Lecture 7 - Socio Culture Environment | Business Environment - Business Basics PDF Download

 Page 1


 
Institute of Lifelong Learning, University of Delhi                    1 
 
 
 
 
 
 
 
 
 
 
 
 
 
NME 
Lesson: Socio Cultural Environment 
Lesson Developer: Ms. Reena Talwar 
                            Ms.Nidhi Sharma 
College/Dept: Bharati College 
                        Shivaji College 
University of Delhi 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Page 2


 
Institute of Lifelong Learning, University of Delhi                    1 
 
 
 
 
 
 
 
 
 
 
 
 
 
NME 
Lesson: Socio Cultural Environment 
Lesson Developer: Ms. Reena Talwar 
                            Ms.Nidhi Sharma 
College/Dept: Bharati College 
                        Shivaji College 
University of Delhi 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    2 
 
Lesson: Culture and its Impact on Business  
 
Table of Contents 
1: Learning Outcomes 
2: Introduction 
3: Meaning and Elements of Culture 
3.1: Meaning and Nature of Culture 
3.2: Elements of Culture 
4: Distinctive Features of Culture 
4.1: Cultural Adaptation 
4.2: Cultural Shock 
4.3: Cultural Transmission 
4.4: Cultural Conformity 
4.5: Cultural Lag 
5: Cultural Traits and its Impact on Business 
6: Socio-Cultural Factors, Influencing Business 
6.1: Religion 
6.2: Language 
6.3: Consumer Preferences and Beliefs 
6.4: Etiquettes 
6.5: Social Trends 
Summary  
Exercises 
Glossary 
References 
 
 
1. Learning Outcomes: 
 
After you have read this lesson, you should be able to: 
? Understand the definition, meaning and nature of Culture. 
? Learn about different elements of culture. 
? Understand various distinctive features of culture. 
? Identify cultural traits and patterns, and their impact on business.  
? Gain insights on various socio-cultural factors that influence business operations.  
 
 
 
 
 
 
 
Page 3


 
Institute of Lifelong Learning, University of Delhi                    1 
 
 
 
 
 
 
 
 
 
 
 
 
 
NME 
Lesson: Socio Cultural Environment 
Lesson Developer: Ms. Reena Talwar 
                            Ms.Nidhi Sharma 
College/Dept: Bharati College 
                        Shivaji College 
University of Delhi 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    2 
 
Lesson: Culture and its Impact on Business  
 
Table of Contents 
1: Learning Outcomes 
2: Introduction 
3: Meaning and Elements of Culture 
3.1: Meaning and Nature of Culture 
3.2: Elements of Culture 
4: Distinctive Features of Culture 
4.1: Cultural Adaptation 
4.2: Cultural Shock 
4.3: Cultural Transmission 
4.4: Cultural Conformity 
4.5: Cultural Lag 
5: Cultural Traits and its Impact on Business 
6: Socio-Cultural Factors, Influencing Business 
6.1: Religion 
6.2: Language 
6.3: Consumer Preferences and Beliefs 
6.4: Etiquettes 
6.5: Social Trends 
Summary  
Exercises 
Glossary 
References 
 
 
1. Learning Outcomes: 
 
After you have read this lesson, you should be able to: 
? Understand the definition, meaning and nature of Culture. 
? Learn about different elements of culture. 
? Understand various distinctive features of culture. 
? Identify cultural traits and patterns, and their impact on business.  
? Gain insights on various socio-cultural factors that influence business operations.  
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    3 
 
2. Introduction: 
Culture is considered to be an important component of business environment, and is highly 
complex in nature. There are various dimensions, patterns and traits of culture which are 
difficult to define and understand for a business firm. A firm which carries out business 
activities without understanding the cultural dimensions of the environment, in which it 
operates, faces severe problems in business. Many multinational corporations also believe 
that cultural differences are the most important challenges that are faced by a firm. 
Therefore, it is significant, for a business firm, to understand the concept, features, traits 
and patterns of culture; and how socio-cultural factors can influence the business activities, 
and to what extent. 
 
