Think Locally, Act Globally: Cultural Constraints in Personnel Management Author(s): Geert Hofstede Reviewed work(s): Source: MIR:

Management International Review, Vol. 38, Cross-Cultural and Comparative International Human Resource Management (1998), pp. 7-26 Published by: Springer Stable URL: http://www.jstor.org/stable/40228480 . Accessed: 14/11/2011 03:41
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.

Springer is collaborating with JSTOR to digitize, preserve and extend access to MIR: Management International Review.

http://www.jstor.org

mir SpecialIssue 1998/2, pp. 7-26

mir
_^ ^ # _^ MonoQOinont International Review
Gabler Verlag1998

Geert Hofstede

ThinkLocally,Act Globally: Cultural Constraintsin Personnel Management

Abstract
Management ingeneral, inparticular, andpersonnel areculturally management A distinction is madebetween national cultures and organization constrained. on thelevel of fundamental Nationalcultures differ cultures. values; mainly dimensions ofvaluescanbe distinguished. Theseaffect five strucorganization motivation, tures, appraisal, objective setting, performance strategic manageofwork. National cultures do notconverge andhumanization overtime. ment, differ onthelevelofmore cultures (within nations) mainly Organization superwhich meansthey are somewhat ficialpractices, Six dimensions manageable. with formanagement. of practices can be distinguished, implications Managmeans national culture differences and multinationals accepting ing managing differences. culture organizational

Key Results
Nobody Bothnational andorganizational cultures canthink constrain globally. Globalpersonnel management management. implies understanding personnel local constraints.

Author
Professor Universiteit Maastricht andCentER Geert Emeritus, Fellow, Hofstede, Tilburg University, The Netherlands.

mirvol. 38 SpecialIssue 1998/2

Geert Hofstede

Organization Cultures and National Cultures

Culture in general has beendefined ofthemind as "thecollective programming whichdistinguishes anthemembers of one groupor category of peoplefrom other" is the thecategory 1991,p. 5). In thecase of national culture, (Hofstede - keeping nation thecatother cultures things equal. In thecase oforganization is the as to other other egory things, organization opposed organizationsagain like nationality, one can distinand organization beingequal. Nextto national cultures business cultures, cultures, cultures, guish occupational age group gender for all these andso on. However, theuse ofthewordculture (likeyouth culture), kinds does notmeanthat Fordifferent are identical categories they phenomena. ofsocial systems, This is their well be of a nature. cultures different particmay thecase for ifonlybecause cultures versus national cultures, ularly organization of an organization is usuallypartial whilethememand voluntary, membership ofa nation is permanent andinvoluntary. bership Culture as collective itself inseveral ofthe mind manifests ways. programming From themany four terms usedtodescribe manifestations ofculture thefollowing and cover the total rather heroes, rituals, valtogether concept neatly: symbols, ues. These can be imagined the as theskinsof an onion,symbols representing most and ofculture, with heroes andvaluesthedeepest manifestations superficial rituals in between. a particular are words,gestures, or objectswhichcarry Symbols pictures, in a as suchbythosewhoshare theculture. The words meaning onlyrecognized orjargon tothis as do dress, hair-do, Coca-Cola,flags, language belong category, and status New symbols are easilydeveloped and old ones disappear; symbols. from Thisis why onecultural areregularly symbols symgroup copiedbyothers. bols represent theouter, mostsuperficial of culture. layer Heroesarepersons, alive or dead,realor imaginary, whopossesscharacteristicswhich arehighly in a culture, andthus serveas models for behavior. prized Founders of companies often becomecultural heroes.In thisage of television, outward in thechoiceof heroesthan havebecomemoreimportant appearances were before. they Rituals arecollective toreach desired activities, ends, technically superfluous butwhich within a culture areconsidered aretherefore as socially essential: they carried out fortheir own sake. Waysof greeting and paying to others, respect social and religious ceremonies are examples.Businessand political meetings forseemingly rational like reasons often servemainly ritual organized purposes, the leaders to assert themselves. allowing andrituals can be labeledpractices. As suchthey heroes, Symbols, together arevisible toanoutside their cultural is invisible and observer; however, meaning, lies precisely andonlyinthewaythese are the insiders. practices interpreted by 8 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

to preis formed The coreofculture by values.Valuesarebroadtendencies Valuesarefeelings with an arrow to it:a overothers. states of affairs fer certain deal with: minus side. and a They plus evil vs. good vs. clean dirty uglyvs. beautiful vs. natural unnatural abnormal vs. normal vs. logical paradoxical irrational vs. rational immoral vs. moral - notconsciously, learn butimplicitly. children thefirst Valuesareamong things most that the children havetheir believe by age often, psychologists Development aredifficult toobinplace,andafter that basicvaluesystem age,changes firmly valuesremain unwereacquiredso earlyin ourlives,many tain.Because they nor can Therefore cannot be to thosewhoholdthem. conscious discussed, they from theway observed be directly Theycan onlybe inferred by outsiders. they circumstances. various act under people one intonational andone intoorganization culTwo largeresearch projects, national culet al. 1990,Hofstede differences ture 1991) showedthat (Hofstede differ while cultures the level of at differ tures values, organization mostly mostly andrituals. at thelevelofthemoresuperficial heroes, practices: symbols, for thenational mixes ofvaluesandpractices thedifferent Figure1 illustrates as wellas forgender, levelsofculture, andtheorganization (social) class,occucan be explained Thesedifferences andbusiness. by thedifferent places pation, these have been listed at values and for for of socialization practices; (learning) in one's early in Valuesareacquired sideofthediagram. theright youth, mainly and laterat school.The twocharacteristics and in theneighborhood, thefamily and nationality. at birth are gender By thetimea childis tenyearsold, present The schoolas a sointoitsmind. ofitsbasicvalueshavebeenprogrammed most cultures the student's future to relates occupation. Organization cializingplace work which most at the socialization areonlylearned peopleenplace, through in A business culvalues the bulk of their with adults that ter as is, firmly place. is placedsomewhere between oroftourism) ofbanking, culture ture level(likethe andorganization. occupation cultures are phecultures and organization that national Figure1 illustrates be misterm cultures for both can the same order. of a different nomena Using leading. been cultures have often literature In thepopular organization management The confusion arises Peters/Waterman of values as a matter 1982). (e.g. presented and between thevaluesofthefounders literature doesnotdistinguish becausethis mlrvol. 38 SpecialIssue 1998/2 9

