Critical analysis of Hofstede’s model of cultural dimensions

To what extent are his findings reliable, valid and applicable to organisations in the 21st century?


Thèse de Master, 2011
148 Pages, Note: 1,0

Extrait

CONTENTS

ABSTRACT

LIST OF TABLES

LIST OF FIGURES

LIST OF ABBREVIATIONS

CHAPTER 1 INTRODUCTION
1.1 GLOBALISATION
1.2 CROSS-CULTURAL MANAGEMENT
1.3 NEED FOR CONTEMPORARY APPROACH
1.4 RESEARCH AIM AND OBJECTIVES
1.4.1 Aim
1.4.2 Objectives
1.5 OUTLINE OF THE CHAPTERS

CHAPTER 2 LITERATURE REVIEW
2.1 CULTURE DEFINED
2.1.1 National culture
2.1.2 Organisational culture
2.2 HOFSTEDE’S STUDY OF CULTURAL DIMENSIONS
2.2.1 Research data
2.2.2 Cultural dimensions
2.2.3 Other cultural studies and comparison with Hofstede’s dimensions
2.3 ANALYSIS AND EVALUATION OF HOFSTEDE’S FINDINGS
2.3.1 Arguments in support of Hofstede’s study
2.3.2 Arguments against Hofstede’s study
2.3.3 Discussion
2.4 HOFSTEDE’S FINDINGS IN PRACTICE

CHAPTER 3 RESEARCH METHODOLOGY
3.1 RESEARCH PROCESS
3.1.1 Philosophy of research
3.1.2 Research Approach
3.1.3 Research Strategy
3.1.4 Research Choices
3.1.5 Time Horizon
3.1.6 Data collection method
3.2 DATA VALIDITY, RELIABILITY AND GENERALISIBILITY
3.2.1 Validity
3.2.2 Reliability
3.2.3 Generalisability
3.3 RESEARCH ETHICS
3.4 LIMITATIONS

CHAPTER 4 ANALYSIS AND FINDINGS
4.1 INTRODUCTION
4.2 CALCULATION OF DIMENSION SCORES
4.3 MASCULINITY
4.3.1 MAS Index Score
4.3.2 Further Analysis
4.4 UNCERTAINTY AVOIDANCE
4.4.1 UA Index Score
4.4.2 Further Analysis
4.5 DISCUSSION

CHAPTER 5 CONCLUSION AND RECOMMENDATIONS
5.1 CONCLUSION
5.2 FUTURE RESEARCH AND RECOMMENDATION

REFERENCES

APPENDICES

LIST OF TABLES

TABLE I: TROMPENAARS 7 DIMENSIONS

TABLE II: SCHWARTZ'S DIMENSIONS

TABLE III: KLUCKHOHN'S AND STRODTBECK'S DIMENSION

TABLE IV: HALL AND HALL COMMUNICATION STYLES

TABLE V: HALL AND HALL TIME ORIENTATION

TABLE VI: GLOBE DIMENSIONS

TABLE VII: COMPARISON OF CULTURAL STUDIES

TABLE VIII: ARGUMENTS FOR AND AGAINST HOFSTEDE'S STUDY

TABLE IX: EXAMPLES OF PRACTICAL APPLICATIONS OF HOFSTEDE'S WORK

TABLE X: KEY ELEMENTS OF EMPLOYEES IN INDIVIDUALISTIC CULTURES

TABLE XI: ADVANTAGES AND DISADVANTAGES OF QUESTIONNAIRES

TABLE XII: ADVANTAGES AND DISADVANTAGES OF SECONDARY DATA

TABLE XIII: ADVANTAGES AND DISADVANTAGES OF PRIMARY DATA

TABLE XIV: MAIN ATTRIBUTES OF SELF-ADMINISTERED DELIVERY AND COLLECTION QUESTIONNAIRES

TABLE XV: THIS STUDY MAS EQUATION

TABLE XVI: THIS STUDY’S MAS COMPARED WITH HOFSTEDE'S

TABLE XVII: CALCULATED GENDER MAS

TABLE XVIII: THIS STUDY UA EQUATION

TABLE XIX: THIS STUDY’S UA COMPARED WITH HOFSTEDE'S UA

TABLE XX: THIS STUDY’S MAS COMPARED TO HOFSTEDE'S MAS

TABLE XXI: THIS STUDY’S UA COMAPRED TO HOFSTEDE'S UA

TABLE XXII: ARGUMENTS FOR AND AGAINST HOFSTEDE'S STUDY

TABLE XXIII: THIS STUDY'S FINDINGS

LIST OF FIGURES

FIGURE 1: THE 'ICEBERG' MODEL OF CULTURE

FIGURE 2: THE 'ONION DIAGRAM':

MANIFESTATIONS OF CULTURE AT

DIFFERENT LEVELS OF DEPTH.

