Business / Cross Cultural Issues In International Business

Cross Cultural Issues In International Business

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Autor:  anton  31 December 2010
Tags:  Cultural,  Issues,  International,  Business
Words: 2540   |   Pages: 11
Views: 750

Table of Contents

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Table of contents 1

Introduction 2

Fiji Culture 3

Festivals of Fiji 4

City Festivals of Fiji 4

Ratu Sir Lala Sukuna Day 4

The Lovo Feast 4

Culture 5

The Three Cultures Model 5

Cultural Frameworks and Dimensions 6

Hofstede 6

Trompenaars & Hampden-Turner 7

Hall 8

The Johari Window 9

GLOBE Research 10

Comparison of Cultural Frameworks and Dimensions 11

Management Approach 12

Conclusion & Recommendation 13

APPENDIX A 14

References & Bibliography 15

Introduction

Leisure Time Ltd a consultancy Agency located in Fiji was hire to present a critical analysis on whether or not Hotel Denarau should attract British business tourist. We are a group of advisors specialising in tourism and we wish to assess whether or not targeting the British business tourist market would be a good investment. We also have to determine whether the hotel should use British management in provision for its leisure activities.

The Hotel Denarau is 18-story, 5-star hotel situated in Port Denarau in Suva on the major island of Viti Levu. It is located 5mins from the beach. They offer tour services, sports, Adventures and other attractions.

We have decided to target British due to the interest they have in Leisure activities. We have also decided to use the geocentric approach of management.

Fiji Culture

The Republic of the Fiji Islands is a multicultural island nation with cultural traditions of Oceanic, European, South Asian, and East Asian origins. Immigrants have accepted several aspects of the indigenous culture, but a national culture has not evolved.

The country consists of more than three hundred islands, approximately 110 of which were inhabited; most of the population is concentrated on the main island of Viti Levu. People from different parts of India came to work as indentured labourers on sugar plantations. European immigrants came primarily from Australia, New Zealand, and Great Britain. Viti Levu contains the major seaports, airports, roads, schools, and tourist centres, as well as the capital, Suva. Fijian, Hindi, and English became the official languages after independence in 1970.

People generally eat three meals a day, but there is much variability in meal times and snacking is common. Most food is boiled, but some is broiled, roasted, or fried. The evening meal, which is usually the most formal, requires the presence of all the family members and may not begin without the male head of the household. Men are served first and receive the best foods and the largest portions.

Men associate primarily with other men, and women's activities are performed mostly with other women. A woman's traditional role is to be a homemaker, a mother, and an obedient wife. Men are the primary breadwinners, although women also contribute to the family economy.

Fiji follows three main religious affiliations: Christianity, Hinduism and Islam. Religion ran largely along ethnic lines. Other ethnic communities include Chinese, Rotumans, Europeans, and other Pacific Islanders. Hindu and Muslim communities maintained a number of active religious and cultural organizations.

Festivals of Fiji

The annual festivals of Fiji are a time to unwind and cut loose. There are many festivals indigenous only to Fiji, such as the City Festivals of Fiji, Ratu Sir Lala Sukuna Day and the Lovo Feast. In addition both Fiji and British celebrate festivals such as Divali, Holi, Eid, The Prophet Mohammed’s Birthday, Easter and of course Christmas.

City Festivals of Fiji

There are three main city festivals held annually in Fiji. The Bula Festival is celebrated in Nadi each July, the Hibiscus Festival is held in Suva in November and the Sugar Festival is held in Lautoka. These festivals include parades with marching bands and beauty pageants, and are a joyous time for the citizens of the cities to celebrate the unique identities of their cities.

Ratu Sir Lala Sukuna Day

May 31st is celebrated as Ratu Sir Lala Sukuna Day in Fiji to honour the former high chief and scholar who was considered Fiji’s greatest statesman. Cultural shows and games mark this public holiday for proud Fijians.

The Lovo Feast

This is a communal village feast for special occasions such as weddings, festivals or the inauguration of a new chief. Lovo is prepared by digging a large pit and lining it with dry coconut husks. The husks are set on fire, and then stones are heaped on top. When the flames from the coconut husks die down, the food is wrapped in banana leaves and lowered into the pit. Meat and fish are always put in first, and the vegetables are put on top. Everything is covered with more banana leaves and stones and left to cook for about 2 Ð… hours.

Culture

Culture can be defined as the source of ties that bind members of societies through an exclusive socially constructed constellation consisting of such things as practices, competencies, ideas, schemas, symbols, values, norms, institutions, goals, constitutive rules, artefacts, and modifications of the physical environment (Fiske, 2002, p.85). These internalized rules create traditions that often go deeper than reason (Stuart, 2004).

