ryla leadership. rotary.june28,2005
DESCRIPTION
Presented to RYLA Rotary Leadership Program in Rochester, New York. June 28, 2005TRANSCRIPT
ManagingCultural Diversity in Global Business
RYLA Program at RITPresented by
Nat YogachandraJune 28, 2005
AMECO Petroleum
Partial list of companies/
brands owned by
foreign companies
What is the Nationality
What is the Nationality
Headquartered in Japan
Controlled by Renault (partly owned by the French government
In Mississippi, it’s a domestic car
What is the Nationality
What is the Nationality
Symbol of British Empire
Built by Germans - BMW
What is the Nationality
Swedish brand
Owned by Americans
What is the Nationality
Symbol of British Empire
Owned by Americans
Swedish brand
Subsidiary of General motors
Manufactured in Mexico
Owned by the Germans
PT Cruiser – More German or Mexican than American
A WORLDLY PLANE
Fischer (Austria)
InteriorAlenia (Italy)
Fuselage
Allied Signal (U.S.) Environmental Controls
Halla Heavy Industries (Korea)
Wing
Allied Signal (U.S.)
Customer Avionics
Honeywell (U.S.)
Avionics
Korean Aerospace (Korea)Nose
Israel Aircraft (Israel)Landing gear
BMW/Rollsroyce (Britain)
Engines
APIC (France)
Auxiliary power
ShinMaywa Industries (Japan) Horizontal Tail
One- half of McDonnell Douglas Corp,’s MD-95 was built overseas
1997 – McDonnell merged with Boeing and renamed to 717
Foreign Companies Have Control of
Nearly all the U.S. electronics industry Nearly all of the photo imaging industry Majority of the U.S. book/magazine publishing Almost half of the U.S. major motion picture studios One of the Big 3 auto manufacturers Majority of the U.S. tire manufacturers Large segment s of the U.S. food distribution
Toy Industry in the U.S.Labeled American-made, but racks, tiles and letter bags are made in China
American Icons
One after another …. Made in China
Timer – Made in Taiwan
Playing pieces and Dice – made in Britain
Rest made in America
Bath tub finger paints are made in China
But, bath tub tints – fizzy water color tablets are made in the U.S.A.
Swan Lake Barbie and Happy Birthday Barbie are made in Indonesia
The plastic Volvo that carries her and friends are made in China
Customer Services moving overseas
Customer services are moving to India, Philippines, China, Mexico, and Ireland.
GE customer services calls - answered by Indians from a small village closer to Mumbai in India (also Nike, AMEX, BA)
GE Capital saves up to $340 million a year by moving tasks to India
Toshiba – call center is in Istanbul
Average software engineer salary in U.S. = $75,000India = $10,000 …. China = $15,000 - $20,000
India Woos Medical Tourists
Private heart surgery in England is $50,000
The same cost applies to joint replacement, neurosurgery and cancer treatment
The Maharashtra State government is now working with British Medical Services
A clinic recently opened in Mumbai
Salary Structure
Country Cost per YearIndia $8,000Canada $36,000Ireland $28,000China $ 9,600Israel $25,000Philippines $ 7,000Eastern Europe $ 7,000Russia $ 7,000Mexico $ 7,000South Africa $18,000
India versus the World
IT Employee Cost per Year
Global Business
Capital raised in London in the Eurodollar market by a New York-based corporation may finance the acquisition of heavy machinery plant located in China
Global Business
A management team from a local firm in Rochester may take over a French-built automotive machinery plant in Indonesia
Global Business
A German is appointed President of a major American Corporation in Rochester, while an American is appointed head of a Swiss bank
Business Today Business are operated across
cultures today
Definition of success now travel beyond national boundaries
Business Today Growing importance of business
creates a demand for managers, who are: Sophisticated in international
management Skilled at working with people from
other countries Emphasize on cross cultural
management
Culture
Culture is a complex concept with many different definitions.
o Cultured is the learned and shared values, beliefs and behaviors of a group of interacting people
o It is NOT innate – we are not born with a culture
Culture has an influence on… Communications styles (Yes or No) Resolving conflicts How supervisors and subordinates are
perceived After work socialization Negotiation style Decision making
Managing our business…..
