Chapter - 3 Cross cultural Management

Dr. Shyamal Gomes

Part – 1: Concept of Culture: Introduction: According to Peter Drucker, if management is an organ of society, culture is its very nature. Therefore, for organizational excellence, management must take care of the sensitivities of social structure. This extends to setting of objectives, formulation and implementation of strategies, designing organization structure and communication or displaying type of leadership roles or reward systems. Human behaviour, in organizational settings in conditioned apart from other factors by societal and organizational culture which in turn influence all other areas of business processes like communication, decision making, negotiation and so on. The overwhelming success of Japanese companies in the eighties is primarily attributed to its unique national culture. In fact every national culture can contribute something unique to the field of management and business. Broadly if we see the interaction of learning within a society, thus produces in every human group of a body of socially transmitted behaviour, which appears super – individual, because it is shared, because it is perpetrated beyond the individual life span, and because in quantity and quality it so vastly exceeds the capacity of any single person to achieve by his own efforts. The term ‘Culture’ is applied to such systems of acquired and transmitted behaviour. Since cultures changes with the varying and cumulative experiences of individuals in social groups, it is possible to say of man , as of no other species, with the hereditary capacity to learn, that societies as well as individuals learn. Social learning is synonymous with cultural evolution. Now, what is Culture? Culture, is that complex of whole which includes knowledge, belief, art, morals, law, custom, and any other capabilities and habits acquired by man as a member of society. E. B. Tylor 1871 `The sum total of knowledge, attitudes and habitual behaviour patterns shared and transmitted by the members of a particular society' Ralph Linton (1940). The pattern of life within a community, the regularly recurring activities and material and social arrangements characteristic of a particular group'. Ward Goodenough (1957): “Culture is the framework of beliefs, expressive symbols, and values in terms of which individuals define their feelings and make their judgements” (Geertz 1957 American Anthropologist 59:32-54). `an historically transmitted pattern of meaning embodied in symbols, a system of inherited conceptions expressed in symbolic form by means which men communicate' (Geertz 1973: 89).

Culture is the configuration of learned behavior and result of behavior whose component elements are shared and transmitted among the members of a particular society. Harskovit.

Elements of Culture: Culture is Relative that guide the behavior of people in a society / community and that are passed on from one generation to the next. This simple meaning connotes the following core elements of culture:

• Culture has normative value. It prescribes Do’s and Don’ts which are binding on the members of a society.

• Culture is a group Phenomenon. • Cultural practices are passed on from generation to generation.

Example: Women in Indian Society wear ‘Kumkum’ on their foreheads because their parent told them to wear. The parents did the same because their parents had done so. However, important cultural elements are – Values, norms, attitudes, folkways and customs. Values, from the bedrock of a culture. They provide the context within which a society’s norms are established and justified. Behavior: Action and reaction in a particular situation. Belief: Acceptance with faith. Morale: Confidence, determination of a person or group. Moral: Concerned with goodness or badness of human characters or behavior. Customs: Usual behavior / particular established way of behaving Laws: Binding force / divine commandments. Norms: Customary Behavior. Norms are further subdivided into two major categories: Folkways and Mores. Generally, folkways are actions of little moral significance. Mores are norms that are seen as central to the functioning of a society and to its social life. They have much greater significance than folkways. For example, eating cow’s meat is viewed critically by Hindu Society. While drinking liquor is common in the US, the same is prohibited in Saudi Arabia and is a punishable offence

• Culture trait: are unique aspects of individual cultures. A cultural trait may be a custom such as men opening the door for women, a gesture such as ‘Nomaste’

• Acculturation: One culture dominates other’s trait that have been borrowed over the short term but prolonged and permanently adopted. For example - Mughal rule in India changed many customs of Hindu society.

• Diffusion: is the process through which culture change. Each society borrows cultural traits from others.

• Assimilation: Assimilation occurs when immigrants or others new comers adopt the culture of the society in which they have settled. This cultural borrowing is often one – sided. The assimilated minority group eventually loses the cultural traits that had set it apart.

