03 Handout 1: Differences in Culture PDF

BM1917 DIFFERENCES IN CULTURE Culture Values and Norms Values form the bedrock of a culture. It includes the following: Society’s attitu...

BM1917 DIFFERENCES IN CULTURE Culture Values and Norms Values form the bedrock of a culture. It includes the following: Society’s attitude towards individual freedom, democracy, truth, justice, honesty, loyalty, social obligations, collective responsibility, women, love, sex, marriage, and so on. Norms are the social rules that govern people’s actions toward one another. It is subdivided into the following: Folkways are the routine conventions of everyday life. Generally, folkways are actions of little moral significance. Rather, they are social conventions that deal with things like appropriate dress code in a particular situation, good social manners, eating with correct utensils, neighborly behavior, and so on. Although folkways define the way people are expected to behave, violation of them is not normally a serious matter. People who violate folkways may be thought of as eccentric or ill-mannered, but they are not usually considered to be evil or bad. In many countries, foreigners may initially be excused for violating folkways. However, traveling managers are increasingly expected to know about specific dress codes, social and professional manners, eating with the correct utensils, and business etiquette. The evolution of norms now demands that business partners at least try to behave according to the folkways of the country in which they are doing business (Hill & Hult, 2018). EXAMPLE: An example of folkways that perhaps is not immediately thought of as a culture issue is people’s attitudes toward time. People are very aware of what time it is, the passage of time, and the importance of time in, for example, the United States and northern European cultures such as Germany, Netherlands, and the Scandinavian countries (Denmark, Finland, Iceland, Norway, and Sweden). In these cultures, businesspeople are very conscious about scheduling their time and are quickly irritated when time is wasted because a business associate is late for a meeting or if they are kept waiting. Time is really money in the minds of these businesspeople (Hill & Hult, 2018). In the opposite of the time-conscious Americans, Germans, and Scandinavians, businesspeople in many Arabic, Latin, and African cultures view time as more elastic. Keeping to a schedule is viewed as less important than building a relationship or finishing an interaction with people. For example, an American businessperson might feel slighted if he/she is kept waiting for 30 minutes outside the office of a Latin American executive before a meeting. However, the Latin American person may simply be completing an interaction with an associate and view the information gathered from this as more important than sticking to a rigid schedule. The Latin American executive intends no disrespect, but due to a mutual misunderstanding about the importance of time, the American may see things differently. Similarly, Saudi Arabian attitudes toward time have been shaped by their nomadic Bedouin heritage, in which precise time played no real role and arriving somewhere “tomorrow” might mean next week. Like Latin Americans, many Saudis are unlikely to understand Westerners’ obsession with precise times and schedules. Filipinos, on the other hand, have the concept of a “Filipino time” wherein they come minutes (or sometimes hours) late of the original schedule (Hill & Hult, 2018). Folkways also include rituals and symbolic behavior. Rituals and symbols are the most visible manifestations of a culture and constitute the outward expression of deeper values. EXAMPLE: Upon meeting a foreign business executive, a Japanese executive will hold his business card in both hands and bow while presenting the card to the foreigner. This ritual behavior is loaded with deep cultural symbolism. The card specifies the rank of the Japanese executive, which is a very important piece of information in a hierarchical society such as Japan. The bow is a sign of respect, and the deeper the angle of the bow, the greater the reverence one person shows for the other. The person receiving the card is expected to examine it carefully (Japanese often have business cards with 03 Handout 1 *Property of STI  [email protected] Page 1 of 11  BM1917 Japanese printed on one side and English printed on the other), which is a way of returning respect and acknowledging the card giver’s position in the hierarchy. The foreigner is also expected to bow when taking the card and to return the greeting by presenting the Japanese executive with his/her own card, similarly bowing in the process. To not do so and to fail to read the card that he/she has been given, instead casually placing it in a jacket, pocket, or purse, violates this important folkway and is considered rude (Hill & Hult, 2018). Mores is a term that refers to norms that are more widely observed, have greater moral significance than other norms, and are central to the functioning of a society and to its social life. This means that mores have a much greater significance than folkways. Violating mores can bring serious retribution, ill will, and the collapse of any business deal. Mores include such drastic factors as indictments against theft, adultery, incest, and cannibalism. In many societies, certain mores are so drastic that they have been enacted into law (Hill & Hult, 2018). EXAMPLE: All advanced