4. What is Cross-Cultural
Management?
CCM is a fairly new field that is based on theories
and research from:
• Cross Cultural Psychology
• International Business
• Organizational Behaviour
• Human Resources
• Anthropology
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5. Goals for Cross-Cultural
Management
Cross Cultural Management seeks to
• understand how national cultures affect
management practices
• identify the similarities and differences across
cultures in various management practices and
organizational contexts
• increase effectiveness in global management
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7. Globalization
Like it or not, globalization is here…to stay.
• Most large companies have some kind of business
relations with customers, companies, employees or
various stake-holders in other countries…and
cultures. (Global corporations)
• Many employees and managers deal with people
from other cultures on a constant basis
• Most of us have a close experience with only one
or two cultures…=>
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8. Globalization
• We do not understand people from other cultures
as readily and intuitively as people from our own
culture =>
• Cross cultural management helps organization
members to gain better understanding of other
cultures, of their culture and of the consequences
of people from different cultures working together
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9. Chap1-3
Definitions of culture
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10. Culture
Definition: acquired knowledge that people use
to interpret experience and generate social
behavior.
Culture forms values, creates attitude,
influences behavior.
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11. Chap1-4
Nature of culture
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13. Cultural diversity
(P4: Culture and types of handshake)
• Cultural values
(P5: Priorities of cultural values: US, Japan)
(P5: examples where culture can affect
management approaches)
Depict cultural diversity through concentric circles.
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15. Priorities of Cultural Values
United States Japan Arab Countries
1. Freedom 1. Belonging 1. Family security
2. Independence 2. Group harmony 2. Family harmony
3. Self-reliance 3. Collectiveness 3. Parental guidance
4. Equality 4. Age/seniority 4. Age
5. Individualism 5. Group consensus 5. Authority
6. Competition 6. Cooperation 6. Compromise
7. Efficiency 7. Quality 7. Devotion
8. Time 8. Patience 8. Patience
9. Directness 9. Indirectness 9. Indirectness
10. Openness 10. Go-between 10. Hospitality
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16. Management Approaches Affected
by Cultural Diversity
Centralized vs.
Decentralized Cultural Informal vs.
formal procedures
decision making
Diversity
Safety vs. risk High vs. low
organizational
loyalty
Individual vs.
group rewards Cooperation vs.
competition
Stability vs.
Sort-term vs. innovation
long-term horizons
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17. Summary of what we learned
last week
• Introduction to the course of cross-cultural
management and our international teaching
team
• Goals for Cross-cultural management
• Nature of culture
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18. We will learn today
• A model of culture: concentric circles
• Comparing culture as a normal distribution
• Values in culture
• Hofstede’s cultural dimensions
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19. A model of culture: concentric
circles
Explicit artifacts and
products of the society Outer layer: observable,
Norms and values e.g. language, food,
that guide the society buildings, art.
Middle layer: helps
Implicit, basic people understand how
assumptions that guide
people’s behavior
they should behave.
Inner layer: intangible,
helpful for problem-
solving and well
interactions with other
people.
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20. Comparing Cultures as
Overlapping Normal Distribution
Chinese Culture U.S. Culture
? ?
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21. Stereotyping from the Cultural
Extremes: Brugha and Du’s research
How Americans see the Chinese How Chinese see Americans
• in community • individualism
• avoid confrontation • face confrontation
(keep in harmony) (arguments and debates)
• respect for authorities • respect for achievements
and seniors
Chinese Culture U.S. Culture
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22. Values in Culture
Values: basic convictions that people have
regarding what is right and wrong, good and
bad, important and unimportant.
• Value differences and similarities across
cultures: P 10: “common personal values”
U.S. Values and possible alternatives
• Values in transition: work values change over
time.
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23. Dominant Western Values
in Workforce
Career Entered the Approximate Dominant
Stage Workforce Current Age Work Values
1. Protestant Mid-1940s to 50 to 65 Hard working; loyal to
Work Ethic Late 1950s firm; conservative
2. Existential 1960s to 35 to 50 Nonconforming; seeks
Mid-1970s autonomy; loyal to self
3. Pragmatic Mid-1970s to 35 to 35 Ambitious, hard worker;
Mid-1980s loyal to career
4. Generation X Mid-1980s Under 25 Flexible, values leisure;
through 1990s loyal to relationships
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25. Hofstede’s Cultural Dimensions
• Dutch researcher Geert Hofstede found there
are four dimensions of culture.
