CULTURAL CULTURAL ENVIRONMENTENVIRONMENT

Nature of Environment

• In its narrow sense, culture is understood to refer to

such activities as dance, drama, music, & festivals

• In its true sense, culture is understood as that

complex whole which includes knowledge, belief, art,

morals, laws, customs , & other capabilities & habits

acquired by an individual as a member of a society

• “Culture consists of”, writer Elbert W Steward &

James A Glynn, “the thought & behavioural patterns that members of a society learn through language & other forms of symbolic interaction

• Cultures change gradually, picking up new ideas &

dropping old ones, but many of the cultures of the

past have been persistent & self-contained

Most scholars of culture would agree on its following

characteristics :-

• Learned – Culture is not inherited or biological

based, it is acquired by learning & experience

• Shared – People as members of a group,

organisation, or society share culture; it is not

specific to specific individuals

• Trans-generational – Culture is trans-generational, passed from one generation to the next

• Symbolic – Culture is based on the human capacity to symbolise or use one thing to represent another

• Patterned – Culture has structure & is integrated;a change in one part will bring changer in another

• Adaptive – Culture is based on the human capacity to changer or adapt, as opposed to the more genetically driven adaptive process of animals

• Culture is understood as human means of adapting to circumstances & transmitting this coping skill &knowledge to subsequent generations

• Culture gives people a sense of who they are, of belonging of, of how they should behave, & of what

they should be doing

• Culture impacts behaviour, morale & productivity

at work, & includes patterns that influence company

attitudes & actors.

Levels of Culture

• The inter-national manager needs to be aware of the

three levels of culture that influence overseas operations

• These include national culture, & the occupational& organisadtional cultures (see Fig. below)

A. National Culture B. Business CultureC. Occupational & Organisational

Cultures

National Culture

Business Culture

Occupational CultureOrganisational Culture

Multinational Management

Levels of Culture in Multinational Management

A. National Culture

• National culture is the dominant culture within the

political boundaries of a country

• Formal education is usually taught & business is

generally conducted in the language of the dominant

culture

• Political boundaries, however, do not necessarily

reflect cultural boundaries

• Many countries, such as India, Canada, & Singapore

have more than one major cultural group within

their political boundaries

• States with relatively homogeneous cultures have

various sub-cultures representing regional & rural/

urban cultural differences that effect business

activities

• Most inter-national businesses take place within the

constraints of political boundaries of the nation-state

• As such, the dominate culture of the nation-state

probably has the greatest impact on inter-national

business

• It usually influences not only the language of

business transactions but also the nature & types of

law that govern business.

B. Business Culture

• For an inter-national manager, business culture – the way Indians, Germans, Koreans& others do business – is more important

• Business culture represents norms, values, & beliefs that pertain to all aspects of doing business in a particular environment

• Business cultures tell the correct, acceptableway to conduct business in a society