Hofstede Geert in Culture forDifferent Social Systems Figure1. The Mix of ValuesandPractices

LEVEL OF CULTURE + GENDER I NATION | | CLASS I

PLACE OF SOCIALIZATION / / / / + I I I I FAMILY

VALUES

OCCUPATION BUSINESS IORGAN ZATION

I | I | | I | + / / / / / /

/ /

I I I I

SCHOOL

PRACTICES

| I I +

WORK PLACE

Founders andleaders create thesymoftheordinary andthose leaders employees. of the the rituals that constitute and the the bols, heroes, organidailypractices values to the Members do nothave to adapttheir zation'smembers. personal as a rule, is nota totalinstitution like needs.A work organization, organization's or a mental a prison hospital. than in the on criteria other valuesdepend Members' membership primarily The and like their class, occupation. waythese nationality, gender, organization, rethehiring is through theorganization valuesenter process:an organization cruits class,education, nationality, age. Theirsubsegender, peopleof a certain oflearning thepractices: is a matter in theorganization socialization symquent who the officers Personnel and rituals. bols,heroes, preselect peopleto be hired values(forbetter or for an organization's rolein maintaining playan important worse). ofpractices rather than valarecomposed cultures that The fact organization the can be somewhat ues makesthem by changing they managed manageable: be an emcan once values of The hired, hardly changed by employees, practices. werechildren. Somebecausetheywereacquiredwhentheemployees ployer, latent valueswhich can activate an employer times employees possessbutwere for initiative andcreativity, likea desire notallowedto showearlier: byallowing were forbidden. which before practices 10 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

Dimensions of National Cultures

culture differences intonational referred totookplace The largeresearch project ofa multinational acrosssubsidiaries Subse(IBM) in 64 countries. corporation in and students 10 23 and in studies covered elites countries, respectively, quent Hofstede/Bond These studies 19 countries 1991, 1988, (Hofstede Hoppe 1990). dimensions ofnational fiveindependent culture differences: identified together that is theextent to which theless powerful 1. PowerDistance, members of and institutions (like thefamily) acceptand expectthat poweris organizations Thisrepresents distributed (moreversus less), butdefined inequality unequally. that a society's levelofinequality is ennotfrom above.It suggests from below, as the leaders. Power and of followers as much the dorsed course, by inequality, by and anybody with facts of anysociety someinternafundamental areextremely "all societies areunequal, butsomearemore willbe awarethat tional experience others." unequalthan atthework small Table 1 atthetoplistssomeofthedifferences placebetween to extremes; The statements refer actualsituandlargePowerDistancecultures. theextremes. inthe inbetween ations People'sbehavior anywhere maybe found inthefamily and affected is strongly situation work bytheir previous experiences abouttheboss areprojections oftheexandfears intheschool:theexpectations - or mother - and theteachers. In order to understand with thefather periences in we have to know someanother and subordinates country colleagues, superiors, in that and schools families about country. thing itsopposite, that is the on theone side versus 2. Individualism Collectivism, intogroups. On theindividualist side are integrated individuals to which degree individuals areloose: everyone is exinwhich thetiesbetween we find societies immediate On thecollectivist andhis/her him/herself tolookafter family. pected birth onwards are into in from which find societies side,we integrated people families andgrandoften extended cohesive uncles, aunts, (with in-groups, strong, in for them which continue exchange unquestioning loyalty. protecting parents) it refers to the inthis sensehasnopolitical collectivism Theword meaning: group, dimension is an extremely funtheissueaddressed nottothestate. bythis Again, in world. the all societies damental one,regarding collectivist at theworkplace between Table 1 also showssomedifferences inbetween willbe somewhere these realcultures most andindividualist cultures; universalism are common and The words extremes. sociological particularism in which thestandards for theway is a wayofthinking Particularism categories. to which this the or on be treated should a person person group category depend in which thestandards forthewaya is a wayofthinking Universalism belongs. be treated arethesamefor should everybody. person mirvol. 38 SpecialIssue 1998/2 11

Geert Hofstede in National Culture Table 1. Consequences at theWork Place ofDifferences SmallPowerDistancesocieties ofroles, meansan inequality Hierarchy established for convenience Subordinates to be consulted expect Ideal boss is resourceful democrat LargePowerDistancesocieties means existential inequality Hierarchy to be told Subordinates expect what todo autocrat Ideal boss is benevolent (good father) Individualist societies Same valuestandards applyto all: universalism Other peopleseenas potential resources Taskprevails overrelationship Calculative modelofemployeremployee relationship societies Masculine Assertiveness appreciated Oversell yourself Stress on careers Decisiveness Avoidance Uncertainty Strong societies Emotional needfor rules written or unwritten and Moreformalization standardization Intolerance ofdeviant persons andideas

