CONTENTS
CHAPTER 1 International Management : Trends, Challenges, and Opportunities = 1
International Management Challenge. Gift-Giving Overseas : How to Lose Business Without Really Trying = 1
Introduction and Chapter Goals = 2
General Growth Trends in International Business = 2
International Management Insight : Burgers Make the World Go Around = 4
Trends in Africa = 5
Tanzania = 5
South Africa = 7
Trends in the Asia-Pacific Region = 8
East Asia = 9
India = 11
Japan = 11
New Zealand = 12
The Philippines = 13
Trends in Eastern Europe = 13
Russia = 15
International Management Insight : Russia's Capitalist Frontier = 16
Trends in the European Union = 17
Trends in the Middle East = 18
Trends in Latin America = 19
Trends in North America = 20
Risks and Dangers in the International Economy = 23
International Management Insight : Prospects for Hong Kong Under Chinese Rule = 24
The Internationalization of the Workforce = 26
The Role of Management in a Volatile Twenty-First Century Environment = 28
International Management Insight : U.S. Firms Face Pressures on Foreign Labor Abuses = 29
Basic Conceptual Foundations = 30
Defining Culture = 31
Defining Organizations in an International Context = 31
Summary = 32
Answering the International Management Challenge : Some Advice on Gift-Giving Overseas = 33
Discussion Questions = 34
Exercise = 35
Case : China's American Frontier = 35
PART 1 International Perspectives on Organizational Behavior = 37
CHAPTER 2 Perceptions, Interpretations, and Attitudes Across Cultures = 39
International Management Challenge. Doing Business in Vietnam = 39
Perception = 40
Differences in Perceptions of People and Events Across Cultures = 40
Perceptions of People = 40
Perceptions of Events = 42
Implications of Research on Perceptions of People and Events = 42
Perception of Nonverbal Behavior = 43
Definition and Examples of Nonverbal Behavior = 43
International Management Insight : Perception and the Ritual of the Business Card = 44
Context as Nonverbal Behavior = 45
Differences in the Perception of Time = 47
Research on Time Perception Across Cultures = 47
Classifying Countries by Their Emphasis on Time = 49
Interpretation of Perceptions = 51
Attribution Theory = 51
Self-Attribution Effects = 52
Attributions About Others = 53
Implications of Cross-Cultural Attribution = 54
International Management Insight : Attributions on Television = 55
Attitudes = 55
Attitudes Toward the Self = 56
Interdependent and Independent Selves = 56
Self-Descriptions = 57
International Management Insight : Face: How to Give It, Get It, and Keep It = 58
Effects of Having Different Self-Views = 60
Specific Self Attitudes = 61
Attitudes About Others and Groups = 62
Attitudes Toward Americans = 62
International Management Insight What Do People From Other Countries Say About Americans? = 64
Formation of Stereotypes = 66
The In-Group as A Cause of Stereotypes = 67
The Effects of Attitudes and Stereotypes = 69
International Management Insight : Made in the USA? Caveat Emptor! = 70
Attitudes about Work = 71
Job Satisfaction = 73
Organizational Commitment = 75
Summary = 77
Answering the International Management Challenge : Doing business in Vietnam = 78
Discussion Questions = 79
Exercise : Measuring Your Perceptual Orientation to Time = 79
Case : Culture Shock in Korea for Jake Bradshaw = 80
CHAPTER 3 Motivating Employees in an International Context = 83
International Management Challenge : How Would You Motivate Russian Workers? = 83
International Management Insight : The "Ki" to Motivating Some Japanese Executives Clustering Countries by Cultural Values Affecting Motivation = 85
Ronen and Shenkar's Country Clusters = 86
Limitations of Ronen and Shenkar's Approach = 86
Hofstede : Clustering Countries on Work-Related Value Dimensions = 90
Individualism-Collectivism = 90
Masculinity-Femininity = 90
Power Distance = 90
Uncertainty Avoidance = 91
Hofstede's Cultural Maps = 91
Limitations of Hofstede's Cultural Dimensions = 93
Defining Motivation in an International Context = 96
International Management Insight Working Together in the United States : Two Sides of the Japanese-American Culture Gap = 96
Performance Appraisal = 97
Promotions = 97
Work-Related Values Affecting Motivation = 98
Motivation Theories and Their Applicability to Other Cultures = 100
Maslow's Hierarchy of Needs = 101