societies have laws against theft, incest, and cannibalism. However, there are also many mores that differ across cultures. In the United States, for example, drinking alcohol is widely accepted, whereas, in Saudi Arabia, the consumption of alcohol is viewed as violating important social mores and is punishable by imprisonment (as some Western citizens working in Saudi Arabia have discovered). That said, countries like Saudi Arabia and the United Arab Emirates are becoming more tolerant of Westerners behaving like Westerners in their countries—such as drinking in if they do not flaunt it. In some way, mores are being implemented differently depending on where you are and who you are (Hill & Hult, 2018). Culture, Society, and the Nation-State Society refers to a group of people who share a common set of values and norms—that is, people who are bound together by a common culture. There is not a strict one-to-one correspondence between a society and a nation-state. Nation-states are political creations. While these nation-states are often studied for their “national identity,” “national character,” and even “competitive advantage of nations,” in reality they may contain a single culture or several subcultures (Hill & Hult, 2018). EXAMPLE: Representative of a single culture setting, the French nation can be thought of as the political embodiment of French culture. However, the nation of Canada has at least three (3) cultures—an Anglo culture, a French-speaking “Quebecois” culture, and a Native American culture. Similarly, many of the 55 African nations have important cultural differences among tribal groups, as exhibited in the early 1990s when Rwanda dissolved into a bloody civil war between two (2) tribes, the Tutsis and Hutus. Africa is not alone in this regard. India, for example, is composed of many distinct cultural groups with their own rich history and traditions (e.g., Andhras, Gonds, Gujaratis, Marathas, Oriya, Rajputs, and Tamils) (Hill & Hult, 2018). It is also possible to talk about culture at different levels. It is reasonable to talk about “American society” and “American culture,” but there are several societies within America, each with its own culture. For example, in the United States, one can talk about African American culture, Cajun culture, Chinese American culture, Hispanic culture, Indian culture, Irish American culture, Southern culture, and many more cultural groups. In some way, this means that the relationship between culture and country is often ambiguous. Even if a country can be characterized as having a single homogeneous culture, often that national culture is a mosaic of subcultures. To abide by these cultural nuances, businesspeople need to be aware of the delicate issues that pertain to folkways, and they also need to make sure not to violate mores in the country in which they intend to do business. Increased globalization has meant an increased number of business relationships across countries and cultures but not necessarily an increased cultural understanding. Culture is still a complex phenomenon with multiple dimensions and multiple levels (Hill & Hult, 2018). Social Structure Social structure refers to its basic social organization. In essence, it refers to how a society is organized in terms of its values, norms, and relationships that are part of the society’s fabric (Hill & Hult, 2018). 03 Handout 1 *Property of STI  [email protected] Page 2 of 11  BM1917 Dimensions of social structure Degree to which the basic unit of a social organization is the individual, as opposed to the group, or even company for which a person works In general, Western societies tend to emphasize the importance of the individual, whereas groups tend to figure much larger in many other societies. Degree to which a society is stratified into classes or castes Some societies are characterized by a relatively high degree of social stratification and relatively low mobility between strata (e.g., India); other societies are characterized by a low degree of social stratification and high mobility between strata (e.g., the United States) (Hill & Hult, 2018). Individuals and Groups A group is an association of two (2) or more individuals who have a shared sense of identity and who interact with each other in structured ways based on a common set of expectations about each other’s behavior. EXAMPLE: Human social life is group life. Individuals are involved in families, work groups, social groups, recreational groups, and potentially a myriad of other groups. In a way, social media have expanded the boundaries of what is included in group life and placed an added emphasis on what we can call the extended social groups. Social media clearly did not enter into the equation of what was possible in terms of group life. But, social media as a vehicle to the creation of group life has unique possibilities that affect both individuals within a social group and the group itself (Hill & Hult, 2018). EXAMPLE: Consumers are significantly more likely to buy from the brands they follow on Instagram, Twitter, Facebook, or LinkedIn, or that they get exposed to via Snapchat, due to group influences. However, while groups are found in all societies, some societies differ according to the degree to which the group is viewed as the primary means of social organization. In some societies, individual attributes and achievements are viewed as being more important than group membership; in others, the reverse is true (Hill & Hult, 