Comparative and cross cultural management Flashcards
Comparative and cross-cultural management (CCCM)
Studies differences in management styles and organizational approaches between countries
Contingency approach in organization theory
Characteristics of management and organization depend on task environment and related contingency factors
Contingency factors
Technology
Ennvironmental turbulence
Size of the organization
Contingency definition
A circumstance or condition that may or may not apply for some organizations
Two strategies for dealing with contingency fac tors in empirical research
Inclusion of control variables
Matching of samples
What is globalization
A qualitative shift towards a global economic system that is no longer based on autonomous national economies but on a consolidated global marketplace for production, distribution, and consumption
Forces promoting (further) globalization
Decrease of transportation costs
Decrease of communication costs
Integration international financial markets
Mass media, social media
International migration
Forces impending (further) globalization
Economic: lower company profits outside home market
Decreasing economic gains of trade liberalization
Overreliance on China, globally concentrated value chain
Social: unbalanced distribution of benefits
Cultural: Search for cultural authenticity
Political: Limits of democracy
Limits to globalization: Economic
When you start removing trade barriers, the wealth effect is relatively larger than distribution effect
Company level: Shift in emphasis from efficiency, productivity and just in time to resilience, robustness and slack
At country: Increasing desire to harbor integral supply chains
Wealth effect
people spend more as the value of their assets rise
Limits to globalization: social
High societal cost by pursuing economic comparative advantages
Lost jobs and employment opportunities
Social fragility
Frustration and anger of low-income populations
Limits to globalization: political
China as a potential spuerpower and the single biggest rival to the US
Rivalry in multiple areas of economics, politics, and security
Shift from deeper integration –> decoupling
Nationalistic/ populist sentiments and inward/domestic focut
Limits to globalization: Technology
Technological development as an additional factor leading to de-globalization
Digital technologies have made the share of labor cost in value added smaller
Less offshoring –> Re- or near-shoring
Four possible scenarios of globalization
1) Convergence
2) Specialization
3) Incremental adaptation
4) Hybridization
Scenarios of globalization: Convergence
The anglo-american version of capitalism will be adopted worldwide
But: Contradicted by successes of e.g. Japan, korea and china
Scenarios of globalization: Specialization
Conventionnal trade theory: Economies will have specialize in where they have a comparative advantage
But: A large proportion of trade is intra-industry trade
Scenarios of globalization: Incremental adaptation
Countries tend to evolve in the direction of the most efficient system and practices
However, cultures and institutions contrain countries and firms in this process
Scenarios of globalization: Hybridization
Parts of the economy/society become part of the global system
Other parts may remain largely unaffected:
E.g. Healthcare, education, personal services, construction
synthetic Definition of culture
Culture consists of patterns, explicit and implicit, of and for behavior acquired and transmitted by symbos, constituting the distinctive achievements of human groups, including their embodiments in artifacts; the essential core of culture consists of traditional ideas and especially their attached values
The concept of culture:
Human nature: universal and inherited
Culture: Specific to group and learned
Personality: Specific to individual, Inherited and learned
Values
Desirability (good vs. bad)
standards (wrong, justified, encouraged)
Important guiding principles
Beliefs
Ideas you hold to be true
Subjective probability of the causality
Maslows hierarchy of needs
Physiological, safety, love/belonging, esteem, self actualization
Dual processing theory
Humans process information in two distinct ways
Implicit system: Not conscious, automatic, fast, parallel processing, high capacity and effortless
Explicit system: conscious, controllable, relatively slow, sequential processing, limited capacity and effortful
Adaptation
Cultures are responses to environmental conditions and have “survival value”
Cultural change is a process of adaptation and natural selection
Culture change often begins with adaptation to changes in economic life
Differentiation
Human groups increase differences with other groups to mark in-group, out-group distinctions
Found in every culture
Homophily
The tendency of people with similar traits (including physical, cultural, and attitudinal characteristics) to interact with one another more than with people with dissimilar traits
Value homophily
Interacting with people with the similarity of thoughts
Status homophily
We feel more comfortable in interacting with people with similar social positions/conditions
Induced homophily
Interactions over time tend to make individuals more similar (“inbreeding” process)
Individual identity
What distinguishes me from others
Social identity
What do I have in common with specific others
Etic (“outsider”)
Statements refer to distinctions judged appropriate by the community of scientific observers
Emic (“insider”)
Statements refer to distinctions that are significant, meaningful, real, accurate, or in some other fashion regarded as appropriate by the actors themselves
The etic approach:
Choice patterns:
Individualistic (maximize tokens for self)
Competitive (maximize difference tokens for self and for other)
Equality (minimize difference tokens for self and for other)
The etic approach:
Differences found between cultures are typically significant, but small
E.g. the specific form of the alloccation preferences was partly dependent on cultural context
Criticism: just as much or more variance within cultures, than between cultures
six dimensions of hofstede cultural dimenstions
Individualism vs. collectivism
Power distance
Uncertainty avoidance
Masculinity vs. femininity
Long term vs. short term orientation
Indulgence vs restraint
Power distance
The extent to which the less powerful members of organizations and institutions accept and expect that power is distributed unequally
Individualism
Take care of yourself and your immediate family
Collectivism
Integration into strong, cohesive group for protection and loyalty
Uncertainty avoidance
A society’s tolerance for ambiguity; the extent to which members of a culture feel threatened by uncertain or unknown situations
Long term vs short term
Long term: Emphasis on future rewards, in particular perseverance and thrift
Short term: Emphasis on the past and the present; respectful for tradition, preservation of “face” and fulfilling social obligations
Indulgence vs restraint
Indulgence: Enjoying life and having fun
Restraint: Controls gratification of needs and regulates it by strict social norms
Shalom schwarts: theory of ten basic values
10 basic values across culture (universal) emerging in a certain pattern (structure of values)
Values form a circular structure that reflects the motivations each value expresses
Conflicts and compatibility among the 10 values
Stimulation, self-direction, universalism, benevolence, security, conformity, power, achievement and hedonism
Inglehart (WVS) Traditional
Societies that prefer to maintain traditions and norms
View societal change with suspicion
Attach much importance to religion and obedience in children
Inglehart (WVS) Secular-rational
Societies that take a more pragmatic approach
Efforts in modern education as a way to prepare for the future
Attach less importance to religion and obedience in children
Inglehart (WVS) Survival
Emphasis on economic and physical security
Linked with a relatively ethnocentric outlook and low levels of trust and tolerance
Inglehart (WVS) Self-expression
High priority to environmental protection
Growing tolerance of foreigners, gays and lesbians and gender equality
Rising demands for participation in decision making in economic and political life
High power distance
Importance and degree of centralization of power
Income inequality along the hierarchy
Status symbols and privelages
High uncertainty avoidance
Rules and procedures in organization
Formal organizational structure
Managers are expected to be specialists than generalists
Less inclined to job changes
Two main dimenstions of culture change (Inglehart and baker)
Traditional vs. rational-secular authority
Survival vs. self-expression
