Discuss Wiring the World:

French Language Experts Coin New Web Words
Though English is the most common language on the web, the Academie Française
is fighting to preserve the purity of the French language by coining uniquely French
words and phrases for well-known Internet buzzwords. "The Web" is officially
known as "la toile" (the spider's web). "Hackers" are known as "le fouineurs" (the
nosy people). Since the Academie Française was founded in 1653, it has made
considerable headway in persuading the French to adopt its substitutes for non-
French words.

• Although the existence of English as a lingua franca may seem to be

advantageous to native English international businesspersons, it can actually put
them at a disadvantage when negotiating or operating on foreign turf. Failure by
English speakers to learn a second language may spell failure for a firm’s
operations in a second country. The text provides an example of a U.S. company
that closed its Mexican operations because of this problem.
• While most experts agree that mastering a foreign language is an optimal
means of gaining information about a culture, they agree that even modest levels of
language training can provide important clues about cultural norms and attitudes
that prove helpful in international business.
• Translation. Translation is one means of overcoming linguistic differences;
however, the translation process requires more than simply substituting the words
of one language for those of a second. Translators must be sensitive to subtleties
in the connotations of words and focus on the translation of ideas, not words
themselves. The text provides some examples of companies who have ignored this
point and consequently had problems resulting from direct translation of words.
• To reduce translation problems, firms can hire local native speakers as
translators and use backtranslation as a check that the intended message is
 The Role of Culture > 54

actually being sent. Backtranslation is a process whereby after one person

translates a document, a second person is hired to translate the translated version
back into the original language.

Discuss Going Global: International Communication: A

Primer
This Going Global Box presents five principles that
international businesspeople should follow when conversing
with foreigners. It also presents four principles of presentation that, if followed,
should help international executives make more successful presentations to their
foreign counterparts. The Box fits in well with a discussion of language, with Review
Question 7, and with Discussion Question 2.

• Saying No. International businesspeople also may face a situation whereby

words may have different meanings to persons with diverse cultural backgrounds.
The word yes is used by the Japanese in a different way than it is used by
Americans, for example. In fact, the Japanese avoid the use of the word no
because it is considered impolite. It may be necessary, when negotiating with
Japanese businesspeople, to repeat points of agreement in order to avoid
misunderstandings.

Communication

• Communication, whether verbal or nonverbal, can go awry between people who

share a culture. The chance for miscommunication increases substantially,
however, when people are from different cultural backgrounds.
• In cross-cultural communication, the sender encodes a message using his/her
cultural filters and the receiver decodes the same message using his/her cultural
filters. This frequently creates misunderstandings. The text provides an example of
a cross-cultural misunderstanding involving Boeing.
• Nonverbal Communication. Between 80 and 90 percent of all information is
transmitted among members of a culture via nonverbal communication such as
facial expressions and hand gestures. Outsiders may find it difficult to understand
nonverbal communication. Table 4.1 lists many common forms of nonverbal
communication.
• Nonverbal communication can often lead to misunderstandings. The text
illustrates this concept with several examples involving various types of nonverbal
communication.
• Gift Giving and Hospitality. In many cultures, gift giving and hospitality are an
important means of communication. It is important for international businesspeople
to be aware of each culture’s set of rules on the subject. The text provides several
examples of different attitudes toward gift giving and hospitality.

Religion

• Religion affects the ways in which members of a society relate to each other
and to outsiders. Seventy percent of the world’s population follows Christianity,
Islam, Hinduism, or Buddhism. Map 4.3, depicting the major world religions, should
be shown here.
55 > Chapter 4

• Religion shapes the attitudes its followers have toward work, consumption,
individual responsibility, and planning for the future. The Protestant ethic for
example, stresses individual hard work, frugality, and achievement as a means of
glorifying God. On the other hand, the goal of a Hindu is to achieve nirvana, a
state of spiritual perfection, by leading a progressively ascetic and pure life as one’s
reincarnated soul goes through the cycles of death and rebirth. Islam emphasizes
the individual’s responsibility to society.
• Religion may constrain business activities and the types of products consumers
may purchase. The impact of religion on international business varies from country
to country, depending on a country’s legal system, its homogeneity of religious
beliefs, and its tolerance of other religious viewpoints. The text provides examples
of the impact of the Muslim faith on business in Saudi Arabia and Catholicism in
South America.
• Countries that are religiously diverse may represent a greater challenge to
companies than those in which a single religion dominates. Firms operating in
countries with diverse religious beliefs must accommodate followers of each religion
or risk absenteeism, low morale, and lost sales.

