Presentation from my own lecture for graduate students from School of Business and Technology of the College of St. Scholastica in Duluth, Minnesota.

1. Cross cultural
cooperation and trade
Global marketing, national culture and
management
Yuriy ROBUL
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2. Globalized environment
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3. Global marketing
environment
• Globalized consumption
- North America, Western Europe and South-West Asia are drivers
- Globalized standards of living
• Globalized manufacturing
- Production facilities are placed in the countries with low priced
labour, from where production is distributed globally in order to
reduce costs
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4. The end of history and
the last man
• The worldwide spread of
liberal democracies and
free market capitalism of
the West and its lifestyle
may signal the end point
of humanity's
sociocultural evolution
and become the final form
of human government
- F. Fukuyama «The end of
history and the last
man» (1992)
Francis Fukuyama
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5. Globalized management
• Globalized management was initially intended to reflect
the state of «the end of history»
- The one and unique form of human government causes the unique form of
government of any kind of organization of humans
- Management would therefor become:
‣ Homogenous: no significant differences persist among different parts of
human beings
‣ Standardized: standards and rules are the same for every single organization
‣ Imperative: standards and rules prescribe the way an organization should act
and how it should be structured
• Should we pay any particular attention to the differences
in origin while all become the same by the end?
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6. Many faces of globalized
management
• Global organizations
- Issues, originated from
cultural or other societal
differences are ignored,
overcome or shadowed
- Global consumption and
marketing
- Global identity
• Not-global organizations
- Issues, originated from
cultural or other societal
differences are stressed,
and put at the heart of
business
- Consumption of local
brands
- Local identity
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7. Standardization vs.
Adaptation
• Standardization
- Due to technology,
communications and
transportation the world
becomes more and more
homogeneous
- Management should be
standardized along with
best practices
- Global forces
• Adaptation
- Due to a fear of lost of
identity people want to
preserve their origin,
culture, traditions, and
particularities thereof
- Global management
should be adapted along
with such particularities
- Local forces
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8. Standardization
• Due to technology, communications and
transportation the world becomes more and
more tied and homogeneous
• People are ready to renounce from their
particularities in order to get products of the
world class
• People benefit from low costs, originated from
the global size of the market
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9. Does standardization
work (always) well?
• Not all kinds of needs and wish causes the global demand
over all segments
- There are globalized and not globalized segments
- Trend for customization
- Trend for tracing back the roots
- Anti-globalization movement
• Globalization does not always mean reduced prices
- Louis Vuitton, Hermes, Rolls-Royce...
• Flexible production units and reduction of number of
production cycles sometimes reduce the value of globalized
size of the market
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10. Adaptation
• People are different in their habits, customs
and insights due to inherited national culture
and societal issues that may causes
- Difference in needs and demands
- Different structure of channels of distribution
- Different forms of government regulation, presence or absence
thereof, etc.
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11. Many faces of difference
• Consumers
- Language, culture, habits
- Societal structure
- Dominant values and
beliefs
- Disposed income
• Marketplace
- Channel structure
- Placement of production
units over the territory
(logistics, operations, etc.)
- Government regulations
(labour, capital, stakes,etc)
- Economical situation
(GDP, inflation, wages, etc)
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12. Types of global
environment
Globalized Transnational
Calm International
Local forces
Global forces
High impact
High impact
Low impact
Low impact
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13. Types of global
environment
Standardization and
centralization
High-tec products
Standardization on
certain levels
Bear, autos
Disciplined and
rationalized approach
Construction
Adaptation and
decentralization
Foods & beverages
Local forces
Global forces
High impact
High impact
Low impact
Low impact
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14. Types of management in
global environment
Globalized
management
Multi-level
management
Routine
management
Adapted
management
Local forces
Global forces
High impact
High impact
Low impact
Low impact
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15. Many faces of globalized
management (2)
Globalized
Routine
Multi-level
Adapted
«The end of history»
«Everybody here does it»
«Think global - do local»
Application of standard
rules is selective in
accordance to local
differences
How to teach locals to be fully
globalized?
How to understand what is going on?
How to (re)conciliate what is going
on on different levels?
How to be properly adapted without
lost of goals and vision?
Challenges
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16. Impact of national culture
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17. Hofstede’s cultural
insights
• «Culture is the
collective
programming of the
mind distinguishing
the members of one
group or category of
people from others»
Geert Hofstede
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18. Hofstede’s cultural
dimensions
• Power Distance (PDI)
• Individualism versus collectivism (IDV)
• Masculinity versus femininity (MAS)
• Uncertainty avoidance (UAI)
• Long-term versus short-term orientation (LTO)
• Indulgence versus Restraint (IVR)
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19. Cultural differences
among countries
PDI IDV MAS UAI LTO
Arab world
Europe
World
USA
Germany
Italy
France
Sweden
Russia
Poland
Japan
Chine
80 38 52 68
40 57 55 74
55 53 50 64 45
40 91 62 46 29
35 67 66 65 31
50 76 70 75
68 71 43 86
31 71 5 29 33
93 39 36 95
68 60 64 93 32
54 46 95 92 80
80 20 66 30 118
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20. Cultural dimensions:
expected values for Ukraine
0
20
40
60
80
100
120
PDI IDV MAS UAI LTO
0
92
53
46
92
38
51
110
52
104
0
90
42
30
90
32
93
64
60
68
0
95
3639
93
Russia Poland Romania Slovakia
Ukraine
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21. Comparison US -
Ukraine
0
20
40
60
80
100
120
PDI IDV MAS UAI LTO
29
46
62
91
40
0
92
53
46
92
Ukraine (Indirect evaluation) USA
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22. Cultural differences of
Ukraine
• People accept a hierarchical order in which everybody has a
place and which needs no further justification.
- Hierarchy in an organization is seen as reflecting inherent inequalities, centralization is
popular, subordinates expect to be told what to do and the ideal boss is a benevolent autocrat
• Ukraine, with an IDV score of 46 is considered a collectivistic
society, close to the middle.
- Close long-term commitment to the member 'group', be that a family, extended family, or
extended relationships.
- Loyalty in a collectivist culture is paramount, and over-rides most other societal rules and
regulations.
- In collectivist societies offense leads to shame and loss of face, employer/employee
relationships are perceived in moral terms (like a family link),
- hiring and promotion decisions take account of the employee’s in-group, management is the
management of groups.
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23. Cultural differences of
Ukraine (2)
• Ukraine seems to be a masculine society –
highly success oriented and driven.
- It is important to be regarded as successful and to reach your
goals.
‣ Status is an important aspect in this, and of course being able
to show which status you have.
‣ Status symbols like cars, impressive houses, clothes etc. play a
big role.
‣ People work hard to achieve a high living standard and being
able to “show their achievements”. Long working hours and
dedication to work are needed in order to achieve this.
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24. Cultural differences of
Ukraine (3)
• Ukraine’s expected score on UAI is 92 — a very
high preference for avoiding uncertainty.
- Rigid codes of belief and behavior, and
- Intolerance of unorthodox behavior and ideas.
- Emotional need for rules (even if the rules never seem to work)
‣ people have an inner urge to be busy and work hard,
‣ innovation may be resisted,
‣ security is an important element in individual motivation.
• There has been no LTO estimation for Ukraine
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25. Cultural dimensions of managers
and graduates from economical
departments of high schools
0
20
40
60
80
100
120
PDI IDV MAS UAI LTO
50
25
59
18
76
0
92
53
46
92
Indirect evaluation Managers (direct evaluation)
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26. Summary
• PDI: In general as expected, gradual lowering over years
may be forecasted
• IDV: Surprisingly much lower than expected (IDV=18 out
of 100)
- Avoidance of individual responsibility may be one of the component thereof
• MAS: Masculine society as expected in spite of declared
value of public wellbeing
• UAI: Surprisingly much lower than expected
(UAI = 25 out of 100)
• LTO: Much higher than expected, conservative society,
contracted by societal myopia
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27. Cross cultural
comparisons
0
20
40
60
80
100
120
PDI IDV MAS UAI LTO
29
46
62
91
40
50
25
59
18
76
0
92
53
46
92
Ukraine (Indirect evaluation) Ukraine (Managers (direct evaluation))
USA
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28. Troubles in cooperation
• Sometimes difficult access to (dealing with) persons, who
take final decisions
- Formal procedures and rituals
• Individual attribution of tasks and responsibilities
- Being sometimes avoided by Ukrainian counterparts
• Very different level of UAI
- Resulting sometimes at neglecting of restriction, imposed by law by Ukrainian
counterparts
• Considerable level of LTO
- Prevalence of short-time orientation; dominance of traditionalist way of working and
living
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29. Troubles in marketing
• Social responsibility and capital are selling
badly in general
• Prestige is over evaluated at the expense of
rational values and attributes of an offer
• Consumers do not care of many things, crucial
for westerns in order to avoid uncertainty
- Failed planning, bad price evaluation and future use of the product
are among the most frequent issues
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30. Values and guidelines for
managerial decisions
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31. Splitting out
organizations
• Do managers at all levels in an organization
behave in the same way?
• Which guidelines they follow taking decisions?
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32. Rokeach Value Survey
• Behavior of humans is defined and guided by
their values
- Terminals: whom I wish to be
- Instrumentals: how to become whom I wish to be
- Rokeach Value Survey (RVS): 36 universal values, distributed
equally by these two sets
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33. • The terminal values
1. True Friendship
2. Mature Love
3. Self-Respect
4. Happiness
5. Inner Harmony
6. Equality
7. Freedom
8. Pleasure
9. Social Recognition
10. Wisdom
11. Salvation
12. Family Security
13. National Security
14. A Sense of Accomplishment
15. A World of Beauty
16. A World at Peace
17. A Comfortable Life
18. An Exciting Life
• The instrumental values
1. Cheerfulness
2. Ambition
3. Love
4. Cleanliness
5. Self-Control
6. Capability
7. Courage
8. Politeness
9. Honesty
10. Imagination
11. Independence
12. Intellect
13. Broad-Mindedness
14. Logic
15. Obedience
16. Helpfulness
17. Responsibility
18. Forgiveness
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34. RVS Research in
Ukraine 2013
• Is there a common system of dominant values
in organizations?
• Which parts constitutes this common system?
- IT companies in Ukraine with high globalized profile
- Top, middle and bottom line managers are studied separately
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35. RVS Research in IT
business in Ukraine,2013
• Is there a common system of dominant values
in organizations?
- No, there is no common system
- The difference between values of top and middle level managers is
being observed for almost 20 years, the limits are not broken
- Top managers are guided by a different set of dominant values
than middle and bottom line managers
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36. Top 4 values
Terminal Rating Instrumental Rating
Top managersTop managersTop managersTop managers
Salvation 4 Honesty 4
Freedom 3 Responsibility 3
Happiness 2 Cheerfulness 2
A comfortable life 1 Broad-Mindedness 1
Middle level managersMiddle level managersMiddle level managersMiddle level managers
Salvation 4 Honesty 4
Happiness 3 Responsibility 3
Mature love 2 Forgiveness 2
A comfortable life 1 Broad-Mindedness 1
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37. • The terminal values
1. True Friendship
2. Mature Love
3. Self-Respect
4. Happiness
5. Inner Harmony
6. Equality
7. Freedom
8. Pleasure
9. Social Recognition
10. Wisdom
11. Salvation
12. Family Security
13. National Security
14. A Sense of Accomplishment
15. A World of Beauty
16. A World at Peace
17. A Comfortable Life
18. An Exciting Life
• The instrumental values
1. Cheerfulness
2. Ambition
3. Love
4. Cleanliness
5. Self-Control
6. Capability
7. Courage
8. Politeness
9. Honesty
10. Imagination
11. Independence
12. Intellect
13. Broad-Mindedness
14. Logic
15. Obedience
16. Helpfulness
17. Responsibility
18. Forgiveness
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