Organizational Culture

Management Implications of Power Distance

What are the implications of power distance for international management? (Figure) shows some of the key differences between high and low power distance societies for work-related issues. As you can see, it is important for managers to express their authority and know-how in high power distance societies. Subordinates expect clear directions from their managers and assume they will be told what to do. In high power distance societies, employees will often equate age with wisdom and seniority. For instance, if a multinational is sending people to negotiate in a high power distance country, they should send higher-level and older managers if they want to be taken seriously.

Cultural Dimension 2: Individualism and Collectivism The second cultural dimension we consider here is

individualism/collectivism. Individualism refers to the degree to which a society focuses on the

relationship of the individual to the group. Collectivism refers to the degree to which a society focuses on the relationship of the group as a whole.

In societies with high individualism (or low collectivism) scores, individuals are valued for their achievements and are rewarded and recognized for such achievements. In contrast, people who live in societies with low individualism (high collectivism) are seen as being part of a wider group, known as the in-group. The in-group includes the family, team, or social class, and how individuals relate to such wider groups is seen as important to their success. In other words, people’s success is gauged by how others in their groups view and support them.

(Figure) shows the levels of individualism in the same selected 15 nations. We again see similar patterns whereby more Anglo cultures such as the U.S., Canada, and the U.K. have relatively high levels of individualism. In contrast, Asian, Latin American, and many emerging countries tend to have cultures that are either on the medium or low range of the  individualism  dimension. (Figure) shows some of the implications of individualism for management. The effects of most management practices are determined by whether they are done at a group or individual level. For example, in countries with low individualism, one will find that employees are hired and promoted mostly on the basis of association with a larger group, such as a university or high school. In such societies, emphasis is placed on loyalty, seniority, and age. To operate smoothly in such societies, companies need to appreciate the importance of the larger social group. Additionally, as (Figure) also shows, care should be taken in terms of how rewards are distributed. Rewarding individual team members in low individualism societies can result in tensions because the individual team member may become stigmatized. In such cases, rewards done on a group level may work best.

Implications of Individualism
Type of Work Activity Low Individualism/High Collectivism High         Individualism/Low Collectivism
Adapted from Geert Hofstede, “Culture’s consequences: Comparing values, behaviors and institutions across nations,” 2nd edition, 2001, page 169-170, Thousand Oaks, CA: Sage Publications.

 

 

 

Employees act in the interest of in-group (members of the family or same university)

 

 

Employees act in their own interests

Relationship with companies Employee commitment to company relatively low

Employee-employer relationships is almost like a family link

Employee     commitment     to organizations high

Employee-employer relationship     based    on    the market

 

 

 

 

Human resource, management

 

Hiring and promotion takes in-group into consideration

Better to reward based on equality (give everyone the same reward) rather than equity (base reward on work effort) Relatives of

employees preferred in hiring

Hiring and promotions based on rules

Family                  relationships unimportant in hiring

Better to reward based on equity

Training best when focused at group level Training           done           best individually
 

Belief in collective decisions

Belief in individual decision making

Treating friends better than others at the workplace is considered unethical

More mobility across occupations within company

Tasks and company prevail over personal relationships in business

Treating friends better than others is normal
Support of teamwork
Other issues Less mobility across occupations
Personal     relationships     very     critical     in business

Cultural Dimension 3: Uncertainty Avoidance

Hofstede’s third cultural dimension is uncertainty avoidance, the degree to which people in a society are comfortable with risk, uncertainty, and unpredictable situations. People in high uncertainty avoidance societies tend to want to avoid uncertainty and unpredictability. As a result, work environments in such countries try to provide stability and certainty through clear rules and instructions. In contrast, societies with low uncertainty avoidance are comfortable with risk, change, and unpredictability. In these countries, risky and ambiguous situations are less likely to upset people.

(Figure) shows details of the levels of uncertainty avoidance for the selected 15 countries. We see that Anglo and Scandinavian countries have relatively lower uncertainty avoidance scores. In contrast, many emerging markets (such as Brazil, Mexico, and China) have medium to high uncertainty avoidance scores. Such findings suggest that companies should adapt their practices to conform to the levels of uncertainty avoidance. In high uncertainty avoidance countries, for example, managers are advised to provide structure and order to reduce uncertainty and ambiguity for subordinates. Companies in these cultures have many written rules and procedures that tell employees exactly what the organization expects of them. Additionally, managers should give clear and explicit directions to their subordinates about exactly what is expected of them in performing their jobs. By reducing any ambiguity, subordinates are less anxious.

