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International Management Managing Across Cultures Notes

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Managing Across Cultures


Ethnocentric Predisposition - A nationalistic philosophy of management whereby the values and interests of the parent company guide strategic decisions.

Polycentric Predisposition - A philosophy of management whereby strategic decisions are tailored to suit the cultures of the countries where the MNC operates.

Regiocentric Predisposition - A philosophy of management whereby the firm tries to blend its own interests with those of its subsidiaries on a regional basis.

Geocentric Predisposition - A philosophy of management whereby the company tries to integrate a global systems approach to decision making.

Globalisation Imperative - A belief that one worldwide approach to doing business is the key to both efficiency and effectiveness.

Parochialism - The tendency to view the world through one's own eyes and perspectives.

Simplification - The process of exhibiting the same orientation toward different cultural groups.

Guanxi - Chinese for "good connections".


As MNC's become more transitional their strategies must address the cross cultural similarities and differences in their varied markets.

Strategic Predispositions

Most MNC's have a cultural strategic predisposition toward doing things in a particular way. Four distinct predispositions have been identified; ethnocentric, polycentric, regiocentric and geocentric.

If an MNC relies on one of these profiles over a period of time, the approach may become institutionalised and greatly influence strategic planning.

A predisposition toward any of these profiles can provide problems for a firm if it is out of step with the economic or political environment.

Successful MNC's use a mix of these predispositions based on the demands of the current environment.

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