Cross-Cultural Evidence Regarding Maslow's Needs Hierarchy = 102
Herzberg's Two- Factor Theory = 102
Cross-Cultural Applicability of Herzberg's Approach = 103
International Management Insight : Money Drives Russian Women Working for Mary Kay = 104
Process Theories of Motivation = 105
Equity Theory = 105
Applying Equity Concepts in Other Countries = 105
International Management Insight : Using U.S.-Style Rewards in China : Lessons from Leather Jackets = 106
Reinforcement Theory = 108
Cultural Issues in Using Reinforcement Approaches = 108
Goal Theory and Management by Objectives (MBO) = 110
Cultural Barriers to Using Goal Setting and MBO = 110
Expectancy Theory = 111
The Cultural Assumptions of Expectancy Theory = 111
International Management Insight : German Banks Try Modified Versions of U.S.-Style Bonus Plans = 112
Some Conclusions About Motivation Across Cultures = 113
Summary = 114
Answering the International Management Challenge : Motivating Russian Workers = 116
Discussion Questions = 117
Exercise : Your Individualism-Collectivism Orientation = 117
Exercise : Testing Your Cross-Cultural Motivation Skills = 119
Case : Chiba International, Inc. = 121
CHAPTER 4 Leading Employees in an International Context = 133
International Management Challenge : Leading Mexican Employees in Maquiladoras = 133
What Constitutes Effective Leadership in An International Context? = 134
International Management Insight : Karoushi and Japanese Management = 135
Cross-Cultural Differences in the Meaning of Leadership = 136
Cross-Cultural Differences in the Origins of Leaders = 137
Cross-Cultural Differences in Leadership Values = 138
Comparing Traditionalism and Modernism = 138
Comparing Particularism and Universalism = 139
Comparing Outer-Directed and Inner-Directed World Views = 139
Culture and the Attributes Associated With Leaders = 141
Differences in Requisite Leader Attributes = 141
Similarity in Requisite Leader Attributes = 143
International Management Insight. The Evolution of Russian Business Leaders = 143
Cross-Cultural Issues in Leaders' Behavioral Styles = 146
Culture and Leader Behavior Dimensions = 146
Culture and the Impact of Leadership Behavior = 147
International Management Insight : Bridging the Leadership Gap in Mexico = 149
The Need to Adapt Leader Behavior to the Cultural Context = 151
Leader Power Sources and Culture = 152
Leader Influence Tactics and Culture = 153
The Cross-Cultural Applicability of Transformational Leadership = 154
Toward Cross-Cultural Leadership : Adapting Path-Goal Theory = 155
Leadership Issues in MNCs = 157
The Skills Needed by International Leaders = 158
Foreign Perspectives on American Management = 158
Summary = 160
Answering the International Management Challenge : Modifying American Assumptions : Leading Mexican Employees in a Maquiladora = 161
Discussion Questions = 162
Exercise : Leadership Transitions in Emerging Market Economies = 163
Case : Grupo Uniko = 164
CHAPTER 5 Communication, Conflict, and Negotiation Across Cultures = 177
International Management Challenge : Foreign Negotiations and the Sounds of Silence = 177
Communication, Conflict, and Negotiation Across Cultures = 179
Verbal and Written Communication = 179
Languages = 179
Speaking(and Not Speaking) Other Languages = 180
International Management Insight : One Language Is Enough for Americans = 181
International Management Insight : Culture and Communication in the Air = 182
Mistakes in Communicating in Other Languages = 183
International Management Insight : Habla Usted Espa$$\tilde n$$ol? Microsoft Needs to Brush Up = 187
Embarrassment and Apology as Communication = 190
Compliments as Communication = 191
Criticism as Communication = 191
Monitoring Others as a Communications Tool = 192
Written Communication = 192
Business Letters and Memos = 193
Nonverbal Communication = 194
Interpersonal Space = 195
Touch = 195
Vocal Qualities as Nonverbal Communication = 196
Context Revisited = 197
International Management Insight : Putting Communication Into Context = 198
Conflict = 199
Causes of Conflict = 199
Dealing with Conflict = 201
Negotiation = 202
Preparing for Negotiations = 203
Stages of Negotiation = 204
Stage 1 : Nontask Sounding = 204
International Management Insight : Negotiation Chinese Style = 206
Stage 2 : Task-Related Exchange of Information = 207
Stage 3 : Persuasion Phase of Negotiation = 208
