The Configuration To Human Culture Commerce Essay

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

As far as the knowledge in physics is concerned, generally we know that, Galaxies that one study is all controlled by the same law. The fact is also not entirely true that, the world is created by humans only, thus we can give prominence to another fact that there are different cultures in the world, which operates according to their own dynamics, principles & laws, and time & space are unique for each culture (Hall and Hall, 1990).

Limiting the configuration to human culture, it can be said that people belonging from different cultures have different attitudes, behaviour, values and beliefs, these differences can mostly be seen at the time when they make decision, in fact the situation acts most effectively in the cases when people from different culture come together for a same purpose apparently can be understood as infusion of Cross-Culture for a valuable result or to reach a set goal. Taking the situation in consideration with any large multi-site or multi-national organisation, the decisions taken are likely to influence other people in the organisation like the managers, sub-ordinates, partners, peers, etc. thus it can be realized that for an international manager it is necessary to first recognize and then respond to the opportunities and threats they face. Taking into account The Globalisation, there has been an emergence in the global, information-oriented culture because of the advance telecommunication, mass transportation, technology and changes in the global political arena.

Considering the Multi-national organisation, which is defined by Mead (2005) as those companies that own and manage investments located in countries other than that of head office. Managing the peoples belonging to different cultures on a same platform mostly come in vision through these companies in commonly known as cross-culture management.

Culture is the most diversified part with unlimited definitions considering different aspects like the political, religion, economical, educational, national, organisational, corporate, etc. In general, it is said to be the values held by the members belonging to a particular culture. This is also a noticeable point that it is quite difficult to study culture and basically the national culture. Tayeb (2003) says, "A constant thread…through our lives which makes us distinguishable from others especially those in other countries: this thread is our national culture". According to her there are two elements which are contributing towards the building of nation and the creation of the national culture:

The physical environment;

History the nation had undergone;

She has also referred to the institutions that refer to the establishment of national culture which include Family, Religion, Education, Mass communication media, and the multi-national companies.

Despite of the great diversity in human cultures there are few characteristics which are fundamentally common basically for the scientific analysis. Murdock (1969) has specified these characteristics as; Culture is learned, inculcated, social, ideational, gratifying, adaptive and integrative. To rationalize these characteristics Murdock stated, culture is not instinctive, innate or transmitted but it is the learned tendencies to react which are acquired by individual from his life's experience. All the human beings compared with other creature are considered to learn and inculcate or pass on their habits to their offspring. These habits are not only inculcated but transmitted over time and are social as they are shared by human beings living in organized societies and kept uniform due to social pressure. Traditionally accepted idea is an element of culture, every individual show some degree of awareness to cultural norms, an ability to differentiate them from purely individual habits and a facility in conceptualizing and reporting them in detail. Culture considerably satisfies the basic primary and secondary needs, the elements are considered to be tested habitual techniques which gratify human impulses in man's interaction with the external world. As time changes, culture changes i.e. people adapt changes in their culture as per the situation like globalization, modernization, technology, etc however the core values remain the same, similarly several parts of cultures are in perfect equilibrium making it an integrated system.

Cleary (2003) describes that there are specific knowledge and beliefs that form a content of a particular culture which differ from other cultures resulting in different groups having different values, patterns and behaviour, commonly known as the cultural difference. If the difference in culture is high then the communication between these cultures becomes harder, resulting in creation of misunderstanding and misperception. Thus it is necessary for peoples and preferably peoples who are working across culture to analyse the culture in which they work.

There are different frameworks followed to analyse the national culture and one of the recognisable framework was given by Greet Hofstede. Hofstede (2001) referred culture as, "The collective programming of the mind that distinguishes the members of one group or category of people from another". His study was based on the data collected from 116,000 peoples working in IBM which belonged to 40 different countries. It can be assumed that the goal for his study was to get a means which can be used to identify different national cultures. His research in culture and management is also known world-wide, and the dimension of culture resulted eventually from his studies were;

Source: Adapted from Hofstede (2001)

These dimensions of culture given by Hofstede include Power Distance, which is the attitude towards the authority and the distance between the individuals in the hierarchy. The degree of tolerance for uncertainty and in stability is Uncertainty Avoidance, Individual versus Group Orientation is in short the independence and interdependence, the loyalty towards oneself and towards group, Masculinity versus Feminine Orientation is the importance of work goals compared with the personal goals and Short-term versus Long-term Orientation, this dimension was given by Hofstede and Bond together in the year 1988, which mean to foster virtues related to the past and present or the virtues related to future.

