Chapter 05 – Managing Across Cultures
Teaching Tip: This is a website sponsored by the European American Chamber of
Commerce (French). The site provides information about the legal, financial, and human
resource implications of doing business in France. The site is available at
{http://www.eaccfrance.com/}.
Doing Business in Brazil
1) Brazil is considered a Latin American country, but it is important to highlight this region
since some characteristics make it markedly different to manage as compared to other
Latin American countries.
2) Guidelines:
a) Physical contact is an acceptable form of communication.
b) Face-to-face preferred; time flexible
c) They do not trust; strong relationship needed
d) Appearance is important; dress well
e) Patience
f) Be prepared and consistent.
Doing Business in Arab Countries
1) The intense media attention given to the Iraq War, terrorist actions, and conflicts in the
Middle East have pointed out that Arab cultures are distinctly different from Anglo
cultures. Americans often find it extremely hard to do business in Arab countries, and a
number of Arab cultural characteristics can be cited for this difficulty.
2) Arab cultural belief that generally holds is that destiny depends more on the will of a
supreme being than on the behavior of individuals. A higher power dictates the outcome of
important events, so individual action is of little consequence. This thinking affects not
4) Other guidelines:
a) Never display feelings of superiority.
b) Do not take credit for joint efforts.
c) Go through administrative channels.
d) Connections are important.
e) Patience is critical.
f) Important decisions are made in person.
Teaching Tip: The website entitled “ArabNet” contains information covering culture,
government, history, geography, tourism, and business related issues for over 20 Arab
countries. The site is available at {http://.arabnet.me/}.
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Chapter 05 – Managing Across Cultures
The World of International Management – Revisited
Questions & Suggested Answers
1. Which aspects of Apple’s culture have helped it succeed in its global growth and
which may have impeded it?
Answer: Apple prides itself on groundbreaking innovation and individual
achievement and excellence. Apple outsources the entirety of its production. On the
2. Which aspects of Samsung’s culture have helped it succeed in its global growth and
which may have impeded it?
Answer: At Samsung, the emphasis is on extending innovations and applications
and on group achievement and collective responsibility, all geared toward
“copy” Apple and other innovators.
3. What might Apple learn from Samsung and Samsung learn from Apple?
Answer: Apple could learn the value of more control over production sites, while
4. How would you characterize Apple and Samsung in terms of the four basic
strategic predispositions?
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Key Terms
Ethnocentric predisposition―A nationalistic philosophy of management whereby the values
and interests of the parent company guide strategic decisions
Geocentric predisposition―A philosophy of management whereby the company tries to
integrate a global systems approach to decision making
Globalization imperative―A belief that one worldwide approach to doing business is the key
to both efficiency and effectiveness
Guanxi―Chinese for “good connections”
Parochialism―The tendency to view the world through one’s own eyes and perspectives
Polycentric predisposition―A philosophy of management whereby strategic decisions are
tailored to suit the cultures of the countries where the MNC operates
Regiocentric predisposition―A philosophy of management whereby the firm tries to blend its
own interests with those of its subsidiaries on a regional basis
Simplification―The process of exhibiting the same orientation toward different cultural
groups
Review and Discussion Questions
1. Define the four basic predispositions MNCs have toward their international
operations.
Answer:
1) Ethnocentric Predisposition―A nationalistic philosophy of management
whereby the values and interests of the parent company guide the strategic
4) Geocentric Predisposition―A philosophy of management whereby the
company tries to integrate a global systems approach to decision-making.
2. If a locally based manufacturing firm with sales of $350 million decided to enter the EU
market by setting up operations in France, which orientation would be the most effective:
ethnocentric, polycentric, regiocentric, or geocentric? Why? Explain your choice.
Answer: The effectiveness of the orientation used will depend on a number of factors.
For example, if the firm uses a flexible manufacturing system, a regiocentric or geocentric
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toward top down authority relationships, product development determined by the needs of
the home country, and personnel of the home country developed for key positions
worldwide.
A polycentric predisposition results in strategic decisions that are tailored to suit the
cultures of the countries where the MNC operates. For example, there would be an
are developed for key positions anywhere in the region.
A geocentric predisposition results in the company trying to integrate a global systems
approach to decision-making. This requires a global integrative and national
responsiveness strategy. A network of organizations would exist, including some
stakeholders and some competitor organizations. The product orientation would be global
more appropriate. These factors, and a number of others which make up the profile of the
firm, will ultimately determine which orientation is likely to be most effective.
3. In what way are parochialism and simplification barriers to effective cross-cultural
management? In each case, give an example.
Answer: They are barriers because they can dramatically alter perceptions. Even a
simple concept such as a handshake can have dramatic implications if not done
4. Many MNCs would like to do business overseas in the same way that they do
business domestically. Do research findings show that any approaches that work
well in the United States also work well in other cultures? If so, identify and
describe two.
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Answer: Stress that this is a recent area in management. Little by little, we are
understanding what works and what doesn’t work globally. One practical example
compensation, or participation in decision making would have on workers from
their home countries.
5. In most cases, local managerial approaches must be modified for doing business
overseas. What are three specific examples that support this statement? Be
complete in your answer.
6. What are some categories of cultural differences that help make one country or
region of the world different from another? In each case, describe the value or
norm and explain how it would result in different behavior in two or more
countries. If you like, use the countries discussed in this chapter as your point of
reference.
Answer: The way in which the country views time, the collectivistic/individualistic
dimension, attitude toward affection, the nature of business conversations,
Internet Exercise: Haier’s Approach
Suggestion for Using the Exercise
1. After your students have investigated the issues pertaining to Heier suggested in the
exercise, ask your students to visit the Disney website and answer the same
questions {http://www.disney.com}. This will give your students a perspective of
the challenges of international marketing from both an Asian and an American point
of view.
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Chapter 05 – Managing Across Cultures
In The International Spotlight: Mexico
Questions & Suggested Answers
1. Why would multinationals be interested in setting up operations in Mexico? Give
two reasons.
Answer: One reason why Mexico is of interest to multinationals is that the work
force is quite productive and turns out high quality goods. This is particularly
2. Would culture be a major stumbling block for American firms doing business in
Mexico? For European firms? For Japanese firms? Explain your answer.
Answer: Culture is always a major problem for those not aware or sensitive to
differences. Since U.S. firms are closer to Mexico and have more experience there,
3. Why might MNCs be interested in studying the organizational culture in Mexican
firms before deciding whether or not to locate there? Explain your logic.
Answer: One reason why MNCs would be interested in studying the organizational
culture of Mexican firms is because of the differences in organizational culture.
While the national cultural differences would help identify general differences
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International Management in Action: Ten Key Factors for MNC
Success
Summary
1. There are 10 factors or guidelines that successful global firms seem to employ.
These are listed in the text.
2. The 10 factors could be discussed in terms of the firms addressed at the beginning
of the chapter: Apple, Samsung, Renault.
International Management in Action: Managing in Hong Kong
Summary
1. Managing across cultures:
• Practical school of management thought: Do little to help expatriates change
their basis cultural values or specific managerial behaviors
•Cross-cultural school of management thought: Effective managerial behavior is
a function of the specific culture.
2. Successful managerial action in the U.S. may not be effective in Hong Kong.
Because firms do not include in their selection criteria individual characteristics
such as cognitive flexibility, cultural flexibility, degree of ethnocentricity, etc., they
end up sending individuals on international assignments who keep the same set of
managerial behaviors they used in the U.S. and not adjust or adapt. Simplistic
assumptions about culture are erroneous. Important to training people about
intercultural differences.
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