Archive for the ‘Local Culture’ Category

Many have written over the years about the political risk arising from cultural values. Back in 1992, Benjamin Barber, in his popular book Jihad vs McWorld, visualized violent local politics (“jihad”) as a reaction to the cultural uniformity induced by globalization. Samuel Huntington took the idea to a widely-discredited extreme, when he argued that continental-scale cultural clashes will be the biggest source of political risk in the future.

Such broad culture-talk generates weak arguments because it takes politics out of the equation. Islamophobia is one instance. The conservative paranoia about the so-called “ground zero mosque” uses crass cultural imagery to not only deny constitutionally guaranteed religious freedoms but also portray the act of building a community center as the “triumph” of a foreign culture. The real issue, however, is not culture, but politics: election-season politics, foreign policy politics, and political risk in provoking far right ideologues.

Similarly, Westernophobia is a trick that the Chinese government has been using to deny basic human rights to Chinese citizens. This came to the fore with the award of the 2010 Nobel Peace Prize to Liu Xiaobo. China’s hostile reaction to that award is based on the premise that human rights are not universal, but culturally-defined, and represents Westernization. Here too, the real problem is not culture, but politics: Human rights and political freedom pose great political risk to the regime in power.

In globalization circles, broad culture-talk, i.e., East = X, West = Y, has been a useful ploy to mask the political sources of risk. Uninquisitive minds readily accept that Western Judeo-Christianic values are superior, are spread through globalization, and provoke primitive reactions in the form of “jihad” in the East because either “they envy us” or “they haven’t seen the light”.

Such talk perpetuates many historical inaccuracies. In a recent article in The Sunday Times, historian William Dalrymple points out some of them:

  • The “earliest known experiment in formal inter-religious dialogue” was not in the West, but in India, led by the Emperor Akbar of the Muslim Mughal Empire.
  • Akbar upheld freedom of religion at a time (16th century) when “in London, Jesuits were being hung, drawn and quartered outside Tyburn, in Spain and Portugal the Inquisition was torturing anyone who defied the dogmas of the Catholic church, and in Rome Giordano Bruno was being burnt at the stake in Campo de’Fiori.”
  • “Judaism and Christianity are every bit as much eastern religions as Islam or Buddhism. So much that we today value – universities, paper, the book, printing – were transmitted from East to West via the Islamic world, in most cases entering western Europe in the Middle Ages via Islamic Spain.”
  • The first ruler “to emphasise the importance of the equality of his subjects” was the Buddhist Indian Emperor Ashoka. This was in the third century BC.
  • The huge upturn in violent conflict in the last hundred years was not in the East, but rooted in the West: the World Wars, the ideologies of Marxism-Leninism, Fascism, Nazism.
  • Genocide began with “the worst excesses of western colonialism.”
  • “The European slave trade forcibly abducted 15m Africans and killed as many more.”

The list goes on. The point is, it is not only crude but historically false to portray the West broadly as a freedom-loving culture that is using globalization to spread superior values, and the East as reactionary, backward, developing, and emerging, with hiccups, into enlightenment. And it’s even more false to then predict a giant collision between the two.

Political risk does not come from broad cultural clashes, but from politics, which is about power. As analysts of political risk, we should be aware of cultural trends, but we should ensure that we assess the significance such trends by asking: what does this mean for the competition for power?

We should not assume that risk to Western investment in “emerging” markets is automatic, or endemic, or sourced in cultural assumptions such as, “they don’t understand the value of investment,” or “they’re backward and don’t get what free market means.”  There is no automatic jihad against McWorld. Risk arises because of the power politics that accompany such investment.


Read Full Post »

Carrying forth the discussion on digital divide and globalization from the last post, let me share another interesting bit. This one is from a Bengali-speaking Dutch researcher who gave a fascinating talk at the just-concluded South Asia conference at the University of Wisconsin-Madison.

Dr. Lotte Hoek, a social anthropologist at the University of Edinburgh (and previously at the University of Amsterdam), spent many months in the darkrooms of the Film Development Corporation (FDC) in Dhaka, Bangladesh. The film industry is caught between 60s technology and traditional mores on the one hand, and the hyperactive output of satellite tv and cultural globalization on the other. This disruption is the context of Dr. Hoek’s work, and she documented a great example of bridging digital divides with localized ingenuity.

To bring the film industry up to date, the Bangladesh government has imported and installed digital editing hardware and software in the FDC editing labs. The installed machines are able to transfer frames from celluloid film into digital editing software. All filmmakers submit their rolls to the FDC, and state-employed technical editors then do their part.

