Cross Cultural Management in France

1. Main objectives and overview of the essay:

The recent 20 years have been the era of globalization with enormous growth in international trade and foreign direct investment (FDI). In former times, most Western companies did not engage in international business. On the hand their domestic market seemed to be attractive enough and there were sufficient opportunities for growth. On the other hand, companies did not have to take into consideration the specific features of foreign markets, such as foreign languages and “strange” cultural behaviour. Nowadays, however, the changing business environment has forced most companies to seek opportunities in foreign markets as well. (Compare: Kotler, Armstrong, Saunders, Wong; Page 166)

This development has led to the existence of so - called MNCs - multinational companies, which conduct business globally. Nowadays, there is no economy in which foreign companies are not active. In those companies, employees, suppliers and customers come from many different cultures, which has led to an increasing awareness about questions related to Cross Cultural Management (Compare: Bergemann, Sourisseaux; Page 9)

In my essay, I will concentrate on this topic and I will try to describe cross cultural management in France. Concerning the structure of this essay, I want to start off by trying to give an explanation of the term "culture". Afterwards, I will explain one of the best known models to describe cultural dimensions -Hofstede's 5-D-Model- and point out French and German cultural elements. But my main goal is to show how culture influences the management process and the business behaviour of the French company leaders and to compare these elements to the German business people. I will explain some differences between German and French business people, as far as management and leadership are concerned, by the help of an investigation of small and medium - sized companies. By describing three important featuresvalues and objectives, internal leadership and external leadership I will point out the main differences between German and French company leaders, as far as leading and representing the firm, but also behaviour in daily business life and the relationship to business partners is concerned. Finally, I will point out, what German business people have to consider when they do business with French companies, how they can avoid mistakes in business decisions , how Germans should behave in a French company and draw a conclusion of this essay.

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2. Definition of the term "culture":

Various authors have tried to define the term culture, by each concentrating on different aspect of this term.

For instance Hofstede (1984) defines culture as "collective programming of the mind, which distinguishes the members of one human group from another. Elashmawi / Harris (1993) define culture as "the behavioural norms that a group of people, at a certain time and place have agreed upon to survive and coexist." I want to describe culture as a set of rules, norms and values which is often subconscious and influences our perception, judgement and feelings. Culture defines the identity of a human group in the same way as personality determines the identity of a n individual. Culture is not fixed - it can change over time.

2.1 Hofstedes's 5 - Model":

Several scientist have tried to examine culture and its dimensions. The most important study in this respect was carried out by the Dutch scientist Gerd Hofstede, who analysed more than 116,000 questionnaires from 67 countries with 60 items each. Five cultural dimensions - power distance, individualism vs. collectivism, masculinity vs. femininity, uncertainty avoidance and short-term- vs. long-term orientation were part of his study. (Compare: Perlitz; Page 282 f.) Following, those five dimensions will be explained at first, and finally applied to the German and Chinese society.

Power distance

Due to Hofstede, power distance is defined as “the extent to which less powerful members of institutions and organisations accept that power is distributed unequally.” (Hofstede, 1983)

Countries, in which employees people follow the instructions of their superiors without questioning them, and are not integrated into decision-making processes belong to the group of countries with high power distance. Leadership style in those countries is considered to be authoritarian. Italy, Japan and France are assigned to this group. In countries with low power distance employees expect from their superiors to participate when decisions are made. Leadership style is rather democratically oriented and frequently companies in those countries have

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decentralized organisations with few supervisors and highly - qualified employees. Anglo - Saxon countries, Scandinavia and Germany belong to that group of countries. (Compare: Baumer, Page 16)

Individualism vs. collectivism

Due to Hofstede, “individualism is the tendency of people to look after themselves and their immediate family only.” In individualistic societies people strive for selfrealization and achievement of individual goals. All employees are treated equally and judged upon their abilities. Collectivism on the other hand is associated with people, who belong to collectives and submit to the common goals and principles of their collectives. Employees are often judged upon their membership in groups and relationships are considered to be more important than tasks. Anglo -Saxon countries, as well as Scandinavia and Germany belong to the individualistic countries. (Compare: Rothlauf, Page 228 f.)

Masculinity vs. femininity

Masculinity is defined by Hofstede as “a situation which the dominant values in a society are success, money and things”, whereas he describes femininity as “a situation in which the dominant values in a society are caring for others and the quality of life”. In a masculine society individuals behave self confidently and performance-oriented. Success and career are considered to be more important than relationships. However, feminine societies attach importance to human relations, empathy and willingness to compromise. (Compare: Rothlauf, Page 229)

Uncertainty avoidance

Hofstede defines uncertainty avoidance as “the extent to which people feel threatened by ambiguous situations.” Societies which tend to avoid uncertainty try to control future or at least to influence it by rules, laws and regulations. Individuals try to avoid conflicts and risks. (Compare: Rothlauf, Page 229 f.)

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Short term vs. long-term orientation

The fifth dimension deals with values which go along with long-term orientation. This describes the degree to which a society is determined by a pragmatic, future-oriented attitude, contrary to a dogmatic, contemporary one. (Compare: Rothlauf, Page 25 f.)

2.2 German and French cultural dimensions in comparison

In this chapter, I will analyse Hofstede's dimensions with respect to Germany and France, concentrating on the impacts for business life. Unfortunately, there are nor results available for the fifth dimension (Short - term vs. long - term orientation) so far.

Power distance

France ranks among the countries, which have a very high degree of Power distance, actually the highest one in the "Western world". For the organizational aspect, this implies that there is a large extent of centralization and tall organization pyramids. A large amount of supervisory personnel is employed by the entrepreneurs and large wage differentials exist. On the other hand, Germany ranks among the countries with a relatively low PDI. Concerning the consequences for organizations, this means that companies tend to avoid centralization and the organizational structure is rather flat. Contrary to France, there is less supervisory personnel and wage differentials are smaller. (Compare: Hofstede, Page 107)

Individualism vs. Collectivism

Both Germany and France belong to the individualistic countries. This has the following consequences for organizational behaviour:

- Organizations are not expected to look after their individuals

- Employees are expected to defend their interests

- Policies and practices should allow for individual initiative

- The organization has little influence on the members' well-being (Compare: Hofstede, Page 173)

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