2018). Individualism can also be a political philosophy. However, it is more than just an abstract political philosophy. In many Western societies, the individual is the basic building block of social organization. This is reflected not just in the political and economic organization of society but also in the way people perceive themselves and relate to each other in social and business settings. The value systems of many Western societies, for example, emphasize individual achievement. The social standing of individuals is not so much a function of whom they work for as of their individual performance in whatever work setting they choose. More and more, individuals are regarded as “independent contractors,” even though they belong to and work for a company. These individuals, in essence, build their personal brands by the knowledge, skills, and experience that they have, which often translates to increased salaries and promotions at the current company or another company that believes that it can benefit from that person’s capabilities. In science, the label “star scientist” has become synonymous with these individualistic high producers of innovative products based on their knowledge, skills, and experience (Hill & Hult, 2018). In contrast to the Western emphasis on the individual, the group is the primary unit of social organization in many other societies. For example, in Japan, the social status of an individual has traditionally been determined as much by the standing of the group to which he/she belongs as by his/her individual performance. In traditional Japanese society, the group was the family or village to which an individual belonged. Today, the group has frequently come to be associated with the work team or business organization. In a now-classic study of Japanese society, Nakane noted how this expresses itself in everyday life: “When a Japanese faces the outside (confronts another person) and affixes some position to himself socially, he is inclined to give precedence to institution over kind of occupation. Rather than saying, “I am a typesetter” or “I am a filing clerk,” he is likely to say, “I am from B Publishing Group” or “I belong to S company (Hill & Hult, 2018)” 03 Handout 1 *Property of STI  [email protected] Page 3 of 11  BM1917 The Philippines is considered as a collectivist type of country. This is mostly seen in maintaining close long- term commitment to a family, extended family, or relationships. Loyalty in collectivist culture is paramount, and over-rides most other societal rules and regulations. Employer/employee relationships are perceived in moral terms, like a family link (Hill & Hult, 2018). Social Stratification All societies are stratified on a hierarchical basis into social categories—that is, into social strata. These strata are typically defined based on socioeconomic characteristics such as family background, occupation, and income. Individuals are born into a particular stratum. They become a member of the social category to which their parents belong. Individuals born into a stratum toward the top of the social hierarchy tend to have better life chances than those born into a stratum toward the bottom of the hierarchy. They are likely to have better education, health, standard of living, and work opportunities. Although all societies are stratified to some degree, they differ in two (2) related ways. First, they differ from each other with regard to the degree of mobility between social strata. Second, they differ with regard to the significance attached to social strata in business contexts. Overall, social stratification is based on four (4) basic principles: 1. Social stratification is a trait of society, not a reflection of individual differences; 2. Social stratification carries over a generation to the next generation; 3. Social stratification is generally universal but variable; and 4. Social stratification involves not just inequality but also beliefs (Hill & Hult, 2018). Social Mobility The term social mobility refers to the extent to which individuals can move out of the strata into which they are born. Social mobility varies significantly from society to society. The most rigid system of stratification is a caste system (Hill & Hult, 2018). A caste system is a closed system of stratification in which social position is determined by the family into which a person is born, and change in that position is usually not possible during an individual’s lifetime. Often, a caste position carries with it a specific occupation. Members of one caste might be shoemakers, members of another might be butchers, and so on. These occupations are embedded in the caste and passed down through the family to succeeding generations. Although the number of societies with caste systems diminished rapidly during the twentieth century, one partial example still remains. India has four (4) main castes and several thousand subcastes. Even though the caste system was officially abolished in 1949, two (2) years after India became independent, it is still a force in rural Indian society where occupation and marital opportunities are still partly related to caste (Hill & Hult, 2018). A class system is a less rigid form of social stratification in which social mobility is possible. It is a form of open stratification in which the position a person has by birth can be changed through his/her own achievements or luck. Individuals born into a class at the bottom of the hierarchy can work their way up; conversely, individuals