Points which strengthened Hofstede study were, it made possible to compare among national cultures, and also it helped to know what in general to accept from the given part of the world. His framework for cultural dimension was also accepted by the world for distinguishing among major cultural group. The framework was found to be applicable to work related values as well as the values in general (Reisinger 2009).

Although the framework given by Hofstede for analysing culture was considered to be good for analysis, but there were certain obligation towards his studies. Browaeys and Price (2008) argued that the dimension given by him were less in number which enabled the observers and analyst to pinpoint to the features to which they and readers can relate. This is also the fact that his study was limited to one company and thus it is not possible to get information about the national culture by a study of limited people as it would only reveal the culture of that particular level of people studied upon and not the whole nation. Silverthrone (2005) commented as, Hofstede's variables are the general trends which are averaged across large number of people's behaviour but his approach also provides interesting framework for research and theorizing about organization and cultural difference.

The question about 'what drives the cultural change' has always attracted many researchers in different fields. Though the national culture and organisational culture are supposed to be linked together but working together in a national culture has undergone an extensive and intensive investigation. The goals, manuals, rules & regulations and also the long standing employees are considered to be the internal factors which influence company's culture. According to Mead (2005), there are two different factors which are considered to be influencing the decision making within the organisation; the internal factors which include the psychological make-up, organisation strategies, resources, history, policies & organisational culture and the external factors which include decisions of competitors, suppliers, customers, the labour market, technology, economies, politics, ethical & religious systems, industry interest and national culture as well. Hence, the study about culture in today's scenario is considered to be important, because of the fact that it helps to increase the relation between different cultures resulting in the effective management of the organisation.

Some other factors which influence the culture of the organisation which are supposed to drive cultural change comprise Globalisation as well. "Advances in telecommunication, mass transportation & technology and changes in the global political arena have led to the emergence of a global information-oriented culture" (Harris et al. 2009). The globalization of the economics and market place also the advance communication technologies are supposed to be transferring the work culture and the workforce. Other than Globalization there are some more factors which drives the cultural change, according to Jackson (2009), there is one big thing which all the cultures have in their heart, which is the Vision. A great vision has the power to inspire, but at the very last the vision should be believable and convincible. Andersen and Taylor (2006) argue that there are several causes which drive the cultural change like the changes in the societal condition, cultural diffusion, innovation and the imposition of cultural change by an outside agency. These conditions are similar to the change in organisational culture where change in market, innovation of products and doing business other than the place of head quarters, basically the business of multi-site and multi-national companies.

In a research, Inglehart and Welzel (2005) found that research and theory on Socio-economic development or Modernization developed two contenting thoughts, one emphasises the convergence of values as a result of modernization- the overwhelming force that drives cultural change and other thought is the persistence of traditional values which are relatively independent of economic conditions. Inglehart and Welzel (2005 cited Meyer et al., 1997 and Stevenson, 1997) studied that convergence around some set of 'modern' values is unlikely; traditional values will continue to exert an independent influence on cultural changes caused by Socio-economic development or Modernization. The cultural change is path dependent, although the value systems of different countries are moving in the same direction which is due to the impact of powerful modernisation forces, the value systems are not been converging, as simplistic notions of cultural globalization suggest. Ritzer (2010) argues that, "Cultures are subject to many of the same global flows and tend to grow more alike". In his statement towards the cultural convergence he says it is based on the idea that globalization tends to lead to the increasing similarities in whole world, and there is a tendency to see global assimilation in the direction of dominant groups and societies in the world.

