Cultural Difference in Business between Japan and USA - Literature review Example

Course name: Professor’s name: University name: City, State Date of submission: Cultural difference in business between Japan and USA Introduction Culture is diverse and is termed to be different among the various social groups around the world[Amm12]. It gets explained as inherited values, concepts, and ways of living which are common among people with the same social group[Adl08]. There are two types of cultures. Firstly, there is an inclusive culture that get shared by all people in the planet. Secondly, a Local culture that is perceived to be values and beliefs shared by a particular group of individuals. Today the world has become a global village since technological achievements have brought people closer together. This closeness indicates that people from different localities in the world and cultural backgrounds are working, communicating and living together. Even though this fact is interesting, dealing with people from other countries requires one to know, their way of life. Knowing their way of life means that one should get to know how to deal with them, what to say and what not to say. One also should be aware of the cultural taboos of others because people from other places may not accept their taboos. Communication among people from different cultures that occurs in everyday life also occurs in the workplaces. Working with people in an organization involves dealing with issues such as structuring policies, motivating workers and coming up with strategies. For a workplace to attain its set goals and objectives it should ensure that there is an understanding of its present varied cultures. The increasing growth in globalization introduces new challenges to the managers who work for multinational businesses and those who work for international joint ventures. Some big companies have merged, formed alliances and acquired firms from other countries. This fact has brought challenges to managers and workers working for such companies because of cultural diversification. Cultural diversification between Japan and the USA at workplace In the late 1980s, there existed a fierce competition between Japan and USA. This contest called for attention to the cultural factor. In the time, Japan was growing very fast, and everyone wanted to know the reasons behind its growth. At the time, United States managers were forced by circumstances to enter in talks with the Japanese, market their products and services in Japan, and manage their operations in Japan. In the late 1990s, this competition between companies changed to cooperation through mergers, business alliance, and joint ventures. Cooperation requires one to have a better understanding of their partner. This knowledge means understanding their culture in business. With adequate understanding of cross-cultural differences and similarities, the international partnership has become more efficient. The partnership between Japan and USA has become more useful today because of the knowledge they have in each other’s business cultures[Hal95]. When companies from different countries merge, managers and works bring with them codes of behaviors and norms of their cultures to the workplace. This rule brings about diversification of cultures in the company. This kind of standards cultural values are the ones that get to shape the managerial practices and processes in a business. Therefore, in a case of a merger between companies from different nations, adequate knowledge of each other’s culture get needed. For example, Japanese needed to be aware of the individualism culture of the United States While the Americans need to have knowledge of the collectivist culture of the Japanese Cross-cultural difference in multi-national corporations Hofstede Theory According to Greet Hofstede, who is a sociologist and studied the behaviors of workers in a multinational corporation, there are four ways used to analyze and understand different cultures[Hof91]. These four methods include: firstly, collectiveness versus individualism. Here some cultures emphasize in the group while others do so on individuals. The United States has individualistic culture. It is more concerned with personal achievements rather a group success. The hiring process of a new worker basis on their records, which is their skills, education levels, and experience. Moreover, the promotion of an employee to higher managerial ranks relies on their achievements at the job they perform as it appears in the performance appraisal records. Also, compensation packages rely on the results that an employee produces in a given task within specified period. On the other hand, Japan has a collectivistic culture[Cha11]. It focuses more on group success rather than the success of one person. Selecting of new employees relies on the recommendation of family members or friends who already work for the particular company. Moreover, in Japan, senior workers play a big role in the promotion decisions. Secondly, power distance. This kind of culture believes that powers in an organization should get shared unequally. In companies where there is high power distance, there is weak equality and a clear power structure in businesses[Hof80]. Every worker in such organization know their place in its hierarchy, and there are distinct status symbols that distinguish between employees at different organizational ranks. Japan has high power distance culture. Its organizational structure is hierarchical. In this kind of structure, the decision has to go through each level of hierarchy before reaching the top management and vice versa. This type of organization slows down the decision-making process. On the other hand, low power distance implies that workers have the freedom to disagree with their superiors and provide their ideas openly. This kind of power distance gets experienced in the United States of America. USA