3. Meaning and Elements of Culture: 
3.1. Meaning of Culture: 
Culture is an aggregative concept which comprises of customs, attitudes, values and beliefs 
of people, living in a society. It is the way people lead their lives and controls the way of 
their thinking and actions.  
According to E. B. Taylor, Culture is defined as “Culture of Civilization is that complex whole 
which includes knowledge, belief, cult, morals, law, custom, and any capabilities and habits 
acquired by a man as a member of society.” 
On the basis of above definition, the concept of culture can be explained through the 
following features: 
1. Culture is an aggregative concept, comprising of customs, attitudes, values and 
beliefs of people, in a society.  
2. Cultural values are essentially learned by a person, during the course of his/her 
development. 
3. Cultural values are developed over a period of time through social interaction amongst 
people, living in a society. 
4. Culture determines human personality, and its symbolic quality makes it meaningful 
to people. 
5. Culture is cumulative in nature and passes on from one generation to another. 
6. There are two types of Culture: 
a. Material Culture: Material Culture consists of man-made materials. For example, 
television, automobile etc. 
b. Non-Material Culture: Non-material culture comprises of factors like language, 
ideals, attitudes, values, beliefs etc.  
 
 
 
 
 
Page 4


 
Institute of Lifelong Learning, University of Delhi                    1 
 
 
 
 
 
 
 
 
 
 
 
 
 
NME 
Lesson: Socio Cultural Environment 
Lesson Developer: Ms. Reena Talwar 
                            Ms.Nidhi Sharma 
College/Dept: Bharati College 
                        Shivaji College 
University of Delhi 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    2 
 
Lesson: Culture and its Impact on Business  
 
Table of Contents 
1: Learning Outcomes 
2: Introduction 
3: Meaning and Elements of Culture 
3.1: Meaning and Nature of Culture 
3.2: Elements of Culture 
4: Distinctive Features of Culture 
4.1: Cultural Adaptation 
4.2: Cultural Shock 
4.3: Cultural Transmission 
4.4: Cultural Conformity 
4.5: Cultural Lag 
5: Cultural Traits and its Impact on Business 
6: Socio-Cultural Factors, Influencing Business 
6.1: Religion 
6.2: Language 
6.3: Consumer Preferences and Beliefs 
6.4: Etiquettes 
6.5: Social Trends 
Summary  
Exercises 
Glossary 
References 
 
 
1. Learning Outcomes: 
 
After you have read this lesson, you should be able to: 
? Understand the definition, meaning and nature of Culture. 
? Learn about different elements of culture. 
? Understand various distinctive features of culture. 
? Identify cultural traits and patterns, and their impact on business.  
? Gain insights on various socio-cultural factors that influence business operations.  
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    3 
 
2. Introduction: 
Culture is considered to be an important component of business environment, and is highly 
complex in nature. There are various dimensions, patterns and traits of culture which are 
difficult to define and understand for a business firm. A firm which carries out business 
activities without understanding the cultural dimensions of the environment, in which it 
operates, faces severe problems in business. Many multinational corporations also believe 
that cultural differences are the most important challenges that are faced by a firm. 
Therefore, it is significant, for a business firm, to understand the concept, features, traits 
and patterns of culture; and how socio-cultural factors can influence the business activities, 
and to what extent. 
 
3. Meaning and Elements of Culture: 
3.1. Meaning of Culture: 
Culture is an aggregative concept which comprises of customs, attitudes, values and beliefs 
of people, living in a society. It is the way people lead their lives and controls the way of 
their thinking and actions.  
According to E. B. Taylor, Culture is defined as “Culture of Civilization is that complex whole 
which includes knowledge, belief, cult, morals, law, custom, and any capabilities and habits 
acquired by a man as a member of society.” 
On the basis of above definition, the concept of culture can be explained through the 
following features: 
1. Culture is an aggregative concept, comprising of customs, attitudes, values and 
beliefs of people, in a society.  
2. Cultural values are essentially learned by a person, during the course of his/her 
development. 
3. Cultural values are developed over a period of time through social interaction amongst 
people, living in a society. 
4. Culture determines human personality, and its symbolic quality makes it meaningful 
to people. 
5. Culture is cumulative in nature and passes on from one generation to another. 
6. There are two types of Culture: 
a. Material Culture: Material Culture consists of man-made materials. For example, 
television, automobile etc. 
b. Non-Material Culture: Non-material culture comprises of factors like language, 
ideals, attitudes, values, beliefs etc.  
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    4 
 
 
 
 
Value Addition 1: Pause & Think 
Difference between Material Culture and Non-material culture 
 
Material culture includes all physical objects that define a culture like clothing, food, 
schools, temples, factories etc. These physical aspects help to identify the behavior and 
attitude of the members of a culture. 
 