International Management Insight The Devil Is in the Details : The Meaning of Compromise Across Cultures = 208
Stage 4 : Agreement = 211
Summary = 212
Answering the International Management Challenge : Communicating and Negotiating with the Japanese = 213
Discussion Questions = 214
Exercise : International Negotiations = 214
Case : Contract Negotiations in Western Africa : A Case of Mistaken Identity = 215
PART 2 International Perspectives on Human Resource Management = 221
CHAPTER 6 Selection and Development of International Employees = 223
International Management Challenge : U.S. Firms Face Challenges When Screening Foreign Job Candidates = 223
Basic Options For Staffing Foreign Operations = 225
International Management Insight : Ethnic Expatriates : Caught between Cultures = 225
Selection Approaches Used By MNCs = 229
Developing Managers With International Skills = 230
International Management Insight : International Managers : Life in the Jet Lane = 231
Cultural Differences in Selection and Development Procedures = 234
International Management insight : Management Development in South Africa = 236
Managing Equal Opportunity and Organizational Diversity = 237
International Management Insight : Managing Immigrants in the U.S. : Challenges and Opportunities = 239
The Special Case of Expatriates = 241
International Management Insight : Want an Overseas Job? Visit Vietnam! = 242
The Selection of Expatriates = 244
A Process for Selecting Expatriates = 245
Training, Preparation, and Adjustment of Expatriates = 246
International Management insight : Training Japanese Executives to Survive U.S. Assignments = 247
Trends in Expatriate Preparation = 248
Returning Home : Repatriation Issues = 250
Summary = 252
Answering the International Management' Challenge : Other Potential Pitfalls When Screening Foreign Job Candidates = 253
Discussion Questions = 255
Exercise : International Orientation Scale = 255
Case : Ellen Moore in Bahrain = 257
CHAPTER 7 Performance Appraisal and Compensation Across Cultures = 271
International Management Challenge : Receiving a Performance Evaluation Overseas = 271
Performance Appraisal = 272
Giving an Appraisal／Evaluation = 272
Performance Evaluation for Expatriates = 273
Who Should Evaluate Performance? = 274
Evaluations by Local Managers = 274
Evaluations by Home Office Management = 275
When Should Performance Be Evaluated? = 276
How Should Evaluations Be Conducted? = 277
Variables that Affect the How Question = 277
Environmental Variables = 277
Task Variables = 278
Personality Variables = 278
Problems in Cross-Cultural Evaluations = 279
Guidelines for Expatriate Evaluation = 279
Rating an Assignment = 279
Factors that Determine Assignment Difficulty = 279
General Guidelines = 280
Issues Involved in Evaluating Foreign-born Employees = 280
International Management Insight : Giving Performance Feedback to Foreign-Born Employees = 282
Compensation of International Employees = 283
Compensation Systems = 283
The Meaning of Compensation across Cultures = 284
Pay Levels across Countries = 284
CEO Compensation across Countries = 286
Relative Compensation = 286
Perks and Other Compensation = 287
Total Compensation = 287
Vacation Time = 287
The Basis for Compensation across Countries = 288
International Management Insight : Hiroshi Okuda-A Nail That Sticks Out at Toyota = 290
Expatriate Compensation = 291
Expatriate Costs = 291
Models for Compensating Expatriates = 293
The Balance Sheet Method = 294
Purchase Power and the Balance Sheet = 294
Housing Costs = 295
Taxes = 296
Living Expenses = 297
The Balance Sheet on Balance = 298
Compensating Foreign Country Nationals = 300
Compensation Methods = 301
International Management Insight : Chinese Managers Know Their Way Around the Labor Market = 301
Summary = 303
Answering the International Management Challenge : Performance Evaluation Overseas = 304
Discussion Questions = 304
Exercise : Putting Together an Expatriate Compensation Package in Four Countries = 305
Case : The Road to Hell = 306
CHAPTER 8 Managing Groups Across Cultures : From Small Work Teams to Large Labor Forces = 313
International Management Challenge : Much Ado About Differences : Multicultural Teamwork at British Petroleum = 313
Managing Work Groups Across Cultures = 314
Differences in Group Behavior Across Cultures = 315