CultureSub-cultures:
Based on race, class or geographic location
United StatesJapanese youthAristocrats in BritainIndiaChina
Sub culture is NOT inferiorRegard all equally
Culture is like an Iceberg
ThoughtsReligious BeliefsTraditionsFundamental ValuesConfidence – BuildingViews of Life and Prejudices
Language, food , dress, manners and ext. appearance
Pattern of workDecision making paceSocial role and statusBody languageIndividual and group rolesDealing with conflicts
First Impressions
10% above surface
90 % below surface
Stereotypes
Journey of Self/Discovery
Visible Aspects
Invisible Aspects
Four Dimensions of Cultural Distance
Individualism and Collectivism
Power Distance High and Low Context Universalistic and
Particularistic
Individualism vs. Collectivism
More self-centered/emphasize on individual goals Prefer clarity in their communications-
effectively as opposed to a group Individual responsible for own actions
Name a few countries
Individualism
Individualism vs. Collectivism
More self-centered/emphasize on individual goals Prefer clarity in their communications-
effectively as opposed to a group Individual responsible for own actions
USA, Western Europe cultures
Individualism
Individualism vs. Collectivism
Have great emphasis on groups and think more in terms of “WE,” against “I”
Harmony and loyalty within the team Japan - The nail that sticks up gets
hammered down Employee loyalty is more important than
efficiency
Name a few countries
Collectivism
Individualism vs. Collectivism
Have great emphasis on groups and think more in terms of “WE,” against “I”
Harmony and loyalty within the team Japan - The nail that sticks up gets
hammered down Employee loyalty is more important than
efficiency – Arabs E.g.: Japan, China, ASEAN, Greece, Italy,
Mexico, Brazil, Middle Eastern
Collectivism
Power Distance
High Power Distance
Low Power Distance
Power High Power Distance
Hierarchy is important for success
“Expert Role’”- the boss is always correct and clearly has authority over subordinates
Subordinates rarely consider by passing the boss
China, Russia, Mexico, Hong Kong, India, Korea, Indonesia
Power Distance Low Power Distance
Hierarchy is less important
Employees expect to bypass the boss frequently in order to get their work done
Belief in flat, less hierarchical organizations with clear roles
USA, Germany, Netherlands, Denmark, Norway, Australia, New Zealand
Hierarchy in KoreaExtremely hierarchical and status-oriented
Each class has a set of prescribed rules that dictate behavior and protocol.
Follow the rules pertaining to their class
Parent to child
Male to female
Elder to youngster
Teacher to student
Boss to subordinate
Customer to vendor
Hierarchy in Korea
Chairman: hwoichang
President: sachang
Vice president: busachang
Executive director: jornmu
Managing director: sangmu
Director: eesah
Department manager: puchang
Deputy department manager: chachang
Section chief: kwachang
Deputy section chief: daerhee
Chief clerk/supervisor: kaychang
Businessmen
are sensitive to
titles
Korea: Goodbye to Confucius
A woman must obey her father before marriageObey her husband during her married lifeObey her eldest son after the death of her husband
- Confucius
High Context Culture
Emphasize non-verbal communications Verbal message will be less direct
(also emphasize on social relationships)
Arab countries, Southern Europe (Italy, Greece) and South America, Japan
Low Context Culture
Place more emphasis/more direct on the message
What you say is more important than how you say it.
Britain, America and Western
Rules and relationships
Laws are written for everyone and must be upheld by all
• Legal or illegal takes precedence over personalities involved in the situation.
