Different Types of Accounts in a Business
The entity concept separates the concerns of the owners from the business. An extension of the same concept is the concept of accounts which splits up the business’s affairs further. The account concept becomes clearer once the double entry system of accounting is explained. That is done at a later stage in the tutorial. Transactions […]
What is Business Communication
Communication is neither the transmission of a message nor the message itself. It is the mutual exchange of understanding, originating with the receiver. Communication needs to be effective in business. Communication is the essence of management. The basic functions of management (Planning, Organizing, Staffing, Directing and Controlling) cannot be performed well without effective communication. Business […]
The Stages of Descent into Bankruptcy
Bankruptcy is a common phenomenon in the business world. There have been many cases wherein the stalwarts of yesterday, the companies which were running multi-billion dollar profits, have later filed for insolvency. For the benefit of the readers, let us define bankruptcy. Bankruptcy is the stage at which companies find it financially unviable to function. […]
Employee Layoffs – Handle Carefully
The term employee layoff is referred to as temporary separation of an employee from the employer. However, these days it is also used for permanent termination of an employee for business reasons. According to section 2 of the Industrial Disputes Act, 1947, the employee layoff is the failure, inability or refusal of an employer to […]
What is Public Relations – An Overview
PR or public relations is nothing but the practice of protecting as well as enhancing the reputation of any particular organization/firm or for that matter any individual. In today’s world of fierce competition, where every organization strives hard to work toward its brand image, public relations has become the need of the hour. It is […]
One of the most widely used frameworks for analyzing cultural differences is the model developed by the eminent cultural theorist, Geert Hofstede.
In this model, the differences in culture between countries have been plotted along five dimensions, which can be used as the basis for predicting the cultural differences between different countries.
The model was developed after extensive research into the cultural differences between different countries and after surveys of thousands of employees in the West and the East.
The five dimensions along which the cultural differences are plotted are power distance, masculinity vs. femininity, long-term orientation vs. short-term thinking, individualism vs. collectivism, and uncertainty avoidance. The model is comprehensive and exhaustive in its treatment of cultural differences across cultures.
To take the first dimension, power distance measures the extent to which hierarchy dominates the work environment. In the US, the power distance is relatively small when compared to China where the power distance is more because of the hierarchical nature of Chinese society.
Similarly, the Masculine traits predominate in India and China as compared to the US and UK as the cultures in the former tends towards patriarchy.
The third dimension of individualism vs. collectivism yields the result that employees in the West would be highly individualistic as compared to the employees in the East who subscribe to the group instead of to the individual.
The fourth dimension of long-term thinking vs. short-term thinking is likewise different in the US and the UK where the emphasis is on getting the short-term results whereas in China and India, there is a tendency to look ahead into the future.
Finally, the fifth dimension of uncertainty avoidance refers to the structured work environment, which in the West would be oriented towards specific and measurable goals and objectives whereas out of the box thinking is prevalent in the East.
The Hofstede model is useful for expatriate managers who when they work in the East find it easy to understand the cultural differences in the work environment. Using this model, the expatriate managers can be trained to adjust to the different cultures.
To take an example, it is common in the East (China and India) to be hierarchical in the organizational structure where the position and the status of the employee matters a lot.
Given the fact that in the West, these are important but not to the extent that they are in the East, expatriate managers can learn to negotiate cultural differences using this model.
Another important aspect is that culturally China and India are male dominated, which is different from the US, and the UK where gender equality is prevalent. Hence, the expatriate managers can likewise adjust to the East when they work there using this model.
Finally, for expatriate managers to adjust to the local cultures, adopting a “Glocal” approach would be the ideal solution. This approach wherein a global outlook is combined with a local approach means that multinationals can adapt themselves to the local cultures and at the same time do not lose focus of their global vision. This is the most important learning that the Hofstede model and the other models of culture provide to the expatriate managers.
In conclusion, cultural differences can make or mar the chances of multinationals in the globalized world economy of the present. Hence, it is important to realize and understand that culture plays a prominent part in shaping the work environment.
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