CROSS CULTURAL MANAGEMENT &

MODELS
An Understanding of
Culture & its Impact on
Business
Culture is a set of beliefs and values about
what is desirable and undesirable in a
community of people and a set of formal or
informal practices to support the values.
Acquired knowledge that people use to
interpret experience and generate social
behavior. This knowledge forms values,
creates attitudes, and influences behavior.
Priorities of Cultural
Values
 Components of Culture
social interactions among people; nuclear
family, extended family; reference groups
Social
technologies that Interaction language has
are used to two parts: the
produce, distribute, Material Life Language spoken and the
and consume silent language
goods and services
Components
of culture ideas and
Value System Aesthetics perceptions
that a culture
upholds in
values shape terms of
peoples norms beauty and
and standards Education Religion
good taste

communitys set of
One of the major vehicles beliefs that relate to a
to channel from one reality that cannot be
generation to the next verified empirically
 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 people
Implicit, basic understand how they
assumptions that guide
peoples behavior
should behave.
Inner layer: intangible,
helpful for problem-solving
and well interactions with
other people.
 Example of the cosmetics marketing which
varies greatly in consumer use.
Germans want advertising that is factual and
rational; they fear being manipulated by the hidden
persuader. The typical German spot features the
standard family of two parents, two children, and
grandmother.
The French avoid reasoning or logic. Their
advertising is predominantly emotional, dramatic,
and symbolic. Spots are viewed as cultural events or
art for the sake of money and are reviewed as if they
were literature or films.
The British value laughter above all else. The typical
broad, self-depreciating British commercial amuses
by mocking both the advertiser and consumer.
How Culture Affects
Managerial Approaches
Centralized vs. Decentralized Decision
Making:
In some societies, top managers make all
important organizational decisions.
In others, these decisions are diffused
throughout the enterprise, and middle- and
lower-level managers actively participate in,
and make, key decisions.
How Culture Affects
Managerial Approaches
Safety vs. Risk:
In some societies, organizational decision
makers are risk averse and have great difficulty
with conditions of uncertainty.
In others, risk taking is encouraged, and
decision making under uncertainty is common.
How Culture Affects
Managerial Approaches
Individual vs. Group Rewards:
In some countries, personnel who do
outstanding work are given individual rewards
in the form of bonuses and commissions.
In others, cultural norms require group
rewards, and individual rewards are frowned
upon.
How Culture Affects
Managerial Approaches
Informal Procedures vs. Formal Procedures:
In some societies, much is accomplished
through informal means.
In others, formal procedures are set forth and
followed rigidly.
How Culture Affects
Managerial Approaches
High Organizational Loyalty vs. Low
Organizational Loyalty
In some societies, people identify very strongly
with their organization or employer.
In others, people identify with their
occupational group, such as engineer or
mechanic.
How Culture Affects
Managerial Approaches
Cooperation vs. Competition
Some societies encourage cooperation between
their people.
Others encourage competition between their
people.
How Culture Affects
Managerial Approaches
Short-term vs. Long-term Horizons
Some culture focus most heavily on short-term
horizons, such as short-range goals of profit and
efficiency.
Others are more interested in long-range goals,
such as market share and technologic
developments.
How Culture Affects
Managerial Approaches
Stability vs. Innovation
The culture of some countries encourages
stability and resistance to change.
The culture of others puts high value on
innovation and change.
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HOFSTEDES CULTURAL
DIMENSIONS
. It is based upon a study of 100,000 IBM employees
who work in IBM divisions throughout the world.
Hofstedes survey revealed five underlying
dimensions of culture: Power Distance, Uncertainty
Avoidance, Individualism/Collectivism, and
Masculinity/Femininity, long term vs short term
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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
EDWARD T HALL STUDY
Edward T. Halls concept of polychronic versus
monochronic time orientation describes how
cultures structure their time. The monochronic
time concept follows the notion of one thing
at a time, while the polychronic concept
focuses on multiple tasks being handled at
one time, and time is subordinate to
interpersonal relations.
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GLOBE- INTEGRATING
CULTURE AND
GLOBAL LEADERSHIP AND ORGANISATIONAL
MANAGEMENT
BEHAVIOUR EFFECTIVENESS
A Multi country study and evaluation of
cultural attributes and leadership behaviors
among more than 17000 managers from 825
organizations in 62 countries.
 Hierarchical Power Distribution Egalitarian