• Business culture also provides the guides for everyday business interactions

• What to wear to a meeting, when & how to use

business cards, whether to shake hands or

embrace – are all examples of business

etiquette taught by business culture

• Each national culture has its own business

culture

• The more pervasive national cultures

constrain & guide the development of business

culture in a society

• Business closely interweaves with the broader

cultural values, norms, & beliefs

• Examples include the priorities given to age

& seniority, the role expectations of women, &

expectations concerning of sub-ordinates by

bosses

C. Occupational & Organisational Culture

• Organisation-specific & occupation-specific

cultures tend to develop within national &

business cultures

• Organisational culture (or its sister-term

corporate culture) refers to the philosophies,

ideologies, values, assumptions, beliefs,

expectations, attitudes, & norms that knit an

organisation together & are shared by its

employees

• Members of organisations tend to internalise

cultural nuances & like to initiate newcomers

into such mores

• Some of the practices are so thoroughly internalised

that no one questions them – they are taken for

granted, that is, they get institutionalised

• Besides institutionalisation, glorification tends to

occur in organisation cultures, heroes emerge,

especially among the founding fathers of the firm,

whose sacrifices, valorous deeds, & ingenuity are

embellished into stories & sagas

• The firm itself may come to be regarded as a source

of pride in some sense unique & employees begin to

feel a strong bond with it, & they begin to identify

with it

• The organisation turns into a source of clan & the

organisational members become ethnocentric

• Clannish organisations often pose problems to inter-

national managers

• Most Indian companies had developed the clan

culture which led to the collapse of several joint

ventures between Indian companies & overseas

firms

• Mention may be made of the breaking up the

marriage between Tatas & IBM & Daimler Benz, of

Godrej with P&G & GE, of DCM with Toyota, of

LML with Piaggio & of Mahindra with Ford

• Different occupational groups, such as physicians,

professors, lawyers, accountants, & crafts-people

have distinct cultures, called occupational cultures

• Occupational cultures are the norms, beliefs &

expected ways of behaving of people in the same

occupational groups, regardless of which

organisations they work for

• The occupational cultures cannot be ignored by the

inter-national manager, notwithstanding the

dominance of national & business cultures

• People with similar jobs often had very similar

culture norms

• Moreover, people from different occupational

groups were often more similar to one another than

to people from their own national cultures.

Elements of Culture

• Culture is a very complex & multifaceted concepts

comprising many elements

• All these elements have evolved over time.

Though the elements of culture are many, we focus here

on language, religion, education, aesthetics, attitudes,

customs, & manners & supernatural beliefs.

(See Fig. below)

Culture

Attitudes Aesthetics

Religion

Education

Supernatural Beliefs

Language

Customs &Manners

Elements of Culture

Language & Culture

I) The Influence of Language on Culture

ii) The Influence of Culture on Language

iii) High & Low-context Languages

i) The Influence of Language on Culture

• Language refers to an abstract system of wordmeanings & symbols of all aspects of

culture• Language includes speech, written characters,

numerals, symbols & gestures of non-verbal

communication • How does language influence culture?• Language establishes the categories on which

our perceptions of the world are organised• It establishes categories in our minds that

force us to distinguish those things that weconsider as similar from those that are not

• Speakers of any two languages will not perceive

reality in exactly the same way

• Besides reflecting its world view, a language reveals

a culture’s basic value structures

• For the Americans, it is the individual, not the

group, that is important

• Many anthropologists argue that the language fails

to capture nuances of human thoughts &

behaviours

• For example, humans possess the ability to make

millions of colour distinctions, yet languages differ in

the number of colours that are represented by their

respective vocabularies

• The English language distinguishes between yellow

& orange, but some other languages cannot

ii) The Influence of Culture on Language

• The impact of culture seems to be more significant

than vice versa

• The vocabularies of all languages reflect cultural

nuances of the societies

• If a society is endowed with highly advanced tech-

nology (as it happens in rich countries), the language

of the society contains such technical jargons as

computers, laptops, BPO, call centres, e-mails,

internet, iPods, software, websites, & the like

iii) High & Low-context Languages

• Languages in which people state things directly &

explicitly are called low context

• The words provide the meaning

• There is no need to interpret the situation to under-

stand the import of the words

• Languages in which people state things indirectly &

implicitly are called high context

• In the high context language, communications have

multiple meanings that can be interpreted only by

reading the situation in which they occur

• So important are the ideas of high & low context

that many people refer to the whole cultures as being

high & low context

• Most northern European languages, including

German, English & the Scandinavian languages, are

low context

• In contrast, Asian & Arabic languages are high

context

Religion & Culture

• Religion refers to a specific & institutionalised set of

beliefs & practices generally agreed upon by a number of persons or sects

• There are nearly 1,00,00 religions across the globe,but the major ones among them are :-

1. Hinduism 2. Christianity 3. Islam4. Buddhism 5. Confucianism

• Religion has considerable impact on one’s life,

irrespective of the country to which he or she

belongs

• People go to any extent & practise abnormal

activities in the name of religion.

1. Hinduism

• Critics argue that by emphasising moksha, dharma,

renunciation, & asceticism, Hinduism negates enter-

prenurialism & the wealth acquisitive nature of its

followers

• From the time of the Rig Veda, which contains many

prayers for riches, worldly wealth was looked upon

as morally desirable for the ordinary man, & indeed

essential to lead a full & civilised life

• India had not only a class of luxury-loving &

pleasure-seeking dilettante but also one of wealth-

seeking merchants & prosperous craftsmen, who if

less respected than the Brahmins & warriors, had an

honourable place in society.

2. Christianity

• Is the most widely practised religion in the world• About one billion people, approximately 20 % of the world’s population identify themselves as Christians• The vast majority of Christians live in Europe & America, although their numbers are growing in Africa • Protestantism (one branch of Christianity, the other being Catholicism) has considerable implications for business• Capitalism, which is the most dominant economic philosophy to-day, has grown out of Protestantism which advocates hard-work &

encourages wealth acquisition.

