MGT 400 CrossCultural Management − Spring 2016
Midterm Exam Study Guide
Midterm exam format (Total points: 150; Length: 1 hour and 15 minutes):
Multiple Choices: 40 questions, 3 points each. They are from chapters.
Short Answers: 3 questions, 10 points each. They are from cases/articles of Harvard Business Publishing.
Cultural values (Chapter 2 and related cases)
What is culture? Saving face in East Asia. Case: An Accenture manager in India (p.35). Is the acquired knowledge people use to interpret experience and actions. Knowledge translates into values that guide behaviors. Empathy Training is something to help employees better understand the customer and their needs, particular the urgency to get a fixed computer.
We also discuss several other topics like Why are higher prices necessary to get bigger quantities supplied?
Highcontext and lowcontext cultures (pp.41 42).
High context is more polite and tend to have more values and tend to care more Latin America and Middle East and Asia. Face is very important: direct embracing questions or statements are to be avoided, or asked in a very discreet way, sometimes via an intermediary.
Low Context tend to be more direct and examples would be Europe and the U.S. Lack of clarity or ambiguity is generally regarded as a negative.
Saving face in East Asia—confrontation causes the person who is confronted to lose face (respect of a person’s peers; avoiding embarrassment). As a result
An Accenture manager in India—in training the Indian employees, they were told to answer the customers questions but not ask beyond those questions. Therefore the customers felt that they were not being helped to the fullest extent and mistakes were being made because customers did not know what questions to ask. Now employees are being trained to address cultural differences and answering questions beyond what the customer asks.
We also discuss several other topics like Who thought the successor should be ali?
Problems in Dealing with Culture: parochialism, ethnocentrism, and polycentrism. Parochialism is the belief that the only way to do something is only one way to do it. NO other way to do it just that way.
Ethnocentrism View hold that an individual or a firm believe that their own way of doing things is the best, and will not see to adapt to local cultural practices.
Polycentric View holds that multinational enterprises should treat each international subsidiary as a separate national entity. Example When in Rome, do as the Romans do. Ethical problems arise with polycentric view.
Common Culture Mistakes: Some firms have evolved protocols to avoid problems arising out of common cultural mistakes. What is protocol?
Protocols are rules of how individuals in a business setting are to interact with each other. It is important to understand protocol and communication aspects of those in a country that you would like to know.
Avoiding Cultural Problems: Executives should be trained in cultural sensitivity to avoid cultural problems in a multicultural business setting.
Sociology framework for analyzing culture (Kluckhohn & Strodtbeck): i. Time orientation (past, present, or future) ii. Space orientation (private, mixed or public) iii. Activity orientation (being, thinking, or doing) iv. Relationships among people (group, hierarchical, or individualistic) v. Relations to nature (subjugation, harmony, or mastery) vi. Basic human nature (evil, mixed, or good). Hofstede’s framework: Understand the five dimensions. Representative countries with high and low scores on each of the dimensions. Understand Figure 2.8 and Figure 2.9, country clusters. (No need to remember a particular country’s scores, but if you want to know, you should use Hofstede’s website, rather than Figure 2.3 to Figure 2.7, for a particular country’s scores.) If you want to learn more check out What is the structure of epithelial tissue?
We also discuss several other topics like What is considered the third holiest muslim city?
*Power distance: the extent to which lesspowerful members and organizations accept the unequal distribution of power and submit to authority.
*Individual collectivism: highindividualistic societies consist of loosely linked individuals, who view themselves as largely independent of other groups, (i.e., Australia, Canada, US). Collectivism is the tendency of people to associate with groups where groups members look after after each other in exchange for group loyalty, (i.e., Japan, China, Latin America). Don't forget about the age old question of What did the marcel duchamp want to convey?
*Uncertainty avoidance: The extent to which the members of a culture feel threatened by uncertain or unknown situations or by ambiguity in a situation. Countries organized around high uncertainty avoidance have populations that tend to have a higher need for security and trust in their superiors (i.e., Japan, Germany, Spain). Low uncertainty avoidance cultures are more willing to accept risk associated with the unknown (i.e., Denmark, UK, US, and Canada).
*Masculinity femininity: roles between genders and the more dominant role in a given society. High masculinemore value on success, money, and a more assertive outlook. Femininity or relational orientation describes more dominant values that are nurturing and caring
Table 2.1 Skip the Example column, but you need to understand the Etiquette and Specifics columns. Specifics: How do people greet and address one another? What role do business cards play? Business cards are extremely important in Japan and China, give and receive them with two hands. It is extremely embarrassing to not have business card to present when traveling in Asia, even if you are a student.
Do people in the firms I am visiting dress and interact formally or informally? The U.S., Canada, Australia and New Zealand are less formal that most countries. Though it is always safer to dress more formal than just khaki pants.
Motivation across cultures (Chapter 7) We also discuss several other topics like Explain how le chatelier's principle works.
Definition of motivation. Case: Virgin Atlantic.
Motivation is an internal state or condition that activates a person’s behavior and gives it direction towards accomplishing a task (based on emotion). Motivation is important as it determines an individual’s effort toward performing a task.