Values and Attitudes

• Values are the principles and standards accepted by members of a society;

attitudes encompass the actions, feelings, and thoughts that result from those
values. Attitudes about time, authority, education, and rewards reflect an
individual’s deep-seated values and shape the behavior of, and opportunities
available to, companies operating in a given culture.
• Time. In Anglo-Saxon cultures the prevailing attitude toward time is that it is
valuable and should not be wasted. Conversely, Latin Americans and Arabs do not
share this attitude and think nothing of starting a business meeting late, or being
interrupted during a meeting.
• In low-context cultures, business meetings follow a precise, well-planned
agenda, while in high-context cultures, time is initially spent deciding whether there
is trust between the participants before focusing on the business at hand.
• Age. Attitudes toward age differ by culture. In the U.S., youthfulness is
considered a virtue and young “fast-trackers” are nurtured, while in Asian and Arab
cultures age is respected and reflects a manager’s stature.
• Education. A country’s formal education system transmits and reflects the
cultural values of its society. Individualism is stressed in the U.S. education system,
and education is available to everyone. In the U.K. however, education is linked to
the class system, and an elite education is available only to a few. The text also
provides examples of German, French, and Japanese attitudes toward education.
• Status. Status in some cultures is inherited, while in others it is earned through
individual achievements. How status is acquired affects job attitudes and
performance. The text provides several examples of attitudes toward status and its
effect on business.

III. SEEING THE FOREST, NOT THE TREES

This section looks at the dimensions and characteristics of culture, instead of looking at
cultures individually.

Hall's Low Context-High Context Approach

 The Role of Culture > 56

• Edmund and Mildred Hall have identified two distinct types of culture. A low-
context culture is one in which the words used by the speaker explicitly convey the
speaker’s message to the listener. Examples of low-context cultures include
Canada, the U.K., the U.S., and Germany. Discuss Figure 4.2 here. A high-
context culture is one in which the context in which a conversation occurs is just
as important as the words that are actually spoken and cultural clues are important
in understanding what is being communicated. Examples of high-context cultures
include Japan and Arab countries. A society’s type of culture will have an impact on
its business behavior. Table 4.2 should be used here to discuss differences in
negotiating style across cultures.

The Cultural Cluster Approach

• International businesspeople must recognize cultural differences as they market

products, manage workforces, and deal with host country governments. While one
may initially conclude that business practices must be customized to meet the
demands of each local culture, in reality there are similarities between cultures.
• Eight country clusters have been identified by researchers. Each cultural
cluster comprises countries that share many cultural similarities, although
differences do remain. Discuss Map 4.4 here.
• Many companies formulate their internationalization strategies using the
country-clustering approach.
• Cultural similarities may impact a firm’s choice of entry method. The text notes
for example, that Canadian firms are likely to expand into Britain via a joint venture
with a British partner; however, Japanese firms are likely to enter the market via a
greenfield investment (a brand new one) because they are less comfortable
working with British partners.

Hofstede's Five Dimensions

International businesspeople need to understand how personality traits and need

structures differ across cultures. Many studies today focus on this area. One of the
most influential studies was done by Geert Hofstede. His work identified five
dimensions along which people seemed to differ across cultures. The dimensions
include social orientation, power orientation, uncertainty orientation, goal orientation,
and time orientation. Present Figure 4.3 here.

1. Social Orientation

• Social orientation, the first dimension identified by Hofstede, is a

person’s beliefs about the relative importance of the individual and the groups to
which the person belongs. Two extremes of social orientation are
individualism (the cultural belief that the person comes first), and collectivism
(the belief that the group comes first). Discuss Table 4.3 here.
• It is important to be aware of the differences in the cultural orientations of
countries along the social orientation dimension. The text notes, for example,
that a country’s reward system will reflect its cultural values. U.S. managers, for
example, are compensated according to their individual achievements. On the
57 > Chapter 4

other hand, a Japanese manager’s compensation is linked to group

performance.
• Cultural differences also impact worker mobility. Because Japanese
workers focus on group goals, individuals who switch jobs are considered
disloyal. In contrast, U.S. managers are expected to accept new jobs that offer
better salaries.

