Latin Western European Business Culture - Essay Example

Latin Western European business culture This analysis includes the countries of France, Italy, Portugal and Spain. All four are ed as Mediterranean countries and share common linguistic and cultural roots. While certain characteristics of the Latin business culture are also common to each, there are also differences that are discussed below. The application of Hofstede's theory of the five cultural dimensions (Hofstede) yields a first appraisal of the Latin culture in this context. In general, the rating for each of the five dimensions is high for Latin countries. Hofstede's Power-Distance rating for Latin countries indicates that there is a stronger tendency towards autocracy and paternalism. Collectivism, the propensity of people to stay within a long-term group, is also rated high. The Masculinity rating corresponds to emphasis laid on the traditional viewpoint of men's and women's roles, while Uncertainty avoidance rating indicates that rules and long-term employment within the same structure are preferred. Finally, the long term / short-term rating is in favour of longer term attitudes, based on perseverance and relationships ordered by status. These cultural dimensions give a basis from which to assess certain aspects of Latin Western European Business Culture. However it is not the complete picture. In the areas of business communication, particularly in face-to-face communication and business negotiations, it is also of interest to compare the concepts advanced by Hall (Hall) and in particular that of the high context and low context cultures. According to Hall, in a high context business culture, the information transmitted in a communication is minimised because implicitly much of the information required is already present in the setting. Low context cultures are the reverse: the communication contains far more information because this information is not present in the setting. According to this model, Latin culture is high-context. Besides the situations already mentioned, this model also finds particular application in the advertising and promotional activities that most businesses engage in. This kind of communication remains somewhat basic and even terse in Latin countries as compared to the other Western European groups (Anglo, Germanic and Nordic). Hall also elaborated a second theory of how different cultures structure their time, which he refers to as polychronic or monochronic time orientation. A top-level approach for Latin countries puts them into the polychronic category. The immediate implications are of the priority of interpersonal relations over schedule and appointments, the simultaneity of tasks and the mixing of work time and personal time. Like the other theories alluded to above, this generates different results when we consider the four countries on an individual basis. Because the creation of the European Community has encouraged the individual member countries to trade more among themselves and, by extension, with the rest of the world, it is interesting to note how the Latin Western European countries and their businesses fare in a cross-cultural context. In particular, a different principle is applied here, that of the Self Referencing Criteria or SRC defined by Lee (Lee). In essence, this describes the cultural trap of assuming that other countries use the same cultural values as one's own. It is the failure to perceive things from the standpoint of a person of a different culture. The Latin countries that we are dealing with here display marked differences in this regard. The first country to be examined using these tools of cultural investigation is France. It is a country which at the same time is Mediterranean and Latin, but which also exhibits a number of non-Latin characteristics, in keeping with its proximity to, or common borders with, a number of (mainly) Germanic countries such as Germany, Belgium and Switzerland. Of the five cultural dimensions, French business culture can be classified as follows. Power-distance is relatively high with top executives exercising an autocratic style of management (Moran). Collectivism and Masculinity on the other hand are low. The French have a reputation for individualism and if they do not actively encourage it, they do not stand in the way of the equality of the sexes in business either. A long-term attitude still prevails in a country that has considerable state intervention in business. This evaluation of French business people concurs with Hofstede's specific analysis of France (Hofstede - Web) in which he rated the French as having high Power-Distance, high Individualism, High Uncertainty Avoidance and low Masculinity (the Long Term aspect was not analysed, possibly because Hofstede only added this fifth factor after reflections concerning China). Personal honour and integrity play a significant role in business activities. There is also a hint of a high-context environment following Hall's definition in that verbal responses are often preferred to written ones and yet the French are typically more systematic and deliberate than their business partners from other countries. In their structuring of time, they prefer promptness for meetings and resist the intrusion of business into family life. In this respect they are "un-Latin". In general the French are in less danger of using Self Reference Criteria in their business dealings as many French business people speak not only their native French language but also German, Italian or English. Within the Italian nation there is a marked divide between the business culture of the north and of the south. Although many countries exhibit regional differences, this one is greater. The business culture in the north where the majority of business people are oriented towards individual profit, is towards coolness, reservation and less communication. In the south, whereas in the south where many people work for the state, the contrary is true. This polarisation of business culture contrasts also with France where business people as a whole exhibit both Latin and non-Latin characteristics. In Italy, the Latin characteristics are indicated by the people in the south and the non-Latin by the people in the north of the country (Moran). The ratings for the five cultural dimensions differ accordingly for the Collectivism (higher in the south) / Individualism (higher in the north) ratings as well as Uncertainty Avoidance (High in the south, lower in the north). Masculinity has a tendency to be high everywhere and yet Italy is a country that has been termed a "crypto matriarchy", in the sense that the real power lies with the women hidden behind the men. The business culture is typically high-context following the definition from Hall. Italians rely on reading facial expressions and using eye contact to get reaction from foreign negotiator. The ultimate decision maker may be present in possibly all meetings, reserving comment till the moment of decision, which makes it imperative to be able to read body and facial language as part of the Italian business culture. In addition, Italians attach importance to making a non-verbal