Collectivist societies Valuestandards differ forin-group andout-groups: particularism Other peopleareseenas members oftheir group overtask Relationship prevails Moralmodelofemployeremployee relationship Feminine societies Assertiveness ridiculed Undersell yourself Stress on lifequality Intuition WeakUncertainty Avoidance societies Dislikeofruleswritten or unwritten Less formalization and standardization Tolerance ofdeviant persons andideas

12

mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

versus itsopposite, 3. Masculinity refers tothe distribution ofroles Femininity, between is another thesexeswhich fundamental issueforanysociety to which a of solutions are found. The IBM studies revealed that women's values (a) range differ less among societies than men'svalues;(b) men'svaluesfrom one country to another contain a dimension from and competitive and maxiveryassertive different from women'svalueson theone side,to modest and caring and mally similarto women'svalues on the other. The assertive has been called pole and themodest, masculine The women in feminine councaring polefeminine. tries havethesamemodest, values as in themen; themasculine countries caring aresomewhat assertive andcompetitive, butnotas much as themen, so that they thesecountries showa gap between men'svaluesandwomen's values. Table 1 also listssomeofthedifferences at thework feminine place between andmasculine cultures. 4. Uncertainty Avoidance deals with a society's tolerance for and uncertainty itultimately refers to man'ssearch forTruth. It indicates to whatexambiguity; tent a culture itsmembers to feeleither uncomfortable or comfortable programs in unstructured situations. Unstructured situations are novel,unknown, surprisfrom usual.Uncertainty cultures to minimize theposing,different avoiding try of suchsituations laws andrules, and security measures, by strict sibility safety, levelbya beliefin absolute andon thephilosophical andreligious "there Truth; andwe haveit."Peoplein uncertainty can onlybe one Truth countries avoiding are also moreemotional, and motivated nervous The opposite by inner energy. are more tolerant of different from cultures, uncertainty accepting opinions type, to haveas fewrulesas possible, what areusedto; they andon thephilothey try level they are relativist and allow many currents to flow sophicaland religious thesecultures are morephlegmatic side by side. People within and contemplaenvironment to express emotions. tive,andnotexpected bytheir listssomeofthedifferences at thework Table 1 at thebottom placebetween Avoidance cultures. weakandstrong Uncertainty versus Short Term Orientation: thisfifth dimension 5. LongTerm was found in23 countries ina study students around theworld, a questionnaire among using (Hofstede/Bond 1988). It can be said to deal with designed byChinesescholars Virtue of Truth. Values associated with are Long TermOrientation regardless values associated with Short Term thrift andperseverance; Orientation arerespect socialobligations, andprotecting one'sface. Boththeposfor tradition, fulfilling in theteachrated valuesof thisdimension are found andthenegatively itively of the most influential Chinese who lived around Confucius, philosopher ings thedimension also appliesto countries without a Confucian 500 B.C.; however, heritage. research as yeton theimplications ofdifferences Therehas beeninsufficient to allowcomposing a tableofdifferences likethosefor the alongthisdimension in Table 1. four dimensions other mirvol. 38 SpecialIssue 1998/2 13

Geert Hofstede

four dimensions wereobtained for50 countries Scoreson thefirst and 3 reIBM on the basis of the and on the fifth dimension for 23 countries study, gions data collected on thebasis of student by Bond. For scorevalues see Hofstede Distance scores are countries (1991). Power highforLatin,Asian,and African countries. Individualism indeveloped for Germanic andWestandsmaller prevails in less developedand Eastern whileCollectivism erncountries, counprevails on thisdimension. is tries;Japantakesa middleposition Masculinity highin countries like in some and Switzerland, and Austria, European Germany, Japan, itis low inNordic inAnglocountries; countries andintheNethmoderately high lowinsomeLatinandAsiancountries andmoderately likeFrance, erlands Spain, in Latin countries, Avoidancescoresare higher in and Thailand.Uncertainty in in lower and and German Chinese countries, Nordic, Anglo, speaking Japan, A LongTerm is mostly in East AsiancounOrientation found countries. culture in China,HongKong,Taiwan, andSouthKorea. in particular tries, Japan, to someoftheroots ofcultural ofcountry scorespoints differThe grouping in thecommon of similarly be sought counences.Theseshould history scoring on forexample, scorerelatively both Power DisAll Latincountries, tries. high Latincountries a Avoidance. tanceand Uncertainty (thosetodayspeaking Roor Italian)have inherited at i.e. Spanish, mancelanguage, French, Portuguese, in its theRomanempire. The Romanempire civilization from oftheir leastpart of a central in Rome,and a authority by theexistence days was characterized in itscitizens' This established to citizens of law anywhere. applicable system centralization fostered which we stillrecognize thevaluecomplex minds today: Avoidance. on lawsfostered Distance anda stress Power strong Uncertainty large butitlackeda fixed oflaws: also knew TheChinese centralization, system empire In the countries once than laws. men rather it was governed by present-day by in the is reflected Power mindset fostered the Chinese under rule, by empire large Avoidance. The Germanic to weak Uncertainty Distancebut medium partof inestablishing anenduring comnever succeeded Great Britain, including Europe, inherited itscivilizations showsmaller which andcountries moncentral authority roots ofcultural differences historical about Distance. Power always Assumptions are in but the remain they quiteplausible.In other givenexamples speculative in thecourseofhistory. hidden remain cases they with are statistically correlated a scoreson thefivedimensions The country Forexample, PowerDistanceis cordataaboutthecountries. ofother multitude and with income with theuse of violencein domestic related inequality politics with national wealth is correlated Individualism in a country. (PerCapitaGross from one generation between social classes and with National Product) mobility theshare oftheir with GrossNais correlated tothenext. negatively Masculinity countries ofthewealthy that Product tional spendon development governments is associated with Avoidance Roman World. to theThird assistance Uncertainty in developed countries forcitizens to thelegal obligation and with Catholicism 14 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin PersonnelManagement

cards.LongTerm Orientation is correlated with national economic identity carry the 25 that what led to the economic success during past years, showing growth in thisperiod is their oftheEastAsianeconomies cultural stress on populations' valuesofthrift andperseverance. thefuture-oriented

