Global Business Today

7e

by Charles W.L. Hill

McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter 3

Differences
in Culture

3-2
 What is Culture?

Question: What is culture?

Answer:
 Culture is a system of values (abstract ideas about what
a group believes to be good, right, and desirable) and
norms (the social rules and guidelines that prescribe
appropriate behavior in particular situations) that are
shared among a group of people and that when taken
together constitute a design for living

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 The culture (from the Latin cultura stemming from colere,
meaning “to cultivate”) is a term that has different
meanings. It can be defined as the socialization process,
in reference to the friends, the education of parents…etc
who play a veritable role in the people life. The approach
can have different interests (geographic, psychology,
sociologic…).
 The key elements of culture for the business world are:
the language, the religion, the values, the customs and
the history and each of them are important.

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 The major elements of culture are
 The language
 The language is one of most important key to understand a
culture. There are over 3,000 languages and as many as
10,000 dialects worldwide. For that reason, English
language is chosen as the business language and as an
official language to communicate between societies.
Countries differ in terms of language or means of
communication
 There are two forms language
spoken
unspoken
 Language is one of the defining characteristics of culture

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 Spoken language
 Countries with more than one spoken language often
have more than one culture
Chinese is the mother tongue of the largest number of
people in the world
English is the most widely spoken language in the
world, and is becoming the language of international
business
 However, knowledge of the local language is beneficial,
and in some cases, critical for business success

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 Unspoken language
 Unspoken language - nonverbal cues
examples include facial expressions and hand
gestures
can be important for communication
 Many nonverbal cues are culturally bound and because
they may be interpreted differently, can result in
misunderstandings

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 education
Education takes a significant part in our life as it
transmits any principles, attitudes and skills, either at
children or people. From generation in generation, the
customs and manner are transmitted from father to son.
Education gives us the knowledge of the environment
that surrounds us. It gives us a perspective of looking at
life. Education is the basis of culture and civilization. It is
instrumental in the development of our values and
virtues. Education cultivates us into mature individuals,
individuals capable of planning for our futures and taking
the right decisions.
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 Formal education is the medium through which
individuals learn many of the language, conceptual, and
mathematical skills that are indispensable in a modern
society
 The knowledge base, training, and educational
opportunities available to a country's citizens can also
give it a competitive advantage in the market and make it
a more or less attractive place for expanding business
 The general education level of a country is a good
indicator of the types of products that might sell in that
location or the type of promotional materials that might
be successful

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 religion
 Religion can have an impact on international business
through influencing a culture’s values and attitudes
toward entrepreneurship, consumption and social
organization. The impact will vary depending on the
strength of the dominant religious tenets. International
managers must be aware of the differences among
religions. …
 Religions with the greatest following are
Christianity (1.7 billion adherents)
Islam (1 billion adherents)
Hinduism (750 million adherents)
Buddhism (350 million adherents)
Confucianism also influences behavior and shapes 3-10
Religious and Ethical Systems
Map 3.1: Dominant Religions

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The religion with the largest following in the world is
a) Christianity
b) Islam
c) Hinduism
d) Buddhism

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 Christianity

 Christianity is the most widely practiced religion

common throughout Europe, the Americas, and other
countries settled by Europeans

Question: What are the economic implications of

Christianity?

Answer:
 In 1904, Max Weber suggested that it was the Protestant
work ethic (focus on hard work, wealth creation, and
frugality) that was the driving force of capitalism

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 Islam

 Islam is an all-embracing way of life that governs one's

being
Muslims believe that there is one true omnipotent
God
Question: What is Islamic fundamentalism?
Answer:
 Islamic fundamentalism is associated in the Western
media with militants, terrorists, and violent upheavals,
the vast majority of Muslims claim that Islam teaches
peace, justice, and tolerance
fundamentalists have gained political power in many
Muslim countries, and have tried to make Islamic law
the law of the land

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 Islam

Question: What are the economic implications of Islam?

Answer:
 Under Islam, people do not own property, but only act as
stewards for God and thus must take care of that which
they have been entrusted with
Islam is supportive of business, but the way business
is practiced is prescribed
businesses that are perceived to be making a profit
through the exploitation of others, by deception, or by
breaking contractual obligations are unwelcome

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 Hinduism

 Hinduism - focuses on the importance of achieving

spiritual growth and development, which may require
material and physical self-denial
practiced primarily on the Indian sub-continent

Question: What are the economic implications of

Hinduism?
Answer:
 Hindus are valued by their spiritual rather than material
achievements
 Promotion and adding new responsibilities may not be
the goal of an employee, or may be infeasible due to the
employee's caste

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 Buddhism

 Buddhists - stress spiritual growth and the afterlife,

rather than achievement while in this world
found mainly in Central and Southeast Asia, China,
Korea, and Japan

Question: What are the economic implications of

Buddhism?
Answer:
 Buddhism does not support the caste system, so
individuals do have some mobility and can work with
individuals from different classes
entrepreneurial activity is acceptable

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 The values and attitudes

 Culture also affects and reflects the values and attitudes of

members of society.
 The values and attitudes are convictions that people have
regarding what is good and bad, right and wrong, important and
unimportant. Values influence culture, for example, Russians
believe that McDonald’s cuisine is superior to their own; that is
a value judgment. Similarly, France champagne manufacturers
know that US customers believe France Champagne products
are of high quality (value).
 The manners and customs
 The customs are common; dictate how things are to be done.
For example, in Arab countries, it is considered bad manners to
attempt to shake hands with a person of higher authority unless
this individual makes the first gesture. 3-18
 Contin……
 Michelle Obama, wife of U.S. President Barack Obama,
puts her arm around Britain’s Queen Elizabeth II at the
reception at Palace in London. Whereas, a protocol
dictates that touching the Queen of England is a big no-
no.
 Finally, Customs also dictate the way companies
advertise and market their products, for example, in the
US, orange juice is considered as a breakfast drink, but
in France, it is sold as refreshment because the French
don’t drink orange juice with breakfast.
.

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 The law and politic

 The law and politic

 In many countries, laws are considered like powerful and
the countries’ policy must be adapted, but however the
change of laws is evidence because the world changes
all the times.
 The technology and material culture
 The material culture results from technology and shows
how a society can organize its economic activity. Internet
is a very useful tool which permits to transmit a lot of
information as cultural information for example. It’s a
tool, which is used to facilitate the exchange of ideas,
data…etc. In fact, individuals can explore new cultures
through the use of internet without leaving their house. 3-20