companies establish a hierarchy for convenience, employees have direct access to superiors, and that is, they do not have to go through the set organization levels. Also, managers rely on individual workers for their expertise in delivery. Moreover, managers and employees directly discuss decisions that affect the effectiveness of the business. This arrangement makes decision-making process fast and efficient. Also, information gets shared between different levels of management and power. This process makes communication informal, participative and direct. Thirdly, uncertainty avoidance. In this case, some culture view changes as a challenge while others do not look at it that way. High of risk bring about anxiety[Hof05]. Businesses that try to avoid changes ensure that tasks get clearly defined, rules and regulations are formal, and that there is low tolerance for deviations from set standards and norms. Japan has the culture of uncertainty avoidance. This high levels of uncertainty avoidance are because it continually face the threat of natural disasters such as earthquakes. These threats have made Japan always to get prepared for any uncertain event. In a business situation, every occurrence is accounted for and anything done is prescribed for maximum predictability. Japanese ensure that they have done a thorough feasibility study and that all risk factors have got eliminated before starting a given project. Before making any decision managers ask for detailed facts and figures. This level of uncertainty avoidance makes it difficult for changes to get realized in Japan. On the other hand, companies that have a moderate degree of uncertainty avoidance get more flexible, less formal, and give way to high levels of heterogeneity in values, norms, and behaviors. The USA has the culture of low-level uncertainty avoidance. Companies in the USA readily accepts new ideas from their workers. Companies get ready to try new or different things. Such businesses give their employees the freedom of expression moreover they do not require a large number of rules and get less expressive than Japan organizations. Lastly, masculinity versus femininity. According to Hofstede, this two terms should get avoided so that a company can focus more on other issues that are more important[Hof05]. He suggests that femininity describes a society in which social gender roles overlap, that is, both men and women get concerned about the quality of life. Japan gets believed to be the most powerful country in the globe. This fact means that Japan focuses more on competition, achievement, and success. Because of it, collectivism competition is between groups rather than individuals. Japan aims at producing excellent and perfect material products, services and presentation in all aspects of life. Japan has traditional work holism culture that further expresses their masculinity. Similarly, USA has masculinity culture. This culture can get seen in the typical American behavior pattern. The combination of high masculinity drive and most individualist drive in the world explains the situation in America. This combination can get shown by strive of everyone to become the best since their culture teaches them that the winner takes it all. Moreover, American assessments get based on achieving set goals. Managers and employees believe that gets a possibility to do things better. The motivation to work gets based on monetary rewards and attainment of status based on how good one can get the job he or she performs. It gets believed by the Americans that a certain degree of conflict makes people play better. The goal of every worker in American organization is to become the best. Maslow’s Hierarchy of needs Theory According to Maslow, Motivation results from a person’s attempts at trying to fulfill five basic needs. These basic needs include physiological, social, safety, esteem and self-actualization. Physiological needs the sort of demands that human beings require for their daily survival such as air, food, water and so forth. In an organization context, a manager can provide physiological needs to the employees by providing safe working conditions. In the United States workers cannot function if these needs do not get provided. On the other hand, Japanese get willing to work in uncomfortable conditions as long as it is for the betterment of the company. Safety needs are those needs gives one the sense of acceptance and belonging. A manager can provide this to the employees by ensuring that workers have job security, secure compensation, and excellent working conditions. Japan organizations provide job security to their workers whereas United States companies do not guarantee this to its employees. Social needs refer to the need for a person to feel the sense of belonging and acceptance. Managers can ensure this by ensuring that employees get to know each other and advocating for corporate teamwork. Japanese follows the culture of collectivism which guarantees fulfillment of social needs. On the other hand, United States develops individualism culture where employees focus on personal achievement and rarely interact with each other. Esteem needs is the need for self-esteem and respect for oneself. Managers ensure this by rewarding their employees and praising their good work. IN the United States people work for money and recognition whereas in Japan employees work for the development of the organization. Self-actualization needs to define the desire of an individual to attain his or her full potential. This fact can get realized in organizations by managers giving challenging tasks, and involving their employees in the decision-making process. In Japan organization levels of hierarchies include representatives from each rank in making decisions that affect the organization. Contrary, in the United States decision-making process, is conducted by top managers. Cross-Cultural Management Cross-cultural management