Module 3: Hofstede’s Dimensions of Culture in Business Flashcards
— born 2 October 1928 in Harlem, Netherlands
— an influential Dutch researcher in the fields of organizational studies, organizational culture, cultural economics and management
— pioneer in his research of cross-cultural groups and organizations
Geert Hostefede
1) Power Distance
2) Individualism
3) Masculinity
4) Uncertainty Avoidance
5) Long-Term Orientation
6) Indulgence
Hostefede’s 6 Dimensions of Culture in Business
— described as the inequality level in an organization
— power distribution accepted by the people that has power or none
— the extent to which the less powerful members of the organizations and institutions (like the family) accept and expect that power is distributed unequally
— without acceptance of leadership by powerful entities, none of today’s societies could run
— in an organization/a company, middle managers are typically in between the higher ups and subordinates resulting to micromanagement and loss of empowerment
Power Distance
→ considers the extent to which inequality is tolerated and whether there is a strong sense of position and status
→ high PDI score would indicate a national culture that accepts and encourages bureaucracy and a high respect for authority and rank
→ low PD score would suggest a national culture that encourages flatter organizational structures and a greater emphasis on personal responsibility and autonomy
→ example:
— In the PH, PDI score is 94%
→ Philippines is governed by politics where power is unequally distributed
→ boss-subordinate relationship = subordinates cannot make arguments to the boss
— Malaysia = 100%
— China = 80%
— Russia = 93%
— Indonesia = 78%
— USA = 40%
Power Distance Index (PDI)
— the extent to which people feel independent, as opposed to being in interdependent as members of larger wholes
— does not mean egoism; it means that individual choices and decisions are expected
— deciding factor is based on your own
Individualism
→ refers to the strength of the ties that people have to others within their community
→ people take less responsibility for others’ actions and outcomes
→ there are societies that value individual performance of individuals while there are those who value team performance
→ its applicability lies in the company culture of having bonuses as against dividend-based performances for groups
→ example:
— Individualistic society → USA, Australia, UK, Canada, New Zealand, South Africa, Hungary
— Collectivist society → Philippines, Japan, Guatemala, Ecuador, Indonesia, Pakistan, China (needs of the family are prioritized over the needs of an individual)
Individualism vs Collectivism (IDV)
— the extent to which the use of force in endorsed socially
— in a masculine society, men are supposed to be tough. Men are supposed to be from Mars, women from Venus
— winning is important for both genders
— quantity is important and big is beautiful
— in a feminine society, the genders are emotionally closer
— competing is not so openly endorsed; there is sympathy for the underdog
— NOT about individuals, but about expected emotional gender roles
— masculine societies are much more openly gendered than feminine societies
Masculinity
→ refers to the distribution of roles between men and women; demonstrating your success, and being strong and fast, are seen as positive
→ Hofstede linked what he called a “masculine” approach to a hard-edged, fact-based and aggressive style decision-making
→ ”feminine” decision-making involved a much greater degree of consultation and intuitive analysis
Masculinity vs Femininity (MAS)
— deals with a society’s tolerance for uncertainty and ambiguity (malabo)
— it has to do with anxiety and distrust in the face of the unknown, and conversely, with a wish to have fixed habits and rituals, and to know the truth
Uncertainty Avoidance
→ essentially considers the different attitudes to risk-taking between countries
→ Hofstede looked at the level of anxiety people feel when in uncertain or unknown situations
→ low levels of uncertainty avoidance indicate a willingness to accept more risk, work outside the rules and embrace change; this might indicate a more entrepreneurial national culture
— display greater ease when in an unpredictable situation
— handles situation more practically
→ higher levels of uncertainty avoidance would suggest more support for rules, data, clarity of roles and responsibilities etc
— less inclination towards change
— systems over innovations
→ these cultures might be less entrepreneurial as a consequence
→ describes how well people can cope with anxiety. If they find that they can’t control their own lives, they may be tempted to stop trying; these people may refer to “mañana” or put their fate “in the hands of God”
→ example:
— UAI of PH → 44
Uncertainty Avoidance Index (UAI)
— deals with change
— in a long-time-oriented culture, the basic notion about the world is that it is in flux, and preparing for the future is always needed
— in a short-time-oriented culture, the world is essential as it was created, so that the past provides a moral compass, and adhering to it is morally good
Long-Term Orientation
→ some countries place greater emphasis on short-term performance (so-called short-termism), with financial and other rewards biased towards a period of just a few months or years.
→ other countries take a much longer-term perspective, which is likely to encourage more long-term thinking
→ the key implication of this category is the impact on investment decisions and risk-taking
Long-Term vs Short-Term Orientation (PRA)
— about the good things in life
— in an indulgent culture it is good to be free; doing what your impulses want you to do, is good
— friends are important and life makes sense; in a restrained culture, the feeling is that life is hard, and duty, not freedom, is the normal state of being
Indulgence
→ indulgence stands for a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun
→ restraint stands for a society that suppresses gratification of needs and regulates it by means of strict social norms
— example of restrained indulgence: China
Indulgent vs Restraint (IVR)
1) Power (Self-Enhancement)
2) Achievement (Self-Enhancement)
3) Hedonism
4) Stimulation (Openness to Change)
5) Self-Direction (Openness to Change)
6) Universalism (Self-Transcendence)
7) Benevolence (Self-Transcendence)
8) Conformity (Conservation)
9) Tradition (Conservation)
10 Security (Conservation
Schwartz’s Ten Universal Values