• Hofstede’s initial data: questionnaire surveys
with over 116000 respondents from over 70
different countries who worked in the local
subsidiaries of IBM.
• The fifth dimension was added later.
• Criticized because of its focus on just one
company.
• Popular in the research field of cross-cultural
management.
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26. Power Distance
Uncertainty Avoidance
Hofstede ’s Individualism
Five Cultural Masculinity
Dimensions Long-Term Orientation
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27. • Power Distance: the extent to which less powerful
members of organizations accept that power is
distributed unequally.
Low: people treated as equals despite social
status
High: people accept authority relations
• Uncertainty avoidance: the extent to which people feel
threatened by ambiguous situations and have
created beliefs and institutions that try to avoid
these.
Low: prefer few formal rules
High: want clear behavioral guides
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28. • Individualism/collectivism: the tendency of people to
look after themselves and their immediate family only
(belong to groups or collectives and to look after
each other in exchange for loyalty).
Low: group behavior important
High: individual behavior important
A bipolar continuum
Individualism Collectivism
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29. • Masculinity/femininity: a situation in which the
dominant values in society are success, money, and
things (caring for others and the quality of life).
Low: cooperation; friendly atmosphere;
employment security; low stress; warm
interpersonal relationships.
High: competition; challenge; recognition;
wealth; advancement; high stress; tight
control.
A continuum
Masculinity Femininity
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30. • Long–term orientation: value placed on
persistence, status, thrift
Low: respect for tradition, personal
stability, focused on the past
High: perseverance, thrift, focused on
the future
This dimension was added to depict the
influence of Confucianism in Asia.
This dimension is similar to “Adjusting”
proposed by Brugha and Du.
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31. Examples of Cultural Dimensions
Power Uncertainty Long-term
Country Individualism* Masculinity**
Distance Avoidance Orientation***
China High Low Moderate Moderate High
France High High Moderate High Low
Germany Low High High Moderate Moderate
Hong Kong High Low High Low High
Indonesia High Low Moderate Low Low
Japan Moderate Moderate High Moderate Moderate
Netherlands Low High Low Moderate Moderate
Russia High Moderate Low High Low
United States Low High High Low Low
West Africa High Low Moderate Moderate Low
* A low score is synonymous with collectivism
** A low score is synonymous with masculinity
*** A low score is synonymous with a short-term orientation
32. Additional Frameworks
Two additional perspectives, of social/cross-cultural
psychologists merit attention:
Markus & Kitayama: Independent &
Interdependent Construals
Triandis: Individualism-Collectivism
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33. Vertical & Horizontal Individualism
& Collectivism
Harry Triandis: Combination of Individualism vs.
collectivism and power & achievement vs.
benevolence & universalism
• VI: achievement + individualism (USA)
• HI: universalism + individualism (Sweden)
• VC: power + collectivism (India)
• HC: benevolence + collectivism (Israel; rare)
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35. Schwartz’s Value Map
Openness to Self-
Change Direction Universalism
Self-
Creativity, Social Justice, Transcendence
Stimulation Freedom Equality
Exciting Life Benevolence
Helpfulness
Hedonism
Pleasure Conformity Tradition
Obedience Humility
Devoutness
Achievement
Success,
Ambition Security
Social Order
Power Conservation
Authority,
Self-
Wealth
Enhancement
Organized by motivational
similarities and dissimilarities
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36. Empirical test of the Theory
• 75,000 + respondents, varied samples in 68 countries
• Instrument lists 57 abstract value items
• “How important is each item as a guiding principle in
your life?”
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37. Tasks in the next session:
Students’ talks and presentations
Discussion in groups: how to learn
Cross-cultural management?
Assignment after class:
Read a paper on Hofstede’s cultural
dimensions.
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38. Preview
• Integrating Hofstede’s cultural
dimensions
• Attitudinal dimensions of culture
• Trompenaars’s cultural dimensions
• Integrating culture and management
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39. Chap1-7 Attitudinal Dimensions of
Culture
Work Value and Attitude Similarities
• Research has revealed many similarities in both work values and
attitudes
• Ronen and Kraut
– Smallest space analysis (SSA) - maps the relationship among
countries by showing the distance between each on various
cultural dimensions
– Can identify country clusters
• Ronen and Shenkar
– Examined variables in four categories
» Importance of work goals
» Need deficiency, fulfillment, and job satisfaction
» Managerial and organizational variables
» Work role and interpersonal orientation
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40. A Synthesis of Country Cultures
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41. GLOBE Project
• Multi-country study and evaluation of cultural
attributes and leadership behavior
• Are transformational characteristics of
leadership universally endorsed?
