Chapter 05 - Managing Across Cultures

Chapter 05 - Managing Across Cultures
Chapter 05
Managing Across Cultures
True / False Questions
1. A company with a geocentric predisposition allows the values and interests of the parent
company to guide the strategic decisions.
True False
2. Firms with a polycentric predisposition make strategic decisions tailored to suit the cultures
of the countries where the MNC operates.
True False
3. An ethnocentric predisposition leads a firm to try to blend its own interests with those of its
subsidiaries on a regional basis.
True False
4. A company with a geocentric predisposition tries to integrate a global systems approach to

decision making.
True False
5. A firm with an ethnocentric predisposition may find it difficult to implement a geocentric

strategy, because it is unaccustomed to using global integration.
True False
6. A globalization imperative is a belief that one worldwide approach to doing business is the
key to both efficiency and effectiveness.
True False
5-1
7. The difficulty of managing global organizations, as in the case of some local subsidiaries
that want more decentralization and others that want less is one of the factors helping to
facilitate the need for MNCs to develop unique strategies for different cultures.
True False
8. Advertising in the United States should be indirect and subtle, emphasizing group
references, shared responsibility and interpersonal trust.
True False
9. Parochialism is the tendency to view the world through one's own eyes and perspectives.
True False
10. Simplification is the process of exhibiting the same orientation toward different cultural
groups.
True False
11. If a U.S. manager interacts with a Chinese manager in the same way that he or she
interacts with a Canadian manager, the U.S. manager is demonstrating a behavioral attribute
referred to as singular-orientation.
True False
12. In America, authority is diffused throughout the bureaucratic system and personal
responsibility is hard to pin down.
True False
13. When internationalization began to gain momentum, there was a hope that many of the
procedures and strategies that worked so well at home could be adopted overseas without
modification.
True False
5-2
14. In Japan, compensation levels are determined by using skill, ability and performance.
True False
15. In Japan, people often are hired based on what they can do for the firm in the short run,
because many of them eventually will quit or be downsized.
True False
16. In Japan, unions are regarded as adversaries of management; in the United States, unions
and managers are seen as partners.
True False
17. Many U.S. and European multinationals find that doing business in the PRC can be a
long, grueling process that often results in failure.
True False
18. A major cultural difference between the PRC and many Western countries is the issue of
time.
True False
19. Russians view contracts as binding only if they continue to be mutually beneficial.
True False
20. Americans may admire or be fascinated with people who disagree with them; in contrast,
the French are more attracted to those who agree with them.
True False
5-3
Multiple Choice Questions
21. Four distinct predispositions, which help determine the specific steps an MNC will follow,
are:
A. Ethnocentric, polycentric, regiocentric and geocentric
B. Intercentric, polycentric, regiocentric and network centric
C. Globalcentric, networkcentric, geocentric and polycentric
D. Geocentric, intercentric, extracentric, ethnocentric
22. A company with a(n) _____ predisposition allows the values and interests of the parent
company to guide the strategic decisions.
A. Polycentric
B. Geocentric
C. Ethnocentric
D. Regiocentric
23. Firms with a _____ predisposition make strategic decisions tailored to suit the cultures of
the countries where the MNC operates.
A. Polycentric
B. Globalcentric
C. Regiocentric
D. Geocentric
24. A(n) _____ predisposition leads a firm to try to blend its own interests with those of its
subsidiaries on a regional basis.
A. Geocentric
B. Globalcentric
C. Ethnocentric
D. Regiocentric
5-4
25. A company with a(n) _____ predisposition tries to integrate a global systems approach to
decision making.
A. Regiocentric
B. Globalcentric
C. Ethnocentric
D. Geocentric
26. Research reveals that far from addressing regional differentiation issues, many MNCs are
committed to a(n) _____, which is a belief that one worldwide approach to doing business is
the key to both efficiency and effectiveness.
A. International complacency
B. Globalization imperative
C. Worldwide indifference
D. Cross-cultural contentment
27. Which of the following correctly matches a firm's predisposition with its strategy?
A. Ethnocentric-global integration and national responsiveness
B. Polycentric-national responsiveness
C. Regiocentric-global integration
D. Geocentric-regional integration and national responsiveness
28. Which of the following correctly matches a firm's predisposition with its culture?
A. Polycentric-home-country
B. Geocentric-global
C. Regiocentric-host-country
D. Ethnocentric-regional
29. An MNC with an ethnocentric predisposition:

A. Redistributes profits globally
B. Redistributes profits within the region
C. Takes back its profits to its home country
D. Retains profits in the host country
5-5
30. Which of the following is likely to be the strategic predisposition of a company that has a
‘top-down' system of governance?
A. Regiocentric
B. Globalcentric
C. Ethnocentric
D. Geocentric
31. All the following factors facilitate the need for international firms to develop unique
strategies for different cultures except:
A. The importance of being an insider, as in the case of customers who prefer to "buy local"
B. The need to allow subsidiaries to use their own abilities and talents and not be restrained
by headquarters
C. The diversity of worldwide industry standards such as those in broadcasting, where
television sets must be manufactured on a country-by-country basis
D. A continual demand by local customers for global products and in the case of globally
recognized products such as McDonald's hamburgers and Sony televisions
32. Advertising in _____ is predominantly emotional, dramatic and symbolic.

A. Japan
B. China
C. Germany
D. France
33. Which of the following countries prefer advertising that is factual and rational?
A. India
B. China
C. Germany
D. France
5-6
34. The typical broad, self-deprecating _____ commercial amuses by mocking both the
advertiser and consumer.
A. British
B. Chinese
C. Japanese
D. French
35. In which of the following countries are spots viewed as cultural events and reviewed as if
they were literature or films?
A. India
B. China
C. Germany
D. France
36. According to the text, value can be added to the marketing approach by carefully tailoring
the advertising message to the particular culture. Therefore, advertising in the United States
should:
A. Target individual achievement
B. Be much more indirect and subtle
C. Emphasize group references and interpersonal trust
D. Emphasize shared responsibility
37. _____ is the tendency to view the world through one's own eyes and perspectives.
A. Parochialism
B. Symbolism
C. Nationalism
D. Simplification
5-7
38. _____ can be a difficult problem for many international managers, who often come from
advanced economies and believe that their state-of-the-art knowledge is more than adequate
to handle the challenges of doing business in less developed countries.
A. Nationalism
B. Ethnocentrism
C. Parochialism
D. Symbolism
39. Initially, after the breakup of the Soviet Union, the republics called themselves the:
A. Newly Independent States
B. Commonwealth of Independent States
C. Federation of Independent Republics
D. United Republics of the former Soviet Union
40. The process of exhibiting the same orientation toward different culture groups is referred
to as:
A. Parochialism
B. Symbolism
C. Nationalism
D. Simplification
41. If a U.S. manager acted the same way with a British manager as he/she does with a
Chinese manager, the U.S. manager will be exhibiting a behavioral process referred to as:
A. Simplification
B. Parochialism
C. Ethnocentrism
D. Symbolism
5-8
42. In regard to the cultural dimension, "What is the person's relationship to other people?"
the dominant characteristic for American managers is:
A. Hierarchic
B. Collectivist
C. Communal
D. Individualist
43. In regard to the cultural dimension, "What is the conception of space?" the dominant
characteristic for American managers is:
A. Private
B. Mixed
C. Shared
D. Public
44. Malaysia has what is called a _____.

A. Moderate-context culture
B. Low-context culture
C. Variable-context culture
D. High-context culture
45. The United States has what is called a _____.

5-9
46. All of the following are characteristics of the Malaysian culture except:
A. Relationships between people are relatively short-lived and individuals tend to not feel a
deep personal involvement with each other
B. Communication often is implicit and individuals are taught from an early age to interpret
these messages accurately
C. People in authority are personally responsible for the actions of their subordinates and this
places a premium on loyalty to both superiors and subordinates
D. Agreements tend to be spoken rather than written
47. All of the following are characteristics of low-context cultures except:

A. Authority is diffused throughout the bureaucratic system and personal responsibility is
hard to pin down
B. Insiders and outsiders are easily distinguishable and outsiders typically do not gain
entrance to the inner group
C. Agreements tend to be in writing rather than spoken
D. Deep personal involvement with others is not valued greatly
48. Which of the following does not pertain to similarities in managerial activities in the
United States and Korea?
A. As organizational size increased, commitment proportionally increased
B. As structure became more employee-focused, commitment increased
C. The more positive the perceptions of organizational climate, the greater the employee
commitment
D. As in the U.S. studies, Korean employees' position in the hierarchy, tenure in their current
position and age all related to organizational commitment
5-10
49. The five criteria in the acronym HAIRL stands for:

A. Helicopter, analysis, imagination, reality and leadership
B. Hierarchy, awareness, ingenuity, reverie and leadership
C. Helicopter, action, interest, reality and leadership
D. Hierarchy, action, ingenuity, reverie and leadership
50. Identify the country in which Shell's operating company prioritized the HAIRL appraisal
system as Leadership, Analysis, Reality, Imagination and Helicopter.
A. Netherlands
B. Germany
C. France
D. Britain
51. In Great Britain, Ireland and the United States, managers value their individualism and are
motivated by all the following opportunities except:
A. Earnings
B. Profit-sharing plans
C. Advancement
D. Recognition
52. Which of the following selections accurately reflects recruitment and selection processes
in Japan?
A. Recent public policy shifts encourage use of sophisticated selection procedures
B. Use of expatriates sparingly; recruit home country nationals at U.S. colleges
C. Obtain skilled labor from government subsidized apprenticeship program
D. Prepare for a long process; ensure that your firm is "here to stay"; and develop trusting
relationship with recruits
5-11
53. Which of the following selections accurately reflects recruitment and selection processes
in Mexico?
54. Which of the following selections accurately reflects labor relations in China?
A. Treat unions as partners; allow time for negotiations
B. Tap large pool of labor cities; lax labor laws may become more stringent
C. Understand changing Mexican labor law; prepare for increasing unionization of labor
D. Be prepared for high wages and short work week; expect high productivity from unionized
workers
55. Which of the following selections accurately reflects labor relations in Germany?
C. Be prepared for high wages and short work week; expect high productivity from unionized
workers
D. Understand changing Mexican labor law; prepare for increasing unionization of labor
56. Which of the following selections accurately reflects compensation practices in China?
A. Use technical training as reward; recognize egalitarian values; and use "more work more
pay" with caution
B. Consider all aspects of labor costs
C. Note high labor costs for manufacturing
D. Use recognition and praise as motivator; avoid pay for performance
5-12
57. The People's Republic of China had a long tradition of isolation until Deng Xiaoping
opened his country to the world in:
A. 1947
B. 1989
C. 1932
D. 1979
58. Experienced travelers report that the primary criterion for doing business in China is:
A. Persuasive top management
B. Savvy marketing
C. Technical competence
D. Hard currency
59. In China, the term guanxi means:

A. Technical competence
B. Good connections
C. Punctuality
D. Business partnership
60. In practice, guanxi resembles:

A. Nepotism
B. Individualism
C. Commercialism
D. Parochialism
61. Which of the following are behavioral practices that affect doing business in China?
A. The Chinese appreciate loud, boisterous behavior and when speaking to each other, they
maintain a greater physical distance than is typical in the West
B. The Chinese are proud of their economic accomplishments and want to share these feelings
with outsiders
C. The Chinese society is one in which individualism is highly prized
D. The Chinese are much more animated than Westerners
5-13
62. Which of the following is not a traditional behavior of Chinese businesspeople?

A. The Chinese never use intermediaries for negotiating business deals
B. If the Chinese give concessions, they do not expect anything in return
C. The Chinese are quick in formulating a plan of action
D. The Chinese place values and principles above money and expediency
63. _____ like exclusive arrangements and often negotiate with just one firm at a time.
A. Americans
B. Russians
C. The British
D. Canadians
64. The word namaste means "greetings to you" in:

A. China
B. Japan
C. India
D. Russia
65. When doing business in India, all of the following behaviors are appropriate except:
A. Being "fashionably late" for meetings
B. Avoiding personal questions unless the other individual is a friend or close associate
C. Addressing doctors or professors in accordance with their titles
D. Refraining from public displays of affection
66. Many in the United States believe that it is more difficult to get along with the _____ than
with other Europeans.
A. Germans
B. Austrians
C. Spanish
D. French
5-14
67. In _____, one's social class is very important and these classes include the aristocracy, the
upper bourgeoisie, the upper-middle bourgeoisie, the middle, the lower middle and the lower.
A. India
B. Great Britain
C. France
D. The United States
68. Identify an incorrect statement about the French.