• Culture Shock: Is what happens when a person suddenly find himself in a place where you may mean no, where a fixed price is negotiable, where to be kept waits in an outer office is no cause for insulting where laughter may significance. It is what happens when the familiar psychological clues that help can individual to function in society are suddenly withdrawn and replaced by new ones that are stranger or incomprehensible. Characteristics of Culture:

• Culture is learned • Culture is unconscious • Culture is shared • Culture is integrated • Culture is Symbolic • Culture is a way of life • Culture is Dynamic • Culture is Relative • Culture is universal

Determinants of Culture: National cultures are constantly evolving. Factors that influence the evolving pattern are prevailing political and economic systems, the social structure of the society, dominant religion, language, aesthetics and education.

Religion: may be defined as a system of shared beliefs and rituals that are concerned with the realm of the sacred. Most, ethical systems which guide and shape human behavior are the product of religion. Language: is an essential element of culture for it reflects its nature and riches. Communication goes beyond the formal written and oral structure of language. In business communication, the translation from one language to another can result in inaccuracies. Education: Learning and sharing through training or gradual observation and internalize is called education. Cultural values may transmit through the education. Political Philosophy: Local governance, established rules and regulations also actively participate for cultural practices.

• Democracy - Government by the people, exercised either directly or through elected representatives.

• Totalitarianism - Government in which one person or political party exercises absolute control over all spheres of human life and opposing political parties are prohibited.

Economic Philosophy: Economy is the backbone of the society and culture. Culture and economy is closely interrelated and force each other to take their own shape.

• Market Economy - All productive activities are privately owned • Command Economy- Goods and services produced, their quantity, and prices are

determined by the government • Mixed Economy - Parts of the economy are left to private ownership and free

market mechanisms while other sectors are state-owned and have government planning

Education

Economic Philosophy

Political Philosophy

Religion

Language

Social Structure

Culture: Norms and

Value Systems

• State-Directed Economy - The state plays a significant role through its “industrial policy” and setting national goals

Social Structure: A society’s social structure refers to its basic social organization. Although social structure consists of many aspects, for study of cultural differences, two aspects of it are more important. The first is the degree to which the basic unit of social organization is the individual, as opposed to the group. An individual is the basic unit in western societies and therefore, individual achievement gets primacy. In the other societies the group is the basic unit of social structure and an individual considers himself first as part of his family or the company for which he works. It is the degree of relative importance to individualism or group that differentiates different cultures. Part – II: HOW CULTURE AFFECTS THE MANAGEMENT APPROACHES? Obviously in IHRM country specific and organization specific culture requires careful attention of international HR Professional. Otherwise, may stand against effective management of international operations There are 4 level of culture:

• Dominant Culture: is pervasive and extends to the whole of a country – for example - Certain things are auspicious and some others are not so and this belief is shared by all Indians.

• Sub Culture: exists within the dominant culture. The cultural practices of Punjabies are different from those obtain in Karnataka.

• Organizational Culture: within dominant culture. Every organization will have its own distinct culture. The culture of TATA is different from that of INFOSYS while that of INFOSIS is not the same as that of WIPRO.

• Occupational Culture: Each profession carries its own culture and it cuts across dominant culture. An Account for example speaks the same financial language whether he or she is an Indian or an American. So is the case with a medical practitioner or an attorney.

Organizational CULTURE

• Culture is Group Phenomena and objective specific. • Now in competitive environment each and every organization possess a single objective/

Culture: Think globally, act globally and achieve globally.

Dominant Culture

Sub Culture

Organizational

Occupational

Any organization comprises the shared values, understanding, assumptions and specific Goals that are formed from earlier generation, imposed by present members of the organization and passed on succeeding generation. If it is learning part the shared outlook or results are: Common attitude – codes of conduct – expectation fulfillment .But these LB & RB subconsciously guide and control by certain NORMS OF BEHAVIOR i.e. Organizational Culture. Now what is management approaches? Integrally to manage these factors OR the way of managing those factors or ultimately to managing the norms of behavior for entire organization is called Management approaches. Therefore, Organizational Culture Or Culture directly linked with Management Approaches. There are many of examining cultural differences and their impact on international management. Culture can affect technology transfer, managerial attitudes, managerial ideology and business government relations. Perhaps most important is how culture affects people’s thinking and behavior. Following are the ways in which culture directly affects management.

• Centralised vs. decentralised decision making: some organizations have top down approach and some where it diffused through out the organization and middle and lower level actively participate in and make, key decisions. .

