1. Introduction to Cross-cultural Management The Critical Role of Culture in International Business 2 Introduction 3 The Euro Disney Debacle 3 The Wal-Mart Failure 4 The Mismatched Merger of Daimler-Benz and Chrysler 4 Globalization — Increasing Increasing Intercultural
Interactions 6 The International Business Environment 8 Legal Systems 8 Political Risks 8
Economic Risks 9 Infrastructure Infrastr ucture and Technology 9 National Culture 9
Convergence of Cultures 10 Culture — A Critical Variable 13 Cross-cultural Cross-cul tural Management 14 The Meaning of Culture 15 Conclusion 19 Understanding Culture and Managing across the Doing Business in China 24 — World Annexure 1.1: 1.1: International Internationa l Trading Trading Blocs and Cultural Diversity 26
2. The Dimensions of Culture The Culture Quiz 33 Introduction 35 What Is Culture? 35 The Link between History, Geograp Geography, hy, and Management Practices 36 Culture and Management 37
Dimensions of Culture 39 Edward Hall Model 41 Language of Time 41 Language of Space 42 Language of Things 43 Language of Friendship 43
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32 Language of Agreement 44 Hall’s High-Context and Low-Context Low- Context Cultures 44
Florence Kluckhohn and Fred Strodtbeck Model 45 Influence of the Six Value Orientations on Workplace Policies 47 Geert Hofstede Model 49 Power Distance Index 49 Individualism and Collectiv Collectivism ism 52 Masculinity and Femin Femininity inity 54 Uncertainty Uncertain ty Avoidance 56
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Long-term Orientation 57 Trompenaars — Seven Dimensions of
Culture 58 Universalism vs Particularism 58 Individualism vs Collectivism 59 Neutral vs Affective 59 Specific vs Diffuse 60 Achievement vs Ascription 61 Sequential vs Synchronous 62 Inner-directed vs Outer-directed 62 Trompenaars Seven Cultural Dimensions and Indian Culture 63 Other Classifications of Culture 65 GLOBE Project 65 Country Clusters 65 The Interacting Spheres of Culture — Influences on Workplace Culture 66
Professional Culture 67 Functional Culture 68 Corporate Culture 68 The Role of Founders in Corporate Culture 68 Industry Culture 69 Managing Differences in the Cultures of Industry 70
Cultural Challenges in the Modern Indian Workplace 70 Conclusion 72 Case Study: Tapio OYJ in India 78 Understanding Culture and Managing across the — World Doing Business in Sweden 81 Annexure 2.1: GLOBE Project 82
3. Communicating across Cultures Miscommunication Can Cause an International Business Failure 92 Introduction 92 The Communication Process 93 Barriers to Cross-cultural Understanding 95 Definitions 95
Languages of the World — Importance and Influence 97 English — The Language of International Business 98 English — Different Forms of the Same Language 100 Language and Culture 102 Using Non-discriminatory Language 103 Nonverbal Communication and Culture 104 Communication through the Body 105 Communicating through Vocal Characteristics 109
91 Communication through the Use of Time 110 Communication through the Use of Space 110 Communication through the Use of Environment 111 Nonverbal Communication — Concluding Remarks 112 Managing First Impressions — Greeting
Etiquette 113 Greeting Rituals — Shaking Hands? Embracing? Or Namaste ? 114 Presentation Styles across the World 115 Presentation Tips for All Countries 117 Conclusion 117 Case Study: Jayanth Gets the Blues 120 Understanding Culture and Managing across the Doing Business in the US 122 — World
4. Culture and Marketing Market Your Country, Then Market Your Company, and Finally Market Your Product — The Entry of Maruti Suzuki in South America 128 Introduction 129
127 History 132 Geography 132 Political Systems 133 Demographics 133
Approach to International Marketing
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Cross-cultural Marketing Research 136 Segmentation and Sampling 137 Data Collection 138 Interviews 138 Focus Groups 139 Observational Studies 139 Questionnaire Surveys 140 Culture and Consumer Behaviour 141 Products and Culture 143 The Core Product 144 Product Names 145 Product Packaging 146 Products — Standardization vs Adaptation Dilemma 148 Services and Culture 150 Place — Diversity of Distribution Systems 151 Relationships with Dealers 152 Retailing and Culture 153 Sales Force Management 154
The Complexity of Pricing 157 Country-of-origin Effect on Pricing 158 Festivals 158 Perceived Value of Product 158 Differing Brand Equity 159 Culture of Bargaining and ‘Haggling’ 159 Even-valued Pricing 159 The Structure of the Distribution System 159 Promotion 160 Advertisements 160 Customer Gifts 163 Direct Selling 163 Conclusion 164 Case Study: Marketing Tej-Yamato Cars in Africa 169 Understanding Culture and Managing across the — World Doing Business in Japan 171
5. Negotiating across Cultures The Impact of Culture on Negotiations — An Analysis of the Japanese Language 179 Introduction 180 Principles of Negotiation 183 Pre-negotiations 184 Post-negotiations 185
Intercultural Communication and the Negotiation Process 185 Language 186 Interpreters, Translators, and Mediators 186 Business Etiquette 186 Shared Experience 187 Humour 187 Face 188 Agenda 188 Listening Skills 188 Pace 188 Time 188 Socializing 189
178 Negotiation Framework 189 The Influence of Organizational Culture and Individual Personality 192 Organizational Culture 193 Individual Personality 194 Culture and Emotions in Intercultural Negotiations 195 Negotiation Styles in Different Countries 196 Culturally Responsive Negotiations Strategies 203 Conclusion 207 Case Study: Negotiating an Outsourcing Deal in China — Canadian Outdoor Recreational Equipment 210 Understanding Culture and Managing across the — World Doing Business in Nigeria 217