3. Islam

• Is the second largest religion with followers spread over more than 35 countries & inhabiting an almostcontinguous stretch of land from the north west coast of Africa through the Middle East, to China &Malaysia in the Far East

• Islam prohibits receipt of payment of interest whichis considered usury

• Some critics argue that Islam discourages profit.This is not true

• The Quran speaks approvingly of free enterprise & of earning legitimate profit through trade & commerce

• Islam also advocates market based systems

• Given this proclivity, Muslim countries tend to

attract inter-national businesses so long as they

behave in a manner that is consistent with Islamic

ethics.

4. Buddhism

• Has 250 million followers in Central & South East

Asia, China, Korea, & Japan

• Buddhists stress spiritual achievement & obviously

wealth creation is not encouraged

• In Buddhist societies, we do not see the same kind of

cultural stress on entrepreneurial behaviour that we

see in the Protestant West

5. Confucianism

• Numbering over 150 million are found in China,

Korea, & Japan

• The religion teaches the importance of attaining

personal salvation through right action

• Confucianism is built around a comprehensive

ethical code that sets down guidelines for relation-

ship with others

• The need for high moral & ethical conduct & loyalty

to others are central to Confucianism

• Confucianism has economic tenets too

• It teaches the followers to lower the costs of doing

business & this has largely contributed to the eco-

nomic success of Japan, South Korea, & Taiwan

• Three principles are central to Confucianism –

loyalty, reciprocal obligations, & honesty.

Education & Culture

• In its broad sense, education is the lifelong process of

learning through which members of a society

acquire knowledge & develop skills, ideas, values,

norms, & attitudes which they share with other

members of the society

• Economic progress of a country depends on the

education of its citizens

• This being a broad statement, specific economic

implications are as follows :-

1. Countries rich in educational facilities attract

high-wage industries. By investing in education, a country can attract (nay, create) the kind of high-wage industries that are often called “brain power” industries

2. The market potential of a country depends on education. Educationally advanced countries,such as England, France, & Germany are more likely to be markets for computers & high-tech equipment than are less educated countries, such as Poland, the Czech Republic, & Romania. It is also likely that MNCs doing business in these countries will find it easier to hire & train local managers in Western Europe than in Eastern Europe

3. The level of literacy & educational attainment

determines the nature of advertising,

packaging, quality of market research, &

distribution systems available or prevalent in

a country.

Aesthetics & Culture

• Aesthetics relates to the artistic tastes of a culture

• Aesthetic values of Indians, for example, are

different from those of Canadians as reflected by

the art, literature, music, & artistic tastes

• One important manifestation of aesthetics is the

behaviour of people

• International managers should understand

aesthetic local values if he or she has to appreciate

another culture & the way in which business must

address these values in the international arena

• Another aesthetically related area is colour

• In many Western countries, the colour black is

associated with mourning, while white is with joy &

purity

• In many Asian countries, white is the colour for

mourning

• Green is the favoured colour in Islam but it is

associated with sickness across much of Asia

• Music is deeply embedded in culture & should be

considered while promoting goods & services

• It can be used in clever & creative ways or in ways

that are offensive to the local population

• The architecture of buildings & other structures

should also be researched to avoid making cultural

blunders due to the symbolism of certain shapes &

forms.

Attitudes & Culture

• Attitudes are positive or negative evaluations,

feelings, & tendencies which make an individual

behave in a particular way towards people or

objects

• Attitudes include opinion about individual freedom,

democracy, truth & honesty, the role of sexes,

justice, love, marriage, & sex

• Of particular interest to us in this context are the

attitudes towards work, business, & time & the

future.

Culture vis-a-vis Customs & Manners

• Customs are common & established practices

• Manners are behaviours that are regarded as

appropriate in a particular society

• Customs dictate how things are to be done; manners

are used in carrying them out

• Further, manners are pointers of an individual’s

character whereas customs are what society

collectively expects its members to do

• The inter-national manager should understand the

manners & customs of host country citizens

• Failure to understand & respect local customs &

manners may land the manager in trouble, besides

losing business

• In Arab countries, for example, it is considered bad

manners to attempt to shake hands with a person of

higher authority unless this individual makes the

first gesture to do so, unlike in the US where a

person would not hesitate to offer his or her hand

regardless of the person’s rank

• Similarly, shaking hands with the opposite sex is not

appreciated in India, though the practice is

prevalent in some other countries

Supernatural Beliefs

• All societies have a certain degree of control over

their physical & social environments

• People in all societies can understand & predict a

number of things

• Things like car cannot run without petrol, Sun

always rises in the east & sets in the west & apple

falls on the earth are predictable

• But, there are certain other things which are not

predictable :why a person dies on the spot in an

accident when the person sitting next to him/her is

unscathed?