• 170 country co-investigators
• 65 different cultures
• 17,500 middle managers
800 organisations
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42. GLOBE Project
• What traits are universally viewed as impediments to leadership
effectiveness?
• Based on beliefs that
– Certain attributes that distinguish one culture from others can be
used to predict the most suitable, effective and acceptable
organizational and leader practices within that culture
– Societal culture has direct impact on organizational culture
– Leader acceptance stems from tying leader attributes and
behaviors to subordinate norms
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43. GLOBE Cultural Variable Results
Variable Highest Medium Lowest
Ranking Ranking Ranking
Assertiveness Spain, U.S. Egypt, Ireland Sweden, New
Zealand
Future orientation Denmark, Canada Slovenia, Egypt Russia, Argentina
Gender differentiation South Korea, Italy, Brazil Sweden Denmark
Egypt
Uncertainty avoidance Austria, Denmark Israel, U.S. Russia, Hungary
Power distance Russia, Spain England, France Demark, Netherlands
Collectivism/Societal Denmark, Hong Kong, U.S. Greece, Hungary
Singapore
In-group collectivism Egypt, China England, France Denmark,
Netherlands
Performance orientation U.S., Taiwan Sweden, Israel Russia, Argentina
Humane orientation Indonesia, Egypt Hong Kong, Germany, Spain
Sweden
44. Chap1-8 Trompenaars’ Cultural
Dimensions
• Research produced five cultural dimensions that are based on
relationship orientations and attitudes toward both time and the
environment
• Universalism vs. Particularism
– Universalism - belief that ideas and practices can be applied
everywhere in the world without modification
• Focus on formal rules and rely on business contacts
– Particularism - belief that circumstances dictate how ideas and
practices should be applied and something cannot be done the
same everywhere
• Focus on relationships, working things out to suit the
parties
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45. Trompenaars’ Cultural Dimensions
(cont.)
• Individualism vs. Communitarianism
– Individualism - people regard themselves as individuals
• Rely on individuals to make decisions
– Communitarianism - people regard themselves as part of a group
• Seek consultation and mutual consent before making decisions
• Neutral vs. Emotional
– Neutral - culture in which emotions are held in check
• People try not to show their feelings
– Emotional - culture in which emotions are expressed openly and
naturally
• People smile, talk loudly, greet each other with enthusiasm
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46. Trompenaars’ Cultural Dimensions
(cont.)
• Specific vs. Diffuse
– Specific - culture in which individuals have a large public space they
readily share with others and a small private space they guard
closely and share with only close friends and associates
• People often are open and extroverted
• Work and private life are separate
– Diffuse - culture in which both public and private space are similar
in size and individuals guard their public space carefully, because
entry into public space affords entry into private space as well
• People often appear indirect and introverted, and work and
private life often are closely linked
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47. Trompenaars’ Cultural
Dimensions (cont.)
• Achievement vs. Ascription
– Achievement - culture in which people are accorded status based
on how well they perform their functions
– Ascription - culture in which status is attributed based on who or
what a person is
• For example, status may be accorded on the basis of age,
gender, or social connections
• Time
– Sequential approach to time - people do one thing at a time, keep
appointments strictly, follow plans to the letter
– Synchronous approach - people do more than one thing at a time,
appointments are approximate
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48. Trompenaars’ Cultural Dimensions
(cont.)