Non-material culture includes thoughts and ideas of people about their culture and does 
not refer to any physical objects. These include beliefs, values, language, norms etc.   
 
As an activity, think about two examples each of material and non-material culture and 
analyze how they influence the behavior of members of that culture.  
 
INTERACTIVE 1 
3.2. Elements of Culture: 
Culture has the following basic elements, as shown in the diagram below: 
Figure 1: Elements of Culture 
 
 
 
 
 
 
 
 
i.Knowledge and Beliefs: Knowledge and beliefs are prevailing notions of reality and refer 
to scientific realities, myths and metaphysical beliefs. An example of scientific reality is that 
earth revolves around the sun and a person can take rebirth is considered as a myth. 
When people share particular cultural values and beliefs, they tend to become hostile 
towards others who do not believe in their values.  
For example, in the U.S., it is believed that a skilled and hardworking person will get ahead 
in life whereas in some other countries, it is believed that outcomes vary more from luck. 
 
ii.Ideals: Ideals refer to norms of the society which determine what is right, expected or 
customary in a given situation. These norms are generally enforced through sanctions i.e. 
Elements of 
Culture 
KNOWLEDGE & 
BELIEFS 
 
IDEALS 
PREFERENCES 
Page 5


 
Institute of Lifelong Learning, University of Delhi                    1 
 
 
 
 
 
 
 
 
 
 
 
 
 
NME 
Lesson: Socio Cultural Environment 
Lesson Developer: Ms. Reena Talwar 
                            Ms.Nidhi Sharma 
College/Dept: Bharati College 
                        Shivaji College 
University of Delhi 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    2 
 
Lesson: Culture and its Impact on Business  
 
Table of Contents 
1: Learning Outcomes 
2: Introduction 
3: Meaning and Elements of Culture 
3.1: Meaning and Nature of Culture 
3.2: Elements of Culture 
4: Distinctive Features of Culture 
4.1: Cultural Adaptation 
4.2: Cultural Shock 
4.3: Cultural Transmission 
4.4: Cultural Conformity 
4.5: Cultural Lag 
5: Cultural Traits and its Impact on Business 
6: Socio-Cultural Factors, Influencing Business 
6.1: Religion 
6.2: Language 
6.3: Consumer Preferences and Beliefs 
6.4: Etiquettes 
6.5: Social Trends 
Summary  
Exercises 
Glossary 
References 
 
 
1. Learning Outcomes: 
 
After you have read this lesson, you should be able to: 
? Understand the definition, meaning and nature of Culture. 
? Learn about different elements of culture. 
? Understand various distinctive features of culture. 
? Identify cultural traits and patterns, and their impact on business.  
? Gain insights on various socio-cultural factors that influence business operations.  
 
 
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    3 
 
2. Introduction: 
Culture is considered to be an important component of business environment, and is highly 
complex in nature. There are various dimensions, patterns and traits of culture which are 
difficult to define and understand for a business firm. A firm which carries out business 
activities without understanding the cultural dimensions of the environment, in which it 
operates, faces severe problems in business. Many multinational corporations also believe 
that cultural differences are the most important challenges that are faced by a firm. 
Therefore, it is significant, for a business firm, to understand the concept, features, traits 
and patterns of culture; and how socio-cultural factors can influence the business activities, 
and to what extent. 
 
3. Meaning and Elements of Culture: 
3.1. Meaning of Culture: 
Culture is an aggregative concept which comprises of customs, attitudes, values and beliefs 
of people, living in a society. It is the way people lead their lives and controls the way of 
their thinking and actions.  
According to E. B. Taylor, Culture is defined as “Culture of Civilization is that complex whole 
which includes knowledge, belief, cult, morals, law, custom, and any capabilities and habits 
acquired by a man as a member of society.” 
On the basis of above definition, the concept of culture can be explained through the 
following features: 
1. Culture is an aggregative concept, comprising of customs, attitudes, values and 
beliefs of people, in a society.  
2. Cultural values are essentially learned by a person, during the course of his/her 
development. 
3. Cultural values are developed over a period of time through social interaction amongst 
people, living in a society. 
4. Culture determines human personality, and its symbolic quality makes it meaningful 
to people. 
5. Culture is cumulative in nature and passes on from one generation to another. 
6. There are two types of Culture: 
a. Material Culture: Material Culture consists of man-made materials. For example, 
television, automobile etc. 
b. Non-Material Culture: Non-material culture comprises of factors like language, 
ideals, attitudes, values, beliefs etc.  
 