• Societies must develop supernatural belief systems for explaining these unexplainable happenings

• The people explain the unexplainable by relying on various types of supernatural explanations, such asmagic, religion, witchcraft, sorcery, & astrology

• Supernatural belief systems affect the conduct of business by shaping attitudes about work, savings,consumption, efficiency, individual responsibility &decision making

• Followers of Hinduism believe in Vastu • Vastu decides the direction of the factory gate, main

entrance of the premises, place where CEO should sit, & whether or not the company should diversify/ acquire another business

Implications for Inter-national Business• Global businesses are the repositories of

multi-cultures• Multi-culturalism means that people from many

cultures (& frequently many countries) interactregularly

• The scenario is highly complex with several national

cultures & sub-cultures interacting regularly • Managing multi-culturalism is essential for every

inter-national firm• Four tasks are crucial :--

a) spreading cross-cultural literacy, b) culture & competitive advantage, c) managing diversity & d) strategy culture fit

a) Spreading Cross-Culture Literacy

• One of the biggest dangers confronting a firm that

enters a foreign market for the first time is the

problem of being ill-informed

• Inter-national businesses that fail to understand

host-country cultures are likely to fail

• Doing business in different cultures requires

adaptation to conform with the nuances of that

culture

• An inter-national manager has to bear in mind that

local people often expect higher standards of

behaviour & tolerate far less deviation from local

manners & customs from foreign companies than

from a native firm.

Removing Cross-Cultural Illiteracy

• One way to appoint local citizens to do business in a

particular culture

• Firms should also be ensure that home-country

executives are cosmopolitan enough to understand

how differences in culture affect the practice of inter-national business

• Transferring executives overseas at regular intervals

to expose them to different cultures will help build a

cadre of cosmopolitan executives

• An inter-national business must also be constantly

on guard against the dangers of ethnocentric

behaviour

• The ethnocentric person sees his or her own group

as the centre or defining point of culture & views of

all other cultures as deviations from what is normal

• Hand-in-hand with ethnocentrism goes a disregard

or contempt for the culture of other countries

• Unfortunately, ethnocentrism is all too prevalent;

many Indians are guilty of it, as are many

Americans, French, Japanese, Britishers, & so on

• Ugly as it is, ethnocentrism is a fact of life & the

inter-national businesses must be on continual guard

against it

• How do inter-national managers learn to live with

other cultures?

• The first step is to realise that there are cultures different from their own

• They must then go on to learn the characteristics of those cultures so that they may adapt to them.

Multi culture

Managing diversity

Compatibilitybetween

Strategy &culture

Culture &Competitive advantage

SpreadCross-culture

literacy

Multi Culture & Inter-national Business

b) Culture & Competitive Advantage

• Culture may sound abstract but the norms & values

prevalent in a society do influence the costs of doing

business in that country

• These costs influence the ability of enterprises to

establish a competitive advantage in the global

market place

• Japan presents us with an example of how culture

can influence competitive advantage

• The country’s emphasis on group affiliation, loyalty,

reciprocal obligations, honesty, & education -- all boost the competitiveness of Japanese companies

• The emphasis of group affiliation & loyalty

encourages individuals to identify strongly with the

companies in which they work

• This tends to foster an ethic of hard work & co-

operation between workers & management for the

good of the company

• In addition, the availability of a pool of highly skilled

labour, particularly, engineers, has helped Japanese

companies develop cost reduction techniques

• A different picture is found in Britain

• Here, the class-based conflict between workers &

management has disrupted industrial relations,

raising the cost, of doing business

• For inter-national business, the connection between

culture & competitive advantage is important for

two reasons :-

• First, the conjunction suggest which countries are

likely to produce the most viable competitors

The Pacific Rim nations (South Korea, Taiwan,

Japan, & China), for example, are likely to produce

cost-effective competitors because of the

combination of free market economies, Confucian

ideology, group-oriented social structures, &

advanced education systems ;