• Environment
– Inner-directed
• People believe in controlling environmental outcomes
– Outer-directed
• People believe in allowing things to take their natural
course
• Cultural Patterns or Clusters
– Defined groups of countries that are similar to each other in
terms of the five dimensions and the orientations toward time
and the environment
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49. Trompenaars’ Cultural Groups
Anglo cluster
Relationship United States United Kingdom
Individualism x x
Communitarianism
Specific relationship x x
Diffuse relationship
Universalism x x
Particularism
Neutral relationship x
Emotional relationship x
Achievement x x
Ascription
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50. Trompenaars’ Cultural Groups
Asian cluster
Relationship Japan China Indonesia Hong Kong Singapore
Individualism
Communitarianism x x x x x
Specific relationship
Diffuse relationship x x x x x
Universalism
Particularism x x x x x
Neutral relationship x x x x
Emotional relationship x
Achievement
Ascription x x x x x
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51. Trompenaars’ Cultural Groups
Latin American cluster
Relationship Argentina Mexico Venezuela Brazil
Individualism x x x
Communitarianism
Specific relationship
Diffuse relationship x x x x
Universalism
Particularism x x x x
Neutral relationship x x x
Emotional relationship x
Achievement x x
Ascription x x
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52. Trompenaars’ Cultural Groups
Latin-European cluster
Relationship France Belgium Spain Italy
Individualism x
Communitarianism x x x
Specific relationship x x
Diffuse relationship x x
Universalism x x x
Particularism x
Neutral relationship x
Emotional relationship x x x
Achievement x
Ascription x x x
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53. Trompenaars’ Cultural Groups
Germanic cluster
Relationship Austria Germany Switzerland Czechoslovakia
Individualism x
Communitarianism x x x
Specific relationship x x x
Diffuse relationship x
Universalism x x x x
Particularism
Neutral relationship x x
Emotional relationship x x
Achievement x x x
Ascription x
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54. Culture Maps - Frameworks
Edward Geert Trompenaar Kluckhohn &
T. Hall Hofstede s Strodbeck
Culture Value Value Variations
Elements Pattern Patterns in Value
s • universalism– Orientation
particularism s
• collectivism– • relation to
• time • power individualism nature
• space • risk • affective–neutral • orientation to
• things • individualism relationships time
• friendships • masculinity • specificity– • belief about
• • long term diffuseness human nature
agreements orientation • achievement– • mode of human
& & ascription
interpersonal management • time orientation activity
behavior theories - •Internal–external • relationships
practice control • space
& &
Int’l. business practice Int’l. business
practice 54
Cross-Cultural Management
Editor's Notes
Chinese culture and American culture have quite different norms and values. The normal distribution curves for the two cultures have only limited overlap. When looking at the tail ends of the two curves, it is possible to identify stereotypical views held by Chinese about Americans and Americans about Chinese. Give some examples.
Workers who grew up influenced by the Great Depression, World War II, U.S. leadership in world manufacturing, the Andrews sisters, and the Berlin blockade entered the workforce from the mid-1940s to the late 1950s. They believed in the Protestant work ethic. Once hired, they tend to be loyal to an employer. They are likely to value family security and a comfortable life. Employees who entered the workforce from the 1960s to the mid-1970s were influenced by John F. Kennedy, the civil rights movement, the Beatles, and the war in Vietnam. They brought with them a large measure of the “ hippie ethic ” and existential philosophy. Quality of life is more important to them than money and possessions. They value autonomy, freedom, and equality. Those who entered the workforce from the mid-1970s through the mid-1980s reflect society ’ s return to more traditional values but with a greater emphasis on achievement and material success. They were influenced by Ronal Reagan, the defense build-up, dual-career households, and $150,000 starter homes. They are pragmatists who believe that ends can justify means. A sense of accomplishment and social recognition rank high for them. The lives of the members of Generation X have been shaped by globalization, the fall of Communism, MTV, AIDS, and computers. They value flexibility, life options, job satisfaction, family, and relationships. Money is important as an indicator of career performance, but they are willing to trade off leisure time for increases in salary, titles, security, and promotions.
10 According to Hofstede, culture can be classified according to five dimensions. Power distance is the extent to which people accept unequal distributions of power. In higher power distance cultures, there is a wider gap between the powerful and the powerless. Uncertainty avoidance is the extent to which the culture tolerates ambiguity and uncertainty. High uncertainty avoidance leads to low tolerance for uncertainty and a search for absolute truths. Individualism is the extent to which either individuals or closely-knit social structures are the basis for social systems. Individualism leads to self-reliance and individual achievement. Masculinity is the extent to which assertiveness and independence are valued. High masculinity fosters high sex-role differentiation and focuses on ambition, independence, and material goods. Long-term orientation is the extent to which people focus of the past, the present, or the future. Present orientation focuses on short-term performance. Hofstede ’ s five dimensions can help managers classify cultures and predict organizational and managerial styles. But while his model provides a general ranking for a country, there may be many differences among the groups within a country.
Hofstede measured this cultural difference on a bipolar continuum with individualism at one end and collectivism at the other.
Hofstede measured this dimension on a continuum ranging from masculinity to femininity.
Different countries have different scores in terms of Hofstede ’ s cultural dimensions.