 
 
 
 
 
Institute of Lifelong Learning, University of Delhi                    4 
 
 
 
 
Value Addition 1: Pause & Think 
Difference between Material Culture and Non-material culture 
 
Material culture includes all physical objects that define a culture like clothing, food, 
schools, temples, factories etc. These physical aspects help to identify the behavior and 
attitude of the members of a culture. 
 
Non-material culture includes thoughts and ideas of people about their culture and does 
not refer to any physical objects. These include beliefs, values, language, norms etc.   
 
As an activity, think about two examples each of material and non-material culture and 
analyze how they influence the behavior of members of that culture.  
 
INTERACTIVE 1 
3.2. Elements of Culture: 
Culture has the following basic elements, as shown in the diagram below: 
Figure 1: Elements of Culture 
 
 
 
 
 
 
 
 
i.Knowledge and Beliefs: Knowledge and beliefs are prevailing notions of reality and refer 
to scientific realities, myths and metaphysical beliefs. An example of scientific reality is that 
earth revolves around the sun and a person can take rebirth is considered as a myth. 
When people share particular cultural values and beliefs, they tend to become hostile 
towards others who do not believe in their values.  
For example, in the U.S., it is believed that a skilled and hardworking person will get ahead 
in life whereas in some other countries, it is believed that outcomes vary more from luck. 
 
ii.Ideals: Ideals refer to norms of the society which determine what is right, expected or 
customary in a given situation. These norms are generally enforced through sanctions i.e. 
Elements of 
Culture 
KNOWLEDGE & 
BELIEFS 
 
IDEALS 
PREFERENCES 
 
Institute of Lifelong Learning, University of Delhi                    5 
 
rewards for the right conduct and punishment for the incorrect behavior. Ideals consist of 
folkways and mores. Folkways refer to guidelines for proper conduct that are enforced 
informally, for example, the manner to greet a friend or respect for elders. Mores, on the 
other hand, refer to obligations which are considered important for the benefit of the 
society. 
  
iii.Preferences: Preferences of people in a society determine those things in life which attract 
people or have a greater liking over others. A country?s culture helps in setting the 
standards in food, housing, clothing etc. Preferences vary between different cultures i.e. 
things which seem to be attractive in one culture might be unattractive in another.     
 For example, Americans have a preference for automatic cars whereas majority of 
Europeans have cars with manual gears. Europeans prefer to eat more varied and balanced 
meals and less fast food as compared to Americans. 
Cultural characteristics play a very significant role in formulation of business strategies. For 
a business, ignorance of customs, traditions, preferences and tastes can prove to be very 
expensive. For example, Nestle makes a variety of instant coffee to satisfy tastes and 
preferences of people of different nations. 
INTERACTIVE 2 
4. Distinctive Features of Culture: 
4.1 Cultural Adaptation:  
Cultural adaptation signifies the way an individual or a social system adjusts to fit into a 
particular culture. The social system can be a small group i.e. the family or a large group 
i.e. an organization or even the complete society.  
Cultural adaption is required for survival of both an individual and an organization. The 
changes in food habits, clothing etc., of individuals, according to the type of weather 
conditions, are forms of adaptation. An individual, who changes his religion, has to adapt 
himself to the cultural values of the new religion. An Indian, who decides to settle abroad in 
U.K., must adapt to its social and cultural environment. 
A business firm must also take into consideration the local cultural values before making 
important decisions. For example, it is important for a business firm to be aware of cultural 
and social background of the target customers while taking decisions related to introduction 
of new products, segmentation of market and formulation of product and promotion 
strategies. 
A variation in cultural values or environment implies difference in people?s habits and 
patterns of living. This awareness, understanding of local beliefs and values, can be helpful 
for a business firm in the following manner: 
i. The behavior of employees, in an organization, is largely determined by their cultural 
values; and it can help business managers to understand their behavior and conduct in a 
better way.