International Dimensions Of Management And Business Commerce Essay

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The international dimension of management and business - due mainly to globalization has become a major challenge to governments, institutions and organizations. This helps explain why the area of international management is becoming more important within the academic setting. In spite of the increasing importance of this area researchers have been overlooking important issues at a higher level of reality. The Enron scandal, among others, is a good example of the sort of governance crisis brought by globalization. The IM literature fails to address in a more realistic fashion the dynamics and local implications brought by the growing investments of transnational corporations and their political power in developing countries With the increase in global activities of both domestic and multinational companies, managers need a good understanding of culture. People's cultural backgrounds influence their assumptions about how work and interactions with other people should proceed. Culture's influence, although profound, often goes unseen. This results in deep and difficult conflicts, but also in untapped potential. In this issue of Perspectives for Managers we provide a tool for understanding management behavior across cultures

2. CULTURE

Culture is a system of values, beliefs, assumptions and norms, shared among a group of people. The group could be a country, region, religion, profession, organization, even a generation or a social or sporting club. The group's cultural system is a general agreement among people about what is important and how things will get done. The more fundamental the grouping, the deeper the culture, the greater its influence on members' values and beliefs, and the less the members are aware of this influence. Religious and country cultures, for example, are usually learned early in life and with extensive reinforcement from family, media, and educational, political and legal systems. When learning these fundamental cultures, most people have low awareness of other cultures. Like fish in water, we do not distinguish our own environment from others.

We usually become aware of our own cultures only when we travel to other places, forcing us to see our own culture differently.

2.1 FUNCTIONS OF CULTURE

Culture provides two functions that affect global management.

2.1.1 First

Culture provides software for the group's interactions, or a sort of oil that greases the machines of the society. The shared cultural system allows members to interact with each other efficiently without questioning every motive or action, and with a relatively smooth flow of activity. Culture provides guidance for decision making: basic criteria need not be discussed at length. Culture also provides scripts for behavior, so people know what to expect of each other and how to reciprocate - even in terms of how to express conflict and resolve it. Within cultures managers can "get things done" more easily than they can when crossing to other cultures.

2.1.2 Second

Culture provides a source of identity for people within the culture. This identity often surfaces when people describe who they are:"I am French" or "I am American";"I am Jewish" or "I am Arab." The identity becomes even more important when it is threatened, and culture provides a boundary pulling insiders together around their shared values, shielding themselves from outsiders. In this function, culture provides a source of motivation for facilitating or thwarting cooperation with people from other cultures.

2.2 CULTURAL ARENAS

In International Management Four types of situations require that managers understand their own culture and how it differs from others In each of these situations, decisions must be made and implemented across cultural boundaries. At the individual level (Arenas 1 and 2), managers must interact effectively with individuals from other cultures. People from different cultures will bring with them diverse expectations about the interaction, and effectiveness depends on understanding and building on these differences. At the organizational level (Arenas 3 and 4), managers must design systems of interaction that guide the coordinated behavior of many people. It is important for managers to know whether these systems will be consistent or contradictory with the cultural system in place. In one-way transactions (Arenas 1 and 3), managers need to take something that has been developed in one culture and put it into another one. Successful execution is based on an understanding of how things will be interpreted in the new context. In multi-way transactions (Arenas 2 and 4), managers must take into account many cultural systems at the same time. Unless the differences are understood, the situation will be characterized by conflict and division.

One-Way

Multi-Way

Individual Level

Arena 1: Expatriate

Individual manager going to another country to mange a business unit or perform a specialist job.

Arena 2: Multicultural Team

Group from many countries, often cross functional, managing across units or a multi-country project.

Organization Level

Arena 3: Export System

Take human resources, information systems, or other practice or strategy from one country to another

Arena 4: Global System

Develop human resource systems, organizational structures or strategies, to implement in many countries.

2.3 CULTURAL ORIENTATIONS

The best way to understand and predict how one culture is different from another is with a framework that compares them on important dimensions. The Cultural Orientations Framework identifies six basic issues that all groups must address and resolve in order to function effectively. Groups of people deal with these issues in different ways, and the combinations provide the patterns of cultural systems. Maps of culture can then be built by identifying the combinations. In the rest of this issue, we outline the dimensions and provide examples of their impact

The six issues are

2.3.1 RELATIONSHIP TO ENVIRONMENT

What kind of relationship do we have with the world around us? How do we see ourselves in relation to it, and what is our role with respect to it? There are three common ways of seeing this relationship: harmony, mastery, and subjugation. In harmony cultures like Japan, people do not see themselves as separate from the environment, but as part of an integrated, holistic system. Humans role is to help maintain the balance of the system. In mastery cultures like the United States, people see themselves as dominating the environment. It is considered normal and good to shape the environment - including work and living environments - to suit humans' own needs or desires. In subjugation cultures like Islam, people have a strong belief that the environment or a supernatural being determines the ultimate outcomes for people or events (in Arabic this is expressed as "Inshallah" or "God-willing"). In Bangladesh people may not believe that this force controls every detail of human life, but do believe that it directs the patterns and major events within which all people act out their lives.

