International Management Luthans | Doh

International Ninth Edition

Fred Luthans

Management Jonathan P. Doh

Ninth Edition

Chapter 4

The Meanings and Dimensions

of Culture
International Management Ninth Edition Luthans | Doh

The Meanings and Dimensions

of Culture
• The specific objectives of this chapter are to
1. DEFINE the term culture, and discuss some of the
comparative ways of differentiating cultures.
2. DESCRIBE the concept of cultural values, and relate some
of the international differences, similarities, and changes
occurring in terms of both work and managerial values.
3. IDENTIFY the major dimensions of culture relevant to
work settings, and discuss their effects on behavior in an
international environment.
4. DISCUSS the value of country cluster analysis and
relational orientations in developing effective
international management practices.
International Management Ninth Edition Luthans | Doh

The Nature of Culture

• Culture is
– Acquired knowledge that people use to interpret
experience and generate social behavior. This
knowledge forms values, creates attitudes, and
influences behavior.
International Management Ninth Edition Luthans | Doh

The Nature of Culture

• Characteristics of culture
– Learned
– Shared
– Transgenerational
– Symbolic
– Patterned
– Adaptive
International Management Ninth Edition Luthans | Doh

Priorities of Cultural Values

United States, Japan, and Arab Countries
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Centralized vs. Decentralized Decision Making

– Centralized: In some societies, top managers make
all important organizational decisions.
– Decentralized: In others, these decisions are
diffused throughout the enterprise, and middle-
and lower-level managers actively participate in,
and make, key decisions.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Safety vs. Risk

– Safety: In some societies, organizational decision
makers are risk-averse and have great difficulty
with conditions of uncertainty.
– Risk: In others, risk taking is encouraged, and
decision making under uncertainty is common.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Individual vs. Group Rewards

– Individual: In some countries, personnel who do
outstanding work are given individual rewards in
the form of bonuses and commissions.
– Group rewards: In others, cultural norms require
group rewards, and individual rewards are
frowned upon.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Informal vs. Formal Procedures

– Informal: In some societies, much is accomplished
through informal means.
– Formal: In others, formal procedures are set forth
and followed rigidly.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• High vs. Low Organizational Loyalty

– High: In some societies, people identify very
strongly with their organization or employer.
– Low: In others, people identify with their
occupational group, such as engineer or mechanic.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Cooperation vs. Competition

– Cooperation: Some societies encourage
cooperation between their people.
– Competition: Others encourage competition
between their people.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Short-term vs. Long-term Horizons

– Short-term: Some cultures focus most heavily on
short-term horizons, such as short-range goals of
profit and efficiency.
– Long-term: Others are more interested in long-
range goals, such as market share and
technological developments.
International Management Ninth Edition Luthans | Doh

Cultural Diversity
How Culture Affects Managerial Approaches

• Stability vs. Innovation

– Stability: The culture of some countries
encourages stability and resistance to change.
– Innovation: The culture of others puts high value
on innovation and change.
International Management Ninth Edition Luthans | Doh

A Model of Culture
International Management Ninth Edition Luthans | Doh

Business Customs in South Africa

• Arrange a meeting before discussing business
over the phone.
• Make appointments as far in advance as possible.
• Maintain eye contact, shake hands, provide
business cards for everyone.
• Be respectful of women, while aware that in their
society they may be “tested.”
• Maintain a win-win situation.
• Be patient; don’t interrupt.
• Keep presentations short; avoid flashy visuals.
International Management Ninth Edition Luthans | Doh

Values in Culture
• Values
– Basic convictions that people have about
• Right and wrong
• Good and bad
• Important and unimportant
– Learned from culture in which the individual is
reared
– Differences in cultural values may result in varying
management practices.
International Management Ninth Edition Luthans | Doh

Comparing Cultures as Overlapping

Normal Distributions
International Management Ninth Edition Luthans | Doh

Stereotyping from the Cultural

Extremes
International Management Ninth Edition Luthans | Doh

U.S. Values and Possible Alternatives

International Management Ninth Edition Luthans | Doh

Value Similarities and Differences

Across Cultures
1. Strong relationship between level of managerial success
and personal values
2. Value patterns predict managerial success and can be
used in selection/placement decisions
3. Country differences in relationship between values and
success; however, findings across U.S., Japan, Australia,
India are similar
4. Values of more successful managers favor pragmatic,
dynamic, achievement-oriented, and active role in
interaction with others
Values of less successful managers tend toward static and
passive values; relatively passive roles in interacting with
others
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