• Safety vs. risk: in some societies, organizational decision makers are risk aversive and have great difficulty with condition of uncertainty. In other societies risk-taking is encouraged, and decision making under uncertainty is common.

• Individual vs. group rewards: In some countries, personnel who do outstanding work are given individual rewards in the form of bonus and commissions. In other countries, cultural norms required for group rewards, and individual rewards are frowned upon.

• Informal vs formal procedures: In some societies much is achieved through informal means. In some other societies, formal procedures are set forth and followed rigidly.

• High vs. low organizational loyalty: In some societies, people identify very strongly with their organization or employer. In other societies, people identify with their occupational group such as that of engineers or doctors.

• Cooperation vs. competition: Some are interested for competition and some are encourage for cooperation.

• Short term vs. long term horizons: some nations focus mostly heavily on short term goals of profit and efficiency, some are more interested on long term goals such as market share and technology development.

• Stability vs. innovation: some cultures encourage stability and resistance to change, while others put high value on innovation and change.

For an example – Hewlett – Packard (HP) has successful to create a conscious corporate culture, which they called ‘The HP way’. HPs corporate culture is based on:

• Respect for others • A sense of one community. • Plain hard work and long term planning (Fortune Magazine, May 15, 1995)

This conscious culture they have developed and they are sustaining through extensive training of managers and all cross section of employees. To day HPs growth and success internationally may be traced to their conscious corporate culture. Advanced Micro Devices (AMD) is located in Dresden of East Germany and a composite of 3 cultures – American, West Germany and East German. The Americans are ‘Go Getter’, who believes in shooting first and aiming later. West Germans are analytical, thorough and correct, whereas the East Germans have mastered the art of innovation with limited resources. AMD became an ideal convergent point for Americans and rest Germans to make computer chips, after the Berlin wall fell. However, soon it became evident that culture clashes hindered success. Americans believed that everyone would want to follow their best practices and Germans found the American

patronizing. West Germans viewed the plant as an opportunity to help their East Germans brethren. East German felt that their unique talents for ingenious solutions were being ignored. These feelings were reflected everywhere even in the way meetings were conducted. American managers preferred freedom brainstorming sessions in English, where in ideas should be developed spontaneously. The Germans did not want to present their thoughts without any preparation. However, a formal reflective process took place between meetings and language barriers came down once members were given choice to present their ideas either in English or in Germany depending on his comfort level. In this dilemma process the Americans learnt the art of deliberation and the Germans Off – the – cuff. As a result, this multicultural style gave AMD the much needed competitive edge. AMD’s Dresden Factory broke production speed records, in less than to years and went through three generation of chip redesign without major errors in a year. Importance of Cultural Sensitivity Therefore, every international manager need to know about cultural differences among nations in order to be able to:

• Communicate effectively with customers, suppliers, business associates and partners in other countries and foreign employees (expatriates).

• Conduct negotiations and understand the nuances of the beginning postures of the other parties into a negotiation.

• Predict trends in social behavior likely to affect the firm’s foreign operations. • Understand the ethical standards and concepts of social responsibility in various

countries. • Build Foster relationships between union confederations and employee associations

require cultural empathy. • Understand local Government policies and influences it for business promotion. • Conduct efficient meetings in different countries and encourage employees participation

in management. • Understand how people interpret market research an other information.

Part – III: Cross cultural theories: Culture has been described as a set of beliefs, values, attitudes and behavior which community adopts , these values play a major role in affecting an individual motivations, expectation of work and group relations. These values in tern also exercise influence of organizational culture. Organizational culture varies one from another based on 4 factors:

• Organizational objectives and Goals. • Competitive Challenge • National variables and • Socio cultural variables like different religion, language, education etc.

Hence differences in the culture across nations become inevitable. The variation in these cultural components gives rise to a phenomenon known as Cultural Diversity. Cultural Diversity or Multiculturism plays a vital role or a significant role while understanding business operations internationally. Like:

Doing business in China 1. The focus of reform in China is primarily on the state owned enterprises (SOE). 2. The managers are official, not entrepreneurs, there is no real incentives for them. 3. Business meetings typically start with pleasantries such as tea and general

conversation about the guest’s trip to the country, local accommodations, and family.