2.3.2 RELATIONS AMONG PEOPLE

What types of relations among people are assumed to be most natural or most effective? Whom are we responsible for, whom must we take care of, and whom must we obey and be accountable to? There are three common patterns of relations: collective, individualistic, and hierarchical. In collective cultures, such as those in Latin America, members of a group look after each other, maintaining and promoting the welfare of the group as a whole. The group may be an extended family, with many generations and lateral relations, or it may be society as a whole or a peer group. In individualistic cultures, like Australia, people are responsible mainly for themselves and their immediate families. Parents are responsible for children, but only until the children are adults themselves. Finally, in hierarchical cultures, like India, those at the top of the hierarchy have both responsibility for and authority over those below. The hierarchy can be of individuals or of groups, but the principle for arranging the hierarchy (e.g. age, caste, gender, wealth) is stable over time. Cultures typically reflect all three of these ways of dealing with how people relate to each other; however, usually one value is stronger than the others. For example, in many Latin, Arab and Chinese cultures, values about protecting one's group (collectivism) and knowing one's place in the system (hierarchy) are more strongly held than values about concern for oneself without regard to the group (individualism)

2.3.3 MODE OF ACTIVITY

What mode of activity best suits interaction in our culture? How should we engage in activity, and how should we count on others to act? The three variations here are being, doing, and thinking. In a being culture, such as many Latin cultures, the emphasis is on spontaneity and fully experiencing each moment. In these cultures, "one works to live, one does not live to work!" Work gets done, but is not necessarily prioritized over other things; people who do work a lot do so because they want to, not because they think they should. In some being cultures, expressing all emotions freely is accepted and expected. The doing approach, such as Canadian or United States culture, is a striving, achieving, accomplishing orientation. In a doing culture people are more likely to view tasks and work-related activities as central to their existence and even self-identity. Thinking cultures, such as German or French, emphasize strong rational thought and planning before action. With a strong thinking orientation, one contains and controls activity. People should neither act impulsively by feelings, nor compulsively by some hidden force of necessity.

2.3.4 NATURE OF HUMANS

This value involves how we think about the fundamental nature of human beings. It is not a belief in how an individual person behaves, but what is the underlying nature of all of us as humans. One clue is what we think our nature is when we are born, before we are subject to the influence of others and of society. In some cultures,people believe that the basic nature of humans is not predetermined, but in fact is a "blank slate". Human nature, they believe, is completely determined by the environment and events of each person's life. Many modern Western cultures fall into this category. In these cultures, there is a strong focus on training and socialization, and rehabilitation or re-training of people who have behaved badly (Kabat, 1997)

In some cultures it is assumed that we begin life basically good, and that if people do bad things in their lives it is an anomaly or because something in their experiences and environment have made them become bad.

Islam believes this. In these cultures, people tend to trust others until evidence is provided that they cannot be trusted, and they inflict harsh punishments on those who go against their nature and harm others. In other cultures it is assumed that we begin life basically bad (e.g. the notion of original sin in Christianity), and that we must always guard against this tendency to give in to our evil nature. People in these cultures tend to protect themselves and monitor others, and to celebrate and honor people who, against their basic nature ,do extremely good things

2.3.5 TIME

The notion of time is complex. Some cultures think about time linearly, as progressing systematically from the past into the future. This conception of time is called monochronic, and time is broken into segments of equal length. Many industrialized cultures see time this way, and measure, record and plan events according to these segments. Things are done one activity at a time, and in sequence. Within this linear view of time, different cultures focus on different parts of the horizon. Cultures with a past orientation look to the past for answers and advice to resolve current dilemmas, and strongly value traditions and ancestors. Cultures with a present orientation think about today's immediate needs or those of the short-term future, and focus on keeping up with modern times. They usually think of time as scarce. Cultures with a future orientation prioritize the long term future, often sacrificing things today for security or success far into the future.