1. Power Distance
2. Uncertainty Avoidance
3. Individualism―Collectivism
4. Masculinity―Femininity
5. Time Orientation
6. Indulgence vs. Restraint
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Power Distance
– The extent to which less powerful members
accept that power is distributed unequally
• High power distance countries: people blindly obey
superiors; centralized, tall organizational structures
(Mexico, South Korea, India)
• Low power distance countries: flatter, decentralized
organizational structures, smaller ratio of supervisor to
employee (Austria, Finland, Ireland)
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Uncertainty Avoidance
– The extent to which people feel threatened by
ambiguous situations; create beliefs/institutions to try
to avoid such situations
• High uncertainty avoidance countries: high need for
security, strong belief in experts and their knowledge;
structure organizational activities, more written rules, less
managerial risk taking (Germany, Japan, Spain)
• Low uncertainty avoidance countries: people more willing
to accept risks related to unknown, less structured
organizational activities, fewer written rules, more
managerial risk taking, higher labor turnover, more
ambitious employees (Denmark and Great Britain)
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Individualism
– The extent to which people look after themselves and
immediate family only
• Collectivism
– The tendency of people to belong to groups and to
look after each other in exchange for loyalty
• High individualism countries: wealthier, Protestant work
ethic, greater individual initiative, promotions based on
market value (U.S., Canada, Sweden)
• High collectivism countries: poorer, less support of
Protestant work ethic, less individual initiative, promotions
based on seniority (Indonesia, Pakistan)
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Masculinity
– A cultural characteristic in which the dominant social
values are success, money, and things
• Femininity
– A cultural characteristic in which the dominant social
values are caring for others and quality of life
• High masculine countries: stress earnings, recognition,
advancement, challenge, wealth; high job stress (Germanic
countries)
• High feminine countries: cooperation, friendly atmosphere,
employment security, group decision making; low job stress
(Norway)
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Time Orientation (1988)
– A cultural characteristic dealing with society’s
search for virtue
• Long-term oriented societies: focus on the future, able
to adapt traditions when conditions change, tend to
save and invest, focus on achieving long-term results
(Asian countries)
• Short-term oriented cultures: focus on quick results, do
not tend to save, service to others, belief in absolutes,
value stability and leisure (U.S., UK, Spain)
International Management Ninth Edition Luthans | Doh

Hofstede’s Cultural Dimensions

• Indulgence vs. Restraint (2010)
– Indulgent: trait related to relative happiness based on
instant gratification
– Restraint: a cultural characteristic based on regulating
and controlling behavior according to social norms
• Indulgent societies: perceived happiness, life in control,
positive emotions, basic needs satisfied (U.S., UK, Australia,
Chile)
• Restrained societies: less happiness, sense of helplessness,
less likely to remember positive emotions, basic needs not
always met (China, Egypt, Romania)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Universalism vs. Particularism
– Universalism: belief that ideas/practices can be
applied everywhere
• High universalism countries: formal rules, close
adherence to business contracts (U.S., UK, Germany,
Sweden, Australia)
– Particularism: belief that circumstances dictate
how ideas/practices apply
• High particularism countries: legal contracts often
modified, the way deals executed change as people get
to know each other (China, Indonesia, Venezuela)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Individualism vs. Communitarianism
– Individualism: people regard themselves as
individuals
• Countries with high individualism: stress personal and
individual matters; assume great personal responsibility
(U.S., UK, Argentina, Mexico, Thailand)
– Communitarianism: people regard themselves as
part of a group
• Value group-related issues; committee decisions; joint
responsibility (Malaysia, Korea)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Neutral vs. Emotional
– Neutral: culture in which emotions are held in
check
• High neutral countries: people act stoically and
maintain composure (Japan and UK)
– Emotional: emotions are expressed openly and
naturally
• High emotion cultures: people smile a lot, talk loudly,
greet each other with enthusiasm (Mexico,
Netherlands, Switzerland)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Specific vs. Diffuse
– Specific: large public space shared with others and
small private space guarded closely
• High specific cultures: people open and extroverted,
strong separation of work and personal life (Austria, UK,
U.S., Switzerland)
– Diffuse: public and private spaces have similar size,
public space guarded because shared with private
space
• Diffuse cultures: people indirect and introverted,
work/private life closely linked (Venezuela, China, Spain)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Achievement vs. Ascription
– Achievement culture: people accorded status
based on how well they perform functions
• High status to high achievers (Austria, Switzerland, U.S.,
UK)
– Ascription culture: status based on who or what a
person is
• Status based on age, gender, social connections
(Venezuela, China, Indonesia)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• Time
– Sequential: only one activity at a time, appointments
kept strictly, follow plans as laid out (U.S.)
– Synchronous: multitask, appointments are
approximate and easily changed, schedules
subordinate to relationships (France, Mexico)
– Past/Present vs. Future:
• Future more important (Italy, U.S., Germany)
• Past/Present more important (Venezuela, Indonesia, Spain)
• All 3 time periods equally important (France, Belgium)
International Management Ninth Edition Luthans | Doh

