2020-01-15
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Managing a truly global multinational company would obviously be much simpler if it required only one set of corporate objectives, goals, policies, practices, products and services. But local differences often make this impossible. The conflict between globalization and localization has led to the invention of the word ‘glocalization’. Companies that want to be successful in foreign markets have to be aware of the local cultural characteristics that affect the way business is done.
A fairly obvious cultural divide is the one between, on the one hand, the countries of North America and north-west Europe, where management is largely based on analysis, rationality, logic and systems, and, on the other hand, the Latin cultures of southern Europe and South America, where personal relations, intuition, emotion and sensitivity are of much greater importance.
The largely Protestant countries on both sides of North Atlantic (Canada, the USA, Britain, the Netherlands, Germany, Scandinavia) are essentially individualist. In such cultures, status has to be achieved. You don’t automatically respect people just because they’ve been in a company for 30 years. A young dynamic, aggressive manager with an MBA (a Master in Business Administration degree) can quickly rise in the hierarchy.
In most Latin and Asian cultures, on the contrary, status is automatically accorded to the boss, who is more likely to be in his fifties or sixties than in the thirties. This particularly true in Japan, where companies traditionally have a policy of promotion by seniority. A Japanese would also want to take the time to get to know the person with whom he was negotiating, and would not appreciate an assertive American who wanted to sign a deal immediately and take the next plane home.
In northern cultures, the principle of pay-for-performance often successfully motivates people. The more you sell, the more you get paid. But the principle might well be resisted in more collectivist cultures, and in countries where rewards and promotion are expected to come with age and experience.
Singaporean and Indonesian manager objected that pay-for-performance caused salesmen to pressure customers into buying products they didn’t really need, which was not only bad for long term business relation, but quite simply unfair and ethically wrong.
Another example of an American idea that doesn’t work well in Latin countries is matrix management. The task-oriented logic of matrix management conflicts with the principle of loyalty to the all-important line superior, the functional boss. You can’t have two bosses any more than you can have two fathers. For example, French managers would rather see an organization die than tolerate a system in which a few subordinates have to report to two bosses.
Speaking about people’s relationships with their boss and their colleagues and friends, we can distinguish between ‘universalists’ and ‘particularists’. The former believe that rules are extremely important; the latter believe that personal relationships and friendships should take precedence. Consequently, each group thinks that the other is corrupt. Universalists say that particularists ‘cannot be trusted because they will always help their friends’, while the second group says of the first ‘you cannot trust the; they would not even help a friend’. There are many more particularists in Latin and Asian countries than in Australia, the USA, Canada, or north-west Europe.
Text 3. Culture clashes.
In Asian countries most of decision-making takes place behind the scenes. In China it may be necessary to have government involved in any decisions taken. And in India people are sometimes late for a scheduled appointment.
Greetings, gestures and terms of address are all potential hazards when meeting people of other cultures.. While we are familiar with short firm handshake in this part of the world, in the Middle East the hand is held in a loose grip for a longer time. In Islamic cultures, showing the soles of your feet is a sign of disrespect and crossing your leg is seen as offensive.
The difference between understanding a culture and ignoring its conventions can be the measure of success or failure abroad. In Western cultures we believe in empowering people and rewarding them for using initiative, but other cultures operate on the basis of obeying direct orders.
You can easily talk yourself into trouble at a business meeting in Japan. For them the most senior person at the meeting will say very little, and the person doing most of the talking is not very important. In a country like Japan, the notion of personal space which we value so much simply has no meaning. With a population of 125 million condensed into a narrow strip of land private space for the Japanese is virtually non-existent.
‘Do and Don’t’ while you are on a business abroad
Do: - show an interest in, and at least an elementary knowledge of the country you are visiting.
- Learn a few words of the language – it will be seen as a compliment.
- Be sensitive to countries who have bigger and better-known neighbours, and try not to confuse Canadians with Americans, New Zealanders with Australians, Belgians with French.
- Familiarize yourself with the basic of business and social etiquette. As a starting point, learning how to greet people is very important.
Don’t:
- Assume you won’t meet any communication problems because you speak English. You may think you are paying somebody a compliment by telling them their business is going a bomb. Americans will conclude you think it is failing.
- Appear too reserved. As Americans are generally more full cheerful than their European colleagues, they may equate reserve with lack of enthusiasm.