• Secondly, the relationship between culture &

competitive advantage has important implications

for the choice of countries in which to locate

production facilities & do business

• Obviously, a country that has strong cultural

support attracts a vast inflow of FDI

c) Managing Diversity

• Managing diversity means establishing a hetero-

geneous work-force to perform to its potential in an

equitable work environment where no member (or

group of members) has an advantage or a

disadvantage

• Managing diversity is a challenge for an inter-

national manager

• The challenge is to create a work environment in

which each person can perform to his or her full

potential & therefore compete for promotions &

other rewards on merit alone

• Success in the inter-national arena is greatly deter-

mined by an MNCs ability to manage diversity

• Inter-action helps bring employees together, thus

leading to diversity

• Most companies encourage interaction & therefore

go in exchange programmes

• Wipro introduced exchange programmes so that

American Management System (AMS) employees could come to Bangalore & vice versa

• HCL in its first three months sent 20 employees each

on both sides for an exchange programme so that the

two sides could work together as a team

• MphasiS encouraged its Chinese engineers to work

alongside MphasiS engineers on its US accounts

• Similarly, for a Japanese project, the development

is co-located in Shanghai & Mumbai, involving

travel, co-ordination & knowledge sharing across

both locations

• All this goes a long way in buildings a rapport

between teams

• WIPRO has come out with an interesting concept of

‘buddies’

• This means that for every five employees of AMS,

there is one WIPRO employee as their buddy who

would guide them on WIPRO rules & regulations

• 40 per cent of Infoscions are non-Indians

• At HSBC, 30 per cent are Asian & nearly 70 per cent

are Latin American.

Diversity – Advantages & Disadvantages

• Diversity, though a challenging task to manage,

carries within it certain advantages

• One main benefit of diversity is the generation of

more & better ideas

• Because group member come from a host of

different cultures, they are often able to create

unique & creative solutions & recommendations

• A second major benefit is that culturally diverse

groups can prevent groupthink, which is social

conformity & pressures on individual members of a

group to conform & reach a consensus

• When this occurs, group participants believe that

their ideas & actions are correct & those who

disagree with them are either uninformed or are

deliberately trying to sabotage their efforts

• Multi-cultural diverse groups are able to avoid this

problem, because the members do not think

similarly or feel the pressure to conform

• As a result, they typically question each other, offer

opinions & suggestions that are contrary to those

held by others & must be persuaded to change their

minds

• Therefore, unanimity is achieved only through a

careful process of deliberation

• Decision-making may be very slow, unlike in a

homogeneous group, but the decision reached tend to be very effective

• There are problems associated with diversity, never-

theless

• Diversity may cause a lack of cohesion that results

in the firm’s inability to take concerted action, be

productive, & create a work environment that is

conducive to both efficiency & effectiveness

• These problems are rooted in people’s attitudes

• There are perceptual problem too

• When culturally diverse groups come together, they often bring pre-conceived stereotypes with them

• A related problem is inaccurate biases

• Japanese firms, for example, depend on groups to

make decisions

• Entrepreneurial behaviour, individualism, &

originality are down-played

• Yet another potential problem with diverse groups

is inaccurate communication, which could occur for

a number of reasons

• One is misunderstandings caused by words used by

one but not clear to others

• Another problem is the way in which situations are

interpreted

• Many Japanese nod their heads when others talk,

but this does not necessarily imply their approval

• They are merely being polite & attentive

• Different uses of time may also lead to

communication problems

• For example, many Japanese will not agree to a

course of action on-the-spot

• They will not act until they have discussed the

matter with their own people because they do not

feel empowered to act alone

• Many Latin managers refuse to be held to strict

time-tables, because they do not have the same time-

urgency that US managers do.

Managing Diversity – Some Practical Measures

• Having discussed the diverse work-forces, & their

benefits & potential problems, it is appropriate to

list out some practical steps that managers can

take to manage diversity

• Here are some such steps :-

• Focus on bringing in the best talent, not on

meeting numerical goals. Geocentric policy

towards staffing should be the guiding

principle• Hold managers accountable for meeting goals

of diversity

• Establish monitoring programmes among employees of same & different races

• Develop career plans for employees as part ofperformance reviews

• Develop an age, gender, & race/ethnic profileof the present work-force

• Promote minorities & other disadvantaged sections to decision-making positions, not

justto staff jobs

• Diversify the company’s board of directors• Provide extended leaves, flexible scheduling,

flexi-time, job sharing, & opportunities to tele-communicate, particularly for disadvantaged workers

d) Culture Strategy Compatability

• A culture & strategy fit is essential for the success of

an inter-national business (see exhibit below)

Strategy - Culture Fit

Name of Company Strategy - Culture Fit

P&G During 1980s, modified its bulky diapers in Japan to ‘trim-fit’ which helped regain 30 per centmarket share. Trim-fit becamebest sellers in the US.