2. Power Orientation

• Power orientation, the second of Hofstede’s dimensions, refers to the

beliefs that people in a culture hold about the appropriateness of power and
authority differences in hierarchies such as business organizations. Introduce
Table 4.4 here.
• In cultures characterized by power respect, people tend to accept the
power and authority of their superiors simply on the basis of the superiors’
positions in the hierarchy and to respect the superiors’ right to that power. In
contrast, in cultures that are characterized by power tolerance, much less
significance is attached to a person’s position in the hierarchy. Discuss Figure
4.4 here.

3. Uncertainty Orientation

• Uncertainty orientation, the third of Hofstede’s dimensions, is the

feeling that people have regarding uncertain and ambiguous situations. Those
individuals characterized by uncertainty acceptance are stimulated by change
and new opportunities, while those individuals characterized by uncertainty
avoidance dislike and avoid ambiguity. Discuss Table 4.5 here.

4. Goal Orientation

• Goal orientation, Hofstede’s fourth dimension, is the manner in which

people are motivated to work toward different kinds of goals. People exhibiting
aggressive goal behavior place a high premium on material possessions,
money, and assertiveness. Those who exhibit passive goal behavior place a
higher value on social relationships, quality of life, and concern for others.
Show Table 4.6 here.

5. Time Orientation

• Time orientation, a fifth dimension in Hofstede’s framework, is the

extent to which members of a culture adopt a long-term versus short-term
outlook on life, work, and other aspects of society. As noted by the text,
cultures such as Japan, Hong Kong, and South Korea have a long-term
orientation, while Pakistan and West Africa have a shorter-term outlook.
IV. INTERNATIONAL MANAGEMENT AND CULTURAL DIFFERENCES

Many experts believe that the world is currently experiencing a cultural convergence,
as cultures grow more similar as a result of improvements in communication and
 The Role of Culture > 58

transportation. MNCs facilitate cultural convergence through their advertising and

through their transfer of new management techniques, technologies, and cultural
values.

Understanding New Cultures

• Individuals who rely on their self-reference criterion (the unconscious use of

one’s own culture to assess new surroundings) may find themselves making
numerous cultural blunders. It is important that international businesspersons
attempt to follow a “when in Rome, do as the Romans do” philosophy. This
involves achieving cross-cultural literacy. Cross-cultural literacy is best achieved
through experiences, although cross-cultural training programs and information
about specific cultures can facilitate the process.
• Acculturation occurs when an individual not only understands a foreign culture,
but also modifies and adapts his or her behavior to make it compatible with the
foreign culture. Acculturation is particularly important to the international
businessperson that frequently interacts with foreigners.

Cultural Differences and Ethics

• Ethical problems may exist as a result of cultural differences. What is

considered acceptable behavior in one culture may be considered immoral in
another.
• The text presents two ethical dilemmas to illustrate the impact of ethics on
international business, and the relationship between ethics and cultural values.
CA

OS
SE

CL
IN
G

The Benefits of Foreign Exchange

The closing case examines the results of a management swap between two hotel
managers. Both managers felt that by exchanging positions for a week, they could
better understand their customers.

Key Points

• Two hotel managers, one from a hotel in London, the other from the Ritz in
Atlanta agreed to swap positions for a week so that each could better identify the
needs and expectations of business travelers.

• The industry servicing business travelers is increasingly emphasizing the idea of

serving customers with similar wants and needs. However, the two hotel managers
note that there can be huge differences in what travelers actually want. Both noticed
that their hotels do not always provide exactly what customers want, but instead, what
the hotel thinks they want.
• Both managers agreed that the actual managing process of the hotel is very
similar. The British manager noted though, that American senior staff tend to spend far
more time than their British counterparts on the floor. She feels that this time spent
59 > Chapter 4

interacting with guests provides managers with a better idea of what the customer
really wants. She plans to institute the practice at her English hotel.