Individualists and Collectivists = 315
In-Groups and Out-Groups = 315
International Management Insight : Just in Case You Were Asleep the Day They Talked About Collectivism : Hell Camp for Japanese Managers = 316
Group Productivity Across Culture = 317
Social Loafing = 317
In-groups and Social Loafing = 317
Implications of Social Loafing Research = 318
International Management Insight : The Best Service in the Air Might Be Cross-Cultural = 319
Diversity : When Different Cultural Groups Come into Contact = 320
Diversity in Work Groups = 320
Assumptions about Diversity = 320
Minuses and Pluses of Diversity = 321
International Management Insight : Cross-Cultural Teams Open in the Catskills = 322
Using Diversity to Your Advantage = 324
Labor Relations in and Across Cultures = 325
Management and Worker Perspectives on Labor Relations = 326
International Management Insight : Mandatory Payments for Dismissed German Workers = 328
Labor Unions across Countries = 329
Unions among E. U. Countries = 330
Unions in Germany = 330
International Management Insight : Germans Think Americans Work Too Hard = 331
Unions in the United Kingdom = 332
Unions in France = 333
Other European Unions = 333
International Management Insight : Europe's Response to Restrictive Labors Laws? ....One Word....Temps! = 334
Japanese Unions = 335
Unions in China = 336
International Management Insight : Unions in the Middle Kingdom-Not Forbidden, but Not That Useful Either = 337
Unions in Other Asian Countries = 338
Central／South American Unions = 338
African Unionism = 339
International Employee Unions = 340
Other Forms of Employee Control／Input = 341
Joint Consultation Committees = 341
Work Councils = 342
Board Membership = 342
Putting Agreements into Practice = 343
Relations Between Management and Labor = 343
Deterioration of Relations = 343
Japan = 346
International Management Insight : Unions in Japan : A Bridge over Troubled Waters for Japanese Firms = 346
Germany = 347
United Kingdom = 347
United States = 348
Effect of Unions on Strikes = 348
Summary = 348
Answering the International Management Insight : Cultural Diversity among Work Teams at British Petroleum = 350
Discussion Questions = 351
Exercise : Japanese Decision Making = 351
Case : Precision Measurement of Japan : A Small Foreign Company in the Japanese Labor Market = 352
CHAPTER 9 International Human Resource Strategy = 363
International Management Challenge : Using Human Resources Strategically : Making the China Gamble Pay = 363
The Strategic Process in International Human Resource Management = 365
The Need for IHRMS = 367
Meeting the Goals of IHRMS = 367
International Management Insight : Pepsi-Cola International's Strategy for Managing Individual Performance Around the World = 369
Factors Affecting IHRMS = 370
Firm Characteristics = 371
International Management Insight : Redefining "Expatriate" in Japanese MNCs = 372
Internal Situational Variables = 374
Country-Specific-Factors = 374
International Management Insight : Cultural Values that Constrain Human Resource Management Strategy at Hitachi = 377
IHRMS and Stage of Internationalization = 378
International Management Insight : Unilever's Transnational Approach to International Human Resource Management = 381
Human Resource Issues in Specific International Relationships = 383
Human Resource Issues in International Acquisitions = 383
International Management Insight : Want an International Headache? Try Merging Swedish and American Drug Companies = 385
Human Resource Issues in Cooperative Relationships = 386
International Management Insight : Cultural Clash Aloft : The Turbulent Alliance between Northwest Airlines and KLM = 387
International Management Insight : Human Resource Management Strategy in Russian Joint Ventures = 390
Summary = 392
Answering the International Management Challenge : Some of Motorola's Answers to the Chinese Human Resource Management Puzzle = 393
Discussion Questions = 394
Exercise : International Human Resource Management Strategies in Subsidiaries, Joint Ventures, and Other Cooperative Relationships = 394
Case : Nissan Motor Co., Ltd. = 395
PART 3 International Business Strategy and Social Responsibility = 407
CHAPTER 10 Creating Strategy for the International Environment = 409
International Management' Challenge : Developing a Strategic Menu for Beating McDonald's = 409
