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Abstract Individuals frequently experience psychological contract breaches in today's workplace. Psychological contract breaches often lead to a range of negative outcomes such as increases in intention to leave one's job. This paper investigates moderating factors that may help minimize the increases in turnover intentions associated with psychological contract breach. This paper reports the results of examining two related moderating factors — perceived emotional family support and perceived supervisor loyalty. Through a series of analyses, the study concludes that individuals who do not perceive supervisor loyalty have greater turnover intentions under conditions of psychological contract breach than individuals perceiving high levels of perceived supervisor loyalty. Interestingly, individuals who lack perceived supervisor loyalty yet perceive high family support are likely to experience higher turnover intentions as a result of a psychological contract breach than individuals who lack supervisor loyalty and family support. Journal Information The Journal of Managerial Issues (JMI) is a management academic journal that is published quarterly and uses a double-blind, peer-reviewed process. The purpose of the JMI is to contribute to the advancement of knowledge directly related to the theory of organizations and the practice of management. It publishes and disseminates the results of new and original scholarly research to a broad audience consisting of university faculty and administrators, business executives, consultants, employees, and government managers. The JMI acts as a bridge between the academic and business communities. Publisher Information Pittsburg State University (PSU) is one of six Kansas regents universities with approximately 7,300 students. It is located in southeast Kansas in the city of Pittsburg. PSU has over 100 academic programs distributed among the colleges of Arts and Sciences, Business, Education, and Technology. PSU students benefit from small class sizes, challenging courses, qualified and dedicated faculty, and modern classrooms. The university as a whole is accredited by the Higher Learning Commission of the North Central Association of Colleges and Schools as well as some of its colleges and/or programs (the Kelce College of Business is AACSB-accredited). Rights & Usage This item is part of a JSTOR Collection. TOPIC 2: National Differences (Culture & CSR)Introduction to Topic 2 Discussion Notes The Topic Discussion Notes provide you with a brief summary of the essential concepts to master in each Topic and the major Learning Outcomes. Specifically, each of the key concepts in the relevant chapters for each Topic are summarised briefly. In addition, there are brief summaries of each slide related to the Course Slides for each chapter. You will find that the summaries for each slide provide you with an essential background of knowledge, ideally after you have read each chapter. In this way it enables you to test your knowledge, as well as laying a foundation to build on and deepen your knowledge of international business by reading many of the of the Course Journal Articles. While they are optional reading, reading the Course Journal Articles will assist you to have a much broader, more contemporary and practical knowledge base from which to apply your knowledge now and in the future. Note that the Course Slides are located on the Learnonline site and the Journal Articles are available through the e-Library Resources for this Course. Chapter 4: Differences in Culture Learning objectives
This chapter explores the role of culture in international business: how differences in culture across and within countries can affect the practice of business. The discussion then addresses the major questions of the chapter: What is culture? How does it play itself out in social structures, religious and ethical systems, language, and education? The need for cross-cultural literacy and an appreciation of the impact of culture on competitive advantage are all addressed. The opening case focuses on the failures of both Best Buy and eBay in China. In both instances, the companies failed to account for cultural differences between Chinese and American consumers. The closing case explores the cultural implications of the upcoming World Expo 2020 in Dubai, UAE. Dubai is shown to be an ideal host for the world expo because of its eclectic mix of cultures and its unique position as a business gateway for the Middle East. LECTURE OUTLINE The PPT slides include additional notes that can be viewed by clicking on “view,” then on “notes.” The following provides a brief overview of each Power Point slide. Slide 4-2 Cultural Differences and International Business Business success requires cross-cultural literacy. Managers need an understanding of the culture, or cultures, that prevail in the countries where they do business. Slide 4-3 What Is Culture? Culture is a system of values and norms that are shared among a group of people and that when taken together constitute a design for living. Values are abstract ideas about what a society believes to be good, right, and desirable. Norms are social rules and guidelines that prescribe the appropriate behavior in particular situations. Society