4. The Chinese host will give the appropriate indication for when a meeting is to begin and when the meeting is over.

5. Once the Chinese decide who and what is best, they tend to stick with these decisions. Although slow in formulating a plan of action, once they get started, they make fairly good progress.

6. In negotiations, reciprocity is important. If the Chinese give concessions, they expect some in return.

7. Because negotiating can involve a loss of face, it is common to find Chinese carrying out the whole process through intermediaries.

8. During negotiations, it is important not to show excessive emotion of any kind. Anger or frustration is viewed as antisocial and unseemly (indecent).

9. Negotiations should be viewed with a long-term perspective. Those who will do best are the ones who realize they are investing in a long-term relationship.

Doing business in India

1. It is important to be on time for meetings. 2. Personal questions should not be asked unless the other individual is a friend or

close associate. 3. Titles are important, so people who are doctors or professors should be addressed

accordingly. 4. Public displays of affection are considered to be inappropriate, so one should

refrain from backslapping or touching others. 5. Beckoning is done with the palm turned down; pointing often is done with the

chin. 6. When eating or accepting things, use the right hand because the left is considered

to be unclean. 7. The namaste gesture can be used to greet people; it also is used to convey other

messages, including a signal that one has had enough food. 8. Bargaining for goods and services is common; this contrasts with Western

traditions, where bargaining might be considered rude or abrasive. Therefore, it becomes necessary for an International Management to understand these cultural difference across the globe and manage them effectively and efficiently. There are several social scientists and researchers who have tried to measures or develop cultural dimensions through which ‘Cultural Difference’ in different countries and part of the world can be assessed or understood. The widely accepted theoretical experts are: Geert Hofstede , Kluckhohn and Strodthbeck, Andress Laurrent, Hall and Trompenaars. Geert Hofstede: Dutch Scientist, has analyzed cultural dimension in IBM Employees (1,16,000) in 70 countries and in 3 regions like E. Africa, W .Africa and Saudi Arabia.

Managing international business means handling both national and organisation culture differences at the same time. "Organisation cultures are somewhat manageable while national cultures are given facts for management; common organisation cultures across borders are what keeps multinationals together. " Geert Hofstede defines "Culture as the collective programming of the mind which distinguishes the members of one human group from another". Basically Hofstede tried to eliminate the impact of changing organizational cultures and analyzed the influences of different national cultures. Hofstede provides a useful framework for understanding the workforce diversity. His main findings were:

• Work related value are not universal

• Underlying values persists when a multinational company tries to impose the same norms on all its foreign interests.

• Local value determine how the headquarters regulations are interpreted; • By implication, a multinational that tries to insist on uniformity is n danger of creating

morale problems and inefficiencies. In his research Hofstede examined four well known dimensions:

Power distance, a measure of the inequality between bosses and inferiors, extent to which this is accepted

Uncertainty Avoidance, the degree to which people feel threatened by ambiguous situations, and have created beliefs and institutions that try to avoid these

Individualism v. Collectivism, degree to which one thinks in terms of 'I' versus 'we, either ties between individuals are loose or people are part of cohesive in group throughout their lives

Masculinity – is defined by Hofstede as a situation in which the dominant values in society are success, money and things.

However, later a fifth has been added- Confucian Dynamism - the long or short term orientation of different cultures.

A. Power Distance: unequal power of distribution. It is the distance between individuals at different levels of hierarchy. Hofstede observed two types of distance:

1. High power distance 2. Low power distance

High Power distance Low power distance

Countries in which people blindly obey the orders of their superior, employees acknowledge the boss’s authority simply by respecting that individual’s formal position in the hierarchy, and they seldom bypass the chain of comand.

Countries which people (supervisors and sub ordinates) are apt to regard one another equal in power.

Results • Less Harmony and less cooperation • Centralized order • Autocratic Leadership • Taller Organization structure

• More harmony and cooperation. • Decentralized structure • Democratic leadership • Flatter organization structure

Maxico, South Korea and India. Austria, Esrael, USA, UK, Denmark B. Uncertainty Avoidance: This dimensions measures how far cultures prepare or socialize their members into accepting ambiguous situation and tolerating uncertainty about the future.