FIGURE 3: COMPARISON OF HOFSTEDE'S CULTURAL DIMENSION WITH OTHER CULTURAL STUDIES

FIGURE 4: THE RESEARCH ONION (Source: Saunders et al., 2009, p. 108)

FIGURE 5: PROCESS OF DEDUCTION

FIGURE 6: SAMPLE AGE AVERAGE

FIGURE 7: SURVEY SAMPLE (Source: Own illustration)

FIGURE 8: TYPES OF QUESTIONNAIRES (Source: Saunders et al., 2009, p.363)

FIGURE 9: STAGES THAT MUST OCCUR IF A QUESTION IS TO BE VALID AND RELIABLE

FIGURE 10: QUESTION 10F) Co-operation

FIGURE 11: QUESTION 10B) RECOGNITION

FIGURE 12: QUESTION 10G) LIVING AREA

FIGURE 13: QUESTION 10C) ADVANCEMENT

FIGURE 14: AVERAGES OF INDICATOR QUESTIONS

FIGURE 15: AVERAGES OF MASCULINITY ATTRIBUTED QUESTIONS

FIGURE 16: AVERAGES OF FEMININITY ATTRIBUTED QUESTIONS

FIGURE 17: GENDER DISTRIBUTION

FIGURE 18: QUESTION 9 GERMANY

FIGURE 19: QUESTION 9 UK

FIGURE 20: QUESTION 2

FIGURE 21: QUESTION 1

FIGURE 22: QUESTION 5

FIGURE 23: QUESTION 3

FIGURE 24: UA INDICATOR QUESTIONS

FIGURE 25: UA QUESTIONS

FIGURE 26: HIGH AND LOW UA QUESTIONS

FIGURE 27: QUESTION 4 AND 6

FIGURE 28: QUESTION 8

FIGURE 29: JOB SECURITY

LIST OF ABBREVIATIONS

ABSTRACT

Critical analysis of Hofstede’s model of cultural dimensions: To what extent are his findings reliable, valid and applicable to organisations in the 21st

Century?

Kristin Piepenburg 28th January 2011

Global markets are changing faster than ever and increasing international competition makes it necessary for managers to understand not only the domestic culture but also the host country’s culture.

Derived from globalisation, successful cross-cultural management is gaining in importance and its need for understanding of cultural differences becomes essential. Because of this it is argued that, with the increasing importance of a cross-cultural understanding, Hofstede’s (1980) model of cultural dimensions gains proportional importance and attracts notice at the same time. His study is widely used in global operating organisations within trainings and workshops. The first step of effective cross-cultural management is the awareness that cultural differences exist and domestic strategies might fail in host countries

Even though, Hofstede’s (1980) cultural study is the most important one and widely knows, there are many other cultural studies, which are only partly supporting his study. For each and every model of cultural identifications arouse praise and criticism and Hofstede was not spared by criticism. The main criticism refers to the methodology Hofstede used and many authors questioned its validity and reliability. Another major critique is that the nearly 40-years old survey findings are out-dated and not of any modern value anymore. Addressing the elaborated criticisms from the literature, a personal replication study within the two countries of Germany and the UK is undertaken in order to evaluate the validity, reliability and applicability in the 21st century. This study has developed own dimension scores for Masculinity/ Femininity (MAS) and Uncertainty Avoidance (UA) for Germany and the UK and compared and evaluated these with Hofstede’s findings. The findings of this study vary from Hofstede’s findings, as according to this study the UK is more masculine and has a higher Uncertainty Avoidance score than Germany. These findings do not support Hofstede’s findings and further cultural research is recommended.

CHAPTER 1 INTRODUCTION

‘We may have all come on different ships, but we're in the same boat now’.

Martin Luther King Jr.

Martin Luther King Junior’s quotation encapsulates the issue cross-cultural management is dealing with. The ‘same’ boat stands metaphorically for cross- border relations and international businesses, and the ‘different’ ships for the employees and managers of an organisation who come from different countries, cultures and backgrounds. To be able to manoeuvre the boat in the right direction, the captain and the crew have to pull together. The same applies to international and cross-border businesses and to be able to work together effectively the need for understanding of each other’s background is essential. It is argued that, only if you know where all the ships and its members come from, you will know how to get the best out of this crew and be able to reach the final destination. Therefore, to protect cross-cultural activities from failing and use them effectively, Hofstede (1980) developed cultural dimensions to identify cultural differences and to help and support the ship to reach its final destination.