• Rely on extensive contracts to conduct business
USA, Canada, Western Europe,
Universalistic Society
Rules and relationships • It makes a big difference if someone is a
friend or relative• Use much looser agreement and rely on
the strength of their personal relationship to maintain the commitment
• View detail contracts (e.g.) penalty clauses as a sign that they are not trusted and therefore no relationship
South Korea, China, Mexico, Russia, Indonesia
Particularistic Society
Cross-Cultural Judgment
Cross-culturally we use our own culture as a standard of measurement:
A Swiss executive waits more than an hour past the appointment time for his Spanish colleague to arrive and to sign a supply contract
In his impatience he concludes that Spaniards must be lazy and totally unconcerned about business
The Swiss executive has misevaluated his colleague by negatively comparing him to his own cultural standards for business punctuality
Implicitly, he has labeled his own culture’s behavior as good and the Spanish do not arrive on time and that is bad”)
Japanese as seen by others
They deafen you with silence Reality. True. Silence show respect for the
speaker. They often look glum
Reality. Happiness hides behind a straight face They say YES when they mean NO
Reality. They do not like to offend you by showing open disagreement or refusal
They never look you right in the eye Reality. They are taught that it is rude to stare
When they smile, they do not look sincere Reality. They often smile to make you feel
comfortable – one should be thankful
Appearance Vs Reality
Aspect Mexico United StatesWork/Leisure
Loyalty
Staffing
Competition
Time
Family
Personal Appearance
Status
Ethics
Works to live. Leisure considered essential for full life
Mostly loyal to superior (person than organization)
Family and friends are preferred due to trustworthiness. Promotions based on loyalty to superior
Lives to work. Leisure seen as reward for hard work
Mainly self-loyalty. Performance motivated by ambition
Relatives usually barred. No nepotism here. Promotions based on performance
Avoids personal competition. Favors harmony at work
Enjoys proving self in competitive situations
Relative concept. Deadlines flexible Literal imperative. Deadlines and commitments are firm
Family is the first priority. Children are celebrated and sheltered. Wife fulfills domestic role
Family is usually second to work. Children often minimally parented; are independent. Wife often fulfills dual roles
Dress and grooming are status symbols Appearance is secondary to performance
Title and position more important than money in eyes of society
Truth is tempered by need for diplomacy. Truth is a relative concept
Money is main status measure and is reward for achievement
Direct Yes/No answers given and expected. Truth seen as absolute value
Differences : American - Mexican
Differences: Germany - Asia The highest ranking or eldest person
usually enters the room first.
Generally, prefers 3rd party intro.
More physical space between each person Versus Asians, Americans or Europeans
Expect to plunge straight into matters without any jokes, humor, small talk or sharing photo of the kids
Tend to separate their private and professional lives (unlike Americans)
Nonconfrontational. Good strategy is not to “trash” the competition
Tasks First, Friendship later Hard negotiators. Discussion is likely to be
to the point
True in most Asian countries (Japan, Korea, Thailand) It’s always the senior person begin and lead the conversation
True in some NE Asian countries
Some physical space
Have tea, share jokes, talk about family and favorite sports before and after meetings
Spend lots of time getting to know each other and build trust during meetings and after meetings
Friendship First, Tasks Later
Hard negotiators. Have lots of patience
Sending advanced presentation materials help the Asians
Not deadly serious
Germany Asia
Other Cultural Aspects Importance of Face
Direct criticism Use a third party to convey
your message
Avoiding Eye Contact Touching the head of a Thai
secretary Yes and No Language of time
Delay means – not interested or low priority (West) Low-level officials elevate the prestige of their work
by taking long time to complete a work (East)
Eye Contact
In cultures, where power distance is high, the speakers will maintain close eye contact when delivering messages. Implies dominance and one’s personal position ( Spain, Greece and Arab countries)
Latino culture- staring means dissatisfaction and anger or romantic interest
Japanese non-verbal message Smile does not necessarily indicate agreement. It may
reflect sorrow or embarrassment for you or for them If a foreigner insists on request a yes or no answer, they
will usually smile Sighing means relief in Japanese culture Removing glasses or stretching ears indicates confusion Crossed arms means possible refusal, disagreement or
wonder If a Japanese sucks air through his teeth, it is a non verbal
sign that he has a problem Direct eye contact is impolite When a Japanese pat their head they are disappointed
or don’t understand Remaining silent means they are thinking or simply have
nothing to discuss. BUT, DO NOT put your cards on the table right away
Distance Between People
According to a study of space in communications across cultures
Conversation distances U.S. and European 18” to 30” Latin American/Caribbean 8” to 18” Saudi 9” to 10”
Leads to stereotypes….
TOUCHING
Greeting: European American men: shake hands with
little touching there-after Jamaican, Latino men, Caribbean:
Hugging, slapping backs, body contact. Sometimes grabbing the arm for a few seconds
European Americans feel that Latinos touch to a degree that is uncomfortable, threatening and oftentimes insulting to European Americans . May be perceived flirting or sexual harassment
TOUCHED BY an Alien
Canadian PM, Jean Chretian and President Mubarak
Crown Prince Abdullah and President Bush
May be YES or NO - Philippines
Filipino “yes” puzzles most foreigners.
