Cross-Cultural Management in International Business - Term Paper Example

CROSS-CULTURAL MANAGEMENT IN INTERNATIONAL BUSINESS By Cross-cultural Management in International Business Introduction Culture can be defined as inherited values, concepts and ways of living that are shared by individuals of the same social group (Rosaldo, 2006). Globalisation has brought people together, implying that people from different parts of the world with diverse cultures are now working and interacting together. Cross-cultural management is a process of adopting an inclusive management method to the culture affiliates’ countries, which have a diverse type of culture and different stages of development of culture in international business (Maude, 2011). Cross-cultural management helps in designing feasible structures of an organisation and management mechanisms in various forms of cultural atmosphere. To study this, the paper uses Japan and United Kingdom as case studies. Literature Review Culture The “culture” of a people has been defined differently by different scholars. Edward Tyler, a British anthropologist, defined culture as “A complex whole of customs, beliefs and other habits acquired by man as a member of society” (Ratnapalan, 2008). Tyler’s definition was later modified by Kroeber and Kluckhohn, who argued “Culture consists of patterns of behaviour acquired and transmitted by symbols (Rosaldo, 2006). Schwartz modified the definition of culture and defined it as “a collective experience obtained by a member of a population from past populations” (Erez & Gati, 2004). On the other hand, Matsumoto summarised culture as “the set of values and beliefs shared by a group of people but different for each person” (Matsumoto, 1996). According to Spencer and Oatey, culture is “a set of values, beliefs and assumptions that are shared by a group of people that determine each member’s behaviour” (Spencer-Oatey, 2008). The above definitions are just a few out of the various definitions that have been suggested by other researchers. We need culture in society because it serves various important roles. These roles have been espoused by the various arguments put forward on why we need culture in any given society. One of the significant functions is that culture provides a context for the development of language systems, both verbal and non-verbal. The second function is that of perception, put forward by Matsumoto. He argues that culture “gives meaning to social situations, generating social roles and normative behaviours” (Matsumoto, 2007). In this view, culture guides the way we look at and understand both the natural and physical world. Thirdly, culture provides the value systems that guide people’s behaviour through the socialisation process. The fourth function of culture is that it provides the basis of social stratification on the basis of dimensions such as social class, social rank, etc. Another function of culture is that it determines the production and consumption processes in a society as it defines what people “need, use and value”(Davies, 1990). These are, but just a few of the arguments put forth on why we need culture in society. There are three major models that have been put forward to study national cultures and act as a basis for doing cross-cultural comparisons among various countries. These models have some noted strengths and weaknesses as discussed in their overviews below. Hofstede’s Four-Dimension Model The Dutch management researcher Geert Hofstede, in his model, argued that various national cultures could be compared across five dimensions: Power distance, Uncertainty avoidance, Individualism vs. Collectivism and Masculinity vs. Femininity (Hofstede, 2001). This model has based criticism of having a narrow scope on its dimensions in terms of failing to put some countries in the correct dimensions e.g. putting China on weak uncertainty avoidance side when it isn’t correct to say so. Hall’s context Theory and Time Theory For the context theory, there is the high context dimension and the low context dimension (Würtz, 2005). High context cultures communicate more implicitly through a combination of the spoken or written word, symbols, body language and intonations of speech. On the other hand, low-context cultures are more direct, formal and explicit communication through the spoken or written word (Würtz, 2005). For the time theory, different cultures view time differently. Sequential cultures treat time linearly as an important resource that should be well utilised, best exemplified by their to-do-lists, schedules and appointments (Würtz, 2005). On the other hand, synchronic cultures view time as something that can be manipulated or stretched; hence, lateness is not uncommon. They value stable human relationships than they value time. This model has also faced the criticism of being limited to the business background, and its theory was derived from only three countries (Germany, France and America). It also fails incorrectly putting some countries into the correct side of its continuums e.g. wrongly putting China in the sequential side when it is not as a matter of fact. Trompenaar’s Five-Dimension Theory This theory views a people’s culture as expressions of people towards the universal problems of how people relate to nature, time and other people and these expressions differ across different cultures as they have different solutions to these similar problems. In this model, countries’ cultures are differentiated along five dimensions: Universalism, Affective vs. Neutral, Diffuse vs. Specific, Achievement vs. Ascription and Individualism vs. Communitarianism. However, Trompenaar’s model has been criticised for being a replica of the previous two models as well as generalising specific observations in some cultures across a wide numbers of cultures (Trompenaars & Hampden-Turner, 1998). Comparison and critique of the three models Of all the three models, the Hofstede’s Four-Dimension Model is the most comprehensive one in terms of the scope of the research that underlies it and the number of countries that has informed its basis. It is this rich research background that makes this model stand out from the other two in terms of its wide acceptance and usage among professionals in the field of communication, hence making it more universal than the other two. Hall’s Context Theory and Time Theory studies cross cultural communication through novel but very insightful aspects: culture and time. This model clearly brings to the fore the different ways words and symbols are construed in different cultures as well as the meaning given to time in different cultures. This is important in explaining such phenomena as the importance given to handshakes in high context cultures as well as the strictness with which time is treated in low context cultures. Trompenaar’s Five-Dimension theory argues that culturally, people are only different