A. The French are more attracted to those who agree with them
B. The French often determine a person's trustworthiness based on his or her firsthand
evaluation of the individual's character
C. In the workplace, many French people are not motivated by competition or the desire to
emulate fellow workers
D. The French tend to be friendly, humorous and sardonic, in contrast to Americans
69. Most French organizations tend to be:

A. Highly centralized and have rigid structures
B. Highly decentralized and have lose structures
C. Highly centralized and have lose structures
D. Highly decentralized and have rigid structures
70. An important cultural contrast between Arabs and Americans is that of emotion and logic.
Arabs often act based on _____; in contrast, those in an Anglo culture are taught to act on
_____.
A. Emotion; logic
B. Logic; emotion
C. Reasoning; empathy
D. Aptitude; excitement
5-15
Essay Questions
71. Describe the differences between the four strategic dispositions. What is the principle
advantage of each disposition?
72. Describe the difference between parochialism and simplification.
73. What guidelines should MNCs must be aware of while doing business in China?
74. What guidelines have to be followed by MNCs in order to tap the potential business
opportunities in Russia?
5-16
75. Discuss the cultural highlights to be kept in mind regarding the French while doing
business in France.
5-17
Chapter 05 Managing Across Cultures Answer Key
True / False Questions
1. (p. 142) A company with a geocentric predisposition allows the values and interests of the
parent company to guide the strategic decisions.
FALSE
Difficulty: Medium
2. (p. 142) Firms with a polycentric predisposition make strategic decisions tailored to suit the
cultures of the countries where the MNC operates.
TRUE
Difficulty: Medium
3. (p. 142) An ethnocentric predisposition leads a firm to try to blend its own interests with those
of its subsidiaries on a regional basis.
FALSE
Difficulty: Medium
4. (p. 142) A company with a geocentric predisposition tries to integrate a global systems
approach to decision making.
TRUE
Difficulty: Medium
5-18
5. (p. 142) A firm with an ethnocentric predisposition may find it difficult to implement a
geocentric strategy, because it is unaccustomed to using global integration.
TRUE
Difficulty: Medium
6. (p. 142) A globalization imperative is a belief that one worldwide approach to doing business
is the key to both efficiency and effectiveness.
TRUE
Difficulty: Easy
7. (p. 142) The difficulty of managing global organizations, as in the case of some local
subsidiaries that want more decentralization and others that want less is one of the factors
helping to facilitate the need for MNCs to develop unique strategies for different cultures.
TRUE
Difficulty: Medium
8. (p. 145) Advertising in the United States should be indirect and subtle, emphasizing group
references, shared responsibility and interpersonal trust.
FALSE
Difficulty: Medium
9. (p. 146) Parochialism is the tendency to view the world through one's own eyes and
perspectives.
TRUE
Difficulty: Easy
5-19
10. (p. 146) Simplification is the process of exhibiting the same orientation toward different
cultural groups.
TRUE
Difficulty: Easy
11. (p. 146) If a U.S. manager interacts with a Chinese manager in the same way that he or she
interacts with a Canadian manager, the U.S. manager is demonstrating a behavioral attribute
referred to as singular-orientation.
FALSE
Difficulty: Medium
12. (p. 147) In America, authority is diffused throughout the bureaucratic system and personal
responsibility is hard to pin down.
TRUE
Difficulty: Medium
13. (p. 148) When internationalization began to gain momentum, there was a hope that many of
the procedures and strategies that worked so well at home could be adopted overseas without
modification.
TRUE
Difficulty: Easy
14. (p. 149) In Japan, compensation levels are determined by using skill, ability and
performance.
FALSE
Difficulty: Medium
5-20
15. (p. 150) In Japan, people often are hired based on what they can do for the firm in the short
run, because many of them eventually will quit or be downsized.
FALSE
Difficulty: Medium
16. (p. 151) In Japan, unions are regarded as adversaries of management; in the United States,
unions and managers are seen as partners.
FALSE
Difficulty: Medium
17. (p. 153) Many U.S. and European multinationals find that doing business in the PRC can be
a long, grueling process that often results in failure.
TRUE
Difficulty: Medium
18. (p. 154) A major cultural difference between the PRC and many Western countries is the
issue of time.
TRUE
Difficulty: Easy
19. (p. 156) Russians view contracts as binding only if they continue to be mutually beneficial.
FALSE
Difficulty: Medium
5-21
20. (p. 158) Americans may admire or be fascinated with people who disagree with them; in
contrast, the French are more attracted to those who agree with them.
FALSE
Difficulty: Medium
Multiple Choice Questions
21. (p. 142) Four distinct predispositions, which help determine the specific steps an MNC will
follow, are:
A. Ethnocentric, polycentric, regiocentric and geocentric
B. Intercentric, polycentric, regiocentric and network centric
C. Globalcentric, networkcentric, geocentric and polycentric
D. Geocentric, intercentric, extracentric, ethnocentric
Difficulty: Medium
22. (p. 142) A company with a(n) _____ predisposition allows the values and interests of the
parent company to guide the strategic decisions.
A. Polycentric
B. Geocentric
C. Ethnocentric
D. Regiocentric
Difficulty: Easy
23. (p. 142) Firms with a _____ predisposition make strategic decisions tailored to suit the
cultures of the countries where the MNC operates.
A. Polycentric
B. Globalcentric
C. Regiocentric
D. Geocentric
Difficulty: Easy
5-22
24. (p. 142) A(n) _____ predisposition leads a firm to try to blend its own interests with those of
its subsidiaries on a regional basis.
A. Geocentric
B. Globalcentric
C. Ethnocentric
D. Regiocentric
Difficulty: Easy
25. (p. 142) A company with a(n) _____ predisposition tries to integrate a global systems
approach to decision making.
A. Regiocentric
B. Globalcentric
C. Ethnocentric
D. Geocentric
Difficulty: Easy
26. (p. 142) Research reveals that far from addressing regional differentiation issues, many
MNCs are committed to a(n) _____, which is a belief that one worldwide approach to doing
business is the key to both efficiency and effectiveness.
A. International complacency
B. Globalization imperative
C. Worldwide indifference
D. Cross-cultural contentment
Difficulty: Easy
27. (p. 143) Which of the following correctly matches a firm's predisposition with its strategy?
A. Ethnocentric-global integration and national responsiveness
B. Polycentric-national responsiveness
C. Regiocentric-global integration
D. Geocentric-regional integration and national responsiveness
Difficulty: Hard
5-23
28. (p. 143) Which of the following correctly matches a firm's predisposition with its culture?
A. Polycentric-home-country
B. Geocentric-global
C. Regiocentric-host-country
D. Ethnocentric-regional
Difficulty: Hard
29. (p. 143) An MNC with an ethnocentric predisposition:

A. Redistributes profits globally
B. Redistributes profits within the region
C. Takes back its profits to its home country
D. Retains profits in the host country
Difficulty: Medium
30. (p. 143) Which of the following is likely to be the strategic predisposition of a company that
has a ‘top-down' system of governance?
A. Regiocentric
B. Globalcentric
C. Ethnocentric
D. Geocentric
Difficulty: Hard
31. (p. 142) All the following factors facilitate the need for international firms to develop unique
strategies for different cultures except:
A. The importance of being an insider, as in the case of customers who prefer to "buy local"
B. The need to allow subsidiaries to use their own abilities and talents and not be restrained
by headquarters
C. The diversity of worldwide industry standards such as those in broadcasting, where
television sets must be manufactured on a country-by-country basis
D. A continual demand by local customers for global products and in the case of globally
recognized products such as McDonald's hamburgers and Sony televisions
Difficulty: Medium
5-24
32. (p. 143) Advertising in _____ is predominantly emotional, dramatic and symbolic.
A. Japan
B. China
C. Germany
D. France
Difficulty: Medium
33. (p. 142) Which of the following countries prefer advertising that is factual and rational?
A. India
B. China
C. Germany
D. France
Difficulty: Medium
34. (p. 143) The typical broad, self-deprecating _____ commercial amuses by mocking both the
advertiser and consumer.
A. British
B. Chinese
C. Japanese
D. French
Difficulty: Medium
35. (p. 143) In which of the following countries are spots viewed as cultural events and reviewed
as if they were literature or films?
A. India
B. China
C. Germany
D. France
Difficulty: Medium
5-25
36. (p. 145) According to the text, value can be added to the marketing approach by carefully
tailoring the advertising message to the particular culture. Therefore, advertising in the United
States should:
A. Target individual achievement
B. Be much more indirect and subtle
C. Emphasize group references and interpersonal trust
D. Emphasize shared responsibility
Difficulty: Medium
37. (p. 146) _____ is the tendency to view the world through one's own eyes and perspectives.
A. Parochialism
B. Symbolism
C. Nationalism
D. Simplification
Difficulty: Easy
38. (p. 146) _____ can be a difficult problem for many international managers, who often come
from advanced economies and believe that their state-of-the-art knowledge is more than
adequate to handle the challenges of doing business in less developed countries.
A. Nationalism
B. Ethnocentrism
C. Parochialism
D. Symbolism
Difficulty: Easy
39. (p. 146) Initially, after the breakup of the Soviet Union, the republics called themselves the:
A. Newly Independent States
B. Commonwealth of Independent States
C. Federation of Independent Republics
D. United Republics of the former Soviet Union
Difficulty: Easy
5-26
40. (p. 146) The process of exhibiting the same orientation toward different culture groups is
referred to as:
A. Parochialism
B. Symbolism
C. Nationalism
D. Simplification
Difficulty: Easy
41. (p. 146) If a U.S. manager acted the same way with a British manager as he/she does with a
Chinese manager, the U.S. manager will be exhibiting a behavioral process referred to as:
A. Simplification
B. Parochialism
C. Ethnocentrism
D. Symbolism
Difficulty: Medium
42. (p. 147) In regard to the cultural dimension, "What is the person's relationship to other
people?" the dominant characteristic for American managers is:
A. Hierarchic
B. Collectivist
C. Communal
D. Individualist
Difficulty: Medium
43. (p. 147) In regard to the cultural dimension, "What is the conception of space?" the dominant
characteristic for American managers is:
A. Private
B. Mixed
C. Shared
D. Public
Difficulty: Medium
5-27
44. (p. 146) Malaysia has what is called a _____.