gives an understanding of the behaviors of individuals in an organization around the globe[Cha08]. Moreover, it tells people how they should work with workers and clients who are from different cultures. Cross-cultural management gets needed because of the growing co-operation between businesses in different nations where difficulties may occur because of the difference in cultural backgrounds. Today most companies run in the various countries because of globalization[Cul07]. This globalization has led to a lot of activities all over the world that brings about communication between the various cultures. Culture is something that people learn and contact is required for that to take place. Communication takes place through different ways such as facial expressions, body language, gestures and so forth. In a business context, intercultural business communication is used to mean communication that takes place within an industry in which there are workers from different cultural backgrounds. On the other hand, international communication is used to describe the type of communication that takes place between governments of different nations. Therefore, for individuals to compete internationally, they require adequate knowledge on intercultural communication and international business communication. Cultural intelligence Cultural information enables a person to show particular kind of behaviors, qualities, and skills that can allow them to adapt the beliefs and values of others. It involves other areas that include: firstly, linguistic intelligence[Pet04]. This type of data assists an individual in learning the native language of clients. This knowledge helps when dealing with customers from other cultures. Secondly, spatial intelligence that describes the space that exist between meetings and introduction. Thirdly, intrapersonal intelligence. This intelligent requires one to get aware of his or her cultural style so that he or she can make adjustments that enable them to interact smoothly with international counterparts. Lastly, interpersonal intelligence. This kind of knowledge gives one the ability to understand other people and their motivations. This statement simply means that when gets to deal with people from other culture he or she requires to know the something about their language, space they need and have an awareness of their culture. This knowledge will allow them to know how to apply their learning together with that of others. Belbin’s Team Roles Theory According to Belbin team roles gets taken as a single person who performs the tasks of a group. The role gets explained with six factors[Bel93]. This factor is mental abilities, personality, values, motivations, field restrictions and experience and role learning. Japan follows this theory since it advocates teamwork in its organizations. On the other hand, United States advocates for individual performance and hence this method is not applicable to its firms. Effect of cultural values on management Cultural values affect the way a manager manages an organization[Amm12]. Cultural values that affect management involve time focus, space, structure, action, time-orientation, power, communication, and competition. Time focus Every culture perceives time differently because of its history and traditions[Gan02]. There are two types of the time system. These two kinds are monochronic and polychronic. Cultures that use follows monochromic system use time in a straightforward way that is, people do one task at a point according to the pre-set schedule. Moreover, they focus more on time in place of people. It involves careful planning and scheduling of activities. To monochromic people, time is discrete and not continuous that’s why one project ha to get completed before starting another. Japanese people in official business show traits of the monochronic time system. They perform one task at a time. When looking and working inward they portray characteristics of the polychromic system. Japanese get monochronic when dealing with time and technology, but they get polychromic when dealing with all other aspects of life. On the other hand, cultures that follow polychronic system perform more than one task at the same time. Also, they do not depend on detailed information, and schedule changes according to circumstances. Moreover, they focus more on people rather than programs. Polychromic people do not structure their time, and they change from one activity to another when they feel like doing so. This type of people hates it when plans get imposed on them, and also they do not make plans themselves. In the US monochronic time gets used in all businesses in the United States and all other aspects of life. Time orientation Different culture perceives time direction differently. Those cultures that value past traditions in their culture focus are more concerned about the past[Gup03]. The plans they make have to get in concordance with the traditions and history of the business. This kind of cultures focuses on short-term gains. On the other hand, companies that are future focused are those that get concerned about attaining long-term goals. Organizations that are passed oriented put more emphases on traditions and build on them long-term plans. Contrary, companies that are future oriented put stress more on long-term plans and results. Japan focuses more on the future, that is, it is long time oriented. Companies in Japan make a high rate of investment in resources and development even at times when the economy is not doing well. Power distance At a workplace, firms that get oriented to hierarchy are the ones that focus on the level of power. In an organization that uses this kind of structure, managers make decisions and distribute tasks to the workers for them to implement[Ear00]. In cultures, equality is acceptable, and no one makes any effort to try and change this sort of situation. On the other hand, in other