An Introduction to International Strategy = 410
The Major Players in International Competition = 412
International Management Insight : Here Comes Japan-Again = 416
Some Basic Strategic Concepts for International Management = 417
National Competitive Advantage = 417
Country Factors Affecting International Strategy Development = 419
Firm and Industry Factors Affecting International Strategy = 420
MNCs and International Strategy = 420
Should MNCs Always Move Toward Global Strategies? = 422
Small Firm Issues = 425
International Management Insight : Small Firms and International Strategy : Looking for Help in All the Right Places = 426
The Process of Developing International Corporate Strategy = 428
Step 1 : Mission Statement = 428
Step 2 : SWOT Analysis = 429
International Management Insight : Into Africa : Chinese Firms Act on a Regional Analysis = 430
Step 3 : Set Strategic Goals = 434
Step 4 : Implementation Tactics and Plans = 436
Step 5 : Control and Evaluation Procedures = 436
International Management Insight : Creating International Strategy at Nokia = 437
Organizational Requirements for Successful International Strategy = 438
Summary = 442
Answering the International Management Challenge : Jollibees's Strategy for Beating McDonald's = 442
Discussion Questions = 443
Exercise : Conducting a Company Situation Analysis = 443
Case : Colgate-Palmolive Hungary = 445
CHAPTER 11 Implementing International Strategy = 451
International Management Challenge : Will Ford 2000 Pay Off? = 451
Strategic Entry Options That Do Not Involve Ownership = 453
Exporting = 453
International Management Insight : Exporting to the South Korean Market : Strategies That Work, at Least for Now = 454
Licensing = 456
Franchising = 458
Management Contracts = 459
Turnkey Projects = 459
Forms of International Entry Involving Ownership = 460
Wholly Owned Foreign Subsidiaries = 460
International Management Insight : The Greenfield Approach That Cost Tyco Toys Plenty = 461
International Management Insight : Want a Piece of the Old Soviet Empire? The Spies Are Included = 462
Joint Ventures = 464
International Management Insight : BMW and Chrysler : Driving a New Strategic Alliance = 466
Other Types of Strategic Alliances = 469
Challenges in Managing Strategic Alliances = 470
International Management Insight : Toyota and General Motors' Cavalier Alliance : A Head-on Collision? = 471
Factors Affecting International Market Entry Choice = 472
Structuring International Business Operations = 475
Basic Structures for International Businesses = 475
Global Organizational Structures = 478
Formal and Informal Approaches to Coordination = 481
International Management Insight : Culture, People, and Structure Support Global Strategy at ABB = 482
Summary = 484
Answering the International Management Challenge : The Critics' View of Ford 2000 = 485
Discussion Questions = 487
Exercise : Critical Incidents in International Strategy = 487
Case : Beijing Brick Factory = 489
CHAPTER 12 The Management of Production, Services, and Technology Across Borders = 493
International Management Challenge : Factory Location Decisions in the United States = 493
Managing Production, Services, and Technology Across Borders = 494
Production and Operations of the MNC = 495
U.S. Manufacturing = 495
Explaining the U.S. Decline in Certain Industries = 496
Product Lift-Cycle Theory = 497
New Product Phase = 497
Later Stages = 497
International Management Insight : This Is land Is Crazy for Chips-Maybe Too Crazy = 498
Problems with Life-Cycle Theory = 499
Understanding and Improving the Production Process = 500
Locating Facilities = 500
Location Strategies = 500
International Management Insight. The Luck of the Irish-U.S. and Japanese Firms Move Their Operations to the Emerald Isle = 501
Using Different Location Strategies = 502
Production Management 503
Getting Supplies = 503
Make or Buy Decisions = 504
Timing of Supplies = 505
Just-in-Time Supply Systems = 505
International Management Insight : "Japanese" Production Methods in the U.S. : The Recipe for Success Is Not Easy to Follow = 507
Keiretsu Supply Systems = 509
International Management Insight : Can the Japanese Be Beat at Their Own Game? : U.S. Firms Try to Create Homegrown Keiretsu = 510
Making Quality Products = 511
National Differences in Perception of Quality = 513