Difficulty: Medium
45. (p. 147) The United States has what is called a _____.
Difficulty: Medium
46. (p. 147) All of the following are characteristics of the Malaysian culture except:
A. Relationships between people are relatively short-lived and individuals tend to not feel a
deep personal involvement with each other
B. Communication often is implicit and individuals are taught from an early age to interpret
these messages accurately
C. People in authority are personally responsible for the actions of their subordinates and this
places a premium on loyalty to both superiors and subordinates
D. Agreements tend to be spoken rather than written
Difficulty: Medium
47. (p. 147) All of the following are characteristics of low-context cultures except:
A. Authority is diffused throughout the bureaucratic system and personal responsibility is
hard to pin down
B. Insiders and outsiders are easily distinguishable and outsiders typically do not gain
entrance to the inner group
C. Agreements tend to be in writing rather than spoken
D. Deep personal involvement with others is not valued greatly
Difficulty: Easy
5-28
48. (p. 148) Which of the following does not pertain to similarities in managerial activities in the
United States and Korea?
A. As organizational size increased, commitment proportionally increased
B. As structure became more employee-focused, commitment increased
C. The more positive the perceptions of organizational climate, the greater the employee
commitment
D. As in the U.S. studies, Korean employees' position in the hierarchy, tenure in their current
position and age all related to organizational commitment
Difficulty: Medium
49. (p. 149) The five criteria in the acronym HAIRL stands for:
A. Helicopter, analysis, imagination, reality and leadership
B. Hierarchy, awareness, ingenuity, reverie and leadership
C. Helicopter, action, interest, reality and leadership
D. Hierarchy, action, ingenuity, reverie and leadership
Difficulty: Medium
50. (p. 149) Identify the country in which Shell's operating company prioritized the HAIRL
appraisal system as Leadership, Analysis, Reality, Imagination and Helicopter.
A. Netherlands
B. Germany
C. France
D. Britain
Difficulty: Medium
51. (p. 150) In Great Britain, Ireland and the United States, managers value their individualism
and are motivated by all the following opportunities except:
A. Earnings
B. Profit-sharing plans
C. Advancement
D. Recognition
Difficulty: Medium
5-29
52. (p. 151) Which of the following selections accurately reflects recruitment and selection
processes in Japan?
Difficulty: Hard
53. (p. 151) Which of the following selections accurately reflects recruitment and selection
processes in Mexico?
Difficulty: Medium
54. (p. 151) Which of the following selections accurately reflects labor relations in China?
C. Understand changing Mexican labor law; prepare for increasing unionization of labor
D. Be prepared for high wages and short work week; expect high productivity from unionized
workers
Difficulty: Medium
5-30
55. (p. 151) Which of the following selections accurately reflects labor relations in Germany?
C. Be prepared for high wages and short work week; expect high productivity from unionized
workers
D. Understand changing Mexican labor law; prepare for increasing unionization of labor
Difficulty: Medium
56. (p. 151) Which of the following selections accurately reflects compensation practices in
China?
A. Use technical training as reward; recognize egalitarian values; and use "more work more
pay" with caution
B. Consider all aspects of labor costs
C. Note high labor costs for manufacturing
D. Use recognition and praise as motivator; avoid pay for performance
Difficulty: Hard
57. (p. 153) The People's Republic of China had a long tradition of isolation until Deng Xiaoping
opened his country to the world in:
A. 1947
B. 1989
C. 1932
D. 1979
Difficulty: Medium
58. (p. 153) Experienced travelers report that the primary criterion for doing business in China
is:
A. Persuasive top management
B. Savvy marketing
C. Technical competence
D. Hard currency
Difficulty: Medium
5-31
59. (p. 154) In China, the term guanxi means:

A. Technical competence
B. Good connections
C. Punctuality
D. Business partnership
Difficulty: Medium
60. (p. 154) In practice, guanxi resembles:

A. Nepotism
B. Individualism
C. Commercialism
D. Parochialism
Difficulty: Easy
61. (p. 154) Which of the following are behavioral practices that affect doing business in China?
A. The Chinese appreciate loud, boisterous behavior and when speaking to each other, they
maintain a greater physical distance than is typical in the West
B. The Chinese are proud of their economic accomplishments and want to share these feelings
with outsiders
C. The Chinese society is one in which individualism is highly prized
D. The Chinese are much more animated than Westerners
Difficulty: Easy
62. (p. 155) Which of the following is not a traditional behavior of Chinese businesspeople?
A. The Chinese never use intermediaries for negotiating business deals
B. If the Chinese give concessions, they do not expect anything in return
C. The Chinese are quick in formulating a plan of action
D. The Chinese place values and principles above money and expediency
Difficulty: Easy
5-32
63. (p. 156) _____ like exclusive arrangements and often negotiate with just one firm at a time.
A. Americans
B. Russians
C. The British
D. Canadians
Difficulty: Easy
64. (p. 157) The word namaste means "greetings to you" in:
A. China
B. Japan
C. India
D. Russia
Difficulty: Hard
65. (p. 157) When doing business in India, all of the following behaviors are appropriate except:
A. Being "fashionably late" for meetings
B. Avoiding personal questions unless the other individual is a friend or close associate
C. Addressing doctors or professors in accordance with their titles
D. Refraining from public displays of affection
Difficulty: Hard
66. (p. 158) Many in the United States believe that it is more difficult to get along with the
_____ than with other Europeans.
A. Germans
B. Austrians
C. Spanish
D. French
Difficulty: Medium
5-33
67. (p. 158) In _____, one's social class is very important and these classes include the
aristocracy, the upper bourgeoisie, the upper-middle bourgeoisie, the middle, the lower middle
and the lower.
A. India
B. Great Britain
C. France
D. The United States
Difficulty: Easy
68. (p. 158) Identify an incorrect statement about the French.

A. The French are more attracted to those who agree with them
B. The French often determine a person's trustworthiness based on his or her firsthand
evaluation of the individual's character
C. In the workplace, many French people are not motivated by competition or the desire to
emulate fellow workers
D. The French tend to be friendly, humorous and sardonic, in contrast to Americans
Difficulty: Medium
69. (p. 158) Most French organizations tend to be:

A. Highly centralized and have rigid structures
B. Highly decentralized and have lose structures
C. Highly centralized and have lose structures
D. Highly decentralized and have rigid structures
Difficulty: Medium
5-34
70. (p. 161) An important cultural contrast between Arabs and Americans is that of emotion and
logic. Arabs often act based on _____; in contrast, those in an Anglo culture are taught to act
on _____.
A. Emotion; logic
B. Logic; emotion
C. Reasoning; empathy
D. Aptitude; excitement
Difficulty: Medium
Essay Questions
71. (p. 142) Describe the differences between the four strategic dispositions. What is the
principle advantage of each disposition?
In the ethnocentric predisposition, a nationalistic philosophy of management is adopted,

