Expanding the management staff to include people from other cultures living in their home environment requires sensitivity and plenty of research to accommodate the different values and principles these individuals may support. Cultures work in the same way as a persons DNA; although individuals may look the same on the outside, there are internal factors that make us all unique and different. What is appropriate here in the United States, may seem rude or outlandish in another area of the world. Let’s take a look at the different adjustments that will need to be made when attempting to accommodate a divorce management staff and how the Hofstede cultural dimensions might influence these managers’ decisions.
Dr. Geert Hofstede began his studies of culture and valuation in the late 1960s and early 1970s. He started small by studying his own patients in his psychology practice at IBM. He developed five dimensions to classify diverse cultures. Hofstede’s five Cultural Dimensions are power distance index, individualism, masculinity, uncertainty avoidance index, and long-term orientation (ITIM International, 2003). Over the years, there have been new revelations concerning dimensions used to classify cultural diversity such as the Schwartz Affective, Intellectual, and Egalitarian cultural classifications (Law, 2006).
The first dimension is called the Distance Power Index (DPI) and is relative to individual equality amongst groups of other individuals. More accurately, DPI measures less powerful members of the family or corporate structures extent of acceptance for inequality (Clearly Cultural, 2008). The world average for this particular dimension is 55. In Canada and Australia, we will see comparatively low scores of 39 and 36 respectively. In contrast, China’s PDI score is close to 80. This has little to no affect on managers hired in Canada and Australia because the scoring is in close proximity to U.S. scoring of 40. However, for PM Co. this means that individual employees or managers hired in China will not be granted advancement based on merit but rather what society has dictated for them (ITIM International, 2003).
The second dimension we must look at in Hofstede’s studies is the area of Individualism (IDV). High scores in this dimension reflect a strong sense of individual independence and a responsibility to ones own actions. Canada (80) and Australia (90) share similarly high scoring as their culture represents one which values individualism and personal accountability. This is very similar to the scoring of the U.S. (91) which holds the highest score in the world for IDV. China’s scoring on the other hand is very low (20). This explains the countries Collectivist society or one that rewards community and family devotion on the basis of trust alone. In other words, the Chinese culture supports individuals who take responsibility for the actions of their close friends, family, or co-workers (ITIM International, 2003). For PM Co., these extremes could produce positive affects for the company or become detrimental to its success. In Canada and Australia, we must be mindful of managers that would work for the better of themselves alone with no regard to the company. On the other extreme, in China we must be wary of managers constructing an internal advocacy rather than adhering to the hiring standards set by the company.
In Hofstede’s cultural dimensions, Masculinity (MAS) is the next area of study. When Hofstede began his studies on this dimension he discovered two important aspects. First, among varying societies the values of women were relatively the same: meaning levels of modesty, caring, and sensitivity were relatively similar. Second, he revealed that men’s values varied quite a bit from the assertive and competitive qualities to a caring and sensitive manner similar to the female’s values. The world average in this dimension is 50. The only country in our venture to share this average is Canada (50). This means there is a relative balance between feminine and masculine qualities found in this country (ITIM International, 2003). China (66) and Australia (61) scored relatively closely to the U.S. (62). This means that the levels of materialism, strength, power, material success, and self-centeredness will be higher and very similar to those aspects seen in our home country (Clearly Cultural, 2008).
In the fourth dimension we measure the Uncertainty Avoidance Index (UAI). This dimension shows the country’s acceptance of uncertainty versus their overall need for planning and structure. The world average in this dimension is 64 (ITIM International, 2003). Unfortunately, there is no correlation between the world average and the UAI scoring of the U.S. (46) and our chosen countries for international expansion, China (40), Australia (51), and Canada (45). These numbers are relatively low in comparison to other counties where intricate planning is necessary to ensure uncertainty is avoided carefully. Rules and regulations would be more prominent in the higher scoring countries (Clearly Cultural, 2008). For PM Co., lower UAI scores will indicate a lower regard for the rules that are set in place by the company. There is a higher turnover rate in employment within these countries meaning these people are much more mobile and ready to change on their own accord. On the other hand, organizational change is more readily embraced by cultures that are not ruled by constant rules and guidelines. Therefore, implementation of changes will be more readily accepted in our countries of choice (Ball, McCulloch, Geringer, Minor & McNett, 2005, pg. 185).