Global markets are changing faster than ever and ‘in today’s increasingly competitive and demanding international free market economy, managers cannot succeed on their understanding of domestic culture alone’ (Parhizgar, 2002, p. 2). Derived from globalisation, successful cross-cultural management is gaining in importance and the need for an understanding of cultural differences becomes necessary. It is argued that, simultaneously with the increasing importance of a cross-cultural understanding, Hofstede’s (1980) model of cultural dimensions gains proportional importance and attracts notice at the same time (Peterson, 2007).

1.1 GLOBALISATION

‘Globalization can be defined as the process by which markets and production in different countries are becoming increasingly interdependent due] to dynamics of trade in goods and services and flows of capital and technology’ (Held, 2000, p.92). Furthermore, Leidner (2010, p.69) states that globalisation ‘also encompass the exchange of production materials, the substitution of production processes, the relocation of services, the redistribution of resources, and the diffusion and infusion of cultural norms, artifacts, and values’.

According to Bourguignon et al. (2002), globalisation is a centuries-old phenomenon and Scholte (2000) concludes that interconnections and trades between countries took place before the word ‘globalisation’ actually was established. But ‘there is still a great deal of uncertainty surrounding its meaning and use of international business’ (Fletcher, 2000, p.211) and some authors, like Rugman (2003, p.409) even have the opinion that ‘globalisation is a myth’ and does not exist. He believes that the trend towards globalisation does not exist and that most business activities of large international firms do not take place in one single global market but within regional blocks. Moreover, Rugman (2005) states that managers need to design regional strategies rather than global ones. Stevens and Bird (2004, p.509) question Rugman and offer a detailed critique leading to the conclusion that ‘globalization is very much alive and well’.

Moreover, Hofstede et al. (2010) deepens the discussion of vanishing boundaries by implementing the notion of the ‘global village’, which makes the world appear smaller due to the World Wide Web and fast developing technologies.

Globalisation is affecting businesses and life all over the world. Alongside with its strengths and advantages, there are also weaknesses and disadvantages. The global weakness has just taken place in form of the global financial crisis, which has shaken markets worldwide and led Iceland into bankruptcy (Amadeo, 2008; Cline, 2010). Furthermore, Hofstede (2009a) blames the USA, where the financial crisis started and the interdependence of the modern global economy for the huge impact of the crisis and the long lasting consequences. His study and observation of MBA students from 17 countries analysed the objective of their country’s business leaders (Hofstede et al., . Resulting from this study he characterised US business leaders as ‘greedy, short-term gain oriented, and out of power’ (Hofstede, 2009a, p. 309) and concludes that this short-term orientation and greediness of the Americans are the main drivers of the financial crisis. Hofstede (2009a) states further, that the crisis could have been predicted, even though he adds that he did not have the necessary perspicacity for a perfect solution.

Business companies operate worldwide and ‘mergers, acquisitions, joint ventures, and alliances across national borders have become frequent, but they remain a regular source of cross-cultural clashes’ (Hofstede et al., 2010, p.407). Therefore cross-cultural management and multiculturalism has become an essential topic for Multinational Companies (MNC) (Parhizgar, 2002, p. xiii).

1.2 CROSS-CULTURAL MANAGEMENT

‘In the light of globalization and the rapid changes facing the world the need for understanding how people from different cultures interact and communicate has assumed a staggering importance’ (Bhawuk, 2008, p. 305). The awareness of cultural differences is becoming more essential in nowadays global businesses and is affecting cross-cultural management. Therefore it is important for MNCs and their managers to develop cultural awareness to sustain management effectiveness across cultural borders (Trompenaar and Hampden-Turner, 1997). Furthermore managers need multicultural interactive skills to be able to understand the differences of domestic culture and the culture of the country they would like to operate in (Parhizgar, 2002). To prepare managers and expatriates and help them to understand the impact of cultural differences as well as how they can deal with it, appropriate training and teaching is needed (Swierczek, 1994).

The growing interest of the on-going debate about cross-cultural differences and its influence on managerial behaviour was initiated by Hofstede (1980) who developed a model which identified several dimensions of cultural differences (Warner and Joynt, 2002). This model has been used ever since for explaining cultural differences and to investigate adequate manager’s behaviour in other countries. However, the question is to what extent Hofstede’s (1980) model is really helping managers to understand these cultural differences and how managers can benefit from his model in everyday life.

1.3 NEED FOR CONTEMPORARY APPROACH

‘Undoubtedly, the most significant cross-cultural study of work-related values is the one carried out by Hofstede’ (Bhagat and McQuaid, 1982, cited in Jones, 2007, p.2). Hofstede’s (1980) book ‘Culture’s Consequences’ was published at a time where little research about culture had been done, especially related to cross-cultural relationships of organisations. The interest in cultural differences was rising due to organisations entering global markets and expanding worldwide (Hofstede et al., 2010). Hofstede (1980) and his identified cultural dimensions, which are explained more detailed in Chapter 2.2., shaped a foundation and guideline for understanding culture and created a driving force for other researchers to continue (Powell, 2006). Researchers have described his study as the most important paradigm ‘for the study of culture and business management’ (Dawson and Young, 2003, p.587) and the cause of enormous numbers of citations, replications and discussions (Fang, 2003).