born into a class at the top of the hierarchy can slip down (Hill & Hult, 2018). From a business perspective, the stratification of a society is significant if it affects the operation of business organizations. In American society, the high degree of social mobility and the extreme emphasis on individualism limit the impact of class background on business operations. The same is true in Japan, where most of the population perceives itself to be middle class. In a country such as the United Kingdom or India, however, the relative lack of class mobility and the differences between classes have resulted in the emergence of class consciousness. Class consciousness refers to a condition by which people tend to perceive themselves in terms of their class background, and this shapes their relationships with members of other classes (Hill & Hult, 2018). Religious and Ethical Systems Religion may be defined as a system of shared beliefs and rituals that are concerned with the realm of the sacred (Hill & Hult, 2018). An ethical system refers to a set of moral principles, or values, that are used to guide and shape behavior. Most of the world’s ethical systems are the product of religions. 03 Handout 1 *Property of STI  [email protected] Page 4 of 11  BM1917 Christianity Christianity is the most widely practiced religion in the world, with some 2.20 billion followers. The vast majority of Christians live in Europe and the Americas, although their numbers are growing rapidly in Africa. Christianity grew out of Judaism. Like Judaism, it is a monotheistic religion (monotheism is the belief in one God). A religious division in the eleventh century led to the establishment of two (2) major Christian organizations—the Roman Catholic Church and the Orthodox Church. Today, the Roman Catholic Church accounts for more than half of all Christians, most of whom are found in southern Europe and Latin America. The Orthodox Church, while less influential, is still of major importance in several countries (e.g., Greece and Russia). In the sixteenth century, the Reformation led to a further split with Rome; the result was Protestantism. The nonconformist nature of Protestantism has facilitated the emergence of numerous denominations under the Protestant umbrella (e.g., Baptist, Methodist, Calvinist) (Hill & Hult, 2018). Islam With about 1.60 billion adherents, Islam is the second-largest of the world’s major religions. Islam dates to AD 610 when the Prophet Muhammad began spreading the word, although the Muslim calendar begins in AD 622 when, to escape growing opposition, Muhammad left Mecca for the oasis settlement of Yathrib, later known as Medina. Adherents of Islam are referred to as Muslims. Muslims constitute a majority in more than 40 countries and inhabit a nearly contiguous stretch of land from the northwest coast of Africa, through the Middle East, to China and Malaysia in the Far East (Hill & Hult, 2018). Islam has roots in both Judaism and Christianity (Islam views Jesus Christ as one of God’s prophets). Like Christianity and Judaism, Islam is a monotheistic religion. The central principle of Islam is that there is but the one true omnipotent God (Allah). Islam requires unconditional acceptance of the uniqueness, power, and authority of God and the understanding that the objective of life is to fulfill the dictates of His will in the hope of admission to paradise. According to Islam, worldly gain and temporal power are an illusion. Those who pursue riches on earth may gain them, but those who forgo worldly ambitions to seek the favor of Allah may gain the greater treasure: entry into paradise (Hill & Hult, 2018). Obvious parallels exist with many of the central principles of both Judaism and Christianity. Islam is an all-embracing way of life governing the totality of a Muslim’s being. As God’s surrogate in this world, a Muslim is not a totally free agent but is circumscribed by religious principles—by a code of conduct for interpersonal relations—in social and economic activities. Religion is paramount in all areas of life. The Muslim lives in a social structure that is shaped by Islamic values and norms of moral conduct. The ritual nature of everyday life in a Muslim country is striking to a Western visitor. Among other things, orthodox Muslim ritual requires prayer five (5) times a day (business meetings may be put on hold while the Muslim participants engage in their daily prayer ritual), demands that women should be dressed in a certain manner, and forbids the consumption of pork and alcohol (Hill & Hult, 2018). Hinduism Hinduism has approximately 1.10 billion adherents, most of them on the Indian subcontinent. Hinduism began in the Indus Valley in India more than 4,000 years ago, making it the world’s oldest major religion. Unlike Christianity and Islam, its founding is not linked to a particular person. Nor does it have an officially sanctioned sacred book such as the Bible or the Koran. Hindus believe that a moral force in society requires the acceptance of certain responsibilities, called dharma. Hindus believe in reincarnation, or rebirth into a different body, after death. Hindus also believe in karma, the spiritual progression of each person’s soul. A person’s karma is affected by the way he/she lives. The moral state of an individual’s karma determines the challenges he/she will face in the next life. By perfecting the soul in each new life, Hindus believe that an individual can eventually achieve nirvana, a state of