2.3.6 SPACE

This orientation is related to the sense of ownership of space, and ownership of what is in a particular area. A public orientation to space suggests that space is shared among everyone, as is whatever is in the space. A private orientation implies ownership of space by specific individuals or groups, without informal sharing. In a work context closed doors, private offices and desks establishing territory and distance all reflect a private culture. Open office concepts, free and easy sharing of work materials and ideas, close contact among workers, and informal spaces all reflect a more public orientation. In today's organizations, information is an important aspect of this dimension. In public-oriented cultures, people assume that information should be publicly shared; in private-oriented cultures, information is "owned," and people do not expect others to share their information openly.

3. 1 HOFSTEDE MODEL FOR BANGLADESHI CULTURE

Hofstede's cultural dimensions, which vary among nations, include power distance, individualism, masculinity, uncertainty avoidance index, and long-term orientation (Hofstede, 2006, p. 1). Power Distance is the first dimension in Hofstede's model where respecting the importance of equal power in the organizations is the focus. In a high power distance level, inequality is acceptable. The second dimension is Individualism. Individualism that highlights individual activities, actions, and achievements was integrated into the mainstream groups of the society. The third dimension is Masculinity. This dimension describes the role of gender, and the difference between men's values and women's values in a country. Uncertainty- Avoidance is the fourth dimension of the model. This dimension focuses on uncertainty situations at the organizational level examining laws, rules, safety, and security measures that reduce exposure in an unsure future. This means that people may prefer a structured situation rather than unstructured situations in a society. The fifth dimension is Long-term Orientation.

Long-term orientation depicts values toward the future, and short-term orientation emphasizes values toward the past and present (ITIM International, 2006, p. 1). According to Evans and Mavondo's (2002) study, they examined international retailing operations between psychic distance and organizational performance. Their findings with Uncertainty Avoidance Index and Long-Term Orientation of cultural dimensions were associated with financial performance and strategic effectiveness.

3.1.1 EVALUATION OF HOFSTEDE MODEL

Upon evaluation, Hofstede's classification scores high on simplicity. This is because the dimensions are relatively straightforward concepts and rich in meaning in relation to form. With regard to substance, the classification is neither exhaustive nor exclusive for two reasons. First, Uncertainty Avoidance faces criticism for not validly capturing oriental values, thereby not being exhaustive. Second, the late inclusion of Confuscinism (Hofstede and Bond, 1988) or long term orientation (Hofstede, 1991) demonstrates lack of exclusivity. Moreover, Hofstede does not exclude the possibility of finding new dimensions. Thus, with regards to simplicity, Hofstede's classification rates are moderate in substance and high in form. With regards to levels of analysis, Hofstede argued that his classification could only be applied at the national level. Although the precise arguments building upto this are unclear, Hofstede asserts that applying his dimensions to any other level is incorrect and is an ecological fallacy. This severely restricts the use of his schema and receives a low rating for the criterion of levels of analysis. In applying the criterion of different research methods, the application of any other method other than that specified by Hofstede (using the VSM to compare mean-differences between countries) is considered incorrect. While Hofstede's data has been used widely, there appears to be little other application of these dimension in other research methods (e.g., experimental, quasi-experimental and field research). Thus, this receives a rating of low on the research method criterion. In relation to the ability to identify dominant themes, the dimensions may be used in identifying dominant themes both within a specific culture as well as across cultures on one or more dimensions. While this is subject to Hofstede's caveats, theme identification is internally consistent. Hofstede's classification however fails to indicate which of his four dimensions, if any, is likely to provide deeper insights for a specific culture. Thus this receives a rating of medium on the criterion of identifying dominant themes.

3.2 TROMPENAARS DIMENSIONS OF CULTURE

Trompenaars views culture as a way in which a group of people solve problems. This is based directly on Schein's (1985) definition of organizational culture. From the solutions to three types of problems (relationship with others; time; and the environment), he identifies seven fundamental dimensions of culture7. Trompenaars' definition of culture is generic across national and organisational cultures and there therefore often confounds the two. Five of his dimensions are identical to Parsons' (1951) The Social System: affectivity versus affective neutrality; selforientation versus collective-orientation; universalism versus particularism; ascription versus achievement; and specificity versus diffuseness. Basically this culture is not practices in Bangladesh.