In Gerrt Hofstede’s final cultural dimension we examine the countries preference for long or short term goals. This dimension is called Long-Term Orientation (LTO) and was unable to be deduced in Hofstede’s early studies. However, over time the differences in orientation between east and west thinking was revealed. Only 23 countries score on this dimension including Canada (23), Australia (31), China (118) and the U.S. (29). Canada and Australia share similar thinking with concerns to personal stability, respect for traditions, and reciprocation of gift giving and receiving. These are qualities of westernized thinking. On the other hand, China has a very high score for LTO meaning their culture is more persistent and thrifty. The Chinese have a sense of shame that is shared amongst a group of people and relationships are viewed by order of status (Clearly Cultural, 2008).
PDIIDVMASUAILTONational Avg.5543506445U.S.4091624629CANADA3980504523AUSTRALIA3690615131CHINA80206640118
After reviewing the scoring differences amongst our choices for international expansion, PM Co. has noticed that there is a pattern and correlation between two of these counties, Canada and Australia, and that of our home country, the U.S. What this means for PM Co. is that interpretation these foreign cultures might be simpler than the interpretation required to accommodate our final country of choice, China. Chinas scoring patterns are much different and require that business personnel be students of culture as we invest in this project. Generalizations and assumption-based decisions are not regarded highly amongst foreign countries because it does not give consideration to the substantial differences of opinion that might be present.
As the Vice-President of International Sales, I plan to implement organizational changes to help to manage the diverse team of managers that will be working for PM Co. A large part of these changes are associated with the customization and sensitivity that is needed when entering foreign environments. As we have seen in the Hofstede five cultural dimensions, China will be our most difficult region to penetrate since their scoring is very different than that of the U.S. In an effort to properly staff and manage a diverse management pool, diversity training is a must. Individuality is a popular culture concept amongst Canada and Australia. However, accommodating the Chinese need for collectivism should be accommodated. We will expect that the Chinese market will need to plan further out in their business plans because of their need for Long-Term Orientations. Finally, this diversity training will include pieces of information for managers to properly adjust to heavier rules and regulations instilled in this arm of the venture since the Chinese culture demands it. In China there is no standard for rewarding individuals of a company that are pro-active in their career advancement. This concept is traditional to an individualistic culture, which China is not. This means that we cannot expect our managers in China to make decisions for the company without contacting someone of authority first (Ball et al, 2005, pg 185).
PM Co. has no intention of sacrificing quality in any of these countries. Distance, culture and organizational change are all hurdles needing to be bounded before the project can be successful. To accommodate productivity in each country it is my suggestion that PM Co. establish an arm to the shipping department that handles exports to our international locations. This concept will be implemented in stages; first Canada, then Australia, and finally China. In the same order, PM Co. should plan to build a centralized production facility within these foreign countries. At no point will PM Co. export to multiple areas. What this means is that exporting to Australia cannot begin until the new production location is in place and self-producing in Canada. Partnering with the Human Resources Department and comparing notes on culture and diversity should help to facilitate this process.
In conclusion, when beginning to do business with people, businesses, or countries of different cultural backgrounds, we should not assume that cultural differences will be accepted and business will go on as planned because we are from the U.S. The proper process for entering environments that are unfamiliar requires PM Co. to educate its employees and management in cultural sensitivity. For PM Co. this might include special highlights on China’s unique cultural differences.
References:
Ball, D., McCulloch Jr., W., Geringer, J., Minor, M., and McNett, J. (2005) (11th ed.) International Business: The Challenge of Global Competition. McGraw-Hill.
Clearly Cultural. (2008) Cultural Dimensions. Retrieved March 8, 2008, fromhttp://www.clearlycultural.com/geert-hofstede-cultural-dimensions/power-distance-index/
CTU Online. (Ed.). (ca. 2008). Phase 2 Course Material [multimedia presentation]. Colorado Springs, CO: CTU Online. Retrieved March 3, 2008, from CTU Online, Virtual Campus, MGM355 International Business Practices: 0801B-01. Website: https://campus.ctuonline.edu/MainFrame.aspx?ContentFrame=/Classroom/course.aspx?Class=23719&tid;=39
Law, W. (2006) Information Resources Management: Global Changes. Idea Group Publishing: London, England.
ITIM International. (2003) Geert Hofstede™ Cultural Dimensions: Australia, Canada, China, and the United States. Retrieved March 6, 2008, from http://www.geert-hofstede.com/geert_hofstede_resources.shtml