complete spiritual perfection that renders reincarnation no longer necessary. Many Hindus believe that the way to achieve nirvana is to lead a severe ascetic lifestyle of material and physical self-denial, devoting life to a spiritual rather than material quest (Hill & Hult, 2018). Max Weber, famous for expounding on the Protestant work ethic, also argued that the ascetic principles embedded in Hinduism do not encourage the kind of entrepreneurial activity in pursuit of wealth creation 03 Handout 1 *Property of STI  [email protected] Page 5 of 11  BM1917 that we find in Protestantism. According to Weber, traditional Hindu values emphasize that individuals should be judged not by their material achievements but by their spiritual achievements. Hindus perceive the pursuit of material well-being as making the attainment of nirvana more difficult. Given the emphasis on an ascetic lifestyle, Weber thought that devout Hindus would be less likely to engage in entrepreneurial activity than devout Protestants (Hill & Hult, 2018). Mahatma Gandhi, the famous Indian nationalist and spiritual leader, was certainly the embodiment of Hindu asceticism. It has been argued that the values of Hindu asceticism and self-reliance that Gandhi advocated had a negative impact on the economic development of post-independence India. But we must be careful not to read too much into Weber’s rather old arguments. Modern India is a very dynamic entrepreneurial society, and millions of hardworking entrepreneurs form the economic backbone of the country’s rapidly growing economy, especially in the information technology sector (Hill & Hult, 2018). Historically, Hinduism also supported India’s caste system. The concept of mobility between castes within an individual’s lifetime makes no sense to traditional Hindus. Hindus see mobility between castes as something that is achieved through spiritual progression and reincarnation. An individual can be reborn into a higher caste in his/her next life if he/she achieves spiritual development in this life (Hill & Hult, 2018). Buddhism Buddhism, with some 535 million adherents, was founded in the sixth century BC by Siddhartha Gautama in what is now Nepal. Siddhartha renounced his wealth to pursue an ascetic lifestyle and spiritual perfection. His adherents claimed he achieved nirvana but decided to remain on earth to teach his followers how they, too, could achieve this state of spiritual enlightenment. Siddhartha became known as the Buddha (which means “the awakened one”). Today, most Buddhists are found in Central and Southeast Asia, China, Korea, and Japan. According to Buddhism, suffering originates in people’s desires for pleasure. Cessation of suffering can be achieved by following a path for transformation. Siddhartha offered the Noble Eightfold Path as a route for transformation. This emphasizes right seeing, thinking, speech, action, living, effort, mindfulness, and meditation. Unlike Hinduism, Buddhism does not support the caste system. Nor does Buddhism advocate the kind of extreme ascetic behavior that is encouraged by Hinduism. Nevertheless, like Hindus, Buddhists stress the afterlife and spiritual achievement rather than involvement in this world (Hill & Hult, 2018). Confucianism Confucianism was founded in the fifth century B.C. by K’ung-Fu-tzu, more generally known as Confucius. For more than 2,000 years until the 1949 communist revolution, Confucianism was the official ethical system of China. While observance of Confucian ethics has been weakened in China since 1949, many people still follow the teachings of Confucius, principally in China, Korea, and Japan. Confucianism teaches the importance of attaining personal salvation through right action. Although not a religion, Confucian ideology has become deeply embedded in the culture of these countries over the centuries and, through that, has an impact on the lives of many millions more. Confucianism is built around a comprehensive ethical code that sets down guidelines for relationships with others. High moral and ethical conduct and loyalty to others are central to Confucianism. Unlike religions, Confucianism is not concerned with the supernatural and has little to say about the concept of a supreme being or an afterlife (Hill & Hult, 2018). Language Spoken Language Language does far more than just enable people to communicate with each other. The nature of a language also structures the way we perceive the world. The language of a society can direct the attention of its members to certain features of the world rather than others (Hill & Hult, 2018). Because language shapes the way people perceive the world, it also helps define culture. Countries with more than one language often have more than one culture (Hill & Hult, 2018). 