National Cultures and the Functioning of Organizations

Organization Structure

ofa country affects itsparents The national culture anditschildren, and teachers, and labor union leaders and and students, members, politicians citizens, journalists and subordinates. Therefore in readers, managers management practices a country andwhat works inonecountry areculturally doesnotnecessarily work dependent, in another. However notonlythemanagers andsubordinates arehuman andchilculture: also themanagement thepeoplewhowrote dren oftheir andstill teachers, andcreate write theories are human and constrained management concepts, bythe in cultural environmentwhich know. Suchtheories they grewup andwhich they further be appliedin another and concepts cannot without ifthey proof country; areapplicable at all,itis often considerable onlyafter adaptation. of organizations is primarily The structuring influenced by thetwodimenAvoidance. Thisis becauseorganizing sionsofPowerDistanceandUncertainty theanswering oftwoquestions: havethepower (1) whoshould alwaysdemands will be followed to decidewhat?and (2) whatrulesor procedures to attain the ends?The answer to thefirst is influenced desired norms of question bycultural to thesecondquestion, PowerDistance;theanswer cultural norms about Unby andMasculinity Avoidance. Individualism affect thefunctioncertainty primarily of the within the Term Orientation affects the organizations. Long ing people oforganizations. economic performance intothe structures oforganizations Research carried outbyBritish reformal in the 1960s and early from theUniversity of Astonin Birmingham searchers Aston studies: concluded that 1970s(the thetwoma1976)already Pugh/Hickson of organizations differ are concentration alongwhichstructures jor dimensions The first is affected andstructuring ofactivities. ofauthority byPowerDistance, Avoidance. PowerDistanceand Uncertainty thesecondby Uncertainty Avoidtheinformal, mental measure of the anceindices subjective programming people thesevarysystematically a country. The factthat between countries within exstructures of organizations also varybetween countries: plainswhytheformal serveto meetinformal cultural needs. formal structures in implicit modelsof organizations wereproven Differences forthecase of and Britain a Great INSEAD business students France, by study Germany, among mirvol. 38 SpecialIssue 1998/2 15

Geert Hofstede

in Fontainebleau, a case France(Hofstede 1991,p. 140 et seq.). In dealingwith with of from a French conflict, students, study organizational country coming andstrong treated theorganization Avoidance, largePowerDistance Uncertainty likea pyramid theauthority and measures toconcentrate ofpeopleandadvocated also structure theactivities. with from a UncerGermans, country strong coming Avoidance butsmallPowerDistance, treated theorganization as a welltainty oiled machine and wanted without the to structure theactivities concentrating British students witha national culture characterized authority. by smallPower Distanceand weak Uncertainty treated theorganization as a village Avoidance market and advocated activities neither norstructuring concentrating authority butdeveloping themanagers' were skills and all of them dealing negotiation with thesamecase study. do conOther things beingequal,French organizations centrate andpeopleinBritGerman onesdo needmore more, structure, authority ishonesdo believemorein resolving ad hoc (Mauriceet al. 1980). A problems fourth is weakUncertainty Avoidance, combination, largePowerDistancewith in Asia andAfrica found as an andleadsto an implicit modelofan organization in which theowner-manager is theomnipotent (extended) family, (grand)father.
Motivation

The PDxUA mixalso affects themotivation within of employees organization. et al. that with a posthe work situation contains elements (1959) argued Herzberg itivemotivation and elements witha negative (the real motivators), potential Themotivators werethework itself, achievement, (thehygiene factors). potential intrinsic and advancement. These are often labeled recognition, responsibility, elements ofthe The in order toprewhich had to be factors, job. hygiene present vent^motivationbutcouldnotmotivate were company policy by themselves, and administration, eleand working conditions: extrinsic supervision, salary, ments ofthe assumed thisdistinction tobe a universal characterisjob. Herzberg ticofhuman motivation. tohimitis thtjobcontent which makes According peonot the context. act, ple job theissueofhuman motivation was raisedbySigmund Longbefore Herzberg Freud(1856-1939),one ofthefounding Acfathers ofpresent-day psychology. toFreud we areimpelled toactbyunconscious he forces inside us which cording calls ourid. Ourconscious of our tries to control these ourselves, conception ego forces. The ego in itsturn is influenced our byan inner pilot, againunconscious, The criticizes the feeland acts of the and causes superego. superego thoughts ego andanxiety whentheego is felt to be giving intotheid. The superingsofguilt in theyoung oftheparents. child, ego is developed mainly bytheinfluence Freud was an Austrian andhe conceived hisideasintheAustrian intellectual environment of his days.Austria in thePDxUA matrix takesan extreme posi16 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