Globalization, the concert is making people move from one part of world to other and indulging in different cultures not belonging to them. Jansson (2007) says that emerging company markets have become more important for the multi-site and multi-national companies, Under the wave of third internationalization the multi-national companies belonging from developed western countries are moving to the upcoming Asian and central & eastern European market. The cross-hauling of foreign direct investment (FDI) is making country market more global. According to Ngomba-Roth (2007), multinational companies have different dimensions which can be viewed from several perspectives like the ownership, management, strategy and structure etc., Relating it to the international managers or global leaders, it is understandable that it becomes a bit difficult for them to manage the people belonging to different cultural background working in the same multi-national or multi-site company, thus managers or leaders use different form of strategies to manage cross-culture.

In favour of cross-culture management an illustrious strategically approached study was done by Perlmutter and Heenan. Kniel (2009 cited Perlmutter and Heenan, 1979) distinguished multi-national companies by objective criteria to attitudinal criteria and later the qualitative criteria of the top management. The concept generally distinguishes the different types of policies used in head-quarter orientation. These policies are showm in diagram below;


Source: Adapted from Kniel (2009 cited Perlmutter and Heenan, 1979)

Ethnocentrism (native country orientation): These are considered to be general attitudes of the top management for putting home country national in the key positions of the organization everywhere around the world, it shows the tendency to feel the group is more intelligent, capable and reliable, home country policies and practices become default standard for subsidiaries (Kniel 2009, cited Perlmutter and Heenan, 1979). Beller and Leerssen ( 2007, cited Sumner, W.G. 1906) defined ethnocentrism as "this is the view of things in which one's own group is the centre of everything, and all others are scaled and rated with reference to it".

Ethnocentrism has both advantages and disadvantages; the members of group can develop a sense of pride, well-being and security, increase loyalty and pride for the group, strengthens group moral, self-esteem and also brings integration and stability for the group. But ethnocentrism can also guide to intrasocietal fragmentation when there are many sub cultures in the society. It can unable people to understand others and get into them and may result in inter-group conflicts and problems (Panopio and Rolda, 2006).

Polycentrism (host country orientation): The approach focuses on the dissimilarity in cultures and statement that 'one fits all' is impractical, therefore adapting different cultures become a possible approach… "We really don't understand what's going on there, but we have to have confidence in them" (Kniel 2009, cited Perlmutter and Heenan, 1979).

Polycentrism is considered to be opposite of Ethnocentrism, as it has the merit of adapting to the business strategies to the local conditions. As the local managers are given preferences the degree of geographic decentralization maximizes (Cherunilam 2007).

Adler and Gielen (2001) said the disadvantage towards this approach is that all host nationals are not equally and interchangeably good in the local culture, there is a reduction in the advancement and development of carrier as the opportunities in their national border are limited.

According to Bowie and Buttle (2004) the marketing of Best Western Hotels, a multi-national hospitality organization, is typically polycentric as each country develops its own marketing campaign for host country consumers.

Regiocentrism: An approach persuading functional rationalization on the basis of more than one country, grouping countries into larger regional entities, e.g. European Union. The managers in these cases are recruited, developed, assigned and appraised on the regional basis (Kniel 2009, cited Perlmutter and Heenan, 1979).

Keeley (2001) explains that multi-national company with Regiocentrism policy has an advantage of using wider pool of managers, and the region enjoys the degree of decision-making autonomy. But this structure is associated with possible limited interaction between subsidiaries of different regions and individual subsidiaries and parent company.

According to Bowie and Buttle (2004) one of the largest regiocentric hotel company in the world is Hong-Kong based Shangri-La hotels in Asia.

Geocentrism (world oriented concept): The approach is seeking an employee who is best in his abilities and is regardless of the nationality… "To integrate diverse regions through a global systems approach to decision making" (Kniel 2009, cited Perlmutter and Heenan, 1979).

The advantages of geocentrism approach is that it increases the global leadership development opportunities, increases the learning and knowledge of cross-cultural opportunities, it provides a greater opportunity for developing a common multi-national company identity, also leads to indirect competitive advantage in human capital (Vance and Paik, 2010). But there are some disadvantages evaluated from this approach (Iyer 2009) like, laws of nation stating the requirement of certain number of native employees, it reduces the autonomy of foreign subsidiaries, and the largest disadvantage is the cost for moving international managers from a branch to other.

