Hofsteads Cultural Dimesnion

Table of Contents

1. Abstract 1

2. Introduction 1

3. Hofstede Cross Cultural Framework 2

3.1 Data 2

3.2 Hofstede Cultural Dimensions 2

4. Critique of Hofstede Model 3

4.1 Relevance of Time - National and Political influence 4

4.2 Relevance of Survey 4

4.2.1 Data Sampling 4

4.2.2 Non-Statistical Inference 5

4.2.3 Conduction of Survey 5

4.3 Bipolar Dimensions 5

4.4 Cultural Homogeneity based on one company 6

4.5 Static and Deterministic vision of Culture 6

4.6 Few Dimensions with overlap 6

5. Critical Evaluation of Hofstede Model 6

5.1 Homogeneous Culture 7

5.2 Cultural Dynamics 8

5.3 Bipolar dimensions 10

6. Conclusion 10

7. Bibliography 11

1. Abstract

Hofstede cultural framework has been widely used in various HRM literatures, providing valuable insight into cross-cultural management. However, Hofstede's work has been widely evaluated and criticised by several academics over the years. This essay discusses these criticisms in detail and evaluates Hofstede's contribution in the field of cross-cultural management.

2. Introduction

Globalization has led to major development and evolution in the field of technology, communication, economics, society and politics. To gain competitive advantage and exploit new markets organisations have started expanding globally using several strategies such as opening subsidiaries in foreign locations, mergers and acquisitions and forming strategic alliance and networks. As a result, organisations consist of personnel from diverse background with different knowledge backgrounds, ethnicities, religions and nationalities. Organisation behaviour can no longer be based on the national culture, but focuses on the multiple cultures for its design and functioning (Sackmann and Phillips, 2004).

Culture is defined as assumptions and beliefs held by a group of people that makes them distinct and shapes their thought process and behaviour (Sackmann and Phillips, 2004). After the World War II, USA became dominant nation with a booming economy. US based corporations started expanding their businesses and applying their business model into their new overseas subsidiaries, thus bringing in a whole new life style. Academics and researchers started looking for common dimensions and models which would guide managers in conducting business with people in other countries. Based on cross national comparison, Hofstede proposed a framework with four initial cultural dimensions identifying culture with nation.

3. Hofstede Cross Cultural Framework

Hofstede based his research on theoretical reasoning that the differences in attitude of individuals arise from childhood education which is based on national culture and is reinforced throughout their life by various organizations like schools, ecological factors and work force.

3.1 Data

Data was collected using 2 surveys and questionnaires conducted by IBM first in 1968-9 and then in 1971-3 in 66 countries. These surveys combined led to 117,000 questionnaires which is a large number.

3.2 Hofstede Cultural Dimensions

Based on his analysis, Hofstede identified 4 dimensions of national culture which was applied on 40 out of 66 subsidiaries of IBM to give a comparative score. Hofstede used Value Survey Module for identifying the initial four dimensions:

1. Power Distance Index (PDI): Power distance "represents a nation's unique score on how to deal with social inequality. Inequality can occur in areas such as prestige, wealth, and power; different societies put different weights on status consistency among these areas" (Hofstede 1984, p. 65). High power distance found in highly vertical and hierarchical organisations will follow communications through command chains and will not be open to direct interactions between supervisors and their employee.

2. Uncertainty Avoidance (UAI): This index measures the tolerance level for uncertainty and ambiguity and risks associated with it. This measure depicts whether people prefer structure and clear work rules and guidelines in an organisation.

3. Individualism (IDV): This index measures the degree to which individuals are integrated into groups. Individualism relates to emotionally independent behaviour while, in collectivism people expect group to look after them in return of loyalty. (Hofstede 1984, p. 148 and Hofstede and Bond, 1984, p. 419- 420).

4. Masculinity (MAS): This index measures the intensity of emphasis on masculine characteristics such as assertiveness, competitiveness, achievement and getting ahead over feminine traits such as family orientation, relationships, quality of life in the culture.

To relate culture with continuous economic growth Hofstede and Bond (1988) identified the fifth dimension based on Chinese confusion dynamism and added it in 1991.

5. Long Term Orientation (LTO): This index indicates the cultural variation in valuing virtues and focussing on future. In long term orientation people are persevering and value long term growth with strong inclination of saving and security to build better future. While in short term orientation people have normative beliefs and are more focussed on getting things done quickly to get incentives and benefits quickly.

4. Critique of Hofstede Model

Hofstede conducted his research when the companies were entering global markets and managers were looking for a generic model to improve their business internationally. The cultural dimensions proposed are still used as fundamental standard for measuring cross-cultural factors in research. This led to many questions and critiques related to conceptualisation of dimensions based on national cultural and methodology used in empirical studies.

4.1 Relevance of Time - National and Political influence

Survey was conducted during the time of political and economic instability with aftermaths of World War II, cold war in