Avoidance. The latter stands tion:smallPowerDistancebutstrong Uncertainty forpsychological needforrules;theformer fora strong indepenpsychological theserules.The superego boss to enforce can be a flesh-and-blood dencefrom the individual who controls selfas an interiorized boss/father, through interpreted In Austria and other small UA like PD, strong countries, feelings. guilt imposed ofwhatHerzberg calledcompany rulesas part policyand administraGermany, can be realmotivators. notbe seenas hygiene; tionshould they are large, should notbe In a similar supervision way,whenPowerDistances In largePD countries, on more factor. seen as a hygienic dependence powerful Whenin addition Uncerpeopleis a basic needwhichcan be a real motivator. themotivator is theboss as in mostLatincountries, is strong, Avoidance tainty WhenUA is weaker, as in Asian inthesenseoftheformally superior. appointed be labeledthemaster. Themasshould rather themotivator andAfrican countries, is basedon tradition oftheformer and thepower from theboss in that terdiffers on formal more than charisma position. of motivation is showsthat therefore A cultural Herzberg's theory analysis theories itreflects theculture ofthe likeall management constrained; culturally The sameholdsfor aninwhich itsauthor environment grew up anddidresearch. In human needs. Maslow's (1970) hierarchy of motivation: other U.S. theory of need. this is seen as the Maslow'shierarchy However, supreme self-actualization overthegroup. In colinwhich theselfprevails an individualist assumes culture, willrather be thesupreme need.Maswith thegroup lectivist cultures, harmony in This assumesa masculine overbelongingness. low also putsesteem culture; esteem as a motivator. will over feminine cultures, belongingness prevail is McClelland's (1961) motivation constrained A third theory culturally forwhichhe found a that countries McClellandpredicted motive. achievement This show faster economic would motive achievement growth. prestronger that McClelland's Hof stede didnot cometrue. diction ( 1980,pp. 170- 171)showed Avoidance Masweak to motive achievement Uncertainty plusstrong corresponds in in all Anglocountries. found a combination However, theyearsfolculinity; Avoidance countries like somestronger McClelland'sstudy Uncertainty lowing than the countries. McClelfaster and Anglo economically grew Japan Germany to hishomesociety a culture landpresented (theUSA) as a unipattern specific versalnorm.
Performance Appraisal and MBO

intheNorth American andWest arerecommended Performance systems appraisal that will literature. Theyassume employees' performance management European feedback aboutwhattheir receivedirect iftheemployees be improved superior in cultures. which ofthem, thinks However, maywellbe thecase inindividualist mlrvol. 38 SpecialIssue 1998/2 17

Geert Hofstede

collectivist is expected countries suchdirect which feedback the harmony destroys to govern It cause damageto the interpersonal irreparable relationships. may In and ruin his or her to the face employee's organization. suchcultures, loyalty be all shouldrather and ThirdWorldcountries, feedback including East-Asian orvia an interfor thewithdrawing ofa favor, givenindirectly, example through trusted andemployee. mediary person bybothsuperior inthe was developed as a management Management byObjectives technique USA. Under abouttheir a system ofMBO, subordinates haveto negotiate objectiveswith their environment The system therefore assumesa cultural superiors. in which issuescan be settled andrules, rather than by negotiation by authority whichmeansa medium to low PowerDistanceand a nottoo highUncertainty In a largePowerDistanceenvironment Avoidance. subordinates and superiors willbe unabletofunction inthewaysthesystem In a Uncerprescribes. stronger formal structure Avoidance environment the needs a more elaborate tainty system with norms andexamples; thisis thecase in Germany.
Strategic Management

as a concept has also beendevelopedin theUSA. It asStrategic management sumesa weak Uncertainty in whichdeviant Avoidance environment, strategic ideas are encouraged. in with a Uncerit is countries stronger Although taught folare like or its recommendations Avoidance, Germany France, rarely tainty lowedthere, in role to remain because thesecultures itis seenas topmanagers' in dailyoperations involved 1980). (Horovitz
Humanization of Work

Thisis a general to indifferent countries term for a number ofapproaches trying makework thepeoplewhodo it.In theUSA moreinteresting andrewarding for form ofhumanizawhich is a masculine andindividualist theprevailing society, intrinsic tionof workhas beenjob enrichment: individual tasks more giving form In Swedenwhich theprevailing content. is feminine andless individualist, exhas beentheforming in whichmembers of semi-autonomous workgroups, In Germany tasksandhelpeachother. andGerman Switzerland change speaking theintroduction offlexibleworking hourshas been a popular way of adapting in thejob to theworker. Flexibleworking hours havenever becomeas common can be understood other their inGerman-speaking countries countries; popularity of responsibility of a smallPowerDistance(acceptance by by thecombination of theworker) witha relatively Avoidance (internalization strong Uncertainty rules). 18 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

National Cultures: Convergence or Divergence?

in themodern worldbecomemoresimilar? Do national cultures The evidence taken from thelevelofpractices: citedis usually peopledressthesame,buythe anduse thesamefashionable words sameproducts, see thesame (symbols), they the TV showsandmotion same andleisure (heroes), pictures they perform sports These rather manifestations of culture activities are some(rituals). superficial mistaken for all there levelofvalues, times which moreis; thedeeper, underlying themeaning to peopleoftheir is overlooked. overdetermine practices, Valuedifferences between nations described centuries byauthors ago arestill in of close contacts. at continued Studies the values levelcontoday, spite present IBM to showimpressive differences after the studies tinue from nations; among is also thecase for theEuropean around 1970(Hofstede ValueSystems 1980)this et al. 1993).The onlyconvergence is on the 1986,Ester Study (Harding/Phillips that became aremoving dimension: countries richer towards individualism greater butevenherepre-existing differences between countries survive. individualism, havebecomericher than Americans andthere is evidence on average of Japanese in Japan, of individualism buttraditional elements of Japanese an increase coloforganizing is affected survive as well.As theprocess cullectivism bynational in the structure and thenationality of tural values, component functioning organtodisappear for thedecadesorevencenturies tocome.Interizations is unlikely will continue to have to take this intoaccount. national component organizations