International Management Insight : One Medium Reindeer Sausage to Go, Please : How to Customize "Global" Products = 515
The Provision of Services By MNCs = 516
What Are Services? = 516
Importance of Services in World Economies = 516
International Management Insight : It's D$$e'$$j$$a'$$ Vu all Over Again : Service Jobs in the U.S. Are Moving Offshore = 518
Quality in Services = 519
International Management Insight : Global E-Mail - http://www.service.bad? = 520
The Management of Technology by MNCs = 522
Getting a Technological Advantage = 522
International Management Insight. Less-Developed Countries Compete in High Technology = 526
Using Your Technological Edge = 527
Maintaining Your Edge = 528
International Management Insight : Little U.S. Firm Battles a Japanese Giant to Protect Its Technology = 530
Summary = 532
Answering the International Management Challenge : Locating Factories in the United States = 533
Discussion Questions = 534
Exercise : R&D Expenditures of MNCs = 534
Case : Akaki Garment Factory = 535
CHAPTER 13 Laws and Politics Across Countries and Cultures = 545
International Management Challenge : Understanding Political Risk = 545
Laws and Politics Across Countries and Cultures = 546
Legal Issues in International Management = 546
Types of Legal Systems = 547
Civil Law = 547
Common Law = 548
International Management Insight : Guilty as Charged : Culture Clash of U.S. Lawyers and Litigation in Japan = 549
Islamic Law = 551
International Management Insight : Islamic Law and International Business = 552
Other Legal Systems = 553
International Law = 554
GATT = 554
Resolving International Disputes = 555
Source of Jurisdiction = 555
Political Issues and Risks in International Management = 556
What Are Political Risks? = 556
Types of Political Risk = 557
Political／Economic Environment Risk = 557
International Management Insight : In Harm's Way - The Danger in Doing Business Abroad = 560
Domestic Economic Conditions as Risk Factors = 561
International Management Insight : The Greening of the River Huai - Environmental Issues in Newly Industrialized China = 562
External Economic Relations as Risk Factors = 564
International Management Insight : Baxter International and the Arab Boycott of Israel = 568
International Management Insight : Risky Business - Piracy in the World's Largest Market = 571
Summery of Risk Factors = 572
Managing or Dealing with Political Risk = 573
Categorizing Risk Reduction = 574
Examples of Risk Reduction = 574
Investing in Risky Countries = 576
Summary = 577
Answering the International Manegement Challenge : An Analysis of the Risks Faced by American Banking Firm = 579
Exercise : Investigating Business Risk Insurance = 580
Case : From Russia With Love = 581
CHAPTER 14 Managing Ethical Issues in International Business = 587
International Management Challenge : Competitive Intelligence : When Does Corporate Snooping Cross the Line? = 587
Ethics and Social Responsibility in International Management = 589
Philosophies and Perspectives on Ethics = 589
International Management Insight : Unfulfilled Promise or Unrealistic Expectations? : U.S. Disappointment with the World Trade Organization = 591
International Management Insight : Ethical Behavior and the Bottom Line : A Tough Balancing Act for MNCs = 594
Cross-National Differences in Ethical Perspectives = 595
International Management Insight : In the International Bribery Game, U.S. MNCs Lag Behind = 596
Ethical Behavior and Human Rights = 599
Human Rights Issues in South Africa = 599
Human Rights Issues in China = 600
International Management Insight : Human Rights Issues for U.S. MNCs in China : The Case of Mr. Gao Feng = 601
Enforcement Issues With Codes of Conduct = 605
Ethics Associated With Questionable Payments and Bribery = 605
The Foreign Corrupt Practices Act = 609
International Management Insight How U.S. Firms Compete in Countries Where Bribes Flourish = 611
Ethical Issues Emerging From Countries Converting to Capitalism = 613
International Management Insight : A Flower in a Greenhouse : One Job Seeker's Odyssey = 615
Summary = 616
Answering the International Management Challenge : Competitive Intelligence : Lots of Gray Areas, No Easy Answers = 617
Discussion Questions = 618
Exercise : Bribery in International Business = 619
Case : Chicago Medical Supplies Corporation - Explaining Sales in India = 621
