Case study: A Tale of Two Cultures Many cultures in Asia are in the midst of an identity crisis. In effect, they are being torn between two worlds. Pulling in one direction is a traditional value system derived from agriculture-based communities and extended families—that is, elements of a culture in which relatives take care of one another and state-run welfare systems are unnecessary. Pulling from the opposite direction is a new set of values emerging from manufacturing-and finance-based economies—elements of a culture in which workers must often move to faraway cities to find work, sometimes leaving family members to fend for themselves. For decades, Western multinational corporations set up factories across Southeast Asia to take advantage of relatively low-cost labor. Later, local companies sprang up and became competitive global players in their own right. Spectacular rates of economic growth in a few short decades elevated living standards beyond what was thought possible. Young people in Malaysia and Thailand felt the lure of “Western” brands. Gucci handbags (www.gucci .com), Harley-Davidson motorcycles (www.harley-davidson.com), and other global brands became common symbols of success. Many parents felt that brand-consciousness among their teenage children signaled familywide success. Despite the growing consumer society, polls of young people show them holding steadfast to traditional values such as respect for family and group harmony. Youth in Hong Kong, for example, overwhelmingly believe that parents should have a say in how hard they study, in how they treat family members and elders, and in their choice of friends. The practice of outsourcing non-essential tasks helped create an Indian IT industry worth $140 billion. As outsourcing continues to wash over India, a social revolution is occurring among India’s graduates of technical colleges and universities. Unlike in India’s traditional high-tech service jobs, young call-centre staffers are in direct contact with Western consumers, answering inquiries on items such as tummy crunchers and diet pills. For these young, mostly female staffers, the work means money, independence, and freedom sometimes far away from home in big cities such as Bangalore and Mumbai. But in addition to the training in American accents and geography, these workers are learning new ideas about family, materialism, and relationships. Parents are suspicious of call-centre work because it must typically be performed at night in India, when consumers are awake in Canada, Europe, or the United States. When her parents objected, Binitha Venugopal quit her call-centre job in favour of a “regular” daytime job. Binitha says her former co-workers’ values are changing and that dating and live-in relationships among them are common. Indian tradition dictates that young adults live with their parents at least until they get married (typically to someone their parents choose). Perhaps facilitating shifting values in India is an influx of Western professionals, such as lawyers, who accepted good-paying jobs there that could not be found back home during the global recession. Roopa Murthy works for an Indian company that offers call-centre and back-office services. Roopa moved to Bangalore from her native Mysore armed with an accounting degree. She now earns $400 per month, which is several times what her father earned before he retired from his government job. Roopa cut her hair short and tossed aside her salwar kameez, the traditional loose-fitting clothing she wore back home, in favour of designer-labelled Western attire. Although she once shunned drinking and her curfew at home is 9 p.m., Roopa now frequents a pub called Geoffrey’s, where she enjoys dry martinis and rum, and The Club, a suburban disco. Roopa confesses that she is “seeing someone” but that her parents would disapprove, adding, “It is difficult to talk to Indian parents about things like boyfriends.” She said she sometimes envies her callers’ lives but that she hopes her job will help her succeed. “I may be a small-town girl, but there is no way I’m going back to Mysore after this,” she said. Many observers wonder whether Asia can embrace modernization and yet retain traditional values. Question: Critically discuss the importance of international companies considering cultural differences when engaging in Foreign Direct Investment.
Case study:
A Tale of Two Cultures
Many cultures in Asia are in the midst of an identity crisis. In effect, they are being torn between two worlds. Pulling in one direction is a traditional value system derived from agriculture-based communities and extended families—that is, elements of a culture in which relatives take care of one another and state-run welfare systems are unnecessary. Pulling from the opposite direction is a new set of values emerging from manufacturing-and finance-based economies—elements of a culture in which workers must often move to faraway cities to find work, sometimes leaving family members to fend for themselves. For decades, Western multinational corporations set up factories across Southeast Asia to take advantage of relatively low-cost labor. Later, local companies sprang up and became competitive global players in their own right. Spectacular rates of
Many parents felt that brand-consciousness among their teenage children signaled familywide success. Despite the growing consumer society, polls of young people
show them holding steadfast to traditional values such as respect for family and group harmony. Youth in Hong Kong, for example, overwhelmingly believe that parents should have a say in how hard they study, in how they treat family members and elders, and in their choice of friends.
The practice of outsourcing non-essential tasks helped create an Indian IT industry worth $140 billion. As outsourcing continues to wash over India, a social revolution is occurring among India’s graduates of technical colleges and universities. Unlike in India’s traditional high-tech service jobs, young call-centre staffers are in direct contact with Western consumers, answering inquiries on items such as tummy crunchers and diet pills. For these young, mostly female staffers, the work means money, independence, and freedom sometimes far away from home in big cities such as Bangalore and Mumbai. But in addition to the training in American accents and geography, these workers are learning new ideas about family, materialism, and relationships.
Parents are suspicious of call-centre work because it must typically be performed at night in India, when consumers are awake in Canada, Europe, or the United States. When her parents objected, Binitha Venugopal quit her call-centre job in favour of a “regular” daytime job. Binitha says her former co-workers’ values are changing and that dating and live-in relationships among them are
common. Indian tradition dictates that young adults live with their parents at least until they get married (typically to someone their parents choose). Perhaps facilitating shifting values in India is an influx of Western professionals, such as lawyers, who accepted good-paying jobs there that could not be found back home during the global recession.
Roopa Murthy works for an Indian company that offers call-centre and back-office services. Roopa moved to Bangalore from her native Mysore armed with an accounting degree. She now earns $400 per month, which is several times what her father earned before he retired from his government job. Roopa cut her hair short and tossed aside her salwar kameez, the traditional loose-fitting clothing she wore back home, in favour of designer-labelled Western attire. Although she once shunned drinking and her curfew at home is 9 p.m., Roopa now frequents a pub called Geoffrey’s, where she enjoys dry martinis and rum, and The Club, a suburban disco. Roopa confesses that she is “seeing someone” but that her parents would disapprove, adding, “It is difficult to talk to Indian parents about things like boyfriends.” She said she sometimes envies her callers’ lives but that she hopes her job will help her succeed. “I may be a small-town girl, but there is no way I’m going back to Mysore after this,” she said. Many observers wonder whether Asia can embrace modernization and yet retain traditional values.
Question:
Critically discuss the importance of international companies considering cultural differences when engaging in Foreign Direct Investment.
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