High uncertainty avoidance Low uncertainty avoidance Countries with a high level of uncertainty avoidance tend to have strict laws and procedures to which people adhere closely, and there is strong sense of nationalism. In a business context this value results in formal rules and procedures designed to provide more security and greater career stability

In countries with lower levels of uncertainty avoidance nationalism is less pronounced, and protests and other such activities are tolerated. As a consequence, company activities are less structured and less formal.

So

• Managers have propensity for low risk decisions,

• employees exhibit little aggressiveness • lifetime employment is common • Taller organization structure

• Managers take more risk, and there is high job mobility

• Peoples have risk taking attitude and high labour turnover.

• Flatter organizational structure

Japan, Israel, Austria, Pakistan India, USA, UK etc. C. Individualism: It is a tendency of people to look after themselves and their immediate families only. Hofstede measured these cultural differences on a bipolar continuum: Individualism and collectivism.

Individualism Collectivism Interest of Self and Family ‘I’ consciousness Independence of Individual from organization. Grater Individual Initiatives Promotions are based on Merit and performance

Interest of Group ‘We’ consciousness Dependency on organization Less Individual initiatives Promotions are seniority based

USA, UK, Australia Japan, Taiwan and Pakistan D. Masculinity: Hofstede measured this dimension on a continuum ranging from masculinity to femininity. Traditionally, ‘masculine’ values – assertiveness, materialism, aggressiveness and a lack of concern for others that prevail in society, femininity emphasizes feminine values – a concern for others, for relationships, nurturing, care for weak and for quality of life. The degree of masculinity affects in the following characteristics way:

High Masculinity Low Masculinity • Career is considered as most

important • Work needs take precedence • Individual decision-making is

emphasized • Achievement is given importance and

is defined in terms of money and recognition

• Importance is placed on cooperation and friendly atmosphere.

• Employee security gets precedence. • Group decision – making is

emphasized • Achievement is defined in terms of

human contacts and living environment

Countries with high masculinity – India, Japan, USA, UK etc.

Countries with low masculinity – Denmark, Norway, Sweden etc.

Therefore, it has seen that country wise cultural dimensions are different, say for example Japanese are less power distance but highly task oriented and with low tolerance for uncertainty Avoidance and low long term orientation. Similarly, USA having low power distance, high individualism, medium masculinity and uncertainty avoidance and low orientation. So, Hofstede’s different dimension of culture is very useful in helping to explain the differences between various countries. But Hofstede has gone beyond this to show how countries can be described in terms of pairs of dimension. Ronen and Shenkar classified countries into 8 clusters and 4 countries that are independent and do not fit any of the 8 clusters. Countries in the same cluster are culturally similar and countries in any given cluster closer to the centre are higher in gross national product. Not everyone agrees with the cluster distribution. Some researchers place India and Israel in the Anglo culture because of the strong Anglo ties of these countries.

Strength: Hofstede provides a framework for understanding cultural diversity across nations. An awareness of the differences on these important characteristics between cultures can help to develop a strategy for tackling them. Hofstede dimensions provides framework for prediction of many kinds of behavior in cross cultural organizational settings No other study compares may national cultures in so much in details, so far.

Weaknesses:

First, like all national cultural studies, it assumes that national territory and limits of culture correspond. It is not so in the case of smaller countries and in case of bigger countries there are sub – cultures.

LATIN AMERICA

Argentin

MexicChile

Peru

NORDI

FinlanDenmar

Sweden

NEAR EASTER

Turke

Greece Ira

ARAB

Oman

BahraiAbu-Dhabi

Saudi

GERMANI

AustriGerman

Switzerlan

FAR EASTER

MalaysiSingapor Hong Kong

PhilippineIndonesia

Taiwa

INDEPENDENIndiJapa

Israel Brazil

ANGL

United

CanadUnited

Ireland

South LATIN

EUROPEA

Franc

Belgiu

Italy Spain

A synthesis of country clusters by Ronen and Shankar

Second, Hofstede’s respondents worked within a single industry and a single multinational. Here the objection is that unskilled manual workers are not taken into account, who may form bulk of population of that country.

