REGIONAL CULTURAL DIMENSIONS
When a contract factory wishes to do business with Nike or one its many subsidiaries, it is critical that the owners and/or managers in the supply chain understand the cultural differences across the globe. Failure to understand the cultural norms can result in communication failure, lack of respect, negotiation breakdowns, and a loss of current and future business opportunities. On the contrary, it is critical for Nike managers to understand the culture differences of their international supply chain as well. Failure to grasp the customs of the different supplier communities can result in steep business losses, which hurt every part of the supply chain. Below is a general analysis of the various common cultural dimensions one can expect to encounter when doing business in different parts of the world.
North America
Time Sensitivity: Punctuality is highly-valued in North America because businesspeople value time almost as much as they do money, hence the term "time is money." During any formal business meeting, the meeting leader is expected to provide an agenda and an anticipated schedule of events so attendees can organize their schedules accordingly. Time management and attention to detail are two sought-after skills from both employees and partners
Space Orientations: North Americans prefer more space in the business setting. A good distance between two individuals is about three feet. Greetings consist of firm and brief handshakes.
Power Distance: North America has low power distance. Questioning and challenging authority is common and is often the source of ingenuity in many companies where challenging the status-quo is expected.
Uncertainty Avoidance: North Americans tend to be direct and to-the-point during business proceedings, as this goes back to a high value for time. North Americans place more importance on the content and the efficiency of negotiations than how it is conducted.
Individualism-Collectivism: Because of the competitive nature of its primarily Capitalistic society, North Americans value individual rights and gain social status and professional success by means of competiveness. Although most understand the importance of negotiations, many American business managers act in a "zero-sum" context, where one side's win is another's loss.
Masculinity-Femininity: North America is considered to be a low masculine culture where men and women share equal rights.
Western Europe
Time Sensitivity: Similar to North Americans, Western Europeans value punctuality, as the work-week is fast-paced and meeting times generally adhere to the schedule. Some countries, such as Germany and Great Britain may place higher values on punctuality than others, such as Greece and Spain.
Space Orientations: Western Europeans have similar personal space as North Americans in business settings. Generally, a space of about two to three feet between individuals is acceptable, along with a brief and firm handshake.
Power Distance: Similar to North Americans, Western Europeans value power and executives favor individual decision making versus that of the collective.
Uncertainty Avoidance: Western Europeans as a whole tend to be direct and formal with understated and subtle communication. Again, this metric varies depending on the country, as Germans tend to be much more reserved and direct than Spain or Greece.
Individualism-Collectivism: Western Europeans value education and hard-work on an individual level, and as a result, expect to rewarded solely on their efforts and achievements.
Eastern Europe
Time Sensitivity: Eastern Europeans have similar expectations and valuations for time during business proceedings as that of North America and Western Europe.
Space Orientations: Eastern Europeans tend to share their personal space moreso than North Americans and Western Europeans in business settings. Handshakes typically are firm and brief among men, but can be more lengthy between men and women.
Power Distance: Eastern Europeans perception of power is lower than North American and Western Europeans as they tend to focus more on the group dynamic versus the individual agenda.
Uncertainty Avoidance: Eastern Europeans communicate in a direct, straightforward manner with little to no ambiguity.
Individualism-Collectivism: Eastern Europeans focus on group ideals in business discussions and negotiations are typically conducted by teams, which results in a lack of clarity regarding who has authority to make decisions.
Latin America
Time Sensitivity: Typically, Latin Americans view time as a series of events with no immediate sense of urgency. Arriving to a business meeting 30-60 minutes late is not unusual in Latin America and agendas and planning are not valued with any level of importance.
Space Orientations: In comparison to North American standards, Latin Americans have lower personal space standards. During negotiations, Latin Americans stand closer than arms length and men of equal status or business acquaintances hug one another and women may kiss the other’s cheek. Handshakes are softer than those in North America.
Power Distance: Latin Americans are quick to show respect to authority figures and slow to challenge decisions made by those with more power. Power and stature are heavily emphasized and challenging one's authority is a sign of disrespect.
Uncertainty Avoidance: Latin Americans avoid uncertainty due to the value placed upon structure and authority.
Individualism-Collectivism: Latin Americans view their culture as collectivist, with more focus on the group than the individual needs. Latin Americans focus on the unique qualities of a person over their formal accomplishments such as education, status, etc.
Masculinity-Femininity: Latin America is a masculine culture. This is particularly important in negotiations because a "macho" presence equates to confidence and competence.
Asia
Time Sensitivity: Nations located in Asia and the Pacific Rim tend to have longer, more drawn-out negotiations due to the high value placed upon long-term relationships and the amount of time it takes to create them.
Space Orientation: As a result of the abundance of people in such small spaces, personal space in Asia and Pacific Rim cultures is closer than in North America. Managers engaged in negotiations should expect brief handshakes or bows with minimal physical touching. Eye contact is brief and physical gestures are reserved as signs of respect.
Power Distance: Most Asian nations have a high power distance, meaning that authority is respected. These nations
accept the fact that inequality in power is considered the norm.
Uncertainty Avoidance: Avoiding uncertainty is paramount to most of the Asian cultures, as respecting authority and saving face are critical facets to business processes.
Individualism-Collectivism: Asia and Pacific rim cultures emphasize collectivism, choosing to focus on group needs in lieu of those of the individual. As a result, the negotiation process can be slower since decisions are made by the entire group instead of one key player.
Masculinity-Femininity: The male gender is typically favored over the female, and heavy emphasis is placed on education and career-goals as a way to bring honor to the family.
Sub-Saharan Africa
Time Sensitivity: Sub-Saharan African cultures like to begin negotiations on time. Agendas are typical yet maintaining the schedule varies depending on the location. The pace of negotiations can occur more quickly in some parts of Africa than others.
Space Orientations: Space is typically close among businesspeople, but direct eye contact is avoided depending on the level of authority at the meeting as well as its context.
Power Distance: Because of a complex bureaucracy and an acceptance of hierarchical order, respect and formality are important, especially when addressing an elder or a person who is in a position of higher authority.
Uncertainty Avoidance: Uncertainty is typically avoided due to importance of respect for authority and their decisions.
Individualism-Collectivism: Sub-Saharan Africa cultures tend to be collectivists, with a strong group emphasis. As a result, the negotiation process is slow since decisions require group approval. Business dynamics are influenced by tribal roots.
Masculinity-Femininity: Masculinity among cultures in Sub-Saharan Africa is high because hard work and high performance is valued. Those negotiatiors with auare expected to be decisive and assertive.