03 Handout 1 *Property of STI  [email protected] Page 6 of 11  BM1917 While it does not necessarily follow that language differences create differences in culture and, therefore, separatist pressures (e.g., witness the harmony in Switzerland, where four languages are spoken), there certainly seems to be a tendency in this direction (Hill & Hult, 2018). Mandarin (Chinese) is the mother tongue of the largest number of people, followed by English and Hindi, which is spoken in India. However, the most widely spoken language in the world is English, followed by French, Spanish, and Mandarin (i.e., many people speak English as a second language). And, importantly, English is increasingly becoming the language of international business throughout the world, as it has been in much of the developed world for years. When Japanese and German businesspeople get together to do business, it is almost certain that they will communicate in English. However, although English is widely used, learning the local language yields considerable advantages. Most people prefer to converse in their own language, and being able to speak the local language can build rapport and goodwill, which may be very important for a business deal. International businesses that do not understand the local language can make major blunders through improper translation (Hill & Hult, 2018). EXAMPLE: The Sunbeam Corporation used the English words for its “Mist-Stick” mist-producing hair- curling iron when it entered the German market, only to discover after an expensive advertising campaign that mist means excrement in German. General Motors was troubled by the lack of enthusiasm among Puerto Rican dealers for its new Chevrolet Nova. When literally translated into Spanish, nova means star. However, when spoken it sounds like “no va,” which in Spanish means “it doesn’t go.” General Motors changed the name of the car to Caribe. Ford made a similar and somewhat embarrassing mistake in Brazil. The Ford Pinto may well have been a good car, but the Brazilians wanted no part of a car called “pinto,” which is slang for tiny male genitals in Brazil. Even the world’s largest furniture manufacturer, IKEA from Sweden, ran into branding issues when it named a plant pot “Jättebra” (which means great or superbly good in Swedish). Unfortunately, Jättebra resembles the Thai slang word for sex! Pepsi’s slogan “come alive with the Pepsi Generation” did not quite work in China. People in China took it literally to mean “bring your ancestors back from the grave (Hill & Hult, 2018).” Unspoken Language Unspoken language refers to nonverbal communication. We all communicate with each other by a host of nonverbal cues. The raising of eyebrows, for example, is a sign of recognition in most cultures, while a smile is a sign of joy. Many nonverbal cues, however, are culturally bound. A failure to understand the nonverbal cues of another culture can lead to a communication failure. For example, making a circle with the thumb and the forefinger is a friendly gesture in the United States, but it is a vulgar sexual invitation in Greece and Turkey. Similarly, while most Americans and Europeans use the thumbs-up gesture to indicate that “it’s all right,” in Greece, the gesture is obscene (Hill & Hult, 2018). Education From an international business perspective, one important aspect of education is its role as a determinant of national competitive advantage. The availability of a pool of skilled and knowledgeable workers is a major determinant of the likely economic success of a country (Hill & Hult, 2018). EXAMPLE: In analyzing the competitive success of Japan, Harvard Business School Professor Michael Porter notes that after the last World War, Japan had almost nothing except for a pool of skilled and educated human resources: “With a long tradition of respect for education that borders on reverence, Japan possessed a large pool of literate, educated, and increasingly skilled human resources.... Japan has benefited from a large pool of trained engineers. Japanese universities graduate many more engineers per capita than in the United States.... A first-rate primary and secondary education system in Japan operates based on high standards and emphasizes math and science. Primary and secondary education is highly competitive.... Japanese education provides most students all over Japan with a sound higher education and training. A Japanese high school graduate knows as much about math as most American college graduates (Hill & Hult, 2018).” Porter’s point is that Japan’s excellent education system is an important factor explaining the country’s postwar economic success. Not only is a good education system a determinant of national competitive advantage, but it is also an important factor guiding the location choices of international businesses. The recent trend to 03 Handout 1 *Property of STI  [email protected] Page 7 of 11  BM1917 outsource information technology jobs to India, for example, is partly due to the presence of significant numbers of trained engineers in India, which in turn is a result of the Indian education system. It would make little sense to base production facilities that require highly skilled labor in a country where the education system was so poor that a skilled labor pool was not available, no matter how attractive the country might seem on other dimensions. It might make sense to base production operations that require only unskilled labor in such a country. The general education level of a country is also a good index of the kind of products that might sell in a country and of the type of promotional material that should be used. As a direct example, a country where more than 50 percent of the population is illiterate is unlikely to be a good market for popular books. But perhaps more importantly, promotional material containing written descriptions of mass-marketed products is unlikely to affect a country where half of the population cannot read. It is far better to use pictorial promotions in such circumstances (Hill & Hult, 2018). Culture and Business Of considerable importance for a multinational corporation, or any company—small, medium, or large—with operations in different countries is how a