Third, some of the dimensions suggested overlap. For example, some traits of low power

distance are similar to the femininity dimension 2. Kluckhohn - Strodthbeck This theory is based on the ‘Patterns of behavior and thinking’ in different cultures. The researchers distinguish and compare cultures based on the following dimensions :

1. What is the nature of people – Good, evil or mixed 2. What is a person’s relationship to nature – Dominant, Harmony, subjugation. 3. What is a person’s relationship to – Hierarchical, collectivist or others?

Individualistic. 4. What is the modality of human activity? – Doing, being or containing 5. What is the temporal focus of human activity? Future, present or past. 6. What is the conception of Space? Private, public or mixed.

3. Halls and Halls in 1987 provided another basis for cross cultural classification. They divided the world into two cultures:

A) Low context Culture B) High context Culture

Members of high – context cultures depend heavily on the external environment, situation and non – verbal behavior in creating and interpreting communication. Members of this culture group learn to interpret the covert clues when they communicate – so much meaning is conveyed indirectly.

Examples – Arabic, Chinese and Japanese, where indirect style of communication and ability to understand the same is highly valued.

In low – context cultures like the US, Sweden, and Britain, the environment is les important, and non-verbal behavior is often ignored.

Therefore, communication has to be explicit and clear. A direct and blunt style is valued and ambiguity is disliked in managerial communication.

4. Trompennars: Trompennars, an europen researcher conducted an extensive research with 15000 managers from 28 countries , representing 47 national cultures. He describes cultural differences using seven dimensions ( the theory is therefore called as 7d cultural dimension model): Research produced five cultural dimensions that are based on relationship orientations and attitudes toward both time and the environment

Individualism vs. collectivism Universalism vs. particularism (rules) Neutral vs. affective (emotion) Specific vs. diffused involvement Achievement vs. ascription (status) Past, present and future orientation Internal vs. external control (nature)

Universalism vs. Particularism

Universalism - belief that ideas and practices can be applied everywhere in the world without modification

Focus on formal rules and rely on business contacts

Particularism - belief that circumstances dictate how ideas and practices should be applied and something cannot be done the same everywhere

Focus on relationships, working things out to suit the parties Individualism vs. Communitarianism

Individualism - people regard themselves as individuals Rely on individuals to make decisions

Communitarianism - people regard themselves as part of a group Seek consultation and mutual consent before making decisions

Neutral vs. Emotional Neutral - culture in which emotions are held in check

People try not to show their feelings Emotional - culture in which emotions are expressed openly and naturally

People smile, talk loudly, greet each other with enthusiasm

Specific vs. Diffuse Specific - culture in which individuals have a large public space they readily

share with others and a small private space they guard closely and share with only close friends and associates

People often are open and extroverted Work and private life are separate

Diffuse - culture in which both public and private space are similar in size and individuals guard their public space carefully, because entry into public space affords entry into private space as well

People often appear indirect and introverted, and work and private life often are closely linked

Achievement vs. Ascription

Achievement - culture in which people are accorded status based on how well they perform their functions

Ascription - culture in which status is attributed based on who or what a person is For example, status may be accorded on the basis of age, gender, or

social connections Time

Sequential approach to time - people do one thing at a time, keep appointments strictly, follow plans to the letter

Synchronous approach - people do more than one thing at a time, appointments are approximate

Environment

Inner-directed People believe in controlling environmental outcomes

Outer-directed People believe in allowing things to take their natural course

Cultural Patterns or Clusters Defined groups of countries that are similar to each other in terms of the five

dimensions and the orientations toward time and the environment 5. Andre Laurent’s study of culture Laurent was directed to bring into focus some of the implicit management and organizational assumptions that managers re known to have, it is not so much to explore national differences. Laurent analyzed the values of managers in nine European countries and the US in 1983 and 1989 in China, Indonesia and Japan. Laurent used four parameters:

Perceptions of the organizations

Authority systems Role formulation systems and Hierarchical systems

This research treated management as a process by which managers express their cultural values – like how far manager caries his / her status into the wider context outside the workplace Therefore, the international manager needs cross – cultural competence to manage multiculturalism. Cross cultural competence includes skills, awareness and Knowledge. In order to be culturally competent, an individual needs to:

1. Possess a strong personal identity 2. Have knowledge of and facility with the beliefs and values of the culture; 3. display sensitivity to the effective process of the culture. 4. Communicate clearly in the language of the given culture group. 5. Perform specially sanctioned behaviour. 6. Maintain active social relations within the cultural group 7. Negotiate the institutional structures of that culture.

