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The Global Context
LECTURE 5
Culture in a Global Context 2
• Appreciate the importance of International Orientation
• Gain an understanding of the dimensions of Culture
Lecture Objectives
International Orientation
The ‘mind set’ of a firm’s managers will determine the extent to which they Internationalize.
Perlmutter (1969)
• EPRG Framework– Ethnocentrism
– Polycentrism
– Regiocentrism
– Geocentrism
International Orientation
• ETHNOCENTRISIM
(home-country orientation)– the foreign market is seen as a place to
dispose of excess output
– the foreign environment and its opportunities are seen as no different from those of the domestic market
International Orientation
• POLYCENTRISIM
(host-country orientation)– every market where it operates is treated as if it
were unique
– the product is modified to suit the local market
– every market will have its own marketing strategy
International Orientation
• REGIOCENTRISIM
(regional orientation)– management views regions as unique and seeks to
develop an integrated regional strategy
– sees similarities and differences in a world of regions
– is ethnocentric or polycentric in its view of the rest of the world
International Orientation
• GEOCENTRISIM
(world orientation)– the firm will attempt to develop uniform global
strategies
– the firm identifies homogeneous international demand segments that can be targeted with a standard product
International Orientation
Hofstede’s 5 Dimensions Model
• Power Distance (PDI)
The extent to which the less powerful members of society accept that power is distributed unequally
Hofstede’s 5 Dimensions Model
• Individualism (IDV)
Individualism : people look after themselves and their immediate family only.
Collectivism : people belong to in-groups (families, clans, organizations) who look after them in exchange for loyalty.
Hofstede’s 5 Dimensions Model
• Uncertainty Avoidance (UAI)The extent to which people feel threatened by uncertainty and ambiguity and try to avoid these situations.
Hofstede’s 5 Dimensions Model
• Masculinity (MAS)
Masculinity : the dominant values in society are achievement and success.
Femininity : the dominant values in society are caring for others and quality of life.
Hofstede’s 5 Dimensions Model
• Confucian Dynamism (CDI)
The extent to which a society exhibits a pragmatic future-orientated perspective rather than a conventional historic or short-term point of view.
Country Comparisons
Cultural Diversity
• Why People/Organizations Fail– Ethnocentric Orientation
– Ignorance
– Arrogance
– Time Factor
Cultural Diversity
• Success Factors– Geocentric Orientation
– Respect
– Learning
– Language
– Personal Attitude : Humility & Pride
– Personal Qualities : Adaptability & Flexibility
Cultural Diversity
• How to be Successful– Study and Preparation
– Awareness of Cultural Differences
– Commitment to Learn
– Do the Work
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