Dimensions of Organization Cultures

butfocussing onorganization A research similar totheIBM studies rather project was carried outbyIRIC (theInstitute for Research onInternational cultures than inthe1980s(Hofstede theNetherlands) et al. 1990).Qualcultural Cooperation, intwenty work datawerecollected orparts itative andquantitative organizations in theNetherlands andDenmark. The units studied varied from oforganizations As to two mentioned a toy above, company municipal policecorps. manufacturing in practices units ritfound thisstudy heroes, among (symbols, largedifferences in values,beyond thosedue to suchbasicfacts differences uals) butonlymodest andage group. as nationality, education, gender, allowedto describe thelarger ofthevariety dimensions Six independent part Thesesixdimensions canbe usedas a framework inorganization todepractices. but their research baseintwenty units scribe from twocouncultures, organization toconsider them as universally valid.Fordescribing tries is toonarrow organizamirvol. 38 SpecialIssue 1998/2 19

Geert Hofstede Table 2. Manifestations in Organization at theWork Place of Differences Culture 1. Processoriented risks Peopleavoidtaking little effort Peoplespend Each dayis thesame 2. Joboriented Pressure for getting job done decisions Important byindividuals interested Organization only in work peopledo 3. Professional Think ahead years life Employees' private is considered their business Onlycompetence playsa role inrecruiting 4. Opensystem andpeopletransparent Organization to newcomers andoutsiders Almost fits anyone intotheorganization New employees needonlya fewdays tofeelat home 5. Tight control costconscious Everybody times Meeting kept punctually Lotsofjokes about job andorganization 6. Pragmatic on meeting needs Emphasis ofcustomers Results more important than procedures in matters notdogmatic Pragmatic, ofethics Results oriented in unfamiliar situations Comfortable effort Peoplespendmaximal newchallenges Each daypresents oriented Employee Attention to personal problems decisions Important bygroups with welfare concerned Organization andtheir families ofemployees Parochial farahead Do notthink coverbehaviour Norms oforganization onjob andat home socialclass andschool Family, playa roleinrecruiting Closed system andpeopleclosed Organization evento insiders andsecretive, specialpeople Onlyvery fit intotheorganization a year needmore than New employees to feelat home Loose control costconscious Nobody times onlykept approximately Meeting about job Alwaysserious andorganization Normative on correctly Emphasis following procedures more Correct important procedures than results ofethics evenat expense Highstandard ofresults

20

mirvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin Personnel Management

in other in other oforganizations, countries and/or additional tioncultures types or someofthesix maybe less useful. dimensions The dimenmaybe necessary cultures found are listedin Table 2, together with sionsoforganization someof are: manifest themselves. thewaysin which they They 1. Process-oriented versusresults-oriented cultures. The former are domithe latter a nated technical and bureaucratic common concern for routines, by by Thisdimension was associated with theculture's of outcomes. degree homogein results-oriented their in aboutthe units, everybody perceived neity: practices same way; in process-oriented there werevastdifferences in perception units, oftheunit. different levelsandparts The degree ofhomogeneity ofa culamong is a measure ofitsstrength: thestudy confirmed that ture cultures are more strong oriented than weakones,andvice versa(Peters/Waterman results 1982). 2. Joboriented versus cultures. Theformer assume employee-oriented responfortheemployees' and nothing more;employeejob performance only, sibility cultures assumea broad for their members' oriented At responsibility well-being. the distinction between the level of individual orientation and managers, job has been popularized orientation by Blake and Mouton'sManagerial employee showsthat orientation is part Grid(1964). The IRIC study job versus employee A unit'sposition ofa culture and not(only)a choiceforan individual manager. seemsto be largely theresult of historical on thisdimension like the factors, and the or in of its absence its recent of founder(s) presence philosophy history crises with collective economic layoffs. versus In theformer, the(usuallyhighly 3. Professional parochialcultures. with inthelatter, members their thememeducated) identify primarily profession; from the for which bersderive their work. identity organization they Sociology as local versus haslongknown this dimension thecontrast between cosmopolitan, andan external frame ofreference. an internal 4. Opensystems versus closedsystems cultures. Thisdimension refers to the common of internal and external and to the ease with which communication, style Thisdimension andnewcomers areadmitted. is theonlyone ofthesix outsiders is a systematic difference between Danish and Dutchunits.It forwhichthere is a societalcharacteristic seemsthat ofDenmark more organizational openness This showsthat thanof theNetherlands. cultures also contain eleorganization that reflect national culture differences. ments versus cultures. This dimension 5. Tightly deals with the looselycontrolled within of and the it is a function organization; partly degree formality punctuality banks andpharmaceutical oftheunit's canbe expected to technology: companies showtight research laboratories and advertising control, agenciesloose control; butevenwith thesametechnology, units stilldiffer on thisdimension. versus normative 6. Pragmatic cultures. Thelastdimension describes thepreor of with the in with environment,particular vailing way(flexible rigid) dealing mirvol. 38 SpecialIssue 1998/2 21

Geert Hofstede

thepragmatic towards customers. Unitssellingservices are likelyto be found thenormain of rules towards units involved the side, (flexible) application legal tive(rigid)side. This dimension measures thedegreeof customer orientation, which is a highly literature. popular topicin themanagement

