Management Orientations
ETHNOCENTRIC MANAGEMENT ORIENTATION
Management holding an ethnocentric orientation believes that its home country is superior to any other country in the world regardless of any evidence to the contrary. An ethnocentrically oriented manager may think: “since a product or a service performed well at home, it should also perform well abroad. Since this is so obvious, no further research is necessary on foreign markets and no adaptations need to be made to the products or services to tailor them to global customer preferences and needs.” Some companies are so ethnocentric that they choose to ignore foreign opportunities in the first place. These companies are called domestic companies. Other companies holding an ethnocentric orientation do choose to conduct business outside of their home country and are called international companies. Ethnocentrically oriented international companies believe that anything that has worked at home must also work abroad. A company holding this viewpoint would be likely to ignore local managers within different countries who voiced an opinion contrary to the norm of the home-country. For example, a local manager may wish to change an advertisement’s background-color from white to red since, in his country, white signifies death whereas red signifies wealth. An ethnocentrically oriented company might ignore this valuable piece of information. Since white was chosen over red in focus groups inside of the United States, white must be preferred to red universally regardless of where the product is being sold.
POLYCENTRIC MANAGEMENT ORIENTATION
Management holding a polycentric orientation, on the other hand, believes that each country is unique and therefore it allows its subsidiaries to have more control in developing strategies that will work in a particular country. “Since each country is so unique, complete control should be given to local managers since they obviously know what is best for the company in that country.” As long as these
Management holding an ethnocentric orientation believes that its home country is superior to any other country in the world regardless of any evidence to the contrary. An ethnocentrically oriented manager may think: “since a product or a service performed well at home, it should also perform well abroad. Since this is so obvious, no further research is necessary on foreign markets and no adaptations need to be made to the products or services to tailor them to global customer preferences and needs.” Some companies are so ethnocentric that they choose to ignore foreign opportunities in the first place. These companies are called domestic companies. Other companies holding an ethnocentric orientation do choose to conduct business outside of their home country and are called international companies. Ethnocentrically oriented international companies believe that anything that has worked at home must also work abroad. A company holding this viewpoint would be likely to ignore local managers within different countries who voiced an opinion contrary to the norm of the home-country. For example, a local manager may wish to change an advertisement’s background-color from white to red since, in his country, white signifies death whereas red signifies wealth. An ethnocentrically oriented company might ignore this valuable piece of information. Since white was chosen over red in focus groups inside of the United States, white must be preferred to red universally regardless of where the product is being sold.
POLYCENTRIC MANAGEMENT ORIENTATION
Management holding a polycentric orientation, on the other hand, believes that each country is unique and therefore it allows its subsidiaries to have more control in developing strategies that will work in a particular country. “Since each country is so unique, complete control should be given to local managers since they obviously know what is best for the company in that country.” As long as these