Asian Paints Became APCO in Australia, as Australians are averse to the terms Asia.

Coca-Cola Labels on bottles supplied to gulfcontain ‘no-alcohol’.

Nokia Introduced Hindi SMS for Indian

users of cell phones

McDonald’s ‘Meat prepared after halal’ is

printed on the label before

exporting meat to Saudi Arabia

• Cultural differences provide challenges to inter-

national managers in marketing products, managing

work-forces, & dealing with host-country govern-

ments

• But fortunately, similarities do exist among many

cultures, thereby reducing some of the needs to

customise business practices to meet the demands of

local cultures

• Countries that share cultural similarities form a

cultural cluster or simply called the convergence

Several development account for convergence

• Customers’ needs across societies are similar.

In order to meet identical needs, companies

need to produce similar goods. Similar

production process are needed to produce such

products

• Growing industrialisation & economic

development enable organisations to have the

technical & financial capability to use similar

technologies

• Global competition & global trade contribute

to convergence. Inter-national competition

raises managerial awareness of what people in

other societies are doing. Japanese competition

with the other countries for example, enabled

companies elsewhere to initiate such

managerial practices as Just-in-Time (JIT)

inventory, Kaizen, open offices, & common

uniforms

• Inter-national strategic alliances contribute to

clusters. With inter-national co-operative

arrangements among competitors, an

increasing number of firms from diverse

nationalities combine with one another to form

one organisation. These joint ventures or

alliances provide a wealth of information on

the organisational practices of other societies.

Later, parent organisations use this knowledge

to change & improve their own organisations.

• Business education also serves to harmonise organisational practices. In particular, the large number of inter-national students in US& European MBA programmes helps spreadcommon business techniques. Many students return to their home countries with the intentof adopting management practices that best fittheir national cultures. For example, many of the high-tech firms in India, Korea, & Taiwanare staffed with top executives who were educated in the US & stayed on to work for a decade or more. Now, they are returning to their homelands with technical & managerial expertise

Tackling the Cultural Factor – Strategies

• Many inter-national businesses utilise the country-

clustering approach in formulating their inter-

national strategies

• Many firms from New Zealand focus their first

exporting efforts on Australia.

• Similarly, Hong Kong firms have been very

successful in exploiting China’s markets

Worldwide Integration Strategy

• Firms use either a world-wide integration strategy

or local (national) responsive strategy

• Standardised products are developed & are sold

throughout the world with few alternations.

National Responsive Strategy

• A national responsive strategy allows subsidiaries to

enjoy substantial latitude in adopting products &

services to suit the particular needs & cultural

realities of the countries in which they operate.

Types of National Responsiveness

There are three general categories of national

responsiveness :-

1. Product Adaptation

2. Individual Adjustment

3. Institutional Adaptation

1. Product Adaptation

• This refers to the differentiation of a firm’s product

to capture a particular niche in the market

• Product differentiation also means adapting the

product to suit cultural differences in the host-

culture by modifying its characteristics, as for

example, Coca-Cola changing the name of its Diet

Coke to Coke Light in Japan because the word ‘diet’

has a disagreeable connotation.

2. Individual Adjustment

• This is sought to be accomplished through training

• Training should be provided to all personnel & their

families going on inter-national assignments, as they

would be exposed to a cultural environment which

may be very different from their own

• The managers & their families will face daily

challenges, excitement, frustration, uncertainty, &

anxiety

• The degree of success with which they respond to

these feelings & emotions & their ability to handle

them effectively will depend on the success of their

training & more importantly, on their skills,

stamina, linguistic & communicative competence,

intelligence, level of interest & knowledge of the host

-culture, & their ability to empathise with members

of the host-culture

• A successful manager is one who communicates in

the host’s language, behaves in an appropriate

manner, observing all the local manners & customs,

& relates to every one in a manner that enables the

local people to accept him or her as one of them.

3. Institutional Adaptation

• An inter-national firm seeks institutional adaptation

by adopting an appropriate organisational structure

& policies to fit into the host-culture

• An organisational design in one culture may be

totally inappropriate in another

• Human resources practices need to be modified to

take into account the differences in remuneration,

employment, promotion, & training methods

• In Islamic countries, for instance, work scheduling

would have to allow sufficient time & provide suit-

able facilities for employees to pray at certain times

of the day

• Recruitment policies would have to recognise class

& ethnic distinctions in order to avoid causing

offence to employees & customers from different

class & ethnic backgrounds