However, his study and findings are broadly discussed and criticised and many scholars have attempted to complement, update and even challenged his original study (Gooderham and Nordhaug, 2001). Moreover, the main critique is the out-dated and old-fashioned character of Hofstede’s (1980) study. Therefore, it is argued that there is a need to complement Hofstede’s (1980) study with a contemporary approach. Even though, Hofstede (1980; 2001) claims that culture stays stable over time and merely changes slowly, many researchers disagree and state that culture shifts over time. This study seeks to find out to what extent Hofstede’s (1980) study is still relevant in the 21st century and analyses its validity and reliability nowadays.

1.4 RESEARCH AIM AND OBJECTIVES

In the following section the research aim and objectives are introduced.

1.4.1 Aim

The aim and purpose of this study is to analyse and evaluate Hofstede’s (1980) study of cultural dimensions and its reliability, its validity and to what extent it is applicable to organisations in the 21st century.

This study aims to meet the need for a contemporary approach of Hofstede’s (1980) findings and contribute to the discussion of cultural studies by analysing contemporary cultural differences between Germany and the United Kingdom (UK) and in how far they vary from Hofstede’s (1980; 2001) findings. Moreover, the critiques of Hofstede’s study and methodology are considered and an own indicating replication study of the cultural dimensions of Masculinity/ Femininity (MAS) and Uncertainty Avoidance (UA) is undertaken.

A practical context is made within the analysis to figure out to what extent an application of Hofstede’s (1980) study in organisations is helping managers in everyday life regarding cross-cultural management and activities.

1.4.2 Objectives

1. To analyse Hofstede’s (1980) study of cultural dimensions and identify as well as evaluate critique for and against his study
2. To identify similarities and differences of Hofstede’s (1980) study with other cultural studies
3. To investigate the practical use and applicability of his study and to what extent managers benefit from it in cross-cultural management
4. To analyse and investigate the present differences of German and British students regarding the cultural dimensions of Masculinity and Uncertainty Avoidance and evaluate the following Hypotheses:
Hi: The cultural dimension of Masculinity/ Femininity has not changed over time and Germany and UK are still very masculine countries with similar scores (66).
H2: The cultural dimension of Uncertainty Avoidance has not changed over time and Germany still scores higher (65) than the UK (35).
5. To compare the findings of the primary research with Hofstede’s (1980) findings and analyse the differences
6. To be able to recommend improvements for cultural studies and future research.

1.5 OUTLINE OF THE CHAPTERS

This study comprises five chapters, which are outlined subsequently.

The first chapter presents the introductory section of the research topic and identifies the aim and the objectives of this study.

The second chapter reviews the main literature concerning culture, cultural differences, and cultural studies. It further explains, criticises, evaluates and compares Hofstede’s (1980) study with other cultural studies. An investigation of the practical use and the applicability of Hofstede’s (1980) study is provided and gives an insight in the value Hofstede adds to cross-cultural management.

In the third chapter the research methodology is specified and highlights philosophies, approaches and strategies that are used within this study. Moreover, the advantages, disadvantages and limitations of the applied research methods are assessed.

The Analysis and Findings, derived from the primary research are presented in the fourth chapter and present the main body of this study. The findings are analysed and compared to the findings from the literature review to gain a deeper understanding of the differences and similarities with Hofstede's (1980) study.

In the final chapter five, a summary of the findings for the previous chapters and a conclusion is given. This dissertation ends up in recommendations for future research in the field of cross-cultural management and cultural studies.

CHAPTER 2 LITERATURE REVIEW

This Chapter explains, defines and analyses the main elements of this study and gives an insight into the existing literature about culture, cultural differences and the variety of cultural studies. Hofstede’s (1980) study is introduced, explained, criticised, evaluated and compared with other cultural studies. Moreover, Hofstede’s (1980) findings and its practical use are discussed. The literature review is the basis for the Research Methodology and the Analysis and frames the Research Process.

2.1 CULTURE DEFINED

The word ‘culture’ has its origins in the Latin word cultura, which is related to cultus. This means cult or worship. In Latin, cult means to inhabit, till or worship and are means the result of. Thus, culture can be said to mean: the result of human action (Warner & Joynt, 2002).