• Both managers feel that they should extend the swap to other positions. In particular,
they note that maids and restaurant workers could benefit by knowing more about
foreign customers’ expectations.

Case Questions

1. What lessons might an international manager learn from this case?

Most students will probably agree that even managers who are in contact with
foreigners on a daily basis have much to learn. In this case, both managers discovered
that practices they felt were quite appropriate, such as tea or coffee services, or the
provision of fruit in the room, were actually culturally bound practices--that their
counterpart hotels did things in a different way, which reflected local customs and
attitudes.

2. What business characteristics lend themselves most to organizational learning from this
practice? What characteristics are least conducive to learning from this practice?

The managers involved in this swap probably found that they learned more about
issues such as understanding the customer rather than issues such as how accounts
are handled and so forth. Students will probably point out, however, that a swap
involving a different type of manager, for example, a member of the human resources
staff, would gain an entirely different set of benefits.

3. What are the advantages and disadvantages of using the method described in the
case?

Clearly, a great advantage of this management swap was the opportunity to better
understand the customer and how customer needs can be met. However, as the case
notes, business travelers are not limited to Americans and British, but distributed to
many nations around the world. For example, although both managers feel that they
have gained much insight, there is still a wide range of people who may find that their
expectations are not being adequately met. Furthermore, because the swap was
limited to two general managers, many customer needs may still go unmet simply
because those individuals who interact with the customers daily, such as maids, have
not had the chance to see the cultural differences first-hand.

Additional Case Application

Instructors may want to ask students in the class to play the role of business travelers
from different parts of the world. Students can either assume the role of travelers from
their own countries (assuming there is a good mix of foreign students present) or
research a foreign culture, and play an individual from that culture. Other students can
play the role of an American hotel manager trying to understand what his/her
customers want.
 The Role of Culture > 60

VI

R
R

A
H
C
E

P
T
1. What is culture?

Culture consists of the interrelated values, beliefs, behaviors, customs, and attitudes that
distinguish a society. It is a learned behavior that is shared between members of a society
and it changes to adapt to external forces that affect a society.

2. What are the primary characteristics of culture?

The primary characteristics of culture are social structure, language, communication,

religion, and values and attitudes. How these elements interact affects the local
environment in which international businesses operate.

3. What is a lingua franca? Why has English become a lingua franca?

A lingua franca is a predominant common language. Lingua francas emerge because

international businesspeople need to communicate. English has become a lingua franca
as a result of the economic and military dominance of the United Kingdom in the
nineteenth century and the U.S. since World War II.

4. What is backtranslation? What problem is it designed to solve?

Back-translation is a technique used by firms to ensure that they are actually sending the
right message to their customers. The technique involves a process whereby after one
person translates a document into another language, a second person translates the
translated document back into the original language. The process thus provides a check
that the intended message is actually being sent.

5. Describe the difference between high-context and low-context cultures.

In low-context cultures such as the U.S. and Germany, a speaker’s words explicitly convey
his/her message to the listener, whereas in high-context cultures such as Japan, the
context in which the conversation takes place and accompanying cultural clues are just as
important as the actual words.

6. What are cultural clusters?

Countries can be grouped into cultural clusters based on similarities in their cultures.
Within each cluster, countries may be similar in terms of attitudes, values, language, or
some other cultural element. At least eight cultural clusters have been identified: Near
Eastern, Nordic, Germanic, Anglo, Latin European, Latin American, Far Eastern, and Arab.
61 > Chapter 4

7. What are individualism and collectivism? How do they differ?

Individualism is the cultural belief that the person comes first and collectivism is the belief
that the group comes first. Individuals from individualistic cultures typically possess a high
degree of self-respect and independence, while those from collectivistic cultures tend to put
the good of the group ahead of their own personal interests.

8. Discuss pay systems between the U.S. and Japanese firms. To what extent are these
differences culturally determined?

U.S. employees are typically compensated according to their individual accomplishments.

On the other hand, Japanese employees are compensated on the basis of the group’s
achievements. These differences in pay systems are very much rooted in the differences
in the two countries’ cultures. The Japanese culture is a group-oriented one, while the U.S.
stresses individualism.