Part – 4: Cross Cultural Communication: What is Communication?

Communication is a two way process of transferring meanings from senders to receivers for fulfilling the objectives.

Cross Culture communication:

Karlfried Knapp defines it as "'Intercultural communication,' can...be defined as the interpersonal interaction between members of different groups, which differ from each other in respect of the knowledge shared by their members and in respect of their linguistic forms of symbolic behaviour." Now, Successful International management always requires effective cross-cultural communication. Why? 1. In global businesses, activities such as leading, motivating, decision making, problem

solving, exchanging ideas and information depends on the ability of proper communication from one culture to another.

2. Mistakes in cross-cultural communication often go unnoticed by the communicators, but these mistakes have the potentials to cause damage to international relationships and negotiations.

3. Mistakes or misinterpretations of the subtle gestures of the hands, and face, the use of silence, what is said or not said, and the intricacies of dealing with age and status often provide PITFALLS for International Business.

Critical dimensions in Intercultural communication are:

1. Language and Culture 2. Difference between high and low context cultures 3. The use of interpreters and 4. non-verbal communication

If these are taken care of, inter-cultural communication could be effective. 1. Language and Culture:

Language is the foundation of every culture It is an abstract system of words ,their meanings and symbols related to all aspects of

culture Language includes speech, written characteristics, numerals, symbols and gestures The interrelationship between language and culture is very strong, since we think about

what we see and behave one another – it determines control patterns

M. Munter has identified 4 problems relating to language difficulties in Cross cultural communication

2. The world’s language can be classified, based on whether message conveyed is explicit or implicit – into two groups: high and low context languages: Languages in which people state things directly & explicitly are called low context.

Language in which people state things indirectly and implicitly are called high context

Easily understand and no need for Any interpret

Communication have multiple meanings, that can be interpret only by reading the situation in which they occurs

English, German, and Scandinavian are low context

Asian, Arabic, Japanese are high context

3. Use of interpreters: In cross cultural communication, use of a language foreign to both the parties, is common. The international managers are at an advantage if they speak more than one language fluently. US American speak only English, but their European counterparts are generally bilingual or even multilingual. Increasingly, companies are making use of the service of Interpreters in International negotiation. The interpreter’s role is to provide a simultaneous translation of a foreign language while a person speak. Use of Good INTERPRETERS:

Good interpreters are not only bilingual but also have the technical knowledge and vocabulary to deal with tech. details common in business transaction

To simplify the increasing diversity of languages in businesses, some MNCs use one language as corporate language, increasingly, this language is English, as it is first or second language in a majority of countries across globe.

However, to minimize this problem / barriers most of the MNCs go for ‘ local’. For example – TATA Motors ‘ Daewoo venture’ in Korea. We are heavily using locals in Daewoo and the few Indians we have put there are learning to speak Korean says Ms.Rosling the M.D .

5. Non verbal communication: It is easy to misinterpret the meaning of non verbal communication of another culture. Take example: - ‘Body Language’. In the US, when a manger keeps his or her feet on the desk, it means that the boss is relaxing and others can do the same. But such Gestures are frowned upon in Indian culture. Non Verbal communication includes:

Facial Gestures Voice Intonation Physical Distance Smile Batting of eyes & kiss, hand shakes Silence Medium touching:

In greetings one another, people may shake hands, embrace or kiss. In routine interaction, people may touch or put each other in a variety of ways. The type of touching deemed appropriate is deeply rooted in a societies cultural values. Russian men for example, often kiss other men. Outside their family as a form of greetings. Brazilian men hug in greetings.

Scratching the Head: In most western countries, scratching the head is interpreted as lack of understanding or non comprehension. To the Japanese, it indicates ANGER.

Eye contact: In western and Arab cultures, prolonged eye contact with a person is acceptable. In Japan, on the other hand, holding the gaze of another person is considered rude. The Japanese generally focus on a person’s neck of tie knot. Culture shock is a term used to describe the anxiety and feelings (of surprise, disorientation, confusion, etc.) felt when people have to operate within an entirely different cultural or social environment, such as a foreign country. It grows out of the difficulties in assimilating the new culture, causing difficulty in knowing what is appropriate and what is not. This is often combined with certain aspects of the new or different culture. The term was introduced for the first time in 1954 by Kalvero Oberg. Culture shock is a research area in intercultural communication. Phases of Culture Shock:

The "Honeymoon Phase" - During this period the differences between the old and new culture are seen in a romantic light, wonderful and new.