One of the key ways that Branson has tried to motivate employees at his firms is to provide them with ample flexible and make the work both challenging and interesting. Also failure tend not necessarily mean termination, he leaves them room to fail.
*Book reads: “Convention dictates that a company should look after shareholders first, its customers next and worry lastly about its employees. Virgin does the opposite. For us, employees matter the most. It just seems common sense that if you start with a happy, well motivated workforce you’re much more likely to have happy customers. In due course the resulting profits will make your shareholders happy” (197)
Give examples for the Maslow’s five hierarchies of needs. Limitation of Maslow’s theory. Limitation of Maslow’s theory: criticized for failing to explain the specifics of employee needs and neglecting job interests.
The difference between ERG theory and Maslow’s hierarchy (i.e., combine into 3 hierarchies, and have a frustrationregression process).
ERG theory argues that an employee’s behavior is motivated simultaneously by more than one need level. (three broad categoriesexistence, relatedness, and growth.
Herzberg’s hygiene factors and motivators and their relationships with job satisfaction and dissatisfaction. achievement, recognition for achievement, the work itself, responsibility, and growth or achievement. (intrinsic factors).
company policy and administration, supervision, interpersonal relationships, working conditions, salary, status, and security (extrinsic factors).
Maslow’s hierarchy: helpful when recognizing that employees from different countries may be motivated by different needs. Also helpful because it reminds managers who may be inclined to emphasize money as the sole motivator that there are different employee needs and different people are motivated by different things.
McClelland’s three learned needs (need for achievement, need for affiliation, and need for power). nAch: people want to accomplish reasonably challenging goals through their own efforts nAff: desire for approval from others, and as a result, it means conforming to their wishes and expectations and avoiding conflict.
nPow: desire to exercise authority over people and resources.
Expectancy theory (Figure 7.5): a processmotivation theory based on the idea that work effort is directed toward behaviors that people believe will lead to desired outcomes.
EP: efforttoperformance expectancy is an individual’s perception that his or her effort will result in a particular level of performance.
PO: performancetooutcome expectancy is the perceived probability that a specific behavior or performance level will lead to specific outcomes.
V (valence): refers to one’s anticipated satisfaction or dissatisfaction with an outcome. What is valence.
Equity theory. How people respond to inequity; various strategies can be used to restore equity; three types of people: Entitleds, Benevolents, and Equity Sensitives (pp. 218210).
Goal setting theory: effective goals and limitations of this theory. limitations: tied to money incentives, employees try to select easier goals, employers but balance a rewardandevaluation system. Leadership (Chapter 8)
Define leaders and leadership. Case: North American Food and Beverage Manufacturer’s Learning Experience in China
NAMF&BM in China: The implication for leadership was that the collective must be emphasized over the individual. Greater value is placed on the ability to lead groups to cooperative output than on giving an individual attention and recognition.
US managment was rewarding employees through group incentives and had unmotivated workers for over a year. He learned that other Chinese firms were giving their employees recognition in front of their peers and it seemed to motivate the employees. This was in complete contrast to the training the US managers went through. After these changes were made, despite the warnings of disturbing the harmony and collectivism in China things got better for the firm (less turnover rate and higher employee satisfaction).
*take away: leadership requires the recognition that environments do change and even cases where leaders think they are being culturally appropriate may not be the right approach. Leaders are individuals who significantly affect the thoughts and behaviors of others through persuasion of influence
Leadership involves the ability to inspire the thinking, attitudes, and actions of a variety of individuals and cultures. Involves influencing, motivating, and assisting followers to desired levels of performance. Trait theories of leadership: Charisma and transformational leadership (which is a universally endorsed type of leadership across countries, shown by the GLOBE study). Transformational versus Transactional
Leadership. Personality traits commonly associated with good leadership. Internal locus of control. States that people have underlying traits or characteristics that lead to either superior leader or follower performance.
Charism: the ability to inspire or influence others
^ Charisma of leadership has positive effect both in terms of organizational performance and on follower satisfaction, organizational and team commitment, and organizational identification. getting followers to transcend their own selfinterests and focusing on the needs of their colleagues and the organization”employee engagement’
charismatic leadership has a positive effect both in terms of organizational performance and on follower satisfaction, organization and team commitment, and organizational identification. Transformational leadership: charismatic leadership that combines learned skills with the ability to transform an organization in new, substantive ways
When a leader transforms their followers in ways that result in followers trusting the leader, performing behaviors that contribute to the achievement of organizational goals, and being motivated to perform at a high level.
Increases followers’ awareness of the importance of their tasks and performing well
Awareness of needs for personal growth, development, and accomplishment
Works best in cultures that value empowerment and understanding the higher goals of the company (SteveJobs type leadership)
**associated leadership style with charisma
the type of leadership that is used across the globe the most because leadership style that rallies subordinates around a common goal with enthusiasm and support. Unlike Transactional it is mostly used by a give and take relationship using rewards as an incentive which not many companies do. Transformational is attributed as 1, motivate arouser, foresight, encouraging, communicate, trustworthy, dynamic, positive, confidence builder, motivational.