In contrast, in low uncertainty avoidance countries, subordinates are much more comfortable and ambiguity. Managers can therefore give more flexibility and freedom to employees. Design of organizations also allows for fewer rules and regulations. (Figure) provides more detail on the implications of uncertainty avoidance on several managerial aspects.

Implications of Uncertainty Avoidance
Type of Work Activity Low Uncertainty Avoidance High                 Uncertainty Avoidance
 

Based on Geert Hofstede, “Culture’s consequences: Comparing values, behaviors and institutions across nations,” 2nd edition, 2001, page 169-170, Thousand Oaks, CA: Sage Publications.

Weak loyalty to companies Strong loyalty to employing organizations
Relationship companies with Average duration of employment shorter

Preference for smaller organizations

Employment are long term in duration

Preference       for       larger companies

 

 

 

 

Characteristics supervisors/managers

 

 

 

 

of

Superiors optimistic about subordinate ambition and leadership abilities

Top managers usually involved in strategy

Power of superiors based on relationships and position

Transformational leaders preferred

Superiors pessimistic about subordinate ambition

Top        managers        often involved in operations

Power of superiors based on control of uncertainties

Hierarchical control roles preferred

 

 

Entrepreneurship innovation

 

 

and

Innovators feel less constrained by rules

Renegade championing

Innovators feel constrained by rules

Rational championing

Tolerance       for       ambiguity       in procedures and structures Innovation welcomed Formalized       management structures Innovation resisted

Cultural Dimension 4: Masculinity

The fourth and final dimension we consider is masculinity, the degree to which a society emphasizes traditional masculine qualities such as advancement and earnings. In high masculinity societies, work tends to be very important to people, gender roles are clear, and work takes priority over other aspects of a person’s life, such as family and leisure. In addition, masculine societies emphasize earnings and achievements, and employees tend to work very long hours and take very little vacation time.

(Figure) shows the masculine scores for selected societies. As the table shows, Anglo cultures such as the U.S. and Canada tend to have high masculinity. This is not surprising given that both the U.S. and Canada tend to have some of the highest number of hours worked. In contrast, Latin European countries such as France and Spain have much lower masculinity as reflected in the importance of leisure in these societies. Scandinavian cultures also reflect low masculinity, a characteristic that is consistent with the preference for quality of life in such countries. We also see that many of the emerging nations have medium to high masculinity.

(Figure) provides some more insights into the implications of masculinity differences for work- related issues. As you can see, companies in high masculinity societies can count on very work- oriented employees. Multinationals are therefore advised to motivate their employees through pay and security. In contrast, individuals in more feminine societies tend to prefer interesting work and more leisure. Strong motivational policies in these societies emphasize a balance between work and leisure, and multinationals in such societies tend to have stronger policies catering to both genders.

Implications of Masculinity

Type of Work Activity High Masculinity Low Masculinity
Based on Geert Hofstede, “Culture’s consequences: Comparing values, behaviors and institutions across nations,” 2nd edition, 2001, page 318, Thousand Oaks, CA: Sage Publications.
Work in order to live
 

 

Relationship with work

Live in order to work Preference for high pay

Workers look for security, pay and interesting work

Preference for lower number of work hours

Workers look for better working conditions and relationships in work

 

Managers seen as cultural heroes

Managers     are     employees     like others
 

 

 

Managers’ characteristics

Successful managers primarily exhibit male characteristics

Managers need to be competitive, firm, aggressive, and decisive Managers are very ambitious

Successful managers are seen as possessing both male and female characteristics

Managers hold fairly modest career ambition

Fewer women in management More women in management
Managers prepared to move family for career reasons Managers less prepared to uproot family because of career move
 

 

 

 

Other issues

Large pay gap between genders Job applicants oversell their abilities

Absences due to sickness lower

General       preference       for       larger companies

Conflicts are resolved through fighting until the best “man” wins

Low salary gap between top and bottom of company [what about gender gap?]

Managers feel paid adequately and are satisfied

Absences because of sickness higher Preference for smaller organizations Conflicts are resolved  through compromise and negotiations

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