Individualistic Social Relationships Collectivistic

Mastery Environment Relationships Harmony

Monochronic Time/work patterns Polychronic

Uncertainty and social Relationship-

Rule-based based
control
 Power distribution
Hierarchical
Centralized.
Belief that power should be
distributed hierarchically across
society.
Belief in ascribed or inherited power
with ultimate authority residing in
institutions.
Emphasis on organizing vertically and
autocratic or centralized decision-
making.
Emphasis on who is in charge.
Acceptance of authority; reluctance
to question authority.
Egalitarian
Decentralized.
Belief that power should be
distributed relatively equally across
society.
Belief in shared or elected power with
ultimate authority residing in the
people.
Emphasis on organizing horizontally
and participatory or decentralized
decision-making.
Emphasis on who is best qualified.
Rejection or skepticism of authority;
willingness to question authority.
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Social relationships
Individualistic
Person-centered.
Belief that people achieve self-identity
through individual accomplishment.
Focus on accomplishing individual
goals.
Sanctions reinforce independence
and personal responsibility.
Contract-based agreements.
Tendency toward low-context (direct,
frank) communication and individual
decision-making.
Collectivistic
Group-centered.
Belief that people achieve self-identity
through group membership.
Preference for preserving social
harmony over individual rights.
Focus on accomplishing group goals.
Sanctions reinforce conformity to
group norms.
Relationship-based agreements.
Tendency toward high-context (subtle,
indirect) communication and group or
participative decision-making.
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Environmental relationships
Mastery-oriented
Dominance over nature.
Focus on changing or controlling ones
natural and social environment.
Achievement valued over relationships.
Emphasis on competition in the pursuit
of personal or group goals.
Embraces change and unquestioned
innovation.
Emphasis on material possessions as
symbols of achievement.
Emphasis on assertive, proactive,
masculine approach.
Preference for performance-based
extrinsic rewards.
Harmony-oriented
Accommodation with nature.
Focus on living in harmony with nature
and adjusting to the natural and social
environment.
Relationships valued over achievement.
Emphasis on social progress, quality of
life, and the welfare of others.
Defends traditions; skepticism towards
change.
Emphasis on economy, harmony, and
modesty.
Emphasis on passive, reactive,
feminine approach.
Preference for seniority-based intrinsic
rewards.
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Time and work patterns
Monochronic
Linear.
Sequential attention to individual tasks.
Single-minded approach to work,
planning, and implementation.
Precise concept of time; punctual.
Job-centered; commitment to the job and
often to the organization.
Separation of work and personal life.
Approach to work is focused and
impatient.
Polychronic
Non-linear.
Simultaneous attention to multiple tasks.
Interactive approach to work, planning,
and implementation.
Flexible concept of time; often late.
People-centered; commitment to people
and human relationships.
Integration of work and personal life.
Approach to work is at times unfocused
and patient.
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Uncertainty and social control
Rule-based
Individual behavior should be largely
regulated by rules, laws, formal
policies, standard operating
procedures, and social norms that are
widely supported by societal members
and applied uniformly to everyone.
Emphasis on legal contracts and
meticulous record keeping.
Low tolerance for rule breaking.
Decisions based largely on objective
criteria (e.g., legal constraints, data,
policies).
Relationship-based
While rules and laws are important,
they often require flexibility in their
application or enforcement by influential
people (e.g., parents, peers, superiors,
government officials) or unique
circumstances.
Emphasis on interpersonal
relationships and trust; less emphasis
on record keeping.
Moderate tolerance for rule breaking.
Decisions often based on subjective
criteria (e.g., hunches, personal
connections).
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