Even though numerous researchers have dealt with the topic of culture, it could not have been agreed about a general definition so far. When Kroeber and Kluckhohn (1952) wrote their review on culture, they found 164 definitions of culture by anthropologists. Kluckhohn (1951, p.86) defines culture for examples as:

‘Culture consists of patterned ways of thinking, feeling and reacting, acquired and transmitted mainly by symbols, constituting the distinctive achievements of human groups, including their embodiments in artifacts; the essential core of culture consist of traditional ideas and especially their attached values.’

Similarly, Peterson (2004, p.17) defines culture as ‘the relatively stable set of inner values and beliefs generally held by groups of people in countries or regions and the noticeable impact those values and beliefs have on the peoples’ outward behaviours and environment’.

However, the most cited definition is the one provided by Hofstede (1980, p.26): ‘culture is the collective programming of the mind that distinguishes the members of one human group from another’.

Comparing all different definitions and taking them together, Hodgetts and Luthans (2003) identified six characteristics of culture. First, culture is learned, not inherited. Second, it is shared. Culture is not specific to a single individual, but it is shared by groups, organisations-, or entire societies. Third, culture is passed on from generation to generation. Fourth, culture is symbolic. Something can have entirely diverse meanings in different cultures, as it defines how the world is perceived and how life is organised. Fifth, culture is patterned. This means that it is integrated; if one aspect of culture changes, other parts are affected as well. Finally, culture is adaptive (Hoecklin, 1995; Hofstede, 1997; Trompenaars & Hampden-Turner, 1997). As the previous point already suggests, culture is dynamic. It is based on humans, who are able to change and adapt. But due to the difficulty of changing the minds of a whole nation, this occurs to be a very slow process (Hodgetts & Luthans, 2003).

Besides, it is agreed by most researchers that culture has visible and invisible elements, which can be illustrated as an iceberg as it is shown in Figure 2.

illustration not visible in this excerpt

FIGURE 1: THE 'ICEBERG' MODEL OF CULTURE

(Source: Brisbane Catholic Education, 1998, p. 4)

The visible part of an iceberg is only a small fraction of the whole and by seeing only the tip of the iceberg, the danger of clashing with the hidden part under water, which contains about 80% of the iceberg, is fatal (Peterson, Ignoring this hidden part can mean cross-cultural clashes for mergers, acquisitions, alliances, joint ventures or any transactions across national borders (Hofstede et al., 2010). The visible and observable culture elements contain behaviour, appearance, dress, language, habits, customs, and traditions. These cultural elements are obvious and are recognised very quickly (Peterson, 2004). But to understand these obvious elements, one has to look beyond the surface, as the invisible hidden elements are the cause and influence for the visible elements (Brett, 2007). Norms, beliefs, expectations, values, roles, assumptions, perceptions, time orientation, space orientation, learning styles, personality styles, rules, thought processes contain the hidden origins of culture and the core of it. As Brett (2007, p.27) states that ‘there is more to culture below the surface, and just like an iceberg, culture is not static, it drifts and shifts’. This is only half of the truth, as Wederspahn (2000) argues that the surface factors of culture can change over time, as due to globalisation and trends people change their appearance, dress, habits, behaviour, etc., but the ‘deep culture’ stays static and will not change rapidly overnight (Wederspahn, 2000). Peterson (2004, p.28) agrees to this point of view, as superficial cultural changes happen all over the world daily, whereas culture also ‘maintain certain traits over decades and centuries’. Hofstede et al. (2010) describes the shifting modern world as only affecting the level of practice, which subsumes the manifestations of symbols, heroes and rituals and are visible to outside observers. However, their cultural meaning is invisible and lies only in the interpretation of the insider.

Figure 2 shows Hofstede’s (2001) ‘Onion of manifestations of culture’. While globalisation is only affecting the practices of culture like symbols in the way of people dress the same, buy the same products or use the same fashionable words, or heroes become globally accepted through television shows and movies or further rituals of engagement in the same sports and leisure activities, makes the world look as if it is becoming more similar. Nevertheless, the core of culture and the deeper, underlying level of values that determine the meaning of the practices for the people are manifested deep in the individual and will not change overnight due to a new trend or fashion (Hofstede et al., 2010; Hoecklin, 1995). Hofstede et al. (1990, p.312) further state ‘by the time a child is ten, most of his or her basic values are probably programmed into his or her mind’ and will presumably not change throughout their life.

illustration not visible in this excerpt

FIGURE 2: THE 'ONION DIAGRAM':

MANIFESTATIONS OF CULTURE AT

DIFFERENT LEVELS OF DEPTH.

(Source: Hofstede, 2001, p. 11)

Furthermore, it is agreed among researchers that culture consists of further several layers extended to Hofstede’s (2001) assumptions, which can be visualised as an onion as well in the form of three layers: basic assumptions, norms and values, and artifacts and products (Schein, 2010).