impression on business prospects by using expensive offices, cars and restaurants. More aligned to a polychronic mode of action, business agreements are often secured at a lunch meeting and business itself becomes intertwined with family values. Italian business people, mostly men, are among the best travelled and most successful culture crossers in the world. In this sense, at least for those who venture outside of the Italian setting, are unlikely to fall victim to Lee's Self Reference Criterion (Moran). Portuguese may have the most Latin of all the business cultures considered here. Power Distance and Collectivism are high as are Uncertainty Avoidance and a Long-Term attitude. Hofstede rates the Uncertainty Avoidance as double the average of all European countries. One of the manifestations of this is in the fatalist approach to Portuguese government bureaucracy that often turns away potential business investment. As with the three other countries, there is a high degree of centralised decision making in Portugal. The effect is to slow down decisions by comparison with other cultural groups in Europe, making patience a virtue for those business people who wish to do business with the Portuguese. Spain is also rated high by Hofstede for Uncertainty Avoidance and to some extent for Power Distance as well. Interpretations of Masculinity differ. Hofstede rates this as lower than the European average, but the Spanish have a reputation for teaching males to be aggressive and dominant and women to be passive and accepting (Moran). Spanish business culture features as high context. Foreign business people are required to submerge themselves into the Spanish system. In addition, Spanish people are frank about any cultural blunders perpetrated by their business counterparts. Of the four countries discussed here, it is Spain that appears most at risk concerning the Self Reference Criterion trap. Spanish business culture also exhibits strong polychronic characteristics. Work spills over into their personal life and vice versa. The "maana" mentality of procrastination bears a Spanish name for a reason. In the arena of values, there is one that appears to hold true for all four countries. It is the value placed on the family. France has a large percentage of companies that are family owned, and family involvement and connections count for a lot in career advancement. In Italy, the value of the family is so strong that it surpasses allegiance to their country or even compliance with its laws. Business friends and colleagues are called "cousins" and become by extension part of the family. In Spain, the control of business in general is estimated to be in the hands of the 200 leading families. In a similar way, personal relationships play a strong part in business activities. For the French for example, business relations are facilitated by reference to a trusted third party (Moran). As another aspect of values, negotiation techniques also offer insights into Latin Western Europe Business Culture. In Latin culture, there is both wider acceptance and also expectation of the expression of emotion and the use of dramatic techniques to conduct a negotiation. The Latin approach in business negotiating is to start at a considerable distance from the other side's position offer, in contrast to other groups in Europe, notably the Nordic whose members will typically start close to the final point of agreement. Italians also consider it a point of honour to never pay full price for an item that they wish to buy. Dissimulation is a natural part of the process. Kennedy (Kennedy) describes how he witnessed one French executive speak perfect English to one English group at a meeting one week and only speak French through an interpreter to a different English audience the next as a negotiating ploy to gain the upper hand. However, on certain points, the Latin countries in Western Europe have cultural similarities with the other three groups defined as the Anglo, Germanic and Nordic. A case in point is linked to the Hofstede dimension of Masculinity and concerns gender stereotyping. A study by Catalyst (Catalyst.org) found "striking cross-cultural similarities in the ways senior managers stereotype women's and men's leadership capabilities". In general, women were stereotyped as being stronger on caring for their teams and weaker on performance, which in turn leads to possible conjecture about other cultural similarities at a business level between the four cultural groups, and how superficial other so-called differences might be. In conclusion, the Latin Western European countries as typified by France, Italy, Portugal and Spain distinguish themselves by the common factors of Uncertainty Avoidance, High Context communication and polychronic structuring of time. The family is also a common value within the context of business culture. France remains the exception to the Latin rule on several matters, at the same time belonging to the Latin group and having an affinity for the Germanic group. Other factors such as individualism / collectivism and masculinity vary according to the country concerned. For international business activities, France and Italy display the business cultures that are the outward facing and that provide the best chance of avoiding the Self Reference Criteria problem. Spain and Portugal on the other hand remain inward looking on this aspect of their business culture, Portugal on account of nostalgia for its historical role in the development of European civilisation and Spain because of a reluctance to adapt to external cultural differences. References Catalyst.org - http://www.catalyst.org/files/fact/European%20Stereotypes.pdf Hall, E.T. (1976) Beyond Culture. Anchor / Doubleday, New York Hofstede, G. http://www.geert-hofstede.com/hofstede_spain.shtml (_france.shtml, _italy.shtml, _portugal.shtml) Hofstede, G. (1980) "Culture, consequences: international differences in work-related values" Sage London Kennedy, G.(1982) "Everthing Is Negotiable". Arrow books, London. Lee, J.A. "Cultural Analysis in Overseas Operations". Harvard Business Review, Mar-Apr 1966, pp 106-114. Moran, R. (1991 ) Robert T.Moran's Cultural Guide To Doing Business In Europe". Butterworth-Heinemann, Oxford. References - NOTES Hall, E.T. (1976) Beyond Culture. Anchor / Doubleday, New York WEB : http://stephan.dahl.at/research/online-publications/intercultural-research/halls-classic-patterns/ WEB : http://en.wikipedia.org/wiki/High_context_culture Hofstede, G. http://www.geert-hofstede.com/hofstede_spain.shtml (_france.shtml, _italy.shtml, _portugal.shtml) Hofstede, G. (1980) "Culture, consequences: international differences in work-related values" Sage London WEB : http://www.geert-hofstede.com/ Kennedy, G.(1982) "Everthing Is Negotiable". Arrow books, London. PAGE: Kennedy, p.337 Lee, J.A. "Cultural Analysis in Overseas Operations". Harvard Business Review, Mar-Apr 1966, pp 106-114. WEB: http://www.fao.org/docrep/W5973E/w5973e07.htm Moran, R. (1991 ) Robert T.Moran's Cultural Guide To Doing Business In Europe". Butterworth-Heinemann, Oxford. PAGES : Moran, pp France 51-54, Italy 89-91, Portugal 111-112, Spain 117-120 Read More