To manage across cultures in multi-national and multi-site organizations Paul Lawrence and Jay Lorsch have discovered a framework named Integration-Responsiveness (or I/R Framework) in the year 1969, the framework was actually utilized for analysing organisations in 1981 by Doz, Bartlett and Prahalad. A multi-national company is comprised of set of different organizations, which operates according to the local environment, like a region, country or areas within the country. In 1989, Bartlett and Ghoshal extended this framework describing a multi-national company facing challenges and simultaneously achieve Global integration and local responsiveness while it also facilitates world-wide learning. In a business there are full range of functions which can be understood as shaped by pressures of global integration and local responsiveness. An upstream function shows a greater need of global integration and downstream function usually tend to demand the local responsiveness (Stahl and Bjorkman 2006).

Morschett et al. (2009) described Global Integration as process of interconnecting international activities of MNC across all countries to look at the strength of large company and try to reach the synergy effect. Similarly the MNC's operate in heterogeneous conditions in different host countries having different customers, market, competitors, distribution structure, substitution and the host government. The MNC must have the ability to utilize the opportunity aroused from heterogeneity and this contingency condition is called forces of local responsiveness. Morschett et al. (2009 cited Yip 1989; Bartlett/Ghoshal/Beamish 2008) have given four forces of global integration; the market drivers, cost drivers, governmental drivers, and competitive drivers, these forces are also known as the industry globalization drivers. Similarly some of the forces which drive the local responsiveness comprise of Differences in demand, focus on national differences and responsive and integrated nature basically in multi-national and transnational companies, and working Ideal type in specific situations.

For I/R framework different levels were distinguished (Morschett et al. 2009); the external environment, where the forces of global integration and local responsiveness reach different level as per industry. The second level is the MNC's strategic orientation, where some MNC use global strategy and some use multi-national approaches ultimately displaying different levels of global integration and local responsiveness. The final level is Strategy of subsidiaries which differs more or less from integration of MNC's and their adaptable behaviour towards local market.

There may be different strategies or tactics available for the cross cultural management but these strategies or tactical or frameworks can only be successfully utilized for goodwill of the MNC when there is a consistency in the organisation and culture. Champoux (2010) describes that consistency is the degree of agreement within the organization members about the important values and basic assumption.

The trustworthiness in people is generally based on the consistency in character, similarly in organisation there should be coherence between the culture and values of organisation and the policies, processes and behaviour of the organization. When there is consistency, there is integrity, but when there is no consistency, the organizational dissonance appears and people get caught in middle and trust is lost (Banks and Stevens, 2005). In similar context, Ferguson (2003) argued that to make the company more effective the managers try to create a strong culture that can encourage and support goals and useful behaviours. In an organizational culture the consistency can be referred as frequency of replications of attitudes, values and behaviour and the action on it by constituent people. Some experts believe that when there is a strong organizational culture it has positive impact on the organizational effectiveness as the shared value, believes and behaviour are properly understood by large number of people in organization thus organizations can improve the ability to reach a set goal successfully.

The question of whether a manager from one culture can adapt to different strategy from another manager belonging to different culture in the same MNC is always under research by different researchers. In the context of MNC, Gupta (2009) classified three levels of strategies; Corporate strategy, Business strategy and Functional strategy. Corporate strategy is the function of top management to see the interest and operations of organisation, Business unit strategy is concerned with the operations of particular business, and functional level strategy creates a framework for carrying out corporate and business strategies. When a culture is consistent with these strategies, a firm can then develop effective game plan.

According to Scott (2007), in any situation it is important to recognize that there is not only one solution which can fit to all condition. One needs to adapt to the situations, own style, personality and the employee as well, then to decide whether to make a systematic or structural change in workplace. Different strategies, tactics and principles work best for different time as per the situation.

It is said that the road to resilience is always personal and different people use different strategies. Some cultures use resilience or develop resiliency in different ways. Maiden et al. (2006 cited Comas-Diaz et al., 2002) formulated ten strategies for adapting these situations; Make connection, Avoid seeing crisis as insurmountable problems, Accept that change is part of life, Move towards your goals, Take decisive actions, Look for opportunities for self discovery, Nurture a positive view of yourself, Keep things in perspective, Maintain a hopeful outlook, and Take care of yourself.