3.2.1 EVALUATION OF TROMPENAARS DIMENSIONS OF CULTURE

An assessment of Trompernaars' dimensions of culture reveals that dimensions score low on simplicity. Intuitively, seven dimensions should be straightforward to apply, but in fact, these are quite complex constructs. For example, the attitude to environment seems simple but the underlying themes, such as ascription, are complex to understand and apply. The dimensions rate high in exhaustiveness but poor on exclusivity. Two concepts are similar, namely attitude to environment and individualism. Attitude to environment is drawn from locus of control where 'internals' have control lying within them, a concept identical to individualism. In assessing the application to various units of analysis Trompenaars' dimensions may be applied freely to varying levels of analysis. Stability in application of these psychological characteristics to higher levels of abstraction (from individual to national level) is untested and poses an imposing challenge for future research. Thus the classification rates moderate in transcending levels of analysis.

In terms of relevance of different research methods, the constructs lack quite considerably in both precision and clarity, thereby limiting any attempt at measurement. The dimensions and the applications seem to have been directed towards a business readership satisfied with anecdotal evidence rather than one demanding scholarly insights into theory, a high level of rigour, triangulated by empirical evidence. Application into different research methods will be subjective, imprecise and of questionable value. Thus these dimensions are fairly restricted in lending themselves to the rigour of various research methods and thus rated low. Trompenaars' dimensions are also fairly limited in its ability to identify dominant themes, because the dimensions are fine grained and zoomed in at the psychology of the individual, zooming out to identify and extract dominant themes, will be extremely difficult if possible at all. Thus for this criterion, Trompenaars is assigned a low rating. In explaining cultural change the concepts lack any sense of measurement either within or across dimensions. In particular dimensions that rely upon completely subjective measurement like 'attitude to time and environment'

4. MY WORKING ENVIRONMENT

As a managerial level employee of one of the leading companies in furniture in the name of Otobi Ltd.

4.1 My Post:

Manager (A Higher level Position)

4.2 My Organization

Otobi Ltd.. 1243 East Manipur, Dhaka, Bangladesh.

4.3 My Department

Human Resources and Administration Department

4.4 My Responsibilities

Ensuring the efficient recruitment and selection of suitable and sufficient employees to meet vacancies identified by department managers.

With in the limits of the human resources policies, to provide a full human resources service to line management and to provide a framework for maintaining good relationships between management and staff

Implementing the company's remuneration policy in accordance with laid down procedures.

Advising the subordinates and sometimes to assist the manager.

Establishing and maintaining a regular program of joint consultation with employee representative and senior management level.

Providing adequate training programmes for the introduction of new recruits and training and development for employees.

Maintaining adequate records for the employees.

5. LEADERSHIP

Leadership is most important phenomenon for developing an organization. It plays an important role for both the organization and individuals. The leadership style may be

Managers practice what they preach

Lead by example

Clear about their vision

Vision mission and objectives at workplace

Dedication towards the goal

Both kinds of leadership are practices in my organization. Transactional leadership has remained the organisational model for many people and organisations who have not moved into or encouraged the transformational role needed to meet the challenges of our changing times.

5.1 TRANSFORMATIONAL LEADERSHIP

Transformational leadership is a process in which the leaders take actions to try to increase their associates' awareness of what is right and important, to raise their associates' motivational maturity and to move their associates to go beyond the associates' own self-interests for the good of the group, the organization, or society. Such leaders provide their associates with a sense of purpose that goes beyond a simple exchange of rewards for effort provided.

Builds on a man's need for meaning

Is preoccupied with purposes and values, morals, and ethics

Transcends daily affairs

Is orientated toward long-term goals without compromising human values and principles

Focuses more on missions and strategies

Releases human potential - identifying and developing new talent

Designs and redesigns jobs to make them meaningful and challenging

Aligns internal structures and systems to reinforce overarching values and goals

5.2 TRANSACTIONAL LEADERSHIP

Builds on man's need to get a job done and make a living

Is preoccupied with power and position, politics and perks

Is mired in daily affairs

Is short-term and hard data orientated

Focuses on tactical issues

Relies on human relations to lubricate human interactions

Follows and fulfils role expectations by striving to work effectively within current systems

Supports structures and systems that reinforce the bottom line, maximise efficiency, and guarantee short-term profits

6. CONCLUSION

The Cultural Orientations Framework provides an important tool for comparing cultures with each other. It highlights similarities and differences among cultures, and points out implications for management. This information is critical to implementing strategies across cultures in international organizations. Managers who are aware of their own cultural systems can predict areas of conflict and potential learning when working with people from other cultures. Those who are designing strategies and systems for international organizations can take these differences into account. With practice, this tool can lead to a more synergistic approach to managing cultural diversity. no culture is static or completely homogeneous. Cultures change, and individuals within cultures differ from each other. Knowledge of cultures should always be treated as tentative guidelines to interaction: an important first starting place, but subject to change with new information.

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