Respond to the following two posts seperately
FYI, I’ll be doing in-group favoritism and out-group bias, since they seem to be linked together in the studies I read.
In-group favoritism refers to the tendency of groups to favor their own group compared to out-groups.
Out-group bias, also called out-group derogation, refers to the tendency of groups to discriminate against outside groups.
This favor towards one’s own group and bias towards outside groups can be in the form of language—that the in-groups say good things about their members and negative things about outgroup members (Moscatelli, Hewstone, & Rubini, 2017). It can also be seen in the way resources are distributed between groups—that individual in-group members are more likely to take a personal loss to ensure the in-group is better off than the outgroup (Durrheim, Quayle, Tredoux, Titlestad, & Tooke, 2016). What was most surprising to me, this favoritism/bias has been found to be expressed much differently by majority/minority groups. Minority groups tend to consistently have a much higher out-group bias than majority groups (Bettencourt, Miller, & Hume, 1999). This can be seen in the way minority groups are almost twice as likely to speak negatively towards the outgroup than majority groups are, and vice-versa, majority groups almost twice as likely to say positive things about other members of the in-group than minority groups are to say good things about their own members (Moscatelli et al., 2017, p. 762). In what is referred to as asymmetry, majority groups are more likely to try to reinforce and build up their own majority group, while minority groups, instead of focusing on helping their own group, are more likely to try to tear down and apply negative outcomes to the majority out-group (Otten, Mummendey, & Blanz, 1996).
Taking all this into the context of the case study, the company, headquartered in the United States, has already shown in-group favoritism and out-group bias when it tried to build itself up at the expense of the locals by secretly securing for itself the rights to use more of the water from the Island in the South Pacific. When the locals rebelled, the company proceeded to make a series of mistakes not necessarily related to in-group favoritism or out-group bias. It might be argued that HQ sending managers from home to replace local managers is a form of out-group bias, with leadership trusting people from a localized in-group (the headquarters) more than trusting out-group members (employees from the outstation), but I’d say it has more to do with ethnocentrism. The employees from minority-groups in the host country do tend to show an out-group bias when they refuse to speak English to or follow directions from the “out-group” managers.
To sum up, from my research, while all groups display some in-group favoritism and out-group bias, majority groups tend to focus on their in-group favoritism, while minority groups tend to focus on their out-group bias.
Ethnocentrism often refers to the attitude or perspective of an individual or a group of people that believe their “group, organization, culture, or ethnicity is superior to others” (Michailova et al., 2017, p. 335). In the majority of international business literature, ethnocentrism is viewed in a negative way, or as a barrier that has to be overcome by Multi-National Corporations (MNCs) in order to be successful (Michailova et al., 2017). Negative consequences of ethnocentrism include making host-country employees feel like second-class citizens, ethnocentric companies are less successful then geocentric companies, it blocks upward advancement of host country nationals, and it often violates the local values of the host-country culture (Michailova et al., 2017).
What I found interesting is that regardless of the negative view of ethnocentrism, especially in the realm of international business literature, that the majority of Multi-National Corporations (MNCs) are considered dominantly ethnocentric companies. It seems that we are naturally ingrained to have ethnocentric tendencies. For example, Michailova et al. (2017) references anthropologist William McGee that people’s limited knowledge and world views lead to see themselves as “centers around which all other things revolve” (McGee, 1900, p. 831). Also, Perlmutter (1969) argues that ethnocentrism is a natural human tendency, and that ethnocentrism in an MNC will decline as it gains experience and maturity in a global environment. Additionally, host-country nationals also often demonstrate ethnocentric attitudes towards MNCs operating in their host countries. Zeira references a study that found a “prominent ethnocentric attitude toward subsidiaries of MNC’s operating in these countries” (2001, p. 67). Additionally, according to Zeira and Banai the ethnocentric positions of both MNC and host-country nationals can cause conflict and decrease effectiveness of the company (1981).
Putting this data into context with the case study for this discussion, I believe that the company took an ethnocentric approach when they decided to send in managers from the company headquarters to displace the local managers in efforts to return to profitability. Obviously, the company believed that their managers would be superior and better equipped to lead then the locally hired indigenous managers. Additionally, the ethnocentrism of the host-country employees can be seen by their local rebellions and resistance at the plant and the former managers statement that “things are done differently over here”. These are all indications of ethnocentrism taking root in the organization.
McGee, W. J. ( 1900 ). Primitive numbers. Bureau of American Ethnology Annual Report, 19, 821 – 851
Michailova, S., Piekkari, R., Storgaard, M., & Tienari, J. (2017). Rethinking Ethnocentrism in International Business Research. Global Strategy Journal, 7(4), 335. Retrieved from http://vlib.excelsior.edu/login?url=https://search...
Perlmutter, H. V. (1969). The tortuous evolution of the multinational corporation. Columbia Journal of World Business, 4(1), 9–18.
Zeira, Y. (1979). Ethnocentrism in host-country organizations. Business Horizons, 22(3), 66–75.
Zeira, Y., & Banai, M. (1981). Attitudes of host-country organizations toward MNCs’ stafﬁng policies: A cross-country and cross-industry analysis. Management International Review, 21(2), 38–47.