society’s culture affects the values found in the workplace. Management processes and practices may need to vary according to culturally determined work-related values. EXAMPLE: If the cultures of Brazil and the United Kingdom or the United States and Sweden result in different work-related values, a company with operations in both countries should vary its management processes and practices to account for these differences (Hill & Hult, 2018). Hofstede’s Culture Dimensions Figure 1. Hofstede's Culture Dimensions Source: https://corporatefinanceinstitute.com/resources/knowledge/other/hofstedes-cultural-dimensions-theory The most famous study of how culture relates to values in the workplace was undertaken by Geert Hofstede. As part of his job as a psychologist working for IBM, Hofstede collected data on employee attitudes and values for more than 116,000 individuals. Respondents were matched on occupation, age, and gender. The data enabled him later on to compare dimensions of culture across 50 countries. Hofstede initially isolated four (4) dimensions that he claimed summarized the different cultures—power distance, uncertainty avoidance, individualism versus collectivism, and masculinity versus femininity—and then, later on, he added a fifth dimension inspired by Confucianism that he called long-term versus short-term orientation (Hill & Hult, 2018). Power Distance Hofstede’s power distance dimension focused on how a society deals with the fact that people are unequal in physical and intellectual capabilities. According to Hofstede, high power distance cultures were found in countries that let inequalities grow over time into inequalities of power and wealth. Low power distance cultures were found in societies that tried to play down such inequalities as much as possible (Hill & Hult, 2018). 03 Handout 1 *Property of STI  [email protected] Page 8 of 11  BM1917 Individualism vs. Collectivism The dimension focused on the relationship between the individual and his/her fellows. In individualistic societies, the ties between individuals were loose, and individual achievement and freedom were highly valued. In societies where collectivism was emphasized, the ties between individuals were tight. In such societies, people were born into collectives, such as extended families, and everyone was supposed to look after the interest of his/her collective (Hill & Hult, 2018). Uncertainty Avoidance The dimension measured the extent to which different cultures socialized their members into accepting ambiguous situations and tolerating uncertainty. Members of high uncertainty avoidance cultures placed a premium on job security, career patterns, retirement benefits, and so on. They also had a strong need for rules and regulations; the manager was expected to issue clear instructions, and subordinates’ initiatives were tightly controlled. Lower uncertainty avoidance cultures were characterized by greater readiness to take risks and less emotional resistance to change (Hill & Hult, 2018). Masculinity vs. Femininity The dimension looked at the relationship between gender and work roles. In masculine cultures, sex roles were sharply differentiated, and traditional “masculine values,” such as achievement and the effective exercise of power, determined cultural ideals. In feminine cultures, sex roles were less sharply distinguished, and little differentiation was made between men and women in the same job (Hill & Hult, 2018). Long-term vs. Short-term Orientation The dimension refers to the extent to which a culture programs its citizens to accept delayed gratification of their material, social, and emotional needs. It captures attitudes toward time, persistence, ordering by status, protection of face, respect for tradition, and reciprocation of gifts and favors. The label refers to these “values” being derived from Confucian teachings. Hofstede created an index score for each of these five (5) dimensions that ranged from 0 to 100 and scored high for individualism, power distance, uncertainty avoidance, masculinity, and for long-term orientation. By using the company IBM, Hofstede was able to determine that any differences across the country cultures would by design be due to differences in the countries’ cultures and not the company’s culture. He averaged the scores for all employees from a given country to create an index score between 0 and 100 (Hill & Hult, 2018). Power Uncertainty Long-term Individualism Masculinity Distance Avoidance Orientation Australia Low Intermediate Individualist Masculine Short-term Brazil High High Collectivist Intermediate Long-term Canada Low Low Individualist Masculine Short-term Germany Low High Individualist Masculine Short-term United Kingdom Low Low Individualist Masculine Short-term India High Low Collectivist Masculine Long-term Japan Intermediate High Collectivist Masculine Long-term Netherlands Low Intermediate Individualist Feminine Short-term New Zealand Low Low Individualist Masculine Short-term Pakistan Intermediate High Collectivist Intermediate Intermediate Philippines High Low Collectivist Masculine Short-term Singapore High Low Collectivist Intermediate Long-term Sweden Low Low Individualist Feminine Short-term Thailand High High Collectivist Feminine Long-term United States Low Low Individualist Masculine Short-term 03 Handout 1 *Property of STI  [email protected] Page 9 of 11  BM1917 Table 1. Work-Related Values for 15 Selected Countries Source: International Business: Competing in a Global Marketplace, 