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TOPIC 4
CROSS-CULTURAL BUSINESS
SCHOOL OF BUSINESS AND MANAGEMENT
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KEY LEARNING OBJECTIVES

Outline Trompenaars' 7 Cultural Dimensions

Study and apply Hofstede’s research on national

culture
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EXHIBIT 3.2 McDonald's Menu Items Around the World

Source: mipstudio/Shulierstock

Wine is a menu favorite Ebi Burger-made of shrimp

France Japan
McSpaghetti - spaghetti noodles My Poutine- French fries topped
Canada with gravy and cheese curds
in a sweet tomato-based sauce Philippines

Paneer Salsa Wrap - cottage cheese wrap,

McHotdog Mega Breakfast- India
Japan cabbage, celery, with mayonnaise and salsa
hotdog with scrambled eggs
and ketchup

McArabia -grilled beef with spices, Morocco Recette Moutarde - burger in

lettuce, tomato, onion, garlic sauce, Saudi ciabatta bread, slathered in
in a pita wrap Arabia mustard

Norway
Bubur Ayam-chicken McLaks-sandwich made of grilled
Malaysia
porridge, a local favorite salmon and sour cream dill sauce
Germany Hong
Kong
Rice Burger-two patties of sticky rice
Beer is a beverage choice
of instead of buns
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His famous book, Riding the Waves

of Culture, introduces different
concepts of culture

TROMPENAARS'
SEVEN
DIMENSIONS

The Portrait of Mr. Alfonsus

Trompenaars, a Dutch organizational
theorist, management consultant, and
author in the field of cross-cultural
communication
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TROMPENAARS'
SEVEN DIMENSIONS

Universalism Individualism Neutral Specific Achievement Sequential Internal control

Do we Do we
make a clear Do we Do we believe that we can
What is most Do we Do we hide separation of have to prove do things one control our
important - function as an our emotions work and private environment, or do
ourselves to receive at a time or
rules or individual or in or do we lives or do we see we believe that the
status, or is status several things
relationships a group? display them? them as more environment
given to us? at once?
? integrated? controls us?

Particularism Collectivism Emotional Diffuse Ascription Synchronic External control

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UNIVERSALISM VS. PARTICULARISM

• Relationships dictate our actions
• High particularism countries often modify
contracts (e.g. China, South Korea)

PARTICULARISM
• Rules should be applied everywhere
• High universalism countries: business
contracts are important (e.g. US, UK,
Netherlands)

UNIVERSALISM
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INDIVIDUALISM VS. COMMUNITARIANISM • People regard themselves as part of group

• Countries with high communitarianism: stress
group-related issues; committee decisions;
joint responsibility (e.g. Korea, Japan)

• People regard themselves as individuals COMMUNITARIANISM

• Countries with high individualism: stress
individual freedom; assume individual
responsibility (e.g. U.S., Switzerland, U.K.)

INDIVIDUALISM
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INDIVIDUALISM VS. COMMUNITARIANISM

A
'It is obvious that if one has as much freedom
as possible and the maximum opportunity to
develop oneself, the quality of one's life would
improve as a result.'

B
‘If the individual is continuously taking care of
his or her fellows then the quality of life for us all
will improve, even if it obstructs individual
freedom and individual development’
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• Emotions are expressed openly and

NEUTRAL VS. EMOTIONAL naturally
• High emotion cultures: people smile a lot,
talk loudly, cry in public (e.g. Mexico,
Spain, Arab countries)

• Culture in which emotions are not shown EMOTIONAL

in public
• High neutral countries: people act coolly
and maintain composure (e.g. Japan &
U.K.)

NEUTRAL
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NEUTRAL VS. EMOTIONAL

In Vietnamese society, it is considered
unprofessional to express emotions overtly.

A) Agree

B) Disagree
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SPECIFIC VS. DIFFUSE

High diffuse cultures: Work/private life -

closely linked
(e.g. Venezuela, China, Japan)

High specific cultures: strong separation DIFFUSE

between work and personal life
(e.g. Austria, U.K., U.S.)

SPECIFIC
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SPECIFIC VS. DIFFUSE

Your boss asks you to paint his house

a) Yes, I'll help you paint your house.

b) No, I'll not help you paint your house
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ACHIEVEMENT VS. ASCRIPTION

ACHIEVEMENT
CULTURE
What You Do
ASCRIPTION
CULTURE
ACHIEVEMENT ASCRIPTION Who You Are

CULTURE CULTURE

Status based on how Status based on who or

well you perform tasks what person is: family,
(e.g. Norway, UK, age, education, gender
Sweden) (e.g. Venezuela, China,
Indonesia)
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ACHIEVEMENT VS. ASCRIPTION

"The most important thing in life is to act as really

suits you, even if you don't get things done"

a)Agree

b)Disagree
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TIME
ORIENTATION

- Sequential: only one activity at a time;

appointments kept strictly, follow plans as laid out
(e.g. U.S.)
- Synchronous: multi-task, appointments are
approximate, schedules not as important as
relationships (e.g. China, Mexico)
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TIME ORIENTATION PAST

USA UK SPA

PRESENT
JPN FRA GER

FURURE
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INTERNAL VS. EXTERNAL CONTROL

Outer-directed people believe in letting

things take own course and do not try to
influence events or outcome (Fatalistic)

Inner-directed people believe they can (e.g. China & other Asian countries)

control events or outcomes (e.g. UK, USA,

Switzerland)
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INTERNAL VS. EXTERNAL CONTROL

A. What happens to me is my own doing.

B. Sometimes I feel that I do not have

enough control over the direction my life is
taking.
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HOFSTEDE'S RESEARCH ON
NATIONAL CULTURE
Individualism versus Describes whether a person functions primarily as an individual or as part of a
collectivism group.