9. What is power orientation?

Power orientation, the second of Hofstede’s dimensions, refers to the beliefs that people in
a culture hold about the appropriateness of power and authority differences in hierarchies
such as business organizations. In cultures characterized by power respect, people tend to
accept the power and authority of their superiors simply on the basis of the superiors’
positions in the hierarchy and to respect the superiors’ right to that power. In contrast, in
cultures that are characterized by power tolerance, much less significance is attached to a
person’s position in the hierarchy.

10. What is uncertainty orientation?

Uncertainty orientation, the third of Hofstede’s dimensions, is the feeling people have
regarding uncertain and ambiguous situations. Those individuals characterized by
uncertainty acceptance are stimulated by change and new opportunities, while those
individuals characterized by uncertainty avoidance dislike and avoid ambiguity.

11. What are aggressive and passive goal behaviors? How do they differ?

Goal orientation, Hofstede’s fourth dimension, is the manner in which people are motivated
to work toward different kinds of goals. People exhibiting aggressive goal behavior place a
high premium on material possessions, money, and assertiveness. Those who exhibit
passive goal behavior place a higher value on social relationships, quality of life, and
concern for others.

12. What is the self-reference criterion?

It is the reliance, usually subconscious, on one's own culture to help assess new
surroundings. Using one's own culture as a reference point can lead to problems when
dealing cross-culturally.
 The Role of Culture > 62

Questions for Discussion

1. How can international businesspeople avoid relying on the self-reference criterion when
dealing with people from other cultures?

Reliance on the self-reference criterion refers to the unconscious use of one’s own culture
to help assess new surroundings. International businesspeople who rely on their self-
reference criterion when dealing with people from other cultures run the risk of creating ill
will. It is important for an individual doing business in another country to remember that
he/she is the foreigner and must adapt to the culture of the other country. One should
attempt to achieve cross-cultural literacy and become familiar with the other culture either
directly through personal experience or indirectly via training programs and publications.

Teaching Note:
This concept can be illustrated directly if there are foreign students in a
class. Instructors can ask foreign students in their classes about any
cross-cultural preparation they received prior to moving to this country, and on the basis of
that response, raise the question of what would have made the adjustment process easier.

2. How important is it for native English speakers to learn a second language? Should all
business students whose native tongue is English be required to learn another language?
Why or why not?

Responses to this question are likely to vary depending on the composition of the class. A
class that is primarily made up of native English speakers, particularly ones who had
difficulty with an introductory foreign language course, will probably conclude that since
English is a lingua franca, native English speakers can make better use of their time if they
pursue goals other than learning a foreign language. However, a class that has a large
foreign student representation is likely to take the perspective that learning a foreign
language is important and all students should be capable of doing so. However, as the
text notes, widespread usage of English does not solve all communications problems, and
may in fact put a firm at a competitive disadvantage. Moreover, experts have concluded
that mastery of a foreign language is not necessary and that much can be gained from
modest levels of training.
63 > Chapter 4

3. U.S. law protects women from job discrimination, but many countries do not offer women
such protection. Suppose several important job opportunities arise at overseas factories
owned by your firm; however, these factories are located in countries that severely restrict
the working rights of women. You fear that female managers thus will be ineffective there.
Should you adopt gender-blind selection policies for these positions? Does it make a
difference if you have good reason to fear for the physical safety of your female
managers? Does it make a difference if the restrictions are cultural rather than legal in
nature?

This is a difficult question to answer and instructors may wish to simply raise the issue
rather than suggest a correct or incorrect response. From a U.S. manager’s perspective,
the correct response would be to take a gender-blind approach to the selection process for
these positions; however, from an international business perspective it is important to recall
the saying “when in Rome, do as the Romans do.” The U.S. manager’s task may be made
easier if the restrictions are legal rather than cultural because the manager would have a
tangible reason for not using a gender-blind selection process. While some students will
probably argue that females should not be selected if they could be at risk physically,
others will probably point out that women can be taught to protect themselves. This latter
concept is reminiscent of the question of whether women in the U.S. Armed Forces should
be permitted to engage in combat.