The Three Cultures Model

The culture that we are embedded in inevitably influences our views about leadership (Hofstede, 1993). To make sense of the different types of cultural influences, Gardenswartz, Rowe, Digh, and Bennett (2003) developed the three cultures model, which posits three cultural influences at work in corporations:

• Personal culture is the shared combination of an individual’s traits, skills, and personality formed within the context of his or her ethnic, racial, familial, and educational environments.

• National culture is a share understanding that comes from the combination of beliefs, values, attitudes, and behaviours that have provided the foundation for the heritage of a country.

• Corporate culture is a combination of widely shared institutional beliefs, values, and the organisation’s guiding philosophy that is usually stated in its vision, mission, and values statements.

Cultural Frameworks and Dimensions

Hofstede

Hofstede conducted research on IBM employees in 40 countries and discovered that the cultural values strongly influenced relationships both within and between organisational divisions. Four of the significant cultural dimensions that Hofstede defined have been examined by many researchers. Understanding the way these dimensions influence culture is of increasing importance for both global leaders and those managing a diverse workforce.

• Power Distance refers to whether individuals accept inequality in power, including within the organisation. Low power distance means individuals expect equality in power and do not accept a leader’s authority just because of the leader’s position.

• Uncertainty Avoidance refers to the feeling of comfort or discomfort associated with levels of uncertainty and ambiguity. Low uncertainty avoidance means that individuals easily tolerate unstructured and unpredictably situations.

• Individualism and collectivism refers to the social frameworks in which individuals prioritize individual or group needs. In individualistic societies, individuals are expected to take care of themselves, while in collectivistic societies, individuals are expected to look out for one another, and organisations protect their employee’s interests.

• Masculinity and femininity refer to the emphasis a culture places on emotional and social roles and work goals. A masculine culture reflects a preference for assertiveness, achievement and material success. A feminine culture values relationships, corporation, and quality of life.

Trompenaars & Hampden-Turner

Trompenaars & Hampden-Turner (1998) also focus on cultural differences and how they affect business and management. They present data from more than 30,000 participants of training programs and describe seven dimensions of cultural differences:

• Universalism versus Particularism: In a Universalist culture, rules are more important than relationships; In a Partictularist culture, weather a rule applies depends on the situation and relationships evolve.

• Individualism versus Communitarianism: essentially the same as Hofstede’s Individualism versus Collectivism dimension.

• Neutral versus Affective (Emotional): Individual in a Neutral culture hide there thoughts and feelings while maintaining a cool self-control. Speech is often monotone, and the individuals do not touch each other. In an Affective culture, individual express their thoughts openly while using gestures and dramatic expressions. There is often a great deal of passion in discussions, and individuals often touch.

• Specific verses Diffuse: In Specific cultures, individuals are direct, clear, blunt, and to the point while examining the facts. In Diffuse cultures, individuals are more indirect and tactful. The context of a situation matters, and they tolerate ambiguity.

• Achievement verses Ascription: In Achievement-oriented societies, there is little focus on titles, which are used only when they reflect competencies. Leaders are judged on what they do and know. In Ascribed-status societies, titles are important; the boss is the boss, regardless of the situation. Leaders with authority are usually older males.

• Attitudes towards time: Past verses Present verses Future – Essentially the same as Kluckhohn and Strodtbeck’s time orientation dimension.

• Internal verses External Control: Essentially the same as Kluckhohn and Strodtbeck’s subjugation and domination orientations in the sense of being able or not being able to control what happen in the environment.

Hall

Hall (1976) argues that cultures vary in terms of how contextual information is viewed and interpreted. The context of a situation is crucial to communication, often heavily influencing not only what is said and how it is said, but more important, how the information is perceived. Although the need for context in understanding information is universal, Hall states that some cultures rely more heavily on context in their perceptions and interactions with others. In high context cultures what is unsaid but understood carries more weight than what is actually written down or said. In addition, trust is relied upon during negotiations and agreements, and personal relations are often a central part of the interaction. In low context cultures the focus is on the specifics of what is written or said, and trust is gained through legal agreements.

Hall argues that many cross cultural problems can be understood by examining differences in how context is viewed. Leaders would be well advised to consider context in their interactions with those from a culture with a different context. Context must be a consideration in all business dealings with those from cultures that differ on this important construct.

The Johari Window

The Johari Window, named after the first names of its inventors, Joseph Luft and Harry Ingham, is one of the most useful models describing the process of human interaction. A four paned "window" divides personal awareness into four different types, as represented by its four quadrants:

• The "open" quadrant represents things that both I know about myself, and that you know about me.

• The "blind" quadrant represents things that you know about me, but that I am unaware of.

• The "hidden" quadrant represents things that I know about myself that you do not know. This process is called: "Self-disclosure."

• The "unknown" quadrant represents things that neither I know about myself, nor you know about me. Being placed in new situations often reveals new information not previously known to self or others.

GLOBE Research

Perhaps the most comprehensive research conducted to date on national cultural dimensions has been made available by the GLOBE (Global Leadership and Organisational Behaviour Effectiveness) Project Team. The GLOBE team identifies nine cultural dimensions distinguishing one society from another and having implications for managers (Javidan & House, 2001). Four of the GLOBE dimensions identifies Uncertainty Avoidance, Power Distance, Institutional Collectivism vs. Individualism, In-group Collectivism overlap with Hofstede’s dimensions and are described above. Five Globe Dimensions aside from Hofstede’s dimensions are:

• Assertiveness, which refers to the extent a society, encourages individuals to be tough, confrontational, assertive, and competitive verses modest and tender.

• Future orientation, which refers to the level of importance a society attaches to future-oriented behaviours such as planning, investing, and delaying gratification.

• Performance orientation, which measures the degree to which a society encourages and rewards group members for performance improvement and excellence.

• Humane orientation, which is the extent to which a society encourages and rewards people for being fair, caring, generous, altruistic, and kind.

Research cannot pinpoint which cultural dimensions are most important for leadership behaviour.

Comparison of Cultural Frameworks and Dimensions

Fiji British

 FIJI- high context

 Group oriented

 High power distance

 Strong uncertainty avoidance

 Femininity

 Short term outlook  BRITAIN- low context

 Individualist

 Low power distance

 Weak uncertainty avoidance

 Masculinity

 Long term outlook

In order to embrace cultural differences and promote healthy interaction between cultures the Johari window comes in. The British and Fijians both have their perceptions about what is normal but when faced with each other’s culture their perceptions change. The now begins to understand aspects of the other’s culture that they were unaware of and also gives them a better understanding of how others view them.

Management Approach

With the geocentric approach, organisations try to combine the best from headquarters and the subsidiaries to develop consistent worldwide practices. Manager selection is based on competency rather than nationality. (Refer to Appendix A). It tries to involve more integration between centre and subsidiaries to ensure close co-operation between the different parts of the chain, and implement both universal and local standards for evaluation and control. (Johnson, 2003) The company that applies the global integrated business strategy manages and staffs employees on a global basis.

The Geocentric approach will be well suited to the Hotel Denarau because it would give the hotel a balance. Who else would know what the British wants except the British? As well it would not take anything away from the hotel if the management was British and the auxiliary staffs is Fijian, because it would still give the tourist the sense of the different culture than their own.

Conclusion & Recommendations

There were noted similarities between the British and the Fijians. Nevertheless, we believe it is the differences in culture, overall exotic scenery and exciting leisure activities which would draw British to visit Fiji. We also concluded that it would be beneficial to use British & Fiji management in the hotel. In Conclusion it would be profitable to encourage the British to visit Fiji.

I would recommend that The Hotel Denarau offer the British a package designed with them in mind. The hotel can offer them the opportunity to experience a Christmas of a difference, “A Tropical Christmas”. They can also create packages for the City Festivals of Fiji. Since they take place at different times of the year, the hotel should provide packages that include tickets and tours to the various activities of these festivals.

I would also recommend that the hotel use British management in the hotel. It should use the Geocentric Approach.

APPENDIX A

Advantages and disadvantages of using local employees to staff international subsidiaries

Advantages Disadvantages

• Lower labour costs

• Demonstrates trust in local citizenry

• Increases acceptance of the local community

• Maximizes the number of options available in the local environment

• Leads to recognition of the company as a legitimate participant in the local economy

• Effectively represents local considerations and constraints in the decision-making process • Makes it difficult to balance local demands and global priorities

• Leads to postponement of difficult local decisions until they are unavoidable, when they are more difficult, costly, and painful than they would have been if implemented earlier

• May make it difficult to recruit qualified personnel

• May reduce the amount of control exercised by the headquarters

References & Bibliography

1. Armstrong M. (1996) Personnel Management Practice, Kogan Page.

2. Article (2001) Human resources development, employment and globalisation in the hotel, catering and tourism sector, International Labour Organisation, December 10th,

3. Boselie P; Paauwe J; Richardson R; (2003) Human resource management, institutionalization and organizational performance: a comparison of hospitals, hotels and local government, International Journal of Human Resource Management; December, Vol. 14 Issue 8, pp.1407-1429;

4. Briscoe D.R., 1995, International Human Resource Management, Prentice Hall;

5. Dowling P.J.; Schuler R.S.; Welch D.E., International Dimensions of Human Resource Management, Belmont, Wadsworth, 1994.

6. Francesco A.M.; Gold B.A., International Organizational Behavior, Prentice Hall, 1998.

7. Hodgetts R.M.; Luthans F., International Management, McGraw-Hill, 1994.

8. Kelly, Anita E. and McKillop, Kevin J. (1996), "Consequences of Revealing Personal Secrets." Psychological Bulletin, v120(3), pg. 450.

9. Luft, Joseph (1969). "Of Human Interaction," Palo Alto, CA: National Press, 177 pages.



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