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Unit 3: Cultural and Social Environment

notes

Notes The primacy of the value of group identification also discourages managers
and workers from moving from company to company.

Unspoken Language

Unspoken language refers to non-verbal communication. We all communicate with each other
by a host of nonverbal cues. The raising of eyebrows, for example, is a sign of recognition in most
cultures, while a smile is a sign of joy. Many nonverbal cues, however are culturally bound. A
failure to understand the nonverbal cues of another culture can lead to a failure of communication.
For example, making a circle with a thumb and the forefinger is a friendly gesture in the United
States, but it is a vulgar sexual invitation in Greece and Turkey.
Another aspect of non-verbal communication is personal space, which is the comfortable amount
of distance between you and someone you are talking to. In the United States, the customary
distance apart adopted by parties in a business discussion is five to eight feet. In Latin America it
is three to five feet. Consequently, many North American unconsciously feel that Latin Americans
are invading their personal space and can be seen backing away from them during a conversation.
In turn, the Latin American may interpret such backing away as aloofness. The result can be a
regrettable lack of rapport between two business people from different cultures.

3.1.6 education

Formal education plays a key role in a society. It is the medium through which individuals learn
many of the language, conceptual and mathematical skills that are indispensable in a modern
society. Formal education also supplements the family’s role in socializing the young into the
values and norms of a society. Values and norms are taught both directly and indirectly. Schools
generally teach basic facts about the social and political nature of a society. They also focus on
the fundamental obligations of citizenship. Cultural norms are also taught indirectly at school.
Respect for others, obedience to authority, honesty, neatness, being on time, and so on, are all
part of the “hidden curriculum” of schools. The use of grading system also teaches children the
value of personal achievement and occupation.
From an international business perspective, one important aspect of education is its role as a
determinant of national competitive advantage. The availability of a pool of skilled and educated
workers seems to be a major determinant of the likely economic success of a country.
The general education level of a country is also a good index of the kind of products that might
sell in a country and the type of promotional material that should be used.

3.1.7 Demand conditions

Composition of home demand, the size and pattern of growth of home demand.
1. Gross National Product (GNP): Broadest measure of economic activity which is defined
as the market value of final goods and services newly produced by domestic factors of
demand.

Notes The production by domestic factors could take place at home or abroad.

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