Determinants of Organization Cultures

shows on thesixdimensions ofthescoring ofthetwenty units Inspection profiles loose vs. that dimensions vs.results, 1,3,5, and6 (process parochial professional, orof work the vs. tight, the and normative vs. pragmatic) are affected type by four In fact, these inwhich itoperates. ofmarket does,andbythetype ganization In Figure1 it was lodimensions culture. reflect thebusiness or industry partly catedin between theoccupational and theorganizational level,becausea given maintains and it also specific organizaindustry employs specific occupations 1 most manufactional for reasons. On dimension practices, logicalortraditional and and largeoffice unitsscoredprocessoriented; research/development turing with a traditional service units scored more results oriented. 3 units On dimension On scored units scored technology parochial; high-tech professional. dimension 5 units or services or (suchas pharmaceutidelivering precision risky products or unpredictable with innovative cals or money scored those transactions) tight, scoredon studied activities scoredloose. Surprisingly thetwocitypolicecorps and police personnel theloose side: theworkof a policeman is unpredictable, outtheir task.On dimension haveconsiderable in thewaythey discretion carry while markets scored 6 service units andthose in pragmatic operating competitive a monounder units involved in theimplementation oflaws andthoseoperating normative. polyscored the thedimension thus affect Whilethetaskandmarket environment scores, even ineachorganization's also identified distinctive elements IRIC study culture, in thesameindustry. Theserepresent to other competicompared organizations tiveadvantages ordisadvantages. 2 and 4 (employee vs. job and open vs. closed) The other twodimensions, facbasedon historical butrather seemtobe less constrained bytaskandmarket tors andrecent crises.In thecase ofdimenlikethephilosophy ofthefounder(s) above wasshown cultural environment sion4, openvs.closedsystem, the national to playan important role. dohave ofpractices, cultures aremainly they composed Although organization somediffered in theIRIC study a modest valuescomponent. The organizations dimension thecross-national resembles what onthree clusters ofvalues.Thefirst measAvoidance A cross-organizational ofUncertainty Avoidance. Uncertainty 22 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin PersonnelManagement

4 (openversus ureis correlated with dimension weakUncertainty closed),with on side Avoidance the of an communication A second climate. obviously open ofcross-organizational valuesbearssomeresemblance cluster toPower Distance. 1 (processversus It is correlated with dimension results Power oriented): larger Distancesare associatedwithprocessorientation and smaller ones with results orientation. Clusters ofcross-organizational valuedifferences associated with individualwerenotfound in theIRIC study. ism and masculinity in the which Questions cross-national the Individualism and dimensions study composed Masculinity a different in thecross-organizational formed labeledWork configuration study or weak):theimportance ofwork in one's totallifepattern. It Centrality (strong was correlated with dimension 3: parochial versus work professional. Obviously is stronger in professional In parochial cultures. cultures, centrality organization work homewith them. peopledo nottaketheir problems Fortheother three dimensions: valueswas found at 2, 5, and6, no linkwith all. Thesedimensions to which just describe practices peoplehavebeensocialized without their basic valuesbeinginvolved.

Managing (with) Organization Culture

In spiteof their nature cultures are hardto relatively superficial organization havedeveloped intocollective habits. them is a changebecausethey Changing taskwhichcannot be delegated. Some kindof culture assesstop management ment is usually which includes theidentificabyan independent party necessary, tionofdifferent subcultures which need different The top may quite approaches. choice is either to and use theexmajor management's strategic accept optimally culture or to try to changeit.If an attempt at changeis madeit should be isting A particular concern is whether themanpower analysis. preceded bya cost-benefit fora culture necessary changeis available. around an culture demands visibleleadership which Turning organization apto the as much as to their intellect. The leaderorleadfeelings peals employees' ersshouldassurethemselves of sufficient from at different support keypersons levelsin theorganization. can change thepractices Subsequently, they byadaptthe structure: its and tasks functions, locations, ing organization's departments, tasks with talents. After the the controls have structure, matching employee may to be changed, based on a decisionwhataspectsof thework haveto be coordinated howandbywhom at what level.Atthesametime itis usually to necessary certain torecruitment, and change personnel policiesrelated training, promotion. around a culture is nota one-shot atFinally, turning process.It takessustained mlrvol. 38 SpecialIssue 1998/2 23

Geert Hofstede

tention from forseveralyears,and new culture top management, persistence as well assessments be attained, tosee whether theintended have,indeed, changes as what other in occurred themeantime. changes In thecase of mergers is neededforidentifying andacquisitions a diagnosis thepotential Decisionson mergers areasofculture conflict between thepartners. arepart ofa aretraditionally madefrom a financial of view only:mergers point threats or a and seen as defense (real imaginary) big money powergame against theoperating Thosemaking thedecision problems imagine bycompetitors. rarely A diagnosis oftheculwhich ariseinside thenewly formed hybrid organizations. and tures or notto merge, involved shouldbe an input to thedecisionwhether the after thedecision hasbeenmade,itshould toa planfor be an input managing cullosses and so as to minimize friction unique preserve post-merger integration tural capital. butthey are not of an organization The six dimensions describe theculture is intrinsically noposition on oneofthesixdimensions goodorbad. prescriptive: forexcelPeters and Waterman as norms (1982) have presented eightmaxims in or bad lence.The results that what is oftheIRIC study depends good suggest that feature each case on where to go, and a cultural one wants theorganization is an assetforone purpose is unavoidably a liability foranother. Labelingposiis a matter of strategic tionson thedimension scales as moreor less desirable In particular thepopfrom one organization toanother. choice,andthiswillvary on dimension more ularstress on customer orientation 6) is pragmatic (becoming of the in services and relevant for manufacturing highly organizations engaged for or evenharmful custom madequality butmaybe unnecessary for, products, in a competitive themanufacturing of standard pricemarket. products example,

