Module 4 Flashcards
Define Convergence
The Convergence hypothesis argues that businesses in the same sector in all countries are converging on similar types of technology, strategies, products and forms of business organization
Implications of Convergence for managers
1- Enables economies of scale by allowing manufacturing and services to be located anywhere thanks to the creation of global technologies, products and practices
2- Managers and other staff of Multinationals can be moved around the firm without necessarily modifiying its practices
3- Ideas and techniques developed in one cultural or natioal setting may (not always) be transferred to another and used effectively
Define Culture
Culture represents all human activity that is socially transmitted.
Includes:
- Norms
- Values
- Symbols
- Beliefs
These manifest in behavior, practices and institutions
How does Culture interact with business?
3 Ways:
1- Socialization
the influences which shape our behavior in a particular social setting, determine our individual orientations to work.
2- Organizations have their own internal culture
3- Cultures serves to distinguis one society/organization from another
Describe High Context and Low Context Cultures (Edward Hall)
HIGH CONTEXT
- Rely on shared understanding and relationships to communicate
- Long-tern relationships are more important than just the content of a message
- Trust is key in agreements (slower negotiations)
-Words might have different of hidden/deeper meanings
LOW CONTEXT
- Communication focuses on being clear and precise (context > relationship)
- Agreemtns based on formal contracts (formality > trust)
- Messages are straight forward, leaving little room for interpretation
What are the 6 dimensions of Culture (Hofstede)
1- Power distance
2- Individualism VS Collectivism
3- Uncertainty Avoidance
4- Masculinity VS Femininity
5- Long-term VS Short-Term Orientation
6- Indulgence VS Restrain
What are the 7 dimensions of cultural differences (Trompenaars)
Cultural differences are established in the way we relate to other, out behavior over time and our attitudes in relation to the environment
7 Dimensions:
1- Universalism VS Particulatism
2- Specific VS Diffuse Cultures
3- Achievement VS Ascription Cultures
4- Individualism VS Communitarianism
5- Affective VS Neutral Cultures
6- Time as a sequence VS as Syncrhonization
7- Inner-directed VS Outer-directed
What are the 2 main dimensions of cultural variations?
Traditional VS Secular Rational
Survival VS Self-expression
Implications of Cultural diversity for managers
1- Ideas taken from one cultural setting may not work in another if the idea has roots in a particular set of cultural values of the country of origin
2- Managers must recognizr that cultural differences exist and need to adjust their behaviour accordingly
3- Policies for MNEs may need to vary across different countries
4- Managers should ne aware of the influence of culture on products, services and marketing
Describe the National Business Model of Whitley
Comprises economic actors and mechanisms for integration
Actors:
- Prodiders and users of capital (e.g. Banks and Firms)
- Customers and suppliers
- Direct Competitors
- Indirect competitors
- Employees
the different types of business systems (6) emerge from differences in relationship between actors and in the model of integration
Describe the main features of the Anglo-Saxon Capitalism Model
(“laissez-faire” or “competitive managerial capitalism”)
Main Features:
- Competitive opern markets
- Private property is important
- Shareholders most important stakeholder
- Systems characterized by many mergers and takeovers (often hostile)
- Trade unions tolerated by restricted by law
Describe the main features of the Social Market Capitalism Model and its variations
(“German model” or “Rhineland model”)
Main Features:
- Some governemnt intervention on markets
- Private and State ownership coexist
- Well-Founded state controlled welfare systems
-Market and firms regulated by law and bureaucracy
-Shareholders = any other stakeholder
-Corporate focus on its responsability towards society
-Stable markets (less takeovers)
-National companies exist and are protected by the state
-Reinvestment is favoured over high dividends - Trade unions have an important role in decision-making
- Less flexible labour markets
Variations of this model:
1- Social Democratic (scandinavia)
2- Continental European (gemany)
3- Mediterranean (Italy)
Describe the main features of the Asian Model
(“Japanese Model” , “Alliance Capitalism”, “community capitalism”)
Main Features:
- Strong state involvement in the market where necessary
- Confucian Values are rooted in practices and working-life (discipline, hard-work, harmony, saving attachment)
-Weak Social welfare systems
-Development of strong corporate cultures
-Stable stock markets
-Managers tend to pursue long-erm strayegies and goal
-weak trade unions controlled by the states
