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SOCIAL AND CULTURAL FACTORS IN BUSINESS Week 2 The Command Economy Enterprises governed by “the plan” Annual quotas broken down to Quarterly Monthly Weekly The Command Economy Each enterprise told what to produce with What materials What labour What finance At what price Where to be delivered And at what price Principal management skills Bureaucratic bargaining Understating production capabilities Overstating requirements Hofstede Analysis – 4 Parameters POWER DISTANCE Degree of inequality INDIVIDUALISM Reinforcement of individual achievement MASCULINITY Society’s reinforcement of masculine work role model UNCERTAINTY AVOIDANCE Degree society reinforces uncertainty Copernicus project – East/West Divide France, Germany UK have similar values Bulgaria, Poland Czech Republic have similar values Similarities “group” into East and West EXCEPT Poland is similar to France Comparative scores Graphical representation Comparative scores - 2 Graphical representation Factors to consider in cross-cultural development Cultural boundaries inhibit acceptance of western management techniques Cross-cultural adaptation process Trans-national managerial leadership (TML) Cross-cultural insight Relational tracking Relational skills Long-run optimisational pathway Marketing as a managerial skill Marketing practices in less developed countries often prove to be much more efficient by serving the local markets, than marketing transplants from their developed counterparts In transition economies: Many of the most successful entrepreneurs concentrate their efforts on how to beat the system, to find loopholes in legislation and not develop a strong sense of satisfying the customer. Importance of marketing The whole notion of marketing is important because the transition toward a market-led company puts a strong emphasis on the pioneering role of marketing The difficulty of transition Although probably no one had illusions about the changes in Eastern Europe, its length and complexity h
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