Managing Culture Differences in Multinationals

butalso indifferent countries Mostmultinational do notonly operate corporations Difdivisions. indifferent linesofbusiness oratleastindifferent product/market cultures. havedifferent ferent business linesand/or divisions often organization lineordivision, a business cultures within cross-national by Strong organization orin values differences can national common among offering practices, bridge valuesarewhat notcommon members. Common keepsmulganization practices, tinationals together. is structure thepurpose of an organization shouldfollowculture: Structure of a multinational, Forthedesignof thestructure thecoordination of activities. for eachbusiness to be answered have multibusiness three corporation, questions The in one business line unit business unit one (a quescountry). three represents 24 mlrvol. 38 SpecialIssue 1998/2

Think Locally, Act Globally CulturalConstraintsin PersonnelManagement

in-andoutputs oftheunit's should be coordinated tions are:(a) which from elseinthecorporation? andatwhat levelshould thecoordination where take (b) where and how or loose should the coordination be? In case there (c) tight place? every is a basic choicebetween coordination linesandalongbusialonggeographical is whether business know-how or national nesslines.The decisivefactor cultuis more crucial forthesuccessoftheoperation. ralknow-how area possiblesolution butthey arecostly, Matrix structures often a meaning of the and their actual raise more ranks, management doubling functioning may A singlestructural than itresolves. or business) principle problems (geographic ventures is unlikely to fitforan entire Joint further the corporation. complicate The optimal solution is nearly structure structuring problem. alwaysa patchwork that in somecases follows business and in others lines.This may geographical butit does followtheneedsof markets and business lack beauty, unitcultures. in within the environment which a should be matched corporation Variety operates will also changeovertime, with internal solutions variety. Optimal appropriate which so that theperiodic should be knows, reshufflings anylargeorganization seenas functional. Like all organizations, multinationals are heldtogether by people.The best moment on the structure ata given ofsuitable depends primarily availability peocrucial:(a) country business unitmanagers who ple. Two rolesare particularly form thelinkbetween theculture ofthebusiness andthecorporate culture unit, is usually affected oforigin ofthecorporation, which heavily bythenationality i.e. home or other and (b) corporate nationals diplomats, country impregnated with thecorporate from various culture, multilingual, occupational backgrounds, in livingand functioning in various and experienced cultures. foreign Theyare structures as liaisonpersons essential to makemultinational in thevarious work, or as temporary fornewventures. headoffices managers ofsuitable at moment is themain Theavailability task ofmulpeople theright This means tinational of future manapersonnel management. timely recruiting andcareer talent from different movesthrough transnationalities, gerial planned where thesepeoplewillabsorbthecorporate culture. fers Multinational personhaveto find their anddiversity in pernel departments waybetween uniformity Too much is unwarranted sonnel because mental uniformity policies. people's proarenotuniform. It leadstocorporatewidepoliciesbeingimposed on subgrams - oronlyreceive willnotwork sidiaries where from obedient but they lip service that is different and side,theassumption puzzledlocals.On theother everybody therefore knowbestandbe allowedto that alwaysshould peoplein subsidiaries too. In this their own is unwarranted case an is losttobuild ways, go opportunity with features which the a corporate culture unique and keep organization together itwith a distinctive andcompetitive psychological provide advantage. and takeovers within countries have a dubioussuccessrecord, but Mergers ventures areevenless likely cross-national to succeed.Theyhavetobridge both mirvol. 38 SpecialIssue 1998/2 25

Geert Hofstede

national and organization culture gaps. Even morethanin thecase of national into call a as an input for cultural ventures, they mapof theprospective partner thedecision on whether to or not. making merge

References
Blake, R. R./Mouton,J. S., The Managerial Grid, Houston: Gulf 1964. Ester,P./Halman,L./De Moor, R., The IndividualizingSociety: Value Change in Europe and North Press 1993. America, TilburgNeth: TilburgUniversity Harding,S. /Phillips,D., ContrastingValues in Western Europe, London: Macmillan 1986. B. B., The Motivationto Work, New York: Wiley 1959. Herzberg,F/Mausner, BVSnyderman, Hofstede,G., Culture's Consequences: InternationalDifferencesin Work-Related Values, Beverly Hofstede,G., Culturesand Organizations: Software oftheMind,London: McGraw Hill, 199 1; American edition New York: McGraw-Hill USA, 1997; German edition Lokales Denken, globales Handeln: Kulturen,Zusammenarbeitund Management, Munchen: Beck-dtv, 1997; also translated into Chinese, Danish, Dutch, Finnish,French,Japanese, Korean, Norwegian, Portuguese, Romanian, Spanish, Swedish. Hofstede,GVBond, M. H., The Confucius Connection: From Cultural Roots to Economic Growth, Hofstede,G./Neuijen,B./Ohayv,D. D ./Sanders,G., Measuring Organizational Cultures,AdminisHoppe, M. H., A Comparative Studyof CountryElites, Ph.D. thesis,Universityof NorthCarolina at Chapel Hill 1990. Horovitz,J. H., Top Management Control in Europe, London: Macmillan 1980. Maslow, A. H., Motivationand Personality,2nd edition,New York: Harper & Row 1970. Units:A Comin OrganizingManufacturing Maurice, M./Sorge,A./Warner, M., Societal Differences parison of France, West Germanyand Great Britain,Organization Studies, 1, 1980, pp. 59-86. McClelland, D. C, The AchievingSociety,Princeton:Van NostrandReinhold 1961. R. H., In Search of Excellence: Lessons fromAmerica's Best-Run CompaPeters,T. J./Waterman, nies, New York NY: Harper & Row 1982. Pugh, D. S./Hickson, D. J., Organizational Structurein its Context: The Aston Programme I, London: Saxon House 1976.

Hills: Sage 1980.

16,4, 1988,pp. 4-21. Organizational Dynamics,

trative ScienceQuarterly, 35, 1990,pp. 286-316.

26

mlrvol. 38 SpecialIssue 1998/2