companies inequality is unacceptable and, therefore, require amendments. Even though equality oriented organizations do not focus on hierarchy, it exists so that it can facilitate relationships with the company. In this type of agencies, managers get to participate in work rather than give directions to people. Moreover, decision-making process gets decentralized, that is, it involves all the employees in an organization rather than the top management only. Japanese corporate culture has a distinct business hierarchy. These hierarchies are of great importance to the Japanese organizations. They have a firm belief that a manager or a worker should not perform any task below or above their jurisdiction. These hierarchies get designed to provide clear functional boundaries for the professionals in the organization. They get based on cooperation consensus rather than delegating authority and top bottom decision making. Japanese organization system is decentralized, that is, decision-making process involves every level of the organization. These hierarchies are made to make every employee have a sense of belonging to the business and their group. This feeling is the one that helps Japanese organization have the power produce good results. Also, they get made to list rules and procedures that guide members on how to perform tasks in the group. Japanese hierarchy includes the following. In the United States, businesses create hierarchy structures so that they can achieve goals and support those involved in the organization processes. It is the most successful worldwide and most developing nations follow it so as to increase their economic growth. This structure provides a clear and precise duties, designations, and positions. Moreover, the system gives employees freedom to perform tasks and achieve goals using with static functions. The USA hierarchy structure is as follows: Competitiveness In most cases management encourages competition in an organization, more particularly those in environments that are of the free market[Der10]. Moreover, some companies encourage their employees to compete among themselves so that they get more responsible and active. Enterprises that value competition emphasizes more on wealth, performance, and ambitions. Contrary, those that do not focus on competition value job satisfaction and healthy working environments. Most companies in the United States advocate for competition among workers. They believe that competition gets the best of every worker. On the other hand, in Japan competition is among groups. Activity Here companies get classified into two categories. There are those that get considered to have to do culture and those that have been culture[Amm12]. The doing culture organizations are those that develop measurable, time-framed actions while the being culture companies put emphasis on the company strives to achieve. Space There is the difference in the way culture perceive space, that is, what some cultures sees as private may get recognized as public by others[ere14]. Moreover, there is what gets known as personal space. Here cultures may differ on the part of the proximity during conversations. In a case where the personal space gets crossed, it may bring about discomfort. In some cultures, family and personal matters can get discussed openly at the workplace while in others where privacy is highly valued formality to get maintained during a conversation at business areas. Communication Here communication gets expressed regarding its context, that is, the surrounding circumstances in which discussion occur. Context gets classified into high and low context[Rey11]. In high context, most of the information is with the person, and microscopic of it gets coded. On the other hand, in little context most of the message is coded, and tiny is with the person. In Japan most of the information is with people, that is, it is has a full context kind of culture. Contrary, in the United States, most of the information coded, that is, little information is with the people. Structure This term means an organizational structure in a company. It gets classified into individualism and collectiveness. Here the emphasis is on the an individual rather than the group. In such a situation a person is required to get self-reliant, that is, being in a group or not makes no difference hence grouping is not necessary[Ear06]. On the other hand, in collectiveness the interests of a group have more value than those of an individual. In the United States, individualism is more valued than collectiveness. Here people get taught on being self-reliance rather than relying on a group. At the organizational level, workers perform tasks individually. Teamwork gets not embraced, that everyone is given a task to complete personally. The decision-making process is centralized, that is, top management makes decisions and the others follow. This act is done to create independent managers and employees and also to develop responsibility towards completion of tasks that may lead to creativity[Dan151]. On the other hand, Japanese focus more on group approach instead of an individual approach to all aspects of life. They embrace teamwork. Moreover Japanese believe that cooperation brings about the completion of tasks in time. Here managers and employees into management give authority to other employees. Decision-making process gets decentralized, that is, it involves everybody in the organization. The following table shows the difference in Japan and USA regarding organizational structure culture Individualism culture (United States) Collective (Japan) Focus on transaction (concerned about results) Short-term returns Stress on content (numbers, facts, ratios, statistics) Independent Competitive, focused on decision Information gets given directly Every person accounts for their responsibilities Have private office plan Use linear time, that is, task gets done one at a time