A YES could mean
Just that or it could also mean May be” or I do not know or If it will please you
Filipinos generally say what other person wants to hear
May be YES or NO - Indonesia
Impolite to say NO in Indonesia
YES means sometimes “I mean NO”
May be YES or NO - Mexico
Mexicans avoid saying “NO”
“May be” or “We will see” may actually mean ‘NO”
May be YES or NO
When a Saudi says “yes’ itusually means “possibly”
May be YES or NO - India
The word “NO” has harsh implications
Evasive refusals are more common, and are considered more polite
May be YES or NO - China
The closest a traditional Chinese businessperson ever gets to saying
“NO” would be “It would be difficult.”
May be YES or NO – Hong Kong
“YES” does not necessarily mean
“I agree with you.”
A closer meaning would be “I heard you”
Working with Numbers Si (four) Sounds like “death” in Chinese
Avoid using 4 in contracts- brings bad luck in China, Japan, Korea and Asia
Lin (Six) Represents luck. It also stands for six spirits of nature- wind, mountain, river, lightning, moon and sun
Seven is lucky number in Japan and Western World Ba (eight) – Sound like fa- wealthy- and is accepted for all
occasions – Hong Kong, Japan and other Pacific countries Ju (nine)- stands for longevity. In ancient times, only
Chinese emperors were allowed to use number 9. The forbidden city in China was designed with 9,999 rooms
46789
9
What color (or is it colour)
Gift Giving- Business Gift giving is an art in Japan. Integral part of the culture
Observe proper etiquette. Do not open directly upon receiving Use the most auspicious colors for wrapping
Germans do not give or expect expensive gifts Not a major part of German business etiquette. Anything with
your company logo is safe. Perfume and other clothing considered too personal
French likes good taste in business gifts Avoid gifts with your company logo. Do not include your business
card with your gift. Bring flowers or fine chocolates or liqueur to the host and present them before, not after the party
Gift giving in China is a sensitive issue
Importance of Gift-Giving
High Priority Japan
Medium Priority Pacific Rim countries
South Korea, Taiwan, Hong Kong, China, Thailand, Malaysia, The Philippines, Indonesia, and Singapore
Low Priority United States Canada Australia Europe
Managers Working for Multi-national Companies Should
An ability to get along well with people An awareness of cultural differences Open-mindedness Tolerance of foreign culture Adaptability to new cultures, ideas and
challenges An ability to adjust quickly to new conditions An interest in facts and not blind assumptions An ability to learn foreign language
Test your cultural knowledge
In some South American countries, it is considered normal and acceptable to show up for a social appointment:
ten to fifteen minutes early ten to fifteen minutes late fifteen minutes to an hour late one to two hours late
Test your cultural knowledge
In some South American countries, it is considered normal and acceptable to show up for a social appointment:
ten to fifteen minutes early ten to fifteen minutes late fifteen minutes to an hour late one to two hours late
When eating in India, it is appropriate to:
take food with your right hand and eat with your left
take food with your left hand and eat with your right
take food and eat it with your left hand
take food and eat it with your right hand
Test your cultural knowledge
When eating in India, it is appropriate to:
take food with your right hand and eat with your left
take food with your left hand and eat with your right
take food and eat it with your left hand
take food and eat it with your right hand
Test your cultural knowledge
One wedding gift that should not be given to a Chinese couple would be:
a jade bowl a clock a basket of oranges shifts embroidered with dragon patterns
4
Test your cultural knowledge
One wedding gift that should not be given to a Chinese couple would be:
a jade bowl a clock a basket of oranges shifts embroidered with dragon patterns
4
Test your cultural knowledge
If you wanted to give a necktie or scarf to a Latin American, it is best to avoid the color:
red purple green black
Test your cultural knowledge
If you wanted to give a necktie or scarf to a Latin American, it is best to avoid the color:
red purple green black
Test your cultural knowledge
When doing business in Japan, never: $ a. touch someone $ b. leave your chopsticks in the rice $ c. take people to pricier restaurants than they took you $ d. all of the above
Source: Hoggard International
Test your cultural knowledge
When doing business in Japan, never: $ a. touch someone $ b. leave your chopsticks in the rice $ c. take people to pricier restaurants than they took you $ d. all of the above
Source: Hoggard International
Test your cultural knowledge
In Japan, loudly slurping your soup is considered to be: $ a. rude and obnoxious $ b. a sign that you like the soup $ c. okay at home but not in public $ d. something that only foreigners do
Source: Hoggard International
Test your cultural knowledge
In Japan, loudly slurping your soup is considered to be: $ a. rude and obnoxious $ b. a sign that you like the soup $ c. okay at home but not in public $ d. something that only foreigners do
Source: Hoggard International
Test your cultural knowledge
Test your cultural knowledge
As an American teacher you have the opportunity to study for a year at one of the better Japanese universities. Today one of the professors has treated a subject which you had already studied. You are sure that he was wrong in some crucial part of the matter. You feel the obligation to do something about your point of view.