Although different researchers have slightly different explanations of the deeper levels of culture, they do agree on certain characteristics. First, culture is a multilayer construct, and the deeper one digs into a culture, the more difficult it becomes to understand it. Furthermore, they do agree that culture is difficult to change, and again, the deeper the level of culture, the more difficult it is to change or influence it. Hofstede (1983), for example, explains thatespecially the onion’s core, the basic assumptions are difficult to change as they are already shaped early in a child’s life and constantly reinforced throughout life. However, artifacts and products, like Hofstede et al. (2010) explains, can change faster as the outer layer is influenced by the external environment and shapes the external reality.

Culture has been studied for a long time by researchers from diverse fields, but only recently culture is used to understand different behaviours of people in different countries within an organisational context (Francesco and Gold,2005).

2.1.1 National culture

National culture is the broadest level of culture a person can be a member of. It shapes people from early childhood through values, beliefs-, and assumptions inherent in it (Hofstede, 1991). Moreover, national culture is a learned characteristic and none of it is genetic (Hofstede, 2007). While Kogut and Singh (1988) simply define national cultural distance as the degree to which norms are different between countries, Hofstede (1983) suggests that there are three reasons for the existence of differences among countries: political, sociological and psychological. ‘Nations are political units, rooted in history, with their own institutions: forms of government, legal systems, educational systems, labor and employer's association systems’ (Hofstede, 1983, p.75). Obviously formal institutions differ, but even though one would try to match the political units of different countries, the informal way of the implementation would still differ. A further attribute that distinguishes countries is sociology. Belonging to a nation has a symbolic value to citizens and shapes a part of the identity. This sense of identity creates a common national identity, which citizens try to protect and defend if they have the feeling of threat. Lastly, Hofstede mentions psychological reasons for national cultural distance between countries. People’s thinking is determined by national culture factors and the effect of early life experience and educational experiences whilst growing up (Hofstede, 1983).

Moreover, Lewis (1996, p.8) states, that ‘comparisons of National cultures often begins by highlighting differences in social behaviour’ and as Gooderham and Nordhaug (2001) add that individuals become aware of their own culture when they are confronted with another.

2.1.2 Organisational culture

‘Organisations, like nations, have cultures’ (Francesco and Gold, 2005). It is a pattern of basic assumptions as well and is invented, discovered or developed by a given group of people while coping with problems of internal integration and external adaption. This way of doing things and coping with problems has worked well enough to be considered valid and thus is taught as the correct way of doing things to new members (Schein, 1985). Therefore, organisational culture is seen as the ‘natural’ way of understanding the business world and taking action (Francesco and Gold, 2005).

Moreover, Hofstede et al. (2010) explicate that organisational culture consists of the following attributes: holistic, historically determined, related to the things anthropologists study, socially constructed, soft and difficult to change, and further applies his definition of culture to organisational culture: ‘the collective programming of the mind that distinguishes the members of one organization from others’ (Hofstede et al., 2010, p.344).

Besides, Armstrong (2003) states, that while national culture is impossible to change, organisational culture can be changed within the fractious process of change management. While national culture is shaped during the early childhood, organisational culture is learned and adopted while entering the employment market and gaining work experience (Hofstede et al., 2010). The organisational culture is not as deeply rooted as national culture and even though resistance is usually very high during change management processes, the capability to change is given.

Furthermore, Martin (1992, p.113) argues that the national culture is influencing the organisational culture immensely and that ‘we cannot understand what goes on inside an organizational culture without understanding what exists outside the boundaries’.

2.2 HOFSTEDE’S STUDY OF CULTURAL DIMENSIONS

Geert Hofstede, a Dutch social psychologist, published his landmark study in 1980 “Cultures Consequences: International Differences in Work related Values” (Hofstede, 1980). Through his cross-cultural studies he identified four main dimensions, later six, which affect human thinking, organisations, and institutions in predictable ways (Francesco and Gold, 2003). ‘A dimension is an aspect of a culture that can be measured relative to other cultures’ (Hofstede et al., 2010, p.30). Moreover, Levitin (1973, p.492) states that dimensions are not tangible and that they are ‘not directly accessible to observation but inferable from verbal statements and other behaviors and useful in predicting still other observable and measurable verbal and nonverbal behavior’. Furthermore, Hofstede’s (1980) research had a remarkable effect on academics and practitioners (Jones, 2007) and was cited and utilised in a wide range of social context, is taught in class rooms and subject in organisational training (Dawson and Young, 2003) and is further the most cited Non-American in the US Social Science Citation Index (Powell, . Hofstede’s study of pioneering character based on a huge amount of data was taken up enthusiastically by many researchers and has been accepted and adopted quickly within academic and organisational environment ever since.