whereby the values and interests of the parent company guide the strategic decisions. The
primary advantages are economies of scale and a unified global image. The polycentric
predisposition is a philosophy of management whereby strategic decisions are tailored to suit
the cultures of the countries where the MNC operates. The primary advantage is local
responsiveness and enhanced customer loyalty in each market. The regiocentric predisposition
is similar, except for the fact that the firm tries to blend its own interests with those of its
subsidiaries on a regional basis. This approach combines the benefits of cultural adaptation
with some potential for economies of scale. The geocentric predisposition philosophy
attempts to integrate a global systems approach to decision making. Although the most
complex, this approach is most effective in integrating globalization and national
responsiveness.
Difficulty: Medium
5-35
72. (p. 146-148) Describe the difference between parochialism and simplification.
Parochialism is the tendency to view the world through one's own eyes and perspectives. This
can be a difficult problem for many international managers, who often come from advanced
economies and believe that their state-of-the-art knowledge is more than adequate to handle
the challenges of doing business in less developed countries. In addition, many of these
managers have a parochial point of view fostered by their background. Simplification is the
process of exhibiting the same orientation toward different cultural groups. For example, the
way in which a U.S. manager interacts with a British manager is the same way in which he or
she behaves when doing business with an Asian executive. Moreover, this orientation reflects
one's basic culture.
Difficulty: Medium
73. (p. 153-155) What guidelines should MNCs must be aware of while doing business in China?
Outsiders doing business in China must be aware that Chinese people will typically argue that
they have the guanxi to get a job done, when in reality they may or may not have the
necessary connections. When dealing with the Chinese, one must realize they are a collective
society in which people pride themselves on being members of a group. This is in sharp
contrast to the situation in the United States and other Western countries, where individualism
is highly prized. The Chinese place values and principles above money and expediency. In
negotiations, reciprocity is important. If the Chinese give concessions, they expect some in
return. Additionally, it is common to find them slowing down negotiations to take advantage
of Westerners desiring to conclude arrangements as quickly as possible. The objective of this
tactic is to extract further concessions.
Difficulty: Medium
5-36
74. (p. 155-157) What guidelines have to be followed by MNCs in order to tap the potential
business opportunities in Russia?
MNCs have to build personal relationships with partners in Russia, where business laws and
contracts do have much relevance. Because the rules of business have changed so much in
recent years, it pays to have a local Russian consultant working with the company. In order to
get something done in Russia, it often takes months of waiting. Those who are in a hurry to
make a quick deal are often sorely disappointed. In dealing effectively with Russian partners,
it is helpful to get information about the company, its management hierarchy and how it
typically does business. This information helps ensure the chances for good relations because
it gives the Western partner a basis for establishing a meaningful relationship.
Difficulty: Medium
75. (p. 158-159) Discuss the cultural highlights to be kept in mind regarding the French while
doing business in France.
Many in the United States believe that it is more difficult to get along with the French than
with other Europeans. This feeling probably reflects the French culture, which is markedly
different from that in the United States. In France, one's social class is very important. Social
interactions are affected by class stereotypes and during their lifetime, most French people do
not encounter much change in social status. The French are accustomed to conflict and during
negotiations accept that some positions are irreconcilable and must be accepted as such.
Americans, on the other hand, believe that conflicts can be resolved and that if both parties
make an extra effort and have a spirit of compromise, there will be no irreconcilable
differences. Moreover, the French often determine a person's trustworthiness based on his or
her firsthand evaluation of the individual's character. Most French organizations tend to be
highly centralized and have rigid structures. As a result, it usually takes longer to carry out
decisions. Because this arrangement is quite different from the more decentralized, flattened
organizations in the United States, both middle and lower-level U.S. expatriate managers who
work in French subsidiaries often find bureaucratic red tape a source of considerable
frustration.
Difficulty: Medium
5-37

Chapter 05 - Managing Across Cultures

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Chapter 05 - Managing Across Cultures

True / False Questions

4. A company with a geocentric predisposition tries to integrate a global systems approach to

5. A firm with an ethnocentric predisposition may find it difficult to implement a geocentric

29. An MNC with an ethnocentric predisposition:

32. Advertising in _____ is predominantly emotional, dramatic and symbolic.

44. Malaysia has what is called a _____.

45. The United States has what is called a _____.

47. All of the following are characteristics of low-context cultures except:

49. The five criteria in the acronym HAIRL stands for:

59. In China, the term guanxi means:

60. In practice, guanxi resembles:

62. Which of the following is not a traditional behavior of Chinese businesspeople?

64. The word namaste means "greetings to you" in:

68. Identify an incorrect statement about the French.

69. Most French organizations tend to be:

72. Describe the difference between parochialism and simplification.

Chapter 05 Managing Across Cultures Answer Key

True / False Questions

Multiple Choice Questions

29. (p. 143) An MNC with an ethnocentric predisposition:

44. (p. 146) Malaysia has what is called a _____.

59. (p. 154) In China, the term guanxi means:

60. (p. 154) In practice, guanxi resembles:

68. (p. 158) Identify an incorrect statement about the French.

69. (p. 158) Most French organizations tend to be:

In the ethnocentric predisposition, a nationalistic philosophy of management is adopted,

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