Hofstede

cultural dimensions

Made by: Elena Bezborodova, Eleonora Viktoria Horbenko, Lam Hue

Thanh, Lena Gerding, Jenni Korhonen, Foong Hwee Li, Riina
29.09.14 1
Saarenpää
 Introduction

• Gerard Hendrik (Geert) Hofstede

(born 2 October 1928 in Haarlem)
– Dutch social psychologist,
former IBM employee, and
Professor Emeritus of
Organizational Anthropology and
International Management at
Maastricht University in the
Netherlands
• For his cultural dimensions study
he interviewed 117,000 IBM
employees in 23 countries
initially
29.09.14 2
 Table of contents
1. Power Distance
2. Individualism / Collectivism
3. Masculinity
4. Uncertainty avoidance
5. Long term orientation
6. Indulgence / Restraint
7. Video
8. Conclusion
29.09.14 3
 Power Distance (PD)
Hofstede 1st Dimension
This refers to the degree of inequality that exists
and is accepted among people with and without
power

29.09.14 4
 Comparison
High PD Low PD

• Centralized companies • Flatter organizations

• Strong hierarchies • Supervisors and
• Large gaps in employees are
compensation, authority, considered almost as
and respect equals

29.09.14 5
 Example

Malaysia?

Finland?

29.09.14 6
Finland (33)
• Equal rights
• Superiors accessible
• Power is decentralized
• Managers count on the
experience of their team
members
• Attitude towards managers
are informal and on first
name basis
29.09.14
Malaysia (100)
• People accept a hierarchical
order
• Power is centralized
• Subordinates expect to be
told what to do
• The ideal boss is a respected
autocrat
7
 Challenges as an international manager
• Finnish manager has Solutions:
marketing project with •Finnish manager should
a CEO from Malaysia learn in details about
 Finnish manager company’s hierarchy,
receives less respect responsibilities of each
than top managers department beforehand
from the same •Finnish manager should
company show great respect to
 Malaysian CEO refused Malaysian CEO despite
to provide any answers any misunderstandings
on marketing field
29.09.14 8
 Individualism &
Collectivism (IND)
Hofstede 2nd Dimension

This dimension focuses on the relationship

between the individual and larger social
groups. The way in which people define
themselves and their relationship to others.

29.09.14l 9
 Comparison
Individualist Collectivist
• Individual is most • Views of group most
important important
• Independence over • High obligation to the group
dependence • Self is defined in relation to
• Rewards individual others
achievement • Cooperation, not
• Values uniqueness of competition
individual

29.09.14 10
 Example
South Korea?

USA?

29.09.14 11
 United States (90)
• People taking care of themselves
• Identity based on individual
• Decisions based on individual
needs
• Emphasis on individual initiative
and achievement
• Everyone has a right to a private
life
29.09.14
South Korea (18)
• Expect absolute loyalty to group
• Decisions based on group
• Identity based on social system
• High dependence on organization
and institutions
• Emphasis on belonging
• Private life “invaded” by institution
and organizations
12
 Masculinity (MAS)
Hofstede’s 3rd Dimension
The degree of masculinity indicates
whether a society leans more
towards masculine values, or
towards feminine ones.
 Comparison
Masculinity values Femininity values

• a high importance of • relationship building

achievement
• material gain
• competition
 success is being the best
 E x p e c t women to have
different roles than men
• equality
• a good quality of life
 success is enjoying what
you do
 Societies differentiate less
between genders
 Example

Japan?

Sweden?
 Sweden (5)
• the manager should support the employees
• managers strive for consensus, conflicts are
solved by compromising
• people value equality & solidarity
• incentives : free time & flexible working hours
• important to include everyone
• no sense of superiority
 Japan (95)
• long working hours, extremely hard working
(hard for women to participate)
• life is a constant competition
• people are motivated if they are fighting with
a winning team
• drive for excellence and perfection
 Challenges as an international manager
• The Japanese want to work longer hours than the
Swedish ones
 a lack of motivation among Japanese
 fe l t pressure and lack of motivation amongSwedish
• Solution:
– show Japanese the company is successful anyway
– draw up work schedule to reduce pressure of staying
longer
Uncertainty avoidance
index (UAI)
Hofstede 4th Dimension
 Uncertainty Avoidance Index

• The degree of anxiety that society members feel

when in uncertain or unknown situations
• Focuses on the level of tolerance for uncertainty and
ambiguity within the society.

29.09.14 20
 Comparison
High uncertainty
• Very formal business
conduct with lots of rules
and policies
• Need and expect structure
• Sense of nervousness
spurns high levels of emotion
and expression
29.09.14
Low uncertainty
• Informal business attitude
• More concern with long
term strategy than what is
happening on a daily basis
• Accepting of change and
risk
21
 Example

Japan?