6. Motivation and Leadership across Cultures What Works in Aichi May Not Work in Gothenburg — Vignettes on Motivation and Leadership Style 223
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Introduction 226 Cultural Influences on Motivation 228 Content Theories of Motivation 231
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Maslow’s Hierarchy of Needs 231 Frederick Herzberg’s Two-Factor Theory 234 McClelland’s Theory of Learned Needs 236
Process Theories of Motivation and Culture 237 Adams’ Equity Theory 237 Locke and Latham’s Goal-Setting Theory 238 Victor Vroom’s Expectancy Theory 239 Indian Motivation Theories 240 Job Design 241 Meaning of Work 242 Leadership 244 Leadership and Culture 244 Theories of Leadership and Their Global Relevance 248 McGregor’s Theory X and Theory Y 248 Traits Approach 248 Behavioural Approach 249
Contingency Leadership Approach 250
Leadership Theories in Other Cultures 250 Nurturant Task-Participative Model of Leadership 251 Pioneering-Innovative Style 251 Paternalistic Leadership Style 251 Theory Z 252 Performance Maintenance Leadership 253 Other Japanese Leadership Studies 253 Leadership Styles in Europe 254 Leadership in Southeast Asia 255 Leadership in the Middle East 255 GLOBE Project 256 Conclusion 259 Case Study: When Commoners Take Over the Royalty — MexCem’s Takeover of Royal British Cement Company 264 Understanding Culture and Managing across the — World Doing Business in Brazil 270
7. Cultural Dimensions of HRM The Complex World of IHRM — The Case of Bharat Forge 278 Introduction 280 HRM in a Globalizing World 280 Factors Influencing IHRM 282 Differences between IHRM and Domestic HRM 283 Staffing Policies 285 Approaches to IHRM and Cultural Sensitivity 287
Recruitment and Selection 287 Legal Requirements 287 The Influence of Culture on Recruitment and Selection 289 Employee Orientation 292 Training and Development 293 Guidelines for Training across Cultures 295 Performance Appraisal 296
277 The Challenges of Performance Appraisal in International Management 297
Compensation and Rewards 300 The Influence of Culture on the Regulation of Compensation 302 Culture and CEO Compensation 303 Labour Costs across Countries 303 International Labour Relations 304 Union Structure and Power 305 Collective Bargaining 305 Severance Pay 305 Vacation 306 Worker Participation 306 Conclusion 307 Case Study: Global Expansion at Linkideas Inc. — The Challenges of Global HRM 310 Understanding Culture and Managing across the — World Doing Business in Germany 313
8. Managing Global Teams How Many Teams Does It Take to Manage a Global Customer Account? 320
319 Introduction 321 Global Business Teams 322
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Global Teams — Purposes 322 Differences between Traditional Teams and Global Teams 322 Diversity in Global Teams 323 Challenges Created by Cultural Differences 323 Basic Definitions — Groups and Teams 324
The Process of Group Development 325 The Impact of Culture on Group Development 326 The Fit between Teamwork and National Culture 330 Scandinavian Nations — Sweden, Denmark, and Norway 330 Japan 330 US 331 India 331 Team Strategies and the Influence of Culture 332 Task Strategies and Culture 333 Creating a Sense of Purpose 333 Structuring the Task 333
Assigning Roles and Responsibilities 334 Reaching Decisions 334
Process Strategies 335 Team Building 335 Choosing How to Communicate 336 Eliciting Participation 337 Resolving Conflict 337 Evaluating Performance 338 Challenges Faced by Global Teams 339 The Inability to Cultivate Trust among Team Members 339 Communication Barriers 340 Performance Management in Global Teams 340 Managing Diversity 343 Virtual Teams — Special Challenges 345 Conclusion 346 Case Study: ERP Implementation at Maya Steering Wheels Ltd 350 Understanding Culture and Managing across the World — Doing Business in the United Kingdom 355
9. International Assignments and Expatriate Management Sabyasachi Chaterjee’s Move to London 362 Introduction 363 Reasons for Using Expatriates 364 Control and Coordination 365 Local Expertise Unavailable 365 Complexity of Recruitment Processes in the Host Country 365 Transfer of Knowledge and Organizational Culture 365 Management Development 366 Ethnocentric Beliefs 366 Financial Considerations 366
Challenges Faced by Expatriates 367 Reasons for Declining an International Assignment 368 Repatriation Issues 371 Expatriate Failure 372 Reasons for Expatriate Failure 372 Consequences of Expatriate Failure 373 Factors Influencing the Success of a Foreign Assignment 374
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Selection of Expatriates 378 Recommended Process for Selecting Expatriates 378 Cross-cultural Training 379 Types of Cross-cultural Training 380 Performance Management and Reward Systems 380 Performance Management 380 Reward Systems 382 Foreign Assignments — Cost Implications 382 Women as International Managers 383 Repatriation 384 Improving the Repatriation Process 387 Conclusion 389 — Case Study: When Calm Meadows Turn Stormy The Challenges of Being an Expatriate in India 392 Understanding Culture and Managing across the Doing Business in Russia 396 — World
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10. The Global Manager Carlos Ghosn — The Quintessential Global Manager 403 Introduction 403 Competencies for Global Managers 406 Developing Competencies for a Global Manager 408 Personality Development and Family Background 409
Further Reading 424 Index 427
402 Professional Development 410 Organizational Support 412
Ethics and the Global Manager 413 Ethical Frameworks 415 Codes of Conduct for Ethical Business 417 Ethical Guidelines for Global Managers 418 Conclusion 419