So far so good. The problem is, the government did not install any machine to do the reverse transfer, from digital to film, after editing.

So what do the technicians do? They say, “dorkar nai” (we don’t need it). And undaunted, they finish their editing, then display the digitally edited parts on their screens, frame by frame, while someone shoots the display on regular film camera, frame by frame. This, of course, yields interesting colors and effects, and sometimes the portions can’t even be reconciled, since the fps (frames/second) rates are different for digital and celluloid media.

Nonetheless, films are produced, edited, and released to an enthusiastic audience. They simply call this “half-digital,” and life goes on.

Read Full Post »

The global recession is beginning to end. Asia is beginning to recover: South Korea, Taiwan, and India are doing very well. Some countries outside are also faring better, and we’re beginning to see commonalities as to why. In this post, I’ll point to two examples.

The first is from the Economist, Aug 8-14, on the strength of the German economy:

Germany’s economic machine is made of honest iron and steel, not subprime mortgages, collateralised debt obligations and other financial chicanery. Having been concocted in Wall Street and the City of London, the crisis, it is said, has proved the merit of Germany’s solid social-market economy.

The second insight is about Brazil, which was “one of the last [countries] to enter recession and now looks like being one of the first to leave it.” The ingredients are:

  • responsible economic policies, ignoring pressures from left-wing Workers’ Party.
  • insistence on “rational economics” and free trade, and.
  • “ambitious social policies have helped to lift 13m Brazilians out of poverty; searing inequalities of income are narrowing steadily.”

See any commonality? Social safety nets. Social policies–public support for good health, good education, minimum income, and crisis assistance. In fact, this insight is supported by decades of serious research. (I will write about that in another post.) And it’s not just policy (frequently and stupidly derided in the US as big government), but an economic culture that is thankfully more social-ist.

In America, of course, sustaining social support needs an astonishing amount of selling, so much so that the government finds it easier to bail out big investment banks and big insurance companies, whose criminally-negligent incursions into risky financial products helped create the crash in the first place, than extending funds for a sound healthcare system. Funds for public education, similarly, have been difficult to come by for years.

Yes, in the end big banks got us in the mess, and as Paul Krugman says, big government has saved us. But that’s true if “save” = “getting worse more slowly.” 

If saving = learning so that the next recession may be less of a surprise, then it’s another story. The American style of capitalism–the type that has prioritized home ownership over thrifty spending habits as the mark of success, and typically promotes the likes of Rumsfeld and Paulson as the main shapers of fiscal priorities–is sure to not learn well from this recession. The priorities of the economic culture of Brazil and Germany are quite different.

Read Full Post »

The business of a global organization is ultimately a collection of local realities. Even companies like Lenovo that pride themselves of being a HQ-less networked organization in the end needs to succeed in local markets.

Their success depends on achieving a difficult balance. The first part of this involves enticing the local populace with sharing in a global value. In the 1980s, Levis jeans was attractive to rock music listeners across the world: the brand symbolized a common bond. Apple’s iPod is a contemporary example. One’s local experience becomes part of a global community; and that gives people–though it may sound tacky–a sense of belonging. It’s basically global community created through the local marketplace.

The other part of the equation is the local experience. Call it the global tuned to the local. This is an essential trait, according to a recent Washington Post article, of companies that one “cares about,” that is, companies that create an emotional attachment in their customers. It can’t be measured in numbers, directly at least. It’s amorphous, qualitative, another manifestation of that sense of belonging.

The article identifies four US companies–Starbucks, Apple, Google, and Amazon–that have been globally successful in creating local followers. They, the SAGA, have balanced standard global services and products somehow with an intensely local customer base, and they’ve done it through transforming “some important aspect of contemporary life.” Ledbetter and Weisberg, the authors of the article, go on to note:

Each has had an appreciable impact on our daily routines, taken on a looming presence in popular culture, and often engendered an intensity of feeling more often associated with tastes in entertainment or political views. Together, they have created a new model of business innovation, culture and values.

So while McDonald’s becomes the recipient of anti-globalization political backlash, these companies blend much more easily into their environments. While each company is a giant, to the local customers they don’t seem like “monoliths imposed on other countries from abroad.”

This is the challenge, the benchmark, for global brands: can they create local stakeholders who would provide cultural, emotional, and very importantly, political, support through the turbulence of an increasingly globalized world?

Read Full Post »