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Summary Theories of International Management articles week 5
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Week 5The Business of International Business is culture (1994)
Geert Hofstede
Culture = the collective programming of the mind which distinguishes the
members of one category of people from another”. The “category of
people” can be a nation, region, or ethnic group (national etc. culture),
women versus men (gender culture), old versus young (age group and
generation culture), a social class, a profession or occupation
(occupational culture), a type of business, a work organization or part of it
(organizational culture), or even a family.
One research project among subsidiaries of a MNE (IBM) in 64 countries
and other two research projects among students in 10 and 23 countries,
respectively.
Identified five dimensions of National Culture differences:
1. Power Distance – the extent to which the less powerful members
of organizations and institutions (ex. family) accept/expect that
power is distributed unequally.
2. Individualism vs. Collectivism – the degree to which individuals
are integrated into groups. (Individualism: Universalism: the
standards for the way a person should be treated are the same for
everybody. Collectivism: Particularism: the standards for the way a
person should be treated depends on the group/category to which
this person belongs)
3. Masculinity vs. Femininity – the distribution of roles between the
sexes. The IBM studies revealed that: (a) women’s values differ less
among societies than men’s values; (b) men’s values from one
country to another contain a dimension from very assertive and
competitive and maximally different from women’s values on the
one side, to modest and caring and similar to women’s values on the
other. The assertive pole has been called “masculine” and the
modest, caring pole “feminine”.
4. Uncertainty Avoidance – a society’s tolerance for uncertainty and
ambiguity. Uncertainty avoiding cultures try to minimize novel,
unknown, surprising, and different from usual situations by strict law
and rules, safety and security measures, and on the
religious/philosophical level by a belief in absolute truth: there can
only be one truth and we have it. These cultures are more
emotional.
5. Long-term vs. short-term orientation – Values associated with
long-term are thrift and perseverance, and values associated with
short-term are respect for tradition, fulfilling social obligations and
protecting one’s face. Both orientations remind us of Teaching of
Confucius/Confucian Heritage.
, Power distance high in Latin, Asian and African
countries and smaller for Germanic countries.
Individualism high in developed and Western countries, while
collectivism prevails in less developed and Eastern countries; Japan takes
a middle position on this dimension, Masculinity high in Japan, in some
European countries like Germany, Austria and Switzerland, and moderately
high in Anglo countries; it is low in Nordic countries and in The Netherlands
and moderately low in some Latin and Asian countries like France, Spain
and Thailand.
Uncertainty avoidance higher in Latin countries, in Japan, and in
German speaking countries, lower in Anglo, Nordic, and Chinese culture
countries.
A long-term orientation mostly found in East Asian countries, in
particular in China, Hong Kong, Taiwan, Japan, and South Korea.
Some theories/models developed by scholars cannot be applied in every
country (with different culture). Some examples:
Organizational culture
Membership of an organization is usually partial and voluntary, while the
“membership” of a nation is permanent and involuntary. Our field research
showed that national cultures differ mostly at the level of basic values
while organizational cultures differ mostly at the level of the more
superficial practices: symbols, heroes, and rituals. Organizational cultures
are composed of practices rather than values, they are somewhat
manageable: they can be managed by changing the practices. An
employer cannot change the values of employees.
A research project was carried out by the Institute for Research on
Intercultural Cooperation (IRIC) in The Netherlands. Data were collected in
twenty work organizations or parts of organizations in The Netherlands
and Denmark. The study found large differences among units in practices
(symbols, heroes, rituals) but only modest differences in values, beyond
those due to such basic facts as nationality, education, gender and age
group. Dimensions of organizational culture found are:
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