Trompenaars’s Cultural Dimensions

• The Environment
– Inner-directed: people believe in controlling
outcomes
• Dominant (sometimes aggressive) attitude toward
environment (U.S., Switzerland, Australia)
– Outer-directed: people believe in letting things
take their course
• “Go with the flow,” flexible attitude, willingness to
compromise and maintain harmony (China, many other
Asian countries)
International Management Ninth Edition Luthans | Doh

Integrating Culture and Management:

The GLOBE Project
• GLOBE: Global Leadership and Organizational Behavior
Effectiveness
– Project extends and integrates previous analyses of cultural
attributes and variables
– Evaluates nine different cultural attributes using middle
managers from 951 organizations in 62 countries
• First two phases: middle management
– Multi-cultural team of 170 scholars from around the world
worked together to survey 17,000 managers in 3 industries:
financial services, food processing, and telecommunications
– Covered every major geographic region of the world
• Third phase: upper-level management
– Team of 40 researchers from 24 countries surveyed 5,000
reports from 1,000 CEOs
International Management Ninth Edition Luthans | Doh

The GLOBE Project

• The Nine Dimensions of the GLOBE Project
1. Uncertainty avoidance
2. Power distance
3. Collectivism I: Societal collectivism
4. Collectivism II: In-group collectivism
5. Gender egalitarianism
6. Assertiveness
7. Future orientation
8. Performance orientation
9. Humane orientation
International Management Ninth Edition Luthans | Doh

GLOBE Country Analysis

• The results of the GLOBE project
– Correspond generally with those of Hofstede and
Trompenaars
– Different from Hofstede in that many more
researchers with varied perspectives were involved
(vs. Hofstede working alone); studied many
companies (vs. Hofstede studied one company)
• GLOBE provides a current comprehensive
overview of general stereotypes that can be
further analyzed for greater insight
International Management Ninth Edition Luthans | Doh

GLOBE Cultural Variable Results

International Management Ninth Edition Luthans | Doh

GLOBE Analysis
Managerial Perspectives in the United States and Brazil
International Management Ninth Edition Luthans | Doh

Review and Discuss

1. What is meant by the term culture? In what way
can measuring attitudes about the following
help differentiate between cultures: centralized
or decentralized decision making, safety or risk,
individual or group rewards, high or low
organizational loyalty, cooperation or
competition? Use these attitudes to compare
the United States, Germany, and Japan. Based
on your comparisons, what conclusions can you
draw regarding the impact of culture on
behavior?
International Management Ninth Edition Luthans | Doh

Review and Discuss

2. What is meant by the term value? Are
cultural values the same worldwide, or are
there marked differences? Are these values
changing over time, or are they fairly
constant? How does your answer relate to
the role of values in a culture?
International Management Ninth Edition Luthans | Doh

Review and Discuss

3. What are the four major dimensions of culture studied
by Geert Hofstede? Identify and describe each. What
is the cultural profile of the United States? Of Asian
countries? Of Latin American countries? Of Latin
European countries? Based on your comparisons of
these four profiles, what conclusions can you draw
regarding cultural challenges facing individuals in one
group when they interact with individuals in one of
the other groups? Why do you think Hofstede added
the fifth dimension of time orientation and the sixth
dimension related to indulgence versus restraint?
International Management Ninth Edition Luthans | Doh

Review and Discuss

4. As people engage in more international travel and
become more familiar with other countries, will
cultural differences decline as a roadblock to
international understanding, or will they continue to
be a major barrier? Defend your answer.
5. What are the characteristics of each of the following
pairs of cultural characteristics derived from
Trompenaars’s research: universalism vs.
particularism, neutral vs. emotional, specific vs.
diffuse, achievement vs. ascription? Compare and
contrast each pair.
International Management Ninth Edition Luthans | Doh

Review and Discuss

6. How did project GLOBE build on and extend
Hofstede’s analysis? What unique
contributions are associated with project
GLOBE?
7. In what way is time a cultural factor? In what
way is the need to control the environment a
cultural factor? Give an example for each.