Chapter 5- Managing Across Cultures

Four Strategic predispositions
Ethnocentric, Polycentric, Regiocentric, and geocentric
-successful MNCs use a mix of these predispositions
Ethnocentric Predispositions
A nationalistic philosophy that allows values and interests of the parent company to guide strategic decisions
Polycentric Predispositions
Strategic decisions are tailored to suit the cultures of the countries where the MNC operates
Regiocentric Predispositions
Leads a firm to try to blend its own interests with those of its subsidiaries on a regional basis
Geocentric Predisposition
Try to integrate a global systems approach to decision making
Globalization Imperative
A belief that one worldwide approach to doing business is the key to both efficiency and effectiveness
Three major challenges for regional markets
1) MNC must stay abreast of local market conditions
2) MNC must know the strengths and weaknesses of its subsidiaries so that it can provide assistance with local demands
3) Must give the subsidiary more autonomy so that it can respond to changes in local demands
Parochialism
The tendency to view the world through one’s own eyes and perspectives
Simplification
The process of exhibiting the same orientation toward different cultural groups