"Negotiation Phase" - After a few days, weeks, or months, minor differences between the old and new culture are resolved.

The "Everything is OK" phase - Again, after a few days, weeks, or months, one grows

accustomed to the new culture's differences and develops routines. By this point, one no longer reacts to the new culture positively or negatively, because it no longer feels like a new culture. One becomes concerned with basic living again, as one was in their original culture.

Reverse Culture Shock - Returning to one's home culture after growing accustomed to a

new one can produce the same effects as described above. The Culture Shock Pattern:

Why Culture Stress Occur? Your environment makes demands on you for which you have no ready-made response Your responses do not produce the required results

Sign of Culture Shock: Irritability, moodiness

Fluctuating appetite

Emotional State

Lo

Adjustmen

Time

Honeymoon Recovery

Reduced sex drive Disrupted sleep Homesickness Spending time alone Avoiding the locals Reading all day Boredom, low energy Confusion, anxiety Negativity, alienation Depression Physical illness Stereotyping

International Manners: Inter cultural communication/ Interaction / Negotiation is somehow control by international manners, these manners vary across the nations due to specific culture and value systems prevailing in respective countries. For example we see the manner differences in different continents:

Africa Present the card with right hand

Asia Offer the card with both hand and accept in the same way (China, Japan, South Korea, India)

Australia & New Zeeland

Not so Important for them

Europe Power breakfasts are become more popular (in France, Switzerland, England)

Middle East & Gulf Countries

Present Card with right hand with respect

Canada & USA It is acceptable to make a cold call ( calling a person without making an introduction or appointment

Business Card/ Business entertaining: Africa Be prepared for a large no. of people

Asia Decide before hand what tech. information they are willing to share and be sure everyone on your team knows

Australia & New Zeeland

To the point, specific and punctual

Europe Class conscious good manners are critical and ignorance is no excuse for bad manners

Middle East & Gulf Countries

Maintain Royalty and detail discussion, prefer local language or English

Canada & USA Meeting begin and end as scheduled. There is very little small talk at meetings

Topics to Avoid: Africa Refer to people as Africans not Blacks

Asia Both men and women should avoid ‘ Going Negative’ in their clothing choices.

Australia & New Zeeland

Over Introduction

Europe Never try to make a cold call to get an appointment, they don’t like to make business on phone/ call

Middle East & Gulf Countries

Other religion discussion, Political discussion

Canada & USA Unnecessary discussion and killing the time.

Gestures to Avoid: Africa In rural areas, avoid strong eye contact

Asia Avoid Eye contact and touching the body

Australia & New Zeeland

Red eyes

Europe Hate shaking leg with dirty shoes and dirty dress

Middle East & Gulf Countries

Do not walk in front of an Arab while he is praying and never step on a prayer met. Don’t hurry at the diner / lunch party, eat separately women and men at home.

Canada & USA Standing too close to a north American may be perceived as an invasion of one’s personal space

Corporate Gifts / Greetings: Africa A light warm handshake is acceptable form of greeting when anyone

meet and anyone leave

Asia Bow down to each other

Australia & New Zeeland

During parties, host will introduce to the other guests, do not expect gifts from foreigners doing business with them

Europe Shake hands with a firm grip when any one meet and anyone depart

Middle East & Gulf Countries

Gift should be presented publicly to the group after a deal is closed. In addition to hand shake , they may touch other arms & shoulder, and embrace when they are so close

Canada & USA Hand shake is a full – hand grip that is firm and warm with an understated downward snap

Meetings and presentations: Africa Be prepared for a large no. of people

Asia Decide before hand what tech. information they are willing to share and be sure everyone on your team knows

Australia & New Zeeland

To the point, specific and punctual

Europe Class conscious good manners are critical and ignorance is no excuse for bad manners

Middle East & Gulf Countries

Maintain Royalty and detail discussion, prefer local language or English

Canada & USA Meeting begin and end as scheduled. There is very little small talk at meetings