because they tackle differently the same universal problems of our relationship with nature, other people and time. Trompenaar’s model has gained a lot of focus among communication experts because of Mr. Trompenaar’s rise to a foremost management thinker, especially on globalization. The three models are similar in the sense that they are all continuously being refined by their scholars with new data from time to time. This has made the model’s to be more practical and universal towards a diverse set of cultures that they aim to explain. The models are also unique in that they all study communication from different angles, thus, enriching the field of cross cultural communication. The models have however, faced the criticism of being narrow in scope because they have largely drawn their conclusions from business and organizational environments in Western countries. This limits them in giving correct interpretations of some cultures especially from the Asia and Africa. Collaborative studies with researchers from these cultures may help to get a more accurate perspective of cultures from these areas. Overally, these three models have come a long way in trying to understand cross cultural communication albeit their limitations. Continuous research with new data, especially with other researchers from other cultures, may finally make the models more universal and more accurately explanatory of the world’s various cultures. Cross-Cultural Management Cross-cultural management explains how individuals in an organisation behave worldwide and shows individuals how to work with the organisations comprising of employees and clients from different cultures (Adler and Gundersen, 2008; Guirdham, 2011). The significance of cross-cultural management lies in the current cooperation between firms in various nations where difficulties are bound to arise. As a result difference in cultural background. Geert Hofstede (1980) developed what was referred to as the dimensional approach to cross-cultural comparisons. Today, the world is experiencing globalisation. More companies are being put up and run in various places all over the world. This has resulted in more activities being carried out all around the world resulting in communication cultures (Chaney, & Martin, 2013). Culture is something individuals can learn and consequently, learning entails communication (Adler and Gundersen, 2008). Communication is a way of coding and decoding language. For instance, human beings can communicate through other means apart from language, for instance, facial expression, gestures and body language. Generally, we cannot separate culture and communication. This implies that when an individual is exposed to a given culture then the respective communication is must. Kawar (2012) argue that communication takes between countries and governments more as compared to individuals. As a result, a good understanding of cross-cultural management and international business communication is of great importance to giving people an opportunity to compete internationally (Gudykunst and Nishida, 2001). Scholars have also put forth frameworks that help in the study and practice of the cross-cultural communication, which are called the principles of interaction that lead to success. These are Map, Bridge and Integrate (Maznevski and DiStefano, 2003). Mapping implies recognising the differences that may exist and that it is important to describe the differences using an objective with an objective framework, and use this map to different perspectives and then acting on those explanations so as to deal better with the work challenges. Bridging increases effectiveness of communication by paying close attention to interactions across differences in culture (Maznevski and DiStefano, 2003). Integration is built on differences for interaction. The skills required here (i.e. managing participation, resolving conflicts and building on ideas) lead to better quality decision and implementation when they are built on strong mapping and bridging. Case Studies The Two Case Study Countries I am going to compare two countries, the UK and Japan on the three major models that analyse cross-cultural differences among various countries. The United Kingdom is a developed country in Western Europe whose neighbours are the comparatively developed member countries of the European Union. The culture and pride of the British people has been influenced by over the more than three centuries it has developed and the prominent role the country has played in influencing human civilization. On the other hand, Japan in a prominent island country in East Asia that is one of the world’s largest economies. It is comparable to the UK on indicators of development such as the GDP, standard of living and the Human Development Index (HDI). So how do the cultures of these two economically comparable countries compare? Hall’s context theory and Time Theory In the context theory, cultures are differentiated on the basis of the nature of their communication process (Würtz, 2005). Japan is clearly a high context culture as meaning in its communication system is not only derived from words but also symbols and body language (Hijirida & Yoshikawa, 1987; Midooka, 1990). This implies that meaning in Japanese society is more implicit than explicit as the overall meaning has to be obtained from not only words but also from symbols and other imagery. On the other hand, the UK is low context as the British people communicate more explicitly and formally. In British society, an analysis of words alone is enough to bring forward the intended message as the use of symbolism and other imagery is on the low side. On the time theory, cultures are differentiated on the basis of how they view time (Würtz, 2005). Sequential cultures have a linear view of time and treat it very importantly. This is where the UK would generally fall on this side of the continuum. This is well exemplified by the common culture of keeping to-do lists and diaries among the British people. On the other hand, synchronic cultures see time as a simultaneous occurrence of many things. This means that in these cultures, attention can be given to different things at a go. These cultures give stable and healthy human relationships more importance than they do for time. Japan is a good example of this culture. In Japan, it would be normal for a meeting to start late without it being interpreted a big breach of protocol if only to wait for the last person to make it to the meeting. Hofestede’s Five-Dimension Model On this model, cultures are compared on a scale across five dimensions as follows: Power Distance Japan would be expected to score higher than the UK on this dimension with its more hierarchical society that still values social ranks and, hence, treats people more unequally. For the Japanese society, social ranks still hold significance and hence, the relatively