Transactional leadership: contrast to transformational/charismatic leadership
Words best in more difficult environment where followers require the organization to “show them the money” (i.e., lesser developed countries)
A transactional leader recognizes follower needs and tries to ensure that the organization satisfies those needs if the employee performance warrants it.
Exchange/promise of rewards for appropriate levels of effort
Seeks to acquire more followers through the exchange process
*Possible for leader to manifest both transformational and transactional qualities *Personality traits associated with good leadership: charisma, dominance, selfconfidence, energy/activity levels, tolerance for stress, internal locus of control, integrity and honesty, emotional intelligence. *Locus of control: whether people feel that they can control things themselves or whether forces outside of them control their future.
is one who recognizes follower needs and tries to ensure that the organization satisfies those needs if employee performance warrants it.
Behavioral theories: Ohio State/Michigan Studies (task vs. people orientation). The leadership grid (understand the meaning of the cells in the grid, e.g., [9,9], [9,1], etc.). International Perspectives on Behavioral Theories: There is evidence that different cultures will find different positions on the Leadership Grid to be most effective.
Behavioral theories of Leadership – leaders are made
States that specific, learned behaviors can differentiate leaders from nonleaders or successful leaders from unsuccessful leaders, and these behaviors can be learned
Two dimensions of leader behavior: task orientation vs. people orientation
Task orientation: assigning employees to specific tasks, clarifying their work duties and procedures, ensuring that they follow company rules, and pushing them to reach their performance capacity People orientation: showing mutual trust and respect for subordinates, seeking to meet employee needs as a way to build relationships and loyalty to the company, and looking out for employee wellbeing to reduce turnover
Most effective leaders exhibit high levels of both types of behaviors, irrespective of a given situation
^ 1,9 is high creativity assumes that if employees are happy they will work hard, but lacks in production and so is 9,9 out performs all .
9,1 and 1,1 is low creativity.. 9,1 is used more for military prospects.
International perspectives on behavioral theories: different cultures will find different positions on the Leadership Grid to be most effective
High powerdistance culture: more open to the 9,1 form of leadership less likely to question the orders and authority of a leader (e.g. China, Turkey, Middle Eastern countries)
5,5 leadership style (“organization man management”): adequate organization performance through balancing the necessity to produce while maintaining morale at a satisfactory level (e.g. Japan organization man loyalty is prized, yet promotion is based on seniority)
Contingency theories: The general logic of contingency theories. Understand Fiedler’s Contingency Theory and Hersey–Blanchard theory.
Fiedler’s Contingency: there are two types of managerstask oriented and relationship oriented.
Relationship oriented leaders: want to be liked by their subordinates.They are referred to as highLPC leaders as they describe their LPC (Least Preferred Coworker) in relatively positive terms. –Task oriented leaders: want their subordinates to perform at high level and accomplish their assigned goals. They are referred to as lowLPC as they describe their LPC in relatively negative terms. The best leadership style is determined by three contingencies:
Leadermember relationship: the degree of confidence that followers have in their leader, the loyalty given to the leader, and the leader’s appeal
Task structure: the degree to which employees’ tasks are routine, in contrast to varied tasks Power inherent in the leadership position: rewards and sanctions available to the position, the leader’s formal authority, and the support the leader receives from supervisors and the organization
•Hersey–Blanchard Situational Leadership theory
–States that effective leaders must vary their style of leadership based on the employee's’ level of maturity. An employee’s maturity is determined by job maturity and psychological maturity. *Book reads: “Managers who move from a lowpower distance country to a higher power distance country will find that they must alter their style of management to fit that new environment.” (245)
Skip: Pathgoal theory and VroomYetton theory.
Leadership and culture: Power distance and leadership, uncertainty avoidance and leadership, individualism and leadership, and masculinity and leadership.
Power distance and leadership
Participatory leadership is not suitable for all cultures.
Employees in high powerdistance cultures expect a manager to act as a strong leader, and become uncomfortable with leaders delegating decisions.
In a culture that endorses a more authoritarian style, leader sensitivity might be interpreted as being weak. In cultures endorsing a more nurturing style, leader sensitivity is likely to prove essential for effective leadership.
Lower powerdistance societies prefer their leaders to empower and encourage employee participation in decision making.
Uncertainty avoidance and leadership
Leaders in high uncertaintyavoidance cultures are more directive and rely on rules to help guide their decision making; this is not expected in low uncertainty avoidance cultures.
Individualism and leadership
A high degree of individualism implies that leaders must allow employees to make decisions about their work
Masculinity and leadership
Countries high in masculinity will place emphasis on male leadership, and production along the lines of the 9,1 leader.
Countries lower on the masculinity scale could have female leaders, and place more value on relations and quality of life in the company.
➔ Potential conflicts can arise when actions are not consistent with the culture.
➔ In all cultures, a leader must build trust with followers, have a high degree of integrity, and must be perceived as treating everyone fairly.