In his book, Hofstede (1980) identified four dimensions (later on six) for 40 countries to discover cultural differences. These four dimensions are: Power Distance (PD), Uncertainty Avoidance (UA), Individualism/ Collectivism (IDV), Masculinity/Femininity (MAS), added later on by Long-term Orientation (LTO) and recently Indulgence vs. Restraint. These dimensions are further compared with national measurements, such as Gross National Product (GNP), economic growth latitude, population size, population growth, population density and organisation size (Hofstede, 2001).

2.2.1 Research data

Hofstede’s (1980) book is based on the largest survey of value works in the multinational company of International Business Machines (IBM), which was held twice, in 1967 and in 1973 (Hofstede, 1980). At that time, IBM was one of the largest multinational companies with numerous subsidiaries in many different countries around the world and sold a wide range of high-technology products for particular computers (Data Processing Division) and typewriters (Office Products Division). In the duration of the data collection IBM had research laboratories in two countries, developed its products in seven countries, manufactured in thirteen countries and marketed and serviced in about one hundred countries (Hofstede, 2001). Geert Hofstede was hired by IBM in 1965 as the first personnel researcher for the European head office to conduct an international employee morale survey. Hofstede and his team of six researchers prepared the first internationally standardized questionnaire for a simultaneous survey, which consisted of 180 standardized items. During that time conducting an international survey was facing distribution problems as the internet was not yet well established and questionnaires needed to be filled out manually and sent via post back to the headquarter. Issues, such as missing, stolen or lost questionnaires were not uncommon (ibid).

Over these six years, Hofstede and his colleagues collected and analysed questionnaires of IBM employees in 53 and later in 72 countries all over the world, from which over 88,000 people responded (Hofstede, 1980; Hofstede, 2001; Jones, 2007; Powell, 2006). IBM’s international employee attitude survey program was carried out between 1967 and 1973 with the purpose of identifying preferences in specific areas of employee morale and attitude (French, 2010; Hofstede, 2001). A factor analysis of 32 questions in 40 countries was made from the obtained data. Four bipolar dimensions emerged from that and became the basis of his characterisations of culture for each country (Jones, 2007). The first study was limited to 40 countries due to low response rates in some countries. A minimum of 50 respondents needed to be ensured for a reasonable result (Hofstede, 2001).

From 1971 to 1973 Hofstede taught organisational behaviour at the IMEDE Management Development Institute in Lausanne, Switzerland, a postgraduate and post experience international business school. Using the IBM questionnaire as teaching material he decided to administer a reduced version of the IBM survey and obtained data from 362 managers from 30 different countries. It provided the first hard proof for Hofstede that the differences within the IBM study was not company but country specific (Hofstede, 2001; Hofstede et al., 2010).

2.2.2 Cultural dimensions

In the following section Hofstede’s (2001) cultural dimensions are described and analysed in detail. The specific indices are shown in Appendix A.

Power Distance (PD): is defined by Hofstede et al. (2010, p.61) as ‘the extent to which less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally’; where institutions are seen as the basic elements of society, such as family, school and the community and organisations are the people’s work places (ibid). Mullins (2007, p.25) adds, that PD ‘is used to categorise levels of inequality in organisations, which Hofstede claims depend upon management style, willingness of subordinates to disagree with superiors, and the educational level and status accruing to particular roles’. Furthermore, PD represents a society’s level of inequality which is admitted as much as by followers as by leaders. Inequality and power are two fundamental facts of a society and considering international comparison it is obvious that all societies are unequal, but some might be more unequal than others (Hofstede and Hofstede, 2009a).

However, Fougere and Moulettes (2006) criticise Hofstede for evaluating the Power Distance Index (PDI) and distinguishing between ‘low PDI’ as ‘modern’ and ‘high PDI’ as ‘traditional’. They state that Hofstede suggests from his western point of view, the ‘low PDI’ side as better than the other, as this side is deemed to be more technological, more legal, modern, educated, wealthy, fair, equal, democratic, etc.. Nevertheless, Hofstede states in Powell (2006) that there is no such thing as better or worse score within the indices, that the scores are treated completely neutral and there are no assumed disadvantages of being on one side or the other.

Individualism/ Collectivism (IDV): The Individualism Index (IDV) represents the relatively individualistic or collectivist ethic evident in a particular society (Mullins, 2007). Additionally, Hofstede and de Mooij (2010, p.88/89) define Individualism/ Collectivism as ‘people looking after themselves and their immediate family only, versus people belonging to in-groups that look after them in exchange for loyalty’. Moreover, they state that individualistic cultures are universalistic in assuming that their values are valid for the whole world and are low-communication cultures with explicit verbal communication. In contrast, in collectivistic cultures an individual’s identity is based on the society and avoiding loss of face is important. Additionally, collectivistic cultures are high-context communication cultures, as these cultures use an indirect style of communication. Konopaske and Ivancevich (2004) characterise individualistic individuals as being motivated by the self-concept, self-ego and self-interest and collectivistic individuals as group oriented and with a higher awareness of the group’s interest rather than the individual’s.

