Week 3 Culture Review

1 - The cultural variable is the unpredictable aspect of working in international business as people have different influences and conduct business differently, especially concerning greetings, punctuality, gift giving and other aspects.

2 - Almost every business today is inter-cultural with a mixture of ethnicity, faith and nationality.

3 - Culture shock is part of working and re-locating in international business and even when eventually returning to your home country.

4 - Cultural imperialism is a term that was used in former centuries when powerful nations controlled colonies and influenced their language and values. Today some people describe outsourcing, the business of producing goods in foreign countries, as a form of cultural imperialism because corporations enforce their language and goods on their foreign workers.

5 - Theodor Adorno created the term "culture industry" to describe the business of mass produced cultural goods. Now most films, fashion and music are created for a widespread, global audience. Some people believe this means a loss of local cultures and businesses.

The Culture Industry

Cultural events like the Oscars and Cannes Film Festival above attract international advertisers. ABC averages $1.5 million per 30 seconds during the Oscars.

The “Culture Industry”

-The culture industry is a term by German philosopher Theodor Adorno that meant mass produced culture like art, film, TV and radio. The theory was that mass produced culture showed a mass produced world, with needs and dreams that could only be satisfied by global consumerism – it was like saying that art, film, tv and radio are one big commercial.http://www.theory.org.uk/ctr-ador.htm

-Ideology is a set of ideas.

-Hegemony is the dominating culture that promotes ideologies.

-According to Adorno, the culture industry is a hegemony that sells a capitalist ideology. The culture industry is the business of dreams, manufactured dreams toward a global capitalism.

-The culture industry is one of the largest international businesses that includes smaller industries. It is also called the entertainment industry, leisure industry or show-biz, among others...

Tourism Industry – While you cannot mass produce a location, the related industry of souvenirs and hotels are often mass produced. Moderated by the World Tourism Organization. $856 billion annually. Major income for France, as the highest, and former colonies. Sometimes constructed like Dubai or Shrangri-la, in China, based on novel by James Hilton. Places like Ibiza come and go in fashion.

Film industry – With film it is about mass distribution. It averages $15 million to make a mass distributed film but US Blockbusters can make $200 million, mainly in US/Hollywood, India/Bollywood (growing 100 million annually), Hong Kong, and Nigeria.

Fashion Industry – Fashion concerns mass produced clothing predominately and a smaller amount of haute couture. $250 billion is spent by consumers annually. Paris, New York, London and Milan are the top cities hosting major bi-annual “fashion weeks,” for people in the business. LVMH in Paris controls the most luxury brands.

Magazine Industry – Mass produced paper, printed magazines are largely controlled by Conde Nast in New York with offices in London, Paris and more. Single issues can earn 50 million a year in good years but it is decreasing due to the internet. Together they earn Conde Nast about $600 million annually.

Music Industry – Music is like film something that can be mass distributed. The annual business was about $14 billion and has been dropping to $10 billion and lower due to mp3s. Major labels Sony, Warner and Universal control most production and are located in NY and LA.

Gaming Industry - Close behind music at $9.5 billion in the United States alone, gaming includes video games for home entertainment and online.

Celebrities are some times considered mass produced identities as their images sell cultural products. They are some of the world’s richest people with George Lucas, Oprah Winfrey and Mel Gibson at the top earning 100’s of millions each year.

Read more about celebrity billionaires:

http://www.forbes.com/2009/03/10/oprah-trump-rowling-billionaires-2009-billionaires-celebrities_slide_2.html?thisspeed=25000

Above Entourage shows all the jobs in the biz, See more about how a film is made here: http://www.howstuffworks.com/movie-distribution.htm

Show biz is big biz, with top salaries matching and beating the best in finance. Star performers can earn the most. So who wants to be famous! Unfortunately everyone. So if you are banking on natural talent, step in line and check out the average salaries.

Director/Producer - $64,000 annually

Actors - $14 an hour

Musician - $30,000 annually

Athletes - $50,000 annually in the pros

Newscasters - $40,000 annually

Models - $15,000 annually

Designers - $40,000 annually

The entertainment business is also considered a high risk career, not only because of the unpredictable chance factor but also because every area of entertainment is decreasing in revenue due mainly to the internet. Now the masterminds behind entertainment systems, computer software designers and distribution/licensing companies are gaining from the shift. The rise of internet culture like Facebook, estimated at $6.5 billion has increased the leisure industry.

.........................

photos http://www.festival-cannes.com/

Culture & Business

Culture & international business

-For this course, culture can be defined as the surrounding influences upon identity that can be a variable or wild card in doing business. Culture forms values and a point of view that may or may not be predictable.

-Culture can be language and/or country specific but it may also be regional, religious or determined by way of life or livelihood as with agricultural communities

-Culture is like the wild card in international business because you can never be completely in the other country’s place. You can simply respect and learn.

-Respecting a culture includes respecting your own and that of others. One way to respect the culture is to celebrate something valuable about it. For example, a poorer culture may have a long craft or agriculture tradition that could be celebrated. But in working environments, the best way to respect culture is to respect humanity – we are all human. When you make a cultural faux pas you can at least admit your error and try to learn from the situation.