Relationship focused (Concerned about process) Long-term gains Stress on context (intuition, experience, the relationship) Interdepended Collaborative Information gets given indirectly Accountability is by a group Have an open office plan Flexible time, that is, more than one task can be done at the same time Challenges that Japanese and Americans working together face due to cultural diversification There is a distinction between the way Japanese and Americans perceive self-view concept. Japanese belief that every person has a unique spirit, mind, soul, and heart, but the self-concept gets seen as an impediment to growth[Dil90]. Japanese share feelings with their friends and family in an open way so that they can get assistance in improving their weaknesses. Japanese cherish good work relationship within a group since it proves crucial psychologically. On the other hand, American workers follow individualism culture, and they strive to be the best in every task they perform. In a situation where both the Japanese and Americans work together, this may bring about challenges. It will get difficult for managers to bring these two to work together. It will get difficult for American to work for groups since they have always worked individually. Japanese belief that their race is superior to all other races. This knowledge makes them have a strong sense of nationality. On the other hand, even though Americans have a strong sense of national pride too, in America there exist many races, and that decrease their ability to work together. The two countries follow very different education systems[Hay81]. When people from this two countries work together on a project, it gets difficult for the manager to manage the two big egos. Japanese will want to be in charge, and the Americans will not let them. Japanese workers get more respectful to those in authority than the Americans. The two have different attitudes towards work. Japanese sacrifice they're personal for the success of a company since they live to work[Coo95]. They can bare uncomfortable working environments and long working hours as long as their sacrifice leads to the attainment of the end goals of the organization. In some situations they can work even when they get sick to avoid reducing company’s productivity[Ima86]. On the other hand, Americans work to live and do not like working in uncomfortable conditions. American workers also like spending time with workers thus they don’t like working for long hours. In a case where this two get to work together on a project that requires a lot of dedication towards the task, the two will differ in a lot of things. The Americans will seem reluctant to work extra ours and this will make the Japanese feel used. Japanese managers expect the employees to provide suggestions for the improvement of their operating efficiency, and also the overall productivity of the firm. This ability helps in bringing about continuous improvement. Even though this kind of suggestions gets used in the United States, workers ideas get viewed as a threat. Those workers who advocate for changes get labeled as troublemakers. In a case where Japanese workers work in a project under an American manager, they will get termed as trouble makers since their culture has taught them always to provide suggestions for improvement where they see that things don’t get done according to plan. In Japan, workers get given the participation system. This involvement means that employees get involved in consensus decisions where they should make a unanimous decision[OCl03]. In such a situation the final decision is left for the team leader to make and the group members are supposed to accept it as their choice. Japanese organizations do not allow voting since it differentiates between winners and losers. In the system that they follow, all the group members get seen as winners. On the other hand, United States workers do not play a part in the decision-making process. All the decisions affecting the organization gets made by the top management. In a case where a group is supposed to make a decision, a voting system is adopted. In this kind of system, there are winners and losers. This type of difference in business culture would pose a significant challenge in a situation where Japanese and Americans get to work together on a project. Japanese workers would not feel comfortable taking decisions from the top management without getting involved in the decision-making process. Examples of failed projects between Japan and United States DaimlerChrysler, which got formed in 1998, merged with Mitsubishi Corporation of Japan in 2000 with an attempt to become a global competitor in the increasingly competitive market. The aim of the DaimlerChrysler group was to tap into the vast Asian market[Beg11]. They also had a target to manufacture a broad range of vehicles with the help of the expertise of the Japanese. This dream came to a stop after four years of partnership. Japanese national culture played a significant role in the failure of this merger. The reason behind this is because Japanese culture leads to organizations that did not see the need for agency, maximization of profits, or accountability, and this made them not pay much attention to marketing strategies hence poor performance. References Amm12: , (Amman, 2012), Adl08: , (Adler, 2008), Hal95: , (Hall, 1995), Hof91: , (Hofstede, 1991), Cha11: , (Chaney, 2011), Hof80: , (Hofstede, 1980), Hof05: , (Hofstede, 2005), Cha08: , (Chaney, 2008), Cul07: , (Cullen, 2007), Pet04: , (Peterson, 2004), Bel93: , (Belbin, 1993), Gan02: , (Gannon, 2002), Gup03: , (Gupta, 2003), Ear00: , (Earley, 2000), Der10: , (Deresky, 2010), ere14: , (eresky, 2014), Rey11: , (Reynolds, 2011), Ear06: , (Earley, 2006), Dan151: , (Daniels, 2015), Dil90: , (Dillon, 1990), Hay81: , (Hayes, 1981), Coo95: , (Cooper, 1995), Ima86: , (Imai, 1986), OCl03: , (O'Clock, 2003), Beg11: , (Begley, 2011), Read More