Lane et al. (2006) have given an MBI model for the intercultural effectiveness in the global management which is shown below;


Source: Lane et al. 2006

According to the above MBI model for any situation an international/global management should first map out the total situation by understanding the differences as per the dimensions of culture and position of own and others, then bridge, that is communicate across the differences by preparing through motivation and confidence and decentring or re-centring with blame and commonalities. Followed by the integration, where one needs to manage across the differences by the methods of building participation, resolving conflicts and building on all ideas. If the differences are valued then the differences will create value leading to high performance.

Kazmi (2008 cited Waldersee and Griffiths 2004) adopted two types of change implementation; Participative and Unilateral. Participative change is done through support of people, by means of behavioural-social interventions such as organization development and sensitivity training. On the other hand, unilateral changes are forced from the top management and implemented by the technical-structural means such as system and process redesign or administrative changes in term of redefining authority and work rules. Thus this can be realized from the above data that to adopt change will all depend on the individual and organizational strategies and culture, which may or may not allow them to adapt changes as per the situation.

Considering the context with reference to the service industry, where service is defined as, "the results generated, by activities at the interface between the organization and the customer and by the organization's internal activities, to meet customer needs" (Subburaj, 2005 cited International Standard, ISO 9000). Aharoni (1997 cited Riddle 1986) specified that, specific components of service which are commonly adapted to host country include; service ability, environment, delivery style, and product style but the diversity in service make it important to recognize that these adaptations will vary from different types of services with reference to the cultural characteristics of the host country. The cultural values not only affect the service delivery but also influence the political priority, which is assigned to service sector development and degree of state intervention. SERVQUAL or RATER is a framework which gives the dimensions of service quality. The diagram below shows the aspects of this framework;


Source: Adapted from Kandampully et al. (2001) and Khosrowpour (2000) [cited Parsuraman et al. (1988, 1991 and 1994a)]

The above diagram shows the dimensions of Services which include; Reliability reflecting the service provider's ability to provide service dependably and accurately. It extends to provide services as and when promised without errors. Tangible means the appearance of physical facilities, equipments, personnel and communication materials. Responsiveness indicates willingness to help the customers and provide prompt service. Assurance represents the knowledge, courtesy and ability to inspire trust and confidence. Empathy relates to the caring, individualised attention a firm provides to the customer [Kandampully et al. (2001) and Khosrowpour (2000) cited Parsuraman et al. (1988, 1991 and 1994a)]. Usunier and Lee (2005) discussed the dimensions of service delivery or encounters are common across cultures but the valuation of these dimensions varies according to the customer's perception.

Galletta and Zhang (cited Liu et al. 2001) studied that customers belonging to different cultures are found to form different perception of service quality; may be because of the differences in expectations or an inclination towards different service quality criteria. Following the Hofstede model of cultural dimension it was identified that customers belonging to cultures which are characterized by lower individualism or higher uncertainty avoidance tend to have a higher intention to honour if they receive excellent service, similarly can use negative word of mouth or can complain if they receive poor service. These effects are considered to be opposite with customers having cultures characterized by higher individualism or lower uncertainty avoidance. It can be realized that both customers and employees of organization have some influence of culture in their behaviour which can make the cross-culture management more complex.

According to Young and Nie (1996) the organisation in service sector can manage this complexity by creating an own sub-culture of organization, forming an international team where the members belong to different cultural background, and learning, respecting, understanding and trying to accept each other's culture can help in creating cross-culture synergy.

Harris et al. (2004) suggests that a global leader of an organization belonging to any sector working as an MNC, should learn and understand a culture and its sensitivity, use communication as an resource in cultural difference to overcome cross- cultural misunderstanding and misperception. A Global leader can use the strategy of negotiation and alliances with different cultures in which they work, for increasing the profitability of the organization. Leaders should adapt to changes as per the situation, manage transitions and relocations as well as manage diversity in global work culture and understand the synergy in organizational culture and its implementations.

French (2007) argues that people should be aware about the impact of culture in any work organisation as it enhances the realities of day-to-day life in an increasing number of work settings and also contribution to the effective management of employees in term of meeting goals set to measure organisational success. Also Browaeys and Price (2008) express that if the awareness of the cultural difference is consciously raised, then the ability to analyse the effectiveness of employing business policies in differing cultural environments is considerably improved.