How do you approach this matter?
You try to gather signatures from those fellow students who agree with your opinion on the problem.
You go to the dean and talk to him about the low performance of the professor.
You go to the professor to apologize for your interference and show your interest in the subject.
Test your cultural knowledge
As an American teacher you have the opportunity to study for a year at one of the better Japanese universities. Today one of the professors has treated a subject which you had already studied. You are sure that he was wrong in some crucial part of the matter. You feel the obligation to do something about your point of view.
How do you approach this matter?
You try to gather signatures from those fellow students who agree with your opinion on the problem.
You go to the dean and talk to him about the low performance of the professor.
You go to the professor to apologize for your interference and show your interest in the subject.
Test your cultural knowledge
The statement "In order to have efficient work relationships, it is often necessary to bypass the hierarchical line" would be agreeable to managers in which country?A) SwedenB) OmanC) JapanD) Venezuela
Test your cultural knowledge
The statement "In order to have efficient work relationships, it is often necessary to bypass the hierarchical line" would be agreeable to managers in which country?A) SwedenB) OmanC) JapanD) Venezuela
Test your cultural knowledge
In which country is meaning communicated more by clear, direct words than by body language?A) EnglandB) MexicoC) ChinaD) France
Test your cultural knowledge
In which country is meaning communicated more by clear, direct words than by body language?A) EnglandB) MexicoC) ChinaD) France
Test your cultural knowledge “My company has had an excellent relationship with a
supplier from Japan for two years. I have been assigned to replace John who was the supplier's contact with our company. The supplier's representative now says that his boss wants to re-negotiate our contract although it has five years to run. What do you advise me?”
A) Your company broke the contract.B) By changing the person whom the Japanese had a trusting relationship, they believe that the contract itself has to be looked at as if it were new.C) The Japanese don't keep their promises.D) The contract is in English and the Japanese do not understand it.
Test your cultural knowledge “My company has had an excellent relationship with a
supplier from Japan for two years. I have been assigned to replace John who was the supplier's contact with our company. The supplier's representative now says that his boss wants to re-negotiate our contract although it has five years to run. What do you advise me?”
A) Your company broke the contract.B) By changing the person whom the Japanese had a trusting relationship, they believe that the contract itself has to be looked at as if it were new.C) The Japanese don't keep their promises.D) The contract is in English and the Japanese do not understand it.
Summary….. Take time to understand and appreciate other
cultures Cultivate a culture of respect and value
human dignity Take time to understand and appreciate your
own culture Doing homework is critical to selling your
services in a market Recognize the importance of dealing with
cultural differences and the possible consequences of taking no action – understand the music behind the words
Establishing credibility Respect
Thank You
Is forbidden to steal hotel towels please. If you are not person to do such thing is please not to
read this note
Tokyo
10
Istanbul
To call room service, please open the door and call
room service
9
Mexico City
Broken English spoken perfectly
8
To move the elevator cabin, push button for wishing floor. If the cabin should enter more persons, each one should press a number of wishing floor. Driving is then going alphabetically by national order
Belgrade
7
If you wish breakfast, lift the telephone and our waitress
will arrive. This will be enough to bring up your food
Israeli
6
Visitors are expected to complain at the office
between the hours of 9 am and 11am daily
Athens
5
We are pleased to announce that the manager has personally passed all the water served here
Acapulco
4
Vienna
In case of fire, do your utmost
to alarm the porter
3
Cools and heats. If you want thecondition of cool in your room,
please control yourself
Tokyo
2
You are invited to take advantage of the chambermaid
a city in Japan
1
Thank You