4. Under what circumstances should international businesspeople impose the ethics of their
culture on foreigners with whom they do business? Does it make a difference if the activity
is conducted in the home or host country?

Acceptable behavior in one country may not be acceptable in another. International

businesspeople must be cautious about relying on their self-reference criterion when doing
business with foreigners and adapt their perspectives as much as possible to fit with the
foreign culture. In some cases, however, legal restrictions can force international
businesspeople to impose the ethics of their culture on foreigners. For example, the
Foreign Corrupt Practices Act (discussed in Chapter 8) prohibits U.S. companies from
using bribes when dealing with foreigners. Thus, the ethics of the U.S. culture is imposed
on foreigners. In general, though, if business is conducted in the host country, the rules of
the host country should be followed, while if business is conducted in the home country,
home country rules should be followed.

5. Is nonverbal communication more important or less important when two people speak
different languages? What are the pitfalls of trying to use only nonverbal communication to
“talk” to someone from another country?

Nonverbal communication probably becomes more important when two people speak
different languages. In fact, some researchers believe that between 80 and 90 percent of
all information is transmitted among members of a culture by nonverbal communication.
However, nonverbal communication may be difficult for a foreigner to comprehend and may
lead to miscommunication. If an individual attempts to use only nonverbal communication
to converse with a foreigner, misunderstandings are likely. For example, nodding in the
U.S. means “yes,” but in Bulgaria nodding means “no.” Unless there is verbal
communication, a Bulgarian and an American would certainly miscommunicate.
 The Role of Culture > 64

6. How would you evaluate yourself on each of Hofstede’s dimensions?

Students will probably have a fairly good idea where they stand on each of Hofstede’s
dimensions and they may choose to confirm their beliefs my exploring some of the maps,
tables, and figures presented in the section discussion Hofstede’s work. This question can
be particularly interesting in a class with students from a range of countries and cultures.

7. Assume you have just been transferred by your firm to a new facility in a foreign location.
How would you go about assessing the country’s culture along Hofstede’s dimensions?
How would you incorporate your findings into conducting business there?

Most students would probably suggest that examining the dimensional maps that identify
where different countries lie on each of the dimensions would be a good starting point in
assessing the culture of a foreign location. Students might then suggest that managers
attempt to translate that knowledge into specific ideas about how business might be
conducted. For example, students considering a highly individualistic culture might
suggest that reward systems should provide incentives for individual performance rather
than group performance.
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Essence of the exercise

This exercise asks students to select one of the countries included in Hofstede’s study and,
using the Internet, locate information about that country. Students are asked to identify sites
that both support and refute Hofstede’s characterizations of the countries.
AL

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Essence of the exercise

This exercise is designed to provide students with insight as to how cultural and social factors
affect international business. Students are asked to determine how a particular set of products
would be received in another country and what changes would need to be made for their sale
to be a success.

Answers to the follow-up questions.

1. What were your primary sources of information about the three countries? How easy or
difficult was it to find information?

Students will probably rely on various publications for information about the assigned
countries. In some cases, students may have direct experience with another country
through travel, work, or even as an exchange student. Typically, students find it easier to
research developed countries as compared to developing economies.
65 > Chapter 4

2. Can you think of specific products that are in high demand in the United States that would
simply not work in specific other countries because of cultural factors?

Students will probably rely on their own purchasing patterns when responding to this
question. Products in high demand among most college students include beer and
hamburgers, neither of which would sell well in the Middle East because of religious beliefs.

3. How do you think foreign firms assess American culture as they contemplate introducing
products into the U.S. market?

Most students will probably suggest that foreign firms assess the American culture in much
the same way as Americans assess foreign cultures: that when introducing products one
first determines if a product will sell as it is, and then considers the impact of making
changes in the product (and packaging, advertising, and so forth). Students will probably
conclude that because the American culture is a melting pot of many cultures, there is
probably a market for most foreign products somewhere (although some may be rather
small).

Other Applications
An interesting way to illustrate the impact of culture on a company is to identify a real
product that is sold in multiple countries. Students can then identify how the product is
sold in each country, and what, if any, changes had to be made to make the product a
success. McDonald’s is usually a good company to start with.