Cross-Cultural Issues in Ihrm

CROSS-CULTURAL ISSUES IN
IHRM
Chapter 2
For use with International Human Resource Management 6e ISBN-10: 1408032090
By Peter J. Dowling, Marion Festing, and Allen D. Engle. Sr. © Cengage Learning
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Schein’s concept of culture
A culture has 3 levels:
 Artefacts – Visible. Architecture, interior arrangements, physical

space, allocation and office design, decoration, dressing, Language,
types of sound, slogans, and special expressions, Stories and myths,
technology, social practices
1. Values – intermediate level of consciousness. shared opinion on

‘how things should be’
2. Underlying assumptions –invisible, unconscious. Assumptions

about what is the ‘truth’ in physical and social matters, how reality
and truth are determined, and whether truth is to be revealed or
discovered.
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Schein’s 6 underlying assumptions
1. Nature of reality & truth

2. Time dimension
3. Effect of spatial proximity & distance
4. Nature of being human
5. Type of human activity
6. Nature of human relationships
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Hofstede’s 6 culture dimensions
1. Power distance
2. Uncertainty avoidance
3. Femininity vs. masculinity
4. Individualism vs. collectivism
5. Confucianism or long-term orientation
6. Indulgence versus Restraint
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 Power Distance Index (PDI)
 This dimension expresses the degree to which the less powerful members of a society
accept and expect that power is distributed unequally. The fundamental issue here is
how a society handles inequalities among people.
 People in societies exhibiting a large degree of Power Distance accept a hierarchical
order in which everybody has a place and which needs no further justification. In
societies with low Power Distance, people strive to equalize the distribution of power
and demand justification for inequalities of power.
 Individualism versus Collectivism (IDV)

 The high side of this dimension, called Individualism, can be defined as a preference
for a loosely-knit social framework in which individuals are expected to take care of
only themselves and their immediate families.
 Its opposite, Collectivism, represents a preference for a tightly-knit framework in
society in which individuals can expect their relatives or members of a particular
ingroup to look after them in exchange for unquestioning loyalty. A society’s position on
this dimension is reflected in whether people’s self-image is defined in terms of “I” or
“we.”
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 Masculinity versus Femininity (MAS)
 The Masculinity side of this dimension represents a preference in society for
achievement, heroism, assertiveness, and material rewards for success. Society at
large is more competitive. Its opposite, Femininity, stands for a preference for
cooperation, modesty, caring for the weak and quality of life. Society at large is more
consensus-oriented.
 In the business context Masculinity versus Femininity is sometimes also related to as
“tough versus tender” cultures.
 Uncertainty Avoidance Index (UAI)

 The Uncertainty Avoidance dimension expresses the degree to which the members of
a society feel uncomfortable with uncertainty and ambiguity. The fundamental issue
here is how a society deals with the fact that the future can never be known: should we
try to control the future or just let it happen?
 Countries exhibiting strong UAI maintain rigid codes of belief and behavior, and are
intolerant of unorthodox behavior and ideas. Weak UAI societies maintain a more
relaxed attitude in which practice counts more than principles.
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 Long Term Orientation versus Short Term Normative Orientation (LTO)
 Every society has to maintain some links with its own past while dealing with the
challenges of the present and the future. Societies prioritize these two existential goals
differently. Societies who score low on this dimension, for example, prefer to maintain
time-honored traditions and norms while viewing societal change with suspicion. Those
with a culture which scores high, on the other hand, take a more pragmatic approach:
they encourage thrift and efforts in modern education as a way to prepare for the
future. In the business context, this dimension is referred to as “(short-term) normative
versus (long-term) pragmatic” (PRA).
 Indulgence versus Restraint (IND)

 Indulgence stands for a society that allows relatively free gratification of basic and
natural human drives related to enjoying life and having fun. Restraint stands for a
society that suppresses gratification of needs and regulates it by means of strict social
norms.
 https://www.hofstede-insights.com/product/compare-countries/
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Impact of the cultural context on HRM practices
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GLOBE’s 8 culture dimensions
1. Institutional collectivism
2. In-group collectivism
3. Uncertainty avoidance
4. Power distance
5. Gender egalitarianism
6. Assertiveness
7. Performance orientation
8. Humane orientation
(Global leadership and organizational behavior effectiveness)
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Patterns of Cross Cultural Business Behavior
(Gesteland)
1. Business, deal-focused cultures versus relationship-focused cultures
 The business, deal-focused countries are very task-oriented. To them, it’s about the
negotiations and the eventual transaction. Many problems are solved by phone or email
and disagreements tend to be solved in writing rather than orally. This group consists
mainly of Scandinavian and Germanic countries, North-America, Australia and New
Zealand.
 In the case of relationship-focused cultures, the negotiators find interaction more
important than closing the deal. The interaction with the business partner needs to be
right first, and there should be a foundation of trust. These cultures have an indirect
communication style aimed at not offending the other party or creating the impression
that there’s a lack of trust. Examples of this group are the Arab world, most of Africa,
Latin America and Asia.
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(Gesteland)
2. Formal cultures versus informal cultures
 In formal cultures, people prefer a respectful and honorable communication style.

Differences in hierarchical position and status are considered very important and people
are valued accordingly. Academic titles and royal ranks command respect. This applies
in much of Europe, Asia, Mediterranean countries, the Arab world and Latin American
countries.
 Informal cultures are not being disrespectful, but do not put as much importance in
difference in status and position. Everybody is equal and everyone has the chance or
opportunity to advance. The United States, Australia, Canada, New Zealand, Denmark,
Norway and Iceland are informal cultures.
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(Gesteland)
3. Rigid (monochrome) cultures versus fluid / accommodating cultures
 Rigid cultures need everything to go exactly according to schedule with great precision.
Arriving late is not the done thing and missing deadlines or meetings running late is
unthinkable. Clear examples of this are Scandinavian and Germanic countries, North
America and Japan.
 Very different are the countries with a fluid attitude to time. People and interpersonal
relations are considered more important than time, making deadlines or sticking to
schedules. These polychrome cultures can be found in the Arab world, much of Africa,
Latin American and South-east Asia.
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(Gesteland)
4. Expressive cultures versus conservative / reserved cultures
 Expressive cultures are characterized by communicating loudly and with a lot of

gestures. They do their best to avoid awkward silences and there is little consideration
for personal space during conversations; people stand close together, often touch each
other and look each other in the eyes. This is characteristic of Mediterranean countries,
Southern Europe and Latin America.
 People in reserved cultures tend to speak more calmly. General and continuous eye
contact is avoided and they use little if any hand and arm gestures. This is characteristic
of Southeast Asia and Northern Europe.
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Two Iron Rules of International Business in
International Business:
 The Seller Is Expected to Adapt to the Buyer

 The Visitor Is Expected to Observe Local Customs
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CROSS-CULTURAL ISSUES IN

 Artefacts – Visible. Architecture, interior arrangements, physical

1. Values – intermediate level of consciousness. shared opinion on

2. Underlying assumptions –invisible, unconscious. Assumptions

1. Nature of reality & truth

 Individualism versus Collectivism (IDV)

 Uncertainty Avoidance Index (UAI)

 Indulgence versus Restraint (IND)

(Global leadership and organizational behavior effectiveness)

2. Formal cultures versus informal cultures

 In formal cultures, people prefer a respectful and honorable communication style.

3. Rigid (monochrome) cultures versus fluid / accommodating cultures

4. Expressive cultures versus conservative / reserved cultures

 Expressive cultures are characterized by communicating loudly and with a lot of

 The Seller Is Expected to Adapt to the Buyer

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