2018, p.116 Power Uncertainty Long-term Individualism Masculinity Distance Avoidance Orientation Brunei High Low Collectivism Feminine Long-term Cambodia Low High Collectivist Feminine Long-term Indonesia High Low Collectivism Feminine Long-term Laos High Low Collectivism Feminine Short-term Malaysia High Low Collectivism Intermediate Short-term Myanmar High High Intermediate Feminine Long-term Vietnam High Low Collectivism Feminine Long-term Table 2. Work-Related Values for ASEAN Countries Source: hofstede-insights.com Criticisms against Hofstede’s research (1) It assumes there is a one-to-one correspondence between culture and the nation-state. (2) It may have been culturally bound; the research team was composed of Europeans and Americans. (3) Informants worked not only within a single industry, the computer industry, but also within one company, IBM (Hill & Hult, 2018). Cultural Change Culture is not constant; it evolves over time. Changes in value systems can be slow and painful for a society. Change, however, does occur and can often be quite profound. At the beginning of the 1960s, the idea that women might hold senior management positions in major corporations was not widely accepted. Today, it is a reality, and most people in the United States could not fathom it any other way. EXAMPLE: In 2012, Virginia (“Ginni”) Rometty became the CEO of IBM and Mary Teresa Barra became the CEO of General Motors in 2014. Barra, as but one of many examples (in 2015, 23 of the CEO positions at S&P 500 companies were held by women), was named to the Time 100, and Forbes named her one of the World’s 100 Most Powerful Women. No one in the mainstream of American society now questions the development or the capability of women in the business world. American culture has changed. Some business professionals argue that a cultural shift has been occurring in Japan, with a move toward greater individualism. The Japanese office worker, or “salary person,” is characterized as being loyal to his/her boss and the organization to the point of giving up evenings, weekends, and vacations to serve the organization. However, a new generation of office workers may not fit this model. An individual from the new generation is likely to be more direct than the traditional Japanese. This new-generation person acts more like a Westerner, a gaijin. He/She does not live for the company and will move on if he/she gets an offer of a better job or has to work too much overtime. Several studies have suggested that economic advancement and globalization may be important factors in societal change (Hill & Hult, 2018). EXAMPLE: There is evidence that economic progress is accompanied by a shift in values away from collectivism and toward individualism. As Japan has become richer, the cultural emphasis on collectivism has declined, and greater individualism is being witnessed. One reason for this shift may be that richer societies exhibit less need for social and material support built on collectives, whether the collective is the extended family or the company. People are better able to take care of their own needs. As a result, the importance attached to collectivism declines, while greater economic freedoms lead to an increase in opportunities for expressing individualism. The culture of societies may also change as they become richer because economic progress affects several other factors, which in turn influence culture. EXAMPLE: Increased urbanization and improvements in the quality and availability of education are both a function of economic progress, and both can lead to a declining emphasis on the traditional values associated 03 Handout 1 *Property of STI  [email protected] Page 10 of 11  BM1917 with poor rural societies. The World Values Survey has documented how values change. The study linked these changes in values to changes in a country’s level of economic development. As countries get richer, a shift occurs away from “traditional values” linked to religion, family, and country, and toward “secular rational” values. Traditionalists say religion is important in their lives. They have a strong sense of national pride; they also think that children should be taught to obey and that the first duty of a child is to make his/her parents proud. The merging or convergence of cultures can also be traced to the world today being more globalized than ever. Advances in transportation and communication, technology, and international trade have set the tone for global corporations (e.g., Disney, Microsoft, Google) to be part of bringing diverse cultures together into a form of homogeneity we have not seen before. EXAMPLE: McDonald’s hamburgers in China, The Gap in India, iPhones in South Africa, and MTV in Sweden—of global companies helping to foster a youth culture that is ever-present. Plus, with countries around the world climbing the ladder of economic progress, some argue that the conditions for less cultural variation have been created. There may be a slow but steady convergence occurring across different cultures toward some universally accepted values and norms: This is known as the convergence hypothesis (Hill & Hult, 2018). REFERENCES Compare countries. (n.d.). Retrieved January 27, 2020, from https://www.hofstede- insights.com/product/compare-countries/ Hill, C. W., & Hult, G. T. (2018). International business: Competing in the global marketplace (12th ed.). New York: McGraw-Hill Education. 03 Handout 1 *Property of STI  [email protected] Page 11 of 11