While Hofstede (2001) claims that the dimensions are bi-polar and the dimensions are composed of contrasting poles, individualism is treated as the opposite pole of collectivism. Triandis (1994) however, argues that these dimensions can coexist and are depending more or less on the situation.

Masculinity/ Femininity (MAS): ‘Masculinity versus its opposite, femininity refers to the distribution of roles between the genders which is another fundamental issue for any society to which a range of solutions are found’ (Hofstede and Hofstede, 2009a). In masculine societies ‘the tough values- including success, money assertiveness, and competition- are dominant’ (Francesco and Gold, 2005, p.27). While in feminine cultures the importance lies on tender values, such as quality for life, personal relationship, care for others, and service (ibid). This dimension does not refer to the dominance of the gender, but more the degree to which masculine traits or feminine characteristics are given (Jones, 2007). Hofstede et al. (2010) distinguish between the masculine and feminine pole, where the importance of earnings, recognition, advancement and challenge are creating the masculine pole and, on the other hand good relationship with the manager, Co-operation, living area and employment security the feminine pole. Role differentiation is an important aspect of this dimension, as it is small in feminine societies and large in masculines. In feminine countries, for example household work is more shared between husband and wife than in masculine countries (Hofstede and de Mooij, 2010).

The MAS dimension has probably aroused the most criticism over the years and is blamed for being vague and contradictory. For instance, its lack of meaning and its gender role differentiation- is criticised by Fougere and Moulettes (2006). However, Hofstede (2001) claims that the many scholars who have misinterpreted this dimension do not accept the convergence in social gender roles.

Uncertainty Avoidance (UA): Uncertainty Avoidance (UA) is defined by Hofstede et al. (2010, p.191) as ‘the extent to which the members of a culture feel threatened by ambiguous or unknown situations’. This is expressed through a need for predictability and through nervous stress (Hofstede et al., 2010). Individuals in high UA cultures feel threatened by risky and uncertain situations and are constantly trying to minimize risk and uncertainty by developing strict laws and rules or formal regulations (Konopaske and Ivancevich, 2004). Strong UA is shown in a need for security and strict rules and structure, which can hinder change and innovation. Weak UA is represented through unstructured situations, more flexible and more easy- going. In this environment changes and innovations, as well as entrepreneurial spirit are more welcomed (Francesco and Gold, 2005). This aspect is criticised by Shane (1993) as he states, that low UA countries had shown a high rate of innovation in terms of trademarks granted. Nevertheless, Hofstede et al. (2010) claims that only the dimension’s extremes are described and that countries usually are not presenting an extreme but are positioned more in the middle. Moreover, McSweeney (2002) state that the question for measuring the index about ‘rules should not be broken’ is critical, as the meaning can differ from country to country, especially as the question leaves too much room for subjective interpretation.

Long-term orientation (LTO): ‘Long- versus short-term orientation is the extent to which a society exhibits a pragmatic future-oriented perspective rather than a conventional historic short-term point of view’ (Hofstede and de Mooij, 2010, p.90). This fifth dimension, which was originally named ‘Confucian work dynamism’, was developed by Michael Bond, whose attempt was to identify Chinese cultural values and their impact on the workplace (Mullins, 2007). With the ‘Chinese Value Survey’ (CVS) Michael Bond and a number of his Chinese colleagues from Hong Kong and Taiwan created a non-westernised survey. As Hofstede and Bond were interested in new methods and tools, which were not created in their so called ‘Western world’ and influenced by western values, the CVS offered them a new point of view from a different angle (Hofstede et al., 2010). The CVS was administered to one hundred university students in twenty-three different countries around the world. The resulted factor-analysis demonstrated four extracted factors, where three of them correlated with Hofstede’s cultural dimensions (Wu, 2006). Only UA did not have an equivalent in the CVS. The emerged fourth CVS dimension combined values opposing a future orientation versus past and present orientation (Hofstede, 2001). This dimension was called ‘Confucian Work Dynamic’ and included four items: 1. Ordering relationship; 2. Thrift; 3. Persistence; and 4. Having a sense of shame. These Confucian values in the Chinese society as an eastern cultural dimension was adopted by Hofstede and renamed into ‘Long-term orientation’ (Wu, 2006).

Hofstede et al. (2010, p.239) defines long-term orientation as ‘the fostering of virtues oriented toward future rewards- in particular, perseverance and thrift’. Short-term orientation is thereafter ‘the fostering of virtues related