is a group of people who share a common set of values and norms. The cost of doing business in a country is influenced by culture – different cultures are more or less supportive of the capitalist approach to production. Culture is dynamic. Slide 4-4 Values and Norms Values and normsare the basic components of culture. Norms can be further divided into folkways and mores. Values include attitudes towards concepts like freedom, honesty, loyalty, justice, responsibility, and personal relations including marriage. Norms shape the actions of people towards one another. Norms can be divided into folkways and mores. Slide 4-5 Culture, Society and the Nation-State While it is possible for a nation-state to have a uniform culture, this is not always the case. Within a nation-state multiple cultures can exist, and cultures can also cut across national borders. Slides 4-6 and 4-7 The Determinants of Culture Culture is an evolutionary product of a number of factors. Political philosophy, economic philosophy, education, dominant language, social structure, and dominant religion are all determinants of culture. Slide 4-8 Social Structure The social structure of a country can be described along two major dimensions: individualism vs. group, and degree of stratification into classes or castes. Slides 4-9 through 4-10 Individuals and Groups A focus on the individual and individual achievement is common in many Western societies. An emphasis on individual achievement has positive and negative implications. On the positive side, the dynamism of the United States’ economy owes much to people like Sam Walton, Steve Jobs, and Bill Gates - people who took chances, tried new things, succeeded, and encouraged others to do likewise. On the other hand, individualism can lead to a lack of company loyalty and failure to gain company-specific knowledge, competition between individuals in a company rather than team building, and a limitation of people's ability to develop a strong network of contacts within a firm. In sharp contrast to the Western emphasis on the individual, in many Asian societies the group is the primary unit of social organization. While this emphasis on the group may discourage job switching between firms, encourage lifetime employment systems, and lead to cooperation in solving business problems, it tends to suppress individual creativity and initiative. Slides 4-12 through 4-14 Social Stratification All societies have some sort of stratification, where individuals in higher strata or castes are likely to have a better education, standard of living, and work opportunities. Social structure is linked to the ease with which an individual can move between strata. Additionally, the social structure created by the strata levels and the social significances of each strata level can have implications for the way business is conducted. The significance of the social strata can have important implications for the management and organization of businesses. In cultures where there is a great deal of consciousness over the class of others, the way individuals from different classes work together (i.e., management and labor) may be very prescribed and strained in some cultures, or have almost no significance in others. Slides 4-15 through 4-17 Religious and Ethical Systems Religion can be defined as a system of shared beliefs and rituals that are concerned with the realm of the sacred. Ethical systems refer to a set of moral principles, or values, that are used to guide and shape behavior. The ethical practices of individuals within a culture are often closely intertwined with their religion. Another Perspective: The International Business Ethics Institute {http://www.business-ethics.org} promotes ethical business practices around the world. The site contains a number of articles that can be used to expand a discussion of business ethics in foreign markets, and a “top ten mistakes” list for companies doing business in other countries. Slide 4-18 Christianity Christianity, the largest religion, is common throughout Europe, the Americas, and other countries settled by Europeans and has three major branches: Protestant, Roman Catholic, and Eastern Orthodox. The "Protestant work ethic" – a focus on hard work, wealth creation, and frugality – is considered the driving force of capitalism. In the workplace this work ethic translates into a significant emphasis on quality and productivity. Slide 4-19 Islam The world’s second largest religion, Islam has the same underlying roots of Christianity (Christ is viewed as a prophet), and suggests many of the same underlying societal mores. Islam, however, extends this to more of an all-embracing way of life that governs one's being. Islam also prescribes many more rules by which people should act and live. In Islam people do not own property, but only act as stewards for God and thus must take care of that with which they have been entrusted. They must use property in a righteous, socially beneficial, and prudent manner; not exploit others for their own benefit; and they have obligations to help the disadvantaged. Thus, while Islam is supportive of business, the way business is practiced is strictly prescribed. For instance, no interest may be paid on business loans. Slide 4-20 Hinduism Hinduism, practiced primarily on the Indian subcontinent, focuses on the importance of achieving spiritual growth and development, which may require material and physical self-denial. Since Hindus are valued by their spiritual rather than material achievements, there is not the same work ethic or focus on entrepreneurship found in some other religions. Likewise, promotion and adding new responsibilities may not be the goal of an employee, Slide 4-21 Buddhism Buddhists also stress spiritual growth and the afterlife, rather than achievement while in this world. Buddhism, practiced mainly in Southeast Asia, does not support the caste system, however, so individuals do have some mobility not found in Hinduism, and can work with individuals from different classes. Slide 4-22 Confucianism Confucianism, practiced mainly in China, teaches the importance of attaining personal salvation through right action. Unlike religions, Confucianism is not concerned with the supernatural and has little to say about the concept of a supreme being or an afterlife. The needs for high moral and ethical conduct and loyalty to others are central in Confucianism. Three key teachings of Confucianism – loyalty, reciprocal obligations, and honesty – may all lead to a lowering of the cost of doing business in Confucian societies. Slides 4-23 and 4-24 Language Language refers to the spoken and unspoken means of communication, and is one of the defining characteristics of culture. While English is clearly the language of international business, knowing at least some of the local language can greatly help when working in another country. In some situations knowing even a bit of the local language can be critical for business success. Such knowledge may be understood as a sign that the businessperson is willing to learn from the local firm. Unspoken language refers to nonverbal communication such as facial expressions, personal space, and hand gestures. Managers who fail to understand the nonverbal cues of another culture may experience a breakdown in communication. Slide 4-25 Education Formal education is the medium through which individuals learn many of the language, conceptual, and mathematical skills that are indispensable in a modern society. Education is part of the social structure of a country and is instrumental in shaping many cultural values and norms. The knowledge base, training, and educational opportunities available to a country's citizens can contribute to a competitive advantage in the marketplace. Slide 4-26 Think Like a Manager: Analyze Your School Culture Slides 4-28 through 4-32 Culture in the Workplace Geert Hofstede conducted what is probably the most famous study about the connection between culture and values in the workplace. Hofstede made a study of IBM employees worldwide, and identified four dimensions to describe cultures: power distance, individualism vs. collectivism, uncertainty avoidance, and masculinity vs. femininity. Power distance focuses on how a society deals with the fact that people are unequal in physical and intellectual capabilities. Individualism versus collectivism focuses on the relationship between the individual and his or her fellows. Uncertainty avoidance measures the extent to which different cultures socialize their members into accepting ambiguous situations and tolerating ambiguity. Masculinity versus femininity looks at the relationship between gender and work roles. Hofstede later expanded his study to include a fifth dimension called Confucian dynamism which captures attitudes toward time, persistence, ordering by status, protection of face, respect for tradition, and reciprocation of gifts and favors. Slide 4-32 Cultural Change Culture is not a constant, but evolves over time. As countries become economically stronger, cultural change is particularly common. Slides 4-33 and 4-34 Implications for Managers Managers need to be aware that societies differ because their cultures vary, and cultures vary because of profound differences in social structure, religion, language, education, economic philosophy, and political philosophy. Individuals and firms must develop cross-cultural literacy. International businesses that are ill informed about the practices of another culture are unlikely to succeed in that culture. One way to develop cross-cultural literacy is to regularly rotate and transfer people internationally. Managers need to be aware of ethnocentric behavior, or a belief in the superiority of their own culture. Another Perspective:To give students an opportunity to “experience” cultural differences create a mock business meeting. Executive Planet maintains a web site, {http://www.executiveplanet.com/index.php?title=Main_Page}, with guidelines for doing business in different countries. The site allows visitors to explore relevant issues in a variety of cultures. A recent article in Entrepreneur magazine provides some strategies on how to avoid cultural missteps when doing business in other countries {http://www.entrepreneur.com/article/22686}. The connection between culture and competitive advantage is important because it suggests which countries are likely to produce the most viable competitors, and it has implications for the choice of countries in which to locate production facilities and do business. Chapter 5: Ethical Issues in International Business Learning objectives
This chapter looks at ethics in international business. Ethics becomes an issue across nations because of differing political systems, economic systems, legal systems and cultural values. What is acceptable behaviour in one nation may be considered unethical in another. First, the chapter explores some of the more common areas where ethical issues arise in international business, such as employment practices, human rights, environmental pollution, corruption, and moral obligations. Then the discussion moves to ethical dilemmas and the roots of ethical and unethical decision-making. Next, the text examines basic philosophical theories that offer a foundation for ethical decision-making. Finally, the chapter presents the managerial implications of ethical decision-making, including hiring and promotion, organizational culture, sustainability, and corporate social responsibility. The opening case explores the danger associated with lead contamination in imported toys. Despite increased safety standards and regulations, studies show that as many as one-third of the toys imported from China contain dangerous heavy metals. The closing case considers the ethical dilemma posed by Bitcoin, a digital currency introduced in 2009. Because bitcoins are not backed by any government and do not have any real value, some economists suggest that they are an unethical means of avoiding taxes and that they promote illegal activity. LECTURE OUTLINE The PPT slides include additional notes that can be viewed by clicking on “view,” then on “notes.” The following provides a brief overview of each Power Point. Slide 5-2 What Is Ethics? Ethics refers to accepted principles of right or wrong that govern the conduct of a person, the members of a profession, or the actions of an organization. Slide 5-3 Ethical Issues in International Business The most common ethical issues in business involve:
Another Perspective: The Carnegie Council on Ethics and International Affairs maintains a very substantive and thought-provoking website at {http://www.carnegiecouncil.org/}. This site contains publications that comment on many of the ethical issues that surround globalization and international business. Slides 5-4 and 5-5 Employment Practices Often employment practices differ among nations. What is the MNC’s obligation? Should home standards be followed, even in less developed countries? Should local standards be embraced? What is the right basis for employment-related ethical decisions? Slides 5-6 and 5-7 Human Rights The idea of what constitutes human rights varies considerably across national borders. How can the tensions that this reality fosters be reconciled? Slide 5-9 Environmental Pollution Ethical issues arise when environmental regulations in host nations are far inferior to those in the home nation. The tragedy of the commons occurs when a resource held in common by all, but owned by no one, is overused by individuals, resulting in its degradation. Another Perspective:Consumers International {http://www.consumersinternational.org/} is dedicated to protecting the rights of consumers worldwide. In doing so, it promotes ethical behavior on the part of companies. Go to the site and explore some of the organization’s current efforts. Slides 5-9 and 5-10 Corruption The U.S. Foreign Corrupt Practices Act outlawed the practice of paying bribes to foreign government officials in order to gain business. Slides 5-11 and 5-12 Moral Obligations Social responsibility refers to the idea that business people should take the social consequences of economic actions into account when making business decisions, and that there should be a presumption in favour of decisions that have both good economic and good social consequences. Slide 5-13 Ethical Dilemmas Ethical dilemmas are situations in which none of the available alternatives seems ethically acceptable. The ethical obligations of a multinational corporation toward employment conditions, human rights, corruption, environmental pollution, and the use of power are not always clear cut. Slides 5-14 through 5-17 The Roots of Unethical Behavior The causes of unethical behavior are complex and reflect:
Business ethics reflect personal ethics (the generally accepted principles of right and wrong governing the conduct of individuals). The personal ethical code that guides our behavior comes from a number of sources, including our parents, our schools, our religion, and the media. Home country managers working abroad in multinational firms may experience more than the usual degree of pressure to violate their personal ethics because they are away from their ordinary social context and supporting culture, and they are psychologically and geographically distant from the parent company. Business people sometimes do not realize that they are behaving unethically simply because they fail to ask the relevant question—is this decision or action ethical? The term organization culture refers to the values and norms that are shared among employees of an organization. In a company with an organizational culture that de-emphasizes business ethics, all decisions are reduced to the purely economic. When there is pressure from the parent company to meet performance goals that are unrealistic, and can only be attained by cutting corners or acting in an unethical manner, unethical behavior may result. Leaders are vital in helping a firm establish its organization culture, and setting examples. If leaders are not acting ethically, other employees may not act ethically. Societal culture can also influence behavior. Slide 5-18 Philosophical Approaches to Ethics There are several approaches to ethics including the straw men (the Friedman doctrine, cultural relativism, righteous moralist, and the naïve immoralist), the Utilitarian approach, the Kantian approach, and rights and justice theories. Slides 5-19 and 5-20 Straw Men Straw men approaches to business ethics are approaches that are raised by business ethics scholars primarily for the purpose of demonstrating that they offer inappropriate guidelines for ethical decision making in a multinational enterprise. Four such approaches are the Friedman doctrine, cultural relativism, the righteous moralist, and the naïve immoralist. Slides 5-21 and 5-22 Utilitarian and Kantian Ethics In contrast to the straw men, most moral philosophers see value in utilitarian and Kantian approaches to business ethics. The utilitarian approach to business ethics dates back to philosophers such as David Hume, Jeremy Bentham, and John Stuart Mill. Utilitarian approaches to ethics hold that the moral worth of actions or practices is determined by their consequences. An action is judged to be desirable if it leads to the best possible balance of good consequences over bad consequences. Slide 5-23 Rights Theories Rights theories recognize that human beings have fundamental rights and privileges that transcend national boundaries and culture. Moral theorists argue that fundamental human rights form the basis for the moral compass that managers should navigate by when making decisions that have an ethical component. Slide 5-24 Justice Theories Justice theories focus on the attainment of a just distribution of economic goods and services. A just distribution is one that is considered fair and equitable. There is no one theory of justice, and several theories of justice conflict with each other in important ways. One important and influential theory of justice was set forth by John Rawls who argued that all economic goods and services should be distributed equally except when an unequal distribution would work to everyone’s advantage. Slide 25 Think Like a Manager: The Ethics of the Gig Economy Slides 5-26 through 5-34 Ethical Decision Making Five things an international business can do to make sure that ethical issues are considered in a business decision are: (1) Hire and promote people with a well grounded sense of personal ethics (2) Build an organizational culture that places a high value on ethical behavior (3) Make sure that leaders within the business not only articulate the rhetoric of ethical behavior, but also act in manner that is consistent with that rhetoric (4) Put decision-making processes in place that require people to consider the ethical dimension of business decisions (5) Develop moral courage Not only should businesses strive to identify and hire people with a strong sense of personal ethics, but it is also in the interests of prospective employees to find out as much as they can about the ethical climate in an organization. To foster ethical behavior, businesses need to build an organization culture that places a high value on ethical behavior. Business people need a moral compass to help determine whether a decision is ethical. It is important to recognize that employees in an international business may need significant moral courage. Managers can also use a five-step process to think through ethical problems. To ensure ethical behavior in a business, a number of firms now have ethics officers. Slide 5-35 Summary of Decision-Making Steps Not all ethical dilemmas have an obvious solution. In the case of a true dilemma, firms must rely on the decision-making ability of their managers, and these managers need to make as balanced a decision as possible. Copyright © 2017 McGraw-Hill Education. Adapted for MBA BUSS 5251 International Business for the purpose of individual study and course preparation. What are the three determinants of culture?There are three cultural determinants: geography, history and religion.
What is the best description of the labor management relationship in an organization based in Confucian culture?What is the best description of the labor-management relationship in an organization based in Confucian culture? Cooperation is achieved at a lower cost.
What are three rituals associated with orthodox Muslims Check all that apply?What are three rituals associated with orthodox Muslims? There is a daily prayer ritual. Muslims are forbidden to consume alcohol. Muslims are forbidden to consume pork.
What are three of the dimensions Hofstede identified and studied check all that apply?Geert Hofstede, in his pioneer study looking at differences in culture across modern nations, identified four dimensions of cultural values: individualism-collectivism, power distance, uncertainty avoidance, and masculinity-femininity.
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Loyalty, honesty in dealing with others, and reciprocal obligations are the building blocks of
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