USA?
 USA (46)
• Acceptance for new ideas and innovation
• Do not require many rules
• High trust in the state
• Thoughts are shared with colleagues / boss
• Feedback and criticism are accepted

29.09.14 23
 Japan (92)
• Japanese taught to prepare for any uncertain
situation  avoid any risk
• Ceremonies for all aspects of life
• Much emphasis on etiquette
• It is not accepted to have a disagreement with
your employer
• Questions only answered if the answer is
absolutely certain
29.09.14 24
 Challenges as an international
manager
• International team, US team members express an idea
for innovation
 US team members want to go ahead immediately
 Japanese team members wish to take their time to make
absolutely sure that all details are known

Solution: Create a detailed project plan which is efficient

but also has relatively low risk

29.09.14 25
Long term orientation
versus
short term normative
(LTO)
Hofstede 5th Dimension
 Long Term Orientation & Short Term
Normative
• 5thdimension
• Added in 1990s
• Confucian philosophy
• Different culture different decision
• Society  long term orientation / short term
normative.
• Long term orientation also defined as pragmatism.
 Comparison
Long Term Orientation Short Term Normative
• Prepare for the future • Tradition and norms are
• Thrift and effort is more important
largely encouraged • View the societal change
• Ability to adapt with suspicion
traditions in changed • Focus on achieving quick
condition results instead of long
• Perseverance in term benefit
achieving result
 Example

Egypt ？

South
Korea ？
 South Korea (100)
• Society is more pragmatic and long term
orientated
• Almighty God is not familiar to South Koreans
• People guided by virtues and practical good
examples
• Serve the durability of the companies.
• Serve the stakeholders and society at large for
many generations to come.
 Egypt (7)
• Indicates that the society is very normative
• Strong concern with establishing the absolute
Truth
• Normative in their thinking
• Exhibit great respect for traditions
• Small propensity to save for the future
• Focus on achieving quick results
 Challenges as an international manager

• Challenges
• Egypt company Profit in three months
• South Korea company Increase in market share
after three years
• Cooperation fail  No same objective
• Understand the culture and come up with an win-
win proposal to satisfy both objective is important.
 Indulgence vs. Restraint (IVR)

Hofstede 6th Dimension

•Added as sixth dimension in 2010.

•Less data, fewer countries.
•Not yet fully adopted within the intercultural training
and management.
•Is the data valid? (Asking participants ”how happy are
you?”.)

24.09.14 33
 Comparison
Indulgence Restraint
•Free gratification •Strict social norms
•Individual happiness and •Lower % of happy people
leisure time are important •Positive emotions not freely
•Higher % of people expressed
declaring themselves very •A perception of
happy helplessness: what happens
•Positive emotions freely to me is not my own doing
expressed and •Leisure time not given much
remembered importance
•Loose gender roles

24.09.14 34
 South Korea?

Sweden?
 Sweden (78)

• Employees cannot easily be motivated with material

rewards
• Enjoying the moment rather than use time to compare to
others
• No need for status objects
• Employees encouraged to speak up
• Incentives like free time, flexible work hours and places
are effective
 South Korea (29)

• Material reward is expected

• Employees easily feel treated unfairly
• Status objects are important
• Very hierarchical working environment, lower employees do
not voice their own opinions
• People live to work, employees are expected to work as late
as the boss
• Indulging and using too much money on yourself is thought
of as wrong
 Challenges as an international manager
• South Korean organization in Sweden expects
employees to work overtime frequently for
higher pay
 High employee turnover rate

• Solution:
– Hire more employees so that overtime is not
necessary  flexible working hours and free time

29.09.14 38
 Video

Presentation of Hofstede's dimensions

29.09.14 39
 Conclusion

• Cultural norms play a large part in the mechanics and

interpersonal relationships of the workplace.
• Hofstede study has general approach, not individual one
• As a international manager, we need to know the culture that
adopt by the society where the company located.
• This allow us exercise our decision more easily and other will
be more willing to accept and recognized us as a manager
when the decision we made is synchronized with their
culture.

A country comparison tool can be found at the Hofstede Center.

29.09.14 40
 References
• http://geert-hofstede.com/dimensions.html
• http://www.mindtools.com/pages/article/newLDR_66.htm
• http://geert-hofstede.com/countries.html
• http://www.communicaid.com/cross-cultural-training/blog/indulgence-
vs-restraint-6th-dimension/#.VCQmNk0riUk

29.09.14 41
 Thank you!

29.09.14 42