Uncertainty avoidance The extent to which people can tolerate risk and uncertainty in their lives

Describes how a society deals with the inequalities in power that exist among
Power distance
people.

Refers to a society's orientation based on traditional male and female values. Masculine cultures tend
Masculinity versus to value competitiveness, assertiveness, ambition, and the accumulation of wealth. Feminine
femininity cultures emphasize nurturing roles, interdependence among people, and taking care of less
fortunate people.
Long-term versus
short-term Refers to the degree to which people and organizations defer pleasure and gratification to achieve
orientation long-term success.

Indulgence versus
The extent to which people try to control their desires and impulses.
restraint
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HOFSTEDE’S RESEARCH ON NATIONAL CULTURE

Hofstede's Cultural Dimensions

Power Distance Index (PDI)

Low: People strive to equalize the distribution which everybody
High: Acceptance of a hierarchical order in which needs no
further justification.
has a place and of power and demand justification for PDI
inequalities of power.
Individualism versus Collectivism (IDV)
Individualism: As a preference for a loosely-knit social framework
Collectivism: Tightly-knit framework in society. IDV
Masculinity versus Femininity (MAS)
Masculinity: Preference in society for achievement, heroism, Femininity: Stands for a preference for cooperation, modesty,
assertiveness and material rewards for success. caring for the weak and MA quality of life. MAS
Uncertainty Avoidance Index (UAI)
High: Maintains rigid codes of belief and behavior and are Low: Societies maintain a more relaxed attitude in which practice
intolerant of unorthodox behavior and ideas. counts more than principles. UAI
Long Term Orientation versus Short Term Normative Orientation (LTO)
High: Pragmatic approach, they encourage thrift and efforts in Low: Societies prefer to maintain time-honored ao traditions and
modern education as a way to prepare for the future. norms while viewing societal change with suspicion. LTO
Indulgence versus Restraint (IND)
Indulgence: Societies that allow relatively free gratification of basic
Restraint: Societies that suppress gratification of needs and
and natural human drives related to enjoying life and having fun.
regulates it by means of strict social norms. IND
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HOW TO INTERPRET RESULTS

Brazil’s score is as follows:
69 (PDI), 38 (IDV), 76 (UAI), 49 (MAS), 44 (LTO), 59 (IVR)

China’s score is as follows:

80 (PDI), 20 (IDV), 30 (UAI), 66 (MAS), 87 (LTO), 24 (IVR)

Remember Scores Keep Changing.

Scores are available from:
https://www.hofstede-insights.com/country
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Activity
Each group choose a country: Thailand, Japan, the Netherlands, USA,
Australia

Take a look at the score of each dimension for the chosen country

Present each dimension of each country and give an example.

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CRITICISM OF HOFSTEDE

Does it capture national, organizational or professional

culture?

Does it ignore sub-cultures?

Can cultural values and behaviours found in a society be

generalized?
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CULTURE'S EFFECTS ON INTERNATIONAL BUSINESS

Interacting with
current and potential Developing products and services
customers from abroad

Screening and selecting foreign Negotiating and structuring

distributors and other partners international business ventures

Culture
Preparing advertising and Communicating and interacting
promotional materials with foreign business partners

Preparing for international trade Managing employees

fairs and exhibitions
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CONCLUSION

Cultural differences mean that there is no one best

way to manage.

The key to cross-cultural success is to develop an

understanding of, and a deep respect for cultural
differences.
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NEXT WEEK:
• WEEK 6: INTERNATIONALIZATION
STRATEGIES (PART 1)
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REFERENCE LIST • Babel Group n.d, "Trompenaars' Seven Dimensions", Babel Monthly Newsletter,
<http://www.babelgroup.co.uk/uimages/File/babel_the_7_dimensions_of_cul ture.pdf>
• Barkema, HG and Vermeulen, F 1998, "International Expansion Through Start-up or Acquisition: A
Learning Perspective" Academy of Management Journal, vol. 41, pp. 7-26.
• Brouthers, KD and Brouthers, LE 2000, "Acquisition or Greenfield Start-up? Institutional, Cultural and
Transaction Cost Influences", Strategic Management Journal, pp. 89-97. - Desjardins, J 2019, 'Mapped:
The World's Largest Exporters/Importers in 2018', Visualcapitalist,
<https://www.visualcapitalist.com/mapped-worlds-largest-exporters-in-2018/>
• Harrison, L & Huntington, S (ed) 2000, Culture Matters: How Values Shape Human Progress, Basic
Books, New York.
• Hennart, JF and Park, YR 1993, "Greenfield vs. acquisition: The strategy of Japanese investors in the
United States", Management Science, vol. 39, no.9, pp. 1054-1070.
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• Hennart, JF and Reddy, S 1997, "The Choice Between Mergers/Acquisitions and Joint Ventures: The
REFERENCE LIST
Case of Japanese Investors in the United States", Strategic Management Journal, vol. 18, pp. 1-12.
• Kogut, B& Singh, H 1988, "The effect of national culture on the choice of entry mode", Journal of
International Business Studies, 19: 411-432.
• Rogers, E, Hart, W & Mike, Y 2002, "Edward T. Hall and The History of Intercultural Communication:
The United States and Japan", Keio Communication Review.
• Schein, EH 2004, Organizational Culture and Leadership, San Francisco: Jossey-Bass.
• Trompenaars, F & Hampden-Turner, C, 1998, "Riding the Waves of Culture: Understanding Cultural
Diversity", Global Business, McGraw Hill, New York.
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