Chapter 5 Culture, Management Style, and Business Systems 163 and slow in the then-current hot global information economy. However, downturns in a competitive culture can be ugly things.91 For example, the instability and layoffs at Boeing during the commercial aircraft busts of the late 1990s and early 2000s were damaging not only to employees and their local communities, but also to shareholders. And during the dramatic economic downturn in 2008–2009, Asian firms tended to eschew layoffs, com-pared with their American counterparts,92 and even rejected the U.S. as the benchmark for best management practices.93 It should also be mentioned that Thurow and others writing in this area omitted a fourth kind of capitalism—that common in Chinese cultures.94 Its dis-tinguishing characteristics are a more entrepreneurial approach and an emphasis on guanxi (one’s network of personal connections)95 as the coordinating principle among firms. This fourth kind of capitalism is also predicted by culture. Chinese cultures are high on PDI and low on IDV, and the strong reciprocity implied by the notion of guanxi fits the data well. Additionally, entrepreneurial tendencies are stronger in countries with lower UAI (e.g China), as people in those cultures tend to prefer venturing out on their own rather than the known of working for an established company.96 Synthesis: Relationship-Oriented vs. Information-Oriented Cultures Cultural distance as a multidimensional concept continues to be quite useful in the area of inter-national marketing research.97 However, with increasing frequency, studies note a strong relationship between Hall’s high-/low-context and Hofstede’s Individualism/Collective and Power Distance indices. For example, low-context American culture scores relatively low on power distance and high on individualism, whereas high-context Arab cultures score high on power distance and low on individualism. This result is not at all surprising, given that Hofstede98 leans heavily on Hall’s ideas in developing and labeling the dimensions of cul-ture revealed via his huge database. Indeed, the three dimensions—high/low context, IDV, and PDI—are correlated above the r = 0.6 level, suggesting all three dimensions are largely measuring the same thing.99 Likewise, when we compare linguistic distance (to English) and Transparency International’s Corruption Perception Index to the other three, we see similar levels of correlations among all five dimensions. And while metrics for other dimensions of business culture do not yet exist, a pattern appears to be evident (see Exhibit 5.7). LO5 The differences between relationship-oriented and information-oriented cultures 91For a deep description of “how ugly,” see Klien’s Shock Doctrine. 92Evan Ramsatd, “Koreans Take Pay Cuts to Stop Layoffs,” The Wall Street Journal, March 3, 2009. 93“China Rethinks the American Way,” BusinessWeek, June 15, 2009, p. 32. 94Don Y. Lee and Philip L. Dawes, “Guanxi, Trust, and Long-Term Orientation in Chinese Business Markets,” Journal of International Marketing 13, no. 2 (2005), pp. 28 –56; Flora Gu, Kineta Hung, and David K. Tse, “When Does Guanxi Matter? Issues of Capitalization and Its Darkside,” Journal of Marketing 72, no. 4 (2008), pp. 12–28; Roy Y. J. Chua, Michael W. Morris, and Paul Ingram, “Guanxi vs. Networking: Distinctive Configurations of Affect- and Cognition-Based Trust in the Networks of Chinese vs. American Managers,” Journal of International Business Studies 40, no. 3 (2009), pp. 490–508. 95Mark Lam and John L. Graham, Doing Business in the New China, The World’s Most Dynamic Market (New York: McGraw-Hill, 2007). 96 Erkko Autio, Saurav Pathak, and Karl Wennberg, “Consequenses of Cultural Practices for Entrepreneurial Behaviors,” Journal of International Business Studies 44 (2013), pp. 334 – 62. 97Heather Berry, Mauro F. Guillen, and Nan Zhou, “An Institutional Approach to Cross-National Distance,” Journal of International Business Studies 41, no. 9 (2010), pp. 1460–80; Joanna Tochman Campbell, Lorraine Eden, and Stewart R. Miller, “Multinationals and Corporate Social Responsibility in Host Countries: Does Distance Matter?” Journal of International Business Studies 43, no. 1 (2012), pp. 84 –106; Oded Shenkar, “Cultural Distance Revisited: Toward a More Rigorous Conceptualization and Measurement of Cultural Differences,” Journal of International Business Studies 43, no. 1 (2012), pp. 1–11; Oded Shenkar, “Beyond Cultural Distance: Switching to a Friction Lens in the Study of Cultural Differences,” Journal of International Business Studies 43, no.1 (2012), pp. 12–17; Srilata Zaheer, Margaret Spring Shomaker, and Lilach Nachum, “Distance without Direction: Restoring Credibility to a Much-Loved Construct,” Journal of International Business Studies 43, no. 1 (2012), pp. 18 –27. 98Hofstede, Culture’s Consequences. 99This continuum has also been labeled “social context salience” by H. Rika Houston and John L. Graham, “Culture and Corruption in International Markets: Implications for Policy Makers and Managers,” Consumption, Markets, and Culture 4, no. 3 (2000), pp. 315– 40.
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