higher score on this dimension as compared to the UK. The UK, a western country founded on philosophical ideals of equality and freedom of the individual, would score relatively lower on this dimension as compared to Japan. This shows that people in the UK view each other more equally as opposed to Japan. (Soares, Farhangmehr & Shoham, 2007). Individualism The UK is a highly individualistic society. From a very young age, values of personal freedom and responsibility are imbued to children. Personal uniqueness and fulfilment is valued over groupthink and collectivism. This means that on this scale, the UK would be expected to score higher than Japan. On the other hand, Japanese society values teamwork and group harmony in their society than explicit expressions of individuality and personal competitiveness. Thus on the Individualism scale, Japan scores relatively lower than the UK. (Soares, Farhangmehr & Shoham, 2007). Masculinity Research has shown that Japan is one of the most masculine nations in the world, highly driven to achieve success. However, the defining characteristic is that the Japanese love to compete in groups as opposed to other western nations where people compete individually for success. Japan holds a notorious reputation of workaholism in their quest for industrial success. The UK ranks significantly lower than Japan on this dimension but is still a highly masculine society that admires and rewards individual success. People are conditioned to believe in themselves and become the best in whatever they undertake. (Soares, Farhangmehr & Shoham, 2007). Uncertainty Avoidance Japan ranks very highly on this scale as one of the most uncertainty avoiding countries on Earth, naturally influenced by its predisposition to natural disasters like earthquakes. This means that the Japanese take a lot of time to study and predict the future so as to prepare adequately for it (Peltokorpi, 2008). On the other hand, the UK scores lowly on this dimension showing that its citizens are comfortable to face an uncertain future in their day to day lives. This is probably because of its more favourable natural background as compared to Japan. Social Changes in the UK and Japan over the Last 50 Years In the last three decades, there has been a significant social change in the cultural backgrounds of these two countries. Japan culture has allowed very little diversity (Peltokorpi, 2008). This has been because Japan is regarded as a homogeneous nation in that the word Japanese is commonly used to refer both the nation and the culture. In the UK, the English culture has been dominant. Widespread changes in the UK’s cultural life have occurred for almost more than three decades ago. UK has diversified culture to accommodate various cultures from all over the world. This is evident by the increased number of immigrants from all corners of the world who have entered the UK and settled all over the country. Simulated Business Environment I am the direct manager of ABC Limited, an authorised distributor in the UK of smartphones manufactured by the Japanese telecommunications company, Simu Telcom. I lead a team of seven staff based at our head office along Oxford Street in London. Of the seven staff, four are British citizens aged between 23 and 27 that are in the sales department. The remaining three staff are Japanese citizens aged between 24 and 29, seconded by Simu Telcom from Japan to our London office as technicians for customer support services. On a particular day, it is reported to me by one of the British sales staff that her client was very upset with our store because her faulty phone that had been handed over to one of the Japanese technicians for attention had taken too long to return to her. Deeply protective of the reputation of our store, I seek to identify and reprimand the technician to whom the responsibility of attending the phone was entrusted. I am utterly shocked when none of them owns up for the mistake, even when I summon all of them together. It takes the British sales staff who had reported the case to me to identify the culpable technician. Amid great shame, the whole Japanese team apologizes the mistake of one person as a team. Course of Action As the manager in charge of these two groups of staff clearly distinguished by the cultural differences in their countries of origin, I face the task of solving the conflict amicably to ensure that it doesn’t introduce a toxic environment between my two teams which could jeopardize my company’s performance (West & Graham, 2004). I understand that the Japanese group is clearly divergent from the British team on a list of issues such as how they view individuality, teamwork, responsibility, authority, uncertainty, etc. (Peltokorpi, 2008). This requires me to come up with a model that will enable me to rise over these differences between the two teams and make it possible for the two groups to work together harmoniously in order to contribute their best towards our company’s objectives. The 3-step model: MAP-BRIDGE-INTEGRATE, developed by Martha Maznevski and Joseph DiStefano, is a useful tool for managing conflicts among teams whose members come from diverse cultural environments (Maznevski and DiStefano, 2003). The model’s three steps can be used to manage the conflict as follows: MAP In this step, I would seek to understand the differences between my teams. I would objectively seek to understand the perspectives of the involved members from either group in my team. BRIDGE In bridging, I would motivate every team member to communicate his or her perspective on the conflict at hand and building confidence in each team member to offer a useful contribution towards solving the conflict. INTEGRATE In this final step, I would expect every team member to leverage, on his or her unique proposition, to contribute a useful conclusion of the conflict. Conclusion Based on what has been discussed above, there are key things global managers are needed to know about cross-cultural management to as to facilitate smooth running of the organisation. These include: to coach their employees to be effective communicators with other team members. This should concentrate on communication style, cross-cultural and general communication competencies as well as presentation delivery. Secondly, to know what are the team members’ expectations about working with others. Thirdly, should be aware of cultural dimensions and their impact on team performance (Geert Hofstede) and finally, encourage a team culture by developing shared guidelines for behaviour. Ultimately, it is evident that cross-cultural management can be understood by first appreciating the fact that we have diverse cultural backgrounds. Bibliography Adler, N. J., & Gundersen, A. (2007) International dimensions of organisational behavior. Cengage Learning. Chaney, L., & Martin, J. 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