Objectives of the chapter
Places and people differ. The Japanese tend to be very polite, the Australians characteristically blunt. Red means “danger” or “stop” to the British, but in Turkey it signifies death and in China, good fortune. In France getting into a grande école tends to guarantee good job prospects whereas in Saudi Arabia the
wealth and status of your family is far more important.
What is culture? 131
The importance of culture in different
business contexts 133
National stereotypes and key dimensions
of culture 136
Cross-cultural management 144
Culture embodied in national institutions 151
■ Active Learning Case
Culture clash at Pharmacia and Upjohn 130
■ International Business Strategy in Action
Danone and Parmalat—going international,
staying local 149
■ Real Cases
Do not throw your meishi!
Sport can be local and global: Manchester
Patterns of global diversity and the implications of these
differences have been studied from a range of perspectives, by sociologists, psychologists, anthropologists, and political
scientists. Here we are concerned with how cultural diversity and related differences in the behavior, norms, and expectations of particular groups of employees, managers, colleagues, or customers affect management decision making and
corporate organizations. After an introduction to the kinds of business contexts in which cultural differences do matter, this chapter will describe some typologies of national cultural
differences and discuss the implications of these for
The specific objectives of this chapter are to:
1 Define culture and explain the factors that underlie cultural differences.
2 Show where and why cultural differences matter to
3 Explain a number of frameworks that help identify important cultural differences.
4 Examine how firms can anticipate and cope with cultural
PART TWO THE ENVIRONMENT OF INTERNATIONAL BUSINESS
Active Learning Case
Culture clash at Pharmacia and Upjohn
Despite being part of the same advanced, industrialized
world, Kalamazoo (Michigan, United States), Stockholm
(Sweden), and Milan (Italy) are worlds apart in many
important ways. Senior managers leading the merger
between two pharmaceutical firms, Upjohn Company of
the United States and Pharmacia AB of Sweden (with
operations in Italy), came to realize how significant these
differences were after the merger took place in 1995.
Swedes take off most of the month of July for their annual vacation, Italians take off most of August. Not knowing this, US executives scheduled meetings in the summer only to have to cancel many because their European counterparts were at the beach. As the more dominant US firm began to impose its way of doing things on the newly acquired European organizations, international relationships became increasingly strained.
Neither the Swedes nor the Italians were happy with
impositions such as the drug and alcohol testing policy
brought in by Upjohn, or the office smoking ban. These
clashed with local ways of doing things and the more informal work environment that these cultures prefer. Although Upjohn later relaxed many of these work rules, allowing
some local practices and preferences to prevail, ill-feeling and a degree of resistance had already developed among
The additional bureaucracy and the command-andcontrol style imposed by the Americans created more significant problems for the 34,000 employees and
managers in Pharmacia and Upjohn Company. The Swedes
were used to an open, team-based style of management
where responsibilities are devolved; managers are trusted
and not strictly monitored or closely managed. Swedish executives also tend to...