The Cultural Variable

http://findarticles.com/p/articles/mi_m1052/is_n2_v112/ai_10412261/

From this article culture influences business in:

business styles, business relationships, punctuality, negotiating, gift giving, greetings, gestures, colors, numbers, titles and other aspects

You can research a culture you will do business with but there are always unknown factors

Ex: France

Research of Business landscape: Dominated by conservative businesses like finance and insurance, such as Total, BNP, Societe General

Research of Lifestyle: A culture of some traditions, open to the new, interested in dining with friends and family, values relaxation and vacation

Ex. Cultural Variable: More subtle factors like values of humor and romance

Milke in Germany was marketed as a mountain chocolate but then after it was advertised in France it did not sell and was changed to be promoted as more playful

Ex. Cultural Variable: Memories and history

May 1968 was a student rebellion in France. Many of today’s French CEOs would have been alive and may have participated in this event that would not be known by the younger American generation

Inter-cultural, part of all international business

-Intercultural simply means activity that mixes 2 or more cultures and is part of business, marriages, foods, and more. Business may have employees that are inter-cultural within one company in one nation.

-Cross-cultural is when you compare two or more countries. Cross-cultural analysis is very important to international businesses because they want to compare their markets and profits

-An inter-cultural business can do a cross-cultural analysis of its different markets

Culture shock, part of all international business

-Either you or your employees will travel for international business. Culture shock is especially important if you are re-located for your business.

-Culture shock is simply anxiety and feelings associated with a different culture. You can have mild culture shock regionally, from north to south in the US. You can have culture shock from urban to suburban.

Honeymoon Phase – Everything is wonderful and new. For example, in moving to a new country, an individual might love the new foods, the pace of the life, the people's habits, the buildings and so on.

Negotiation Phase - After weeks, differences between the old and new culture become apparent and may create anxiety. One may long for food the way it is prepared in one's native country, dislike habits.

Adjustment Phase – After 6 – 12 months, one grows accustomed to the new culture and develops routines. Basic living becomes more "normal".

Reverse Culture Shock (a.k.a. Re-entry Shock)

Culture and outsourcing

-Outsourcing is a contract for hired service, making it a third party (not a buyer or seller) that is usually of a different culture than the main business

-Outsourcing is normally used to lower costs

-Outsourcing has previously been emphasized by US companies in South America, Asia. Now companies like BMW and Toyota outsource to the US like Alabama and New Jersey factories. In some cases, outsourcing is considered a form of cultural imperialism since the company and product are imposed on other places.

................................................................................................

Images of May 1968 www.life.com and statistics www.wikipedia.org

Cultural Exchange

Above, Jean-Luc Godard's Made in U.S.A.,1966, made in France

Culture as the “impossible exchange”

-French thinker Jean Baudrillard described the “impossible exchange” as that which cannot enter the market. Usually personal things have a value greater than what they could be sold for– a family heirloom, a wedding ring - and are impossible exchanges.

-Culture is an intangible asset that is learned through life experience and in truth cannot be bought or sold. Only the resources of a region can be bought or sold and then if they relate to the intangible culture, such as a postcard, foods, music, crafts and films about an area, they are then cultural goods. These are often called high culture (high value such as fine art work) and low culture (low value such as pop music). Cultural exchange of goods is another way to say trade.

Localization and cultural goods

-Every international business now wants to be global but some businesses are undeniably local and only become international because they export. Localization is recognizing the value of local resources which are traded. Local resources are usually natural resources and special skills.

-Examples include French wine, Saudi Arabian oil, African diamonds, most all agriculture

-Businesses evaluate the following before going from local to international

Determining if there is an international market

Responding to an international demand

Speculating a demand by the success of similar products

Establishing international relations

Starting international marketing and trade

Significance of the “Made in” label and the UPC

-When a localized business becomes international the product leaves its home territory and is often labeled as “made in” It is not required and just serves as an informative and marketing device. It is used to promote a country but also to protect a consumer so they can know the product origin and whether they agree with how a product was made which differs country to country. China has in large ceased with this label other keep it http://www.made-in-china.com/

-In the US, The Federal Trade Commission requires by law that automobiles, textiles, wool or fur made entirely in the US it must carry this label when distributed internationally. No other products are required to have the label but if they desire to promote America they must meet the standards. Some cournties have similar mandates on alcohol and food.

-There are “made in” crimes where people have removed “made in” labels from other countries to sell as their own

-In the 1960’s there was a Japanese town named Usa that labeled their products “Made in USA, Japan”

-The UPC, universal product code started in 1974 in the US, there is also the EAN and JAN for Euro and Japan Article Number, they all simply track inventory and are not mandated but starting in 2005 all US retail stores must be able to read them

-UPC is 12 digits with some variations in the EAN and JAN with either the outer most 2 numbers on the edges or the first 3 numbers indicating product origin. 00 - 09 . USA & Canada, 30 - 37 . Fr

ance, 40 – 44, Germany, 47 Taiwan, 49 Japan, 50 UK and 690-692 is made in China

Read more on "Made in China":

http://www.msnbc.msn.com/id/19508453/

http://yaleglobal.yale.edu/display.article?id=9579

................................................................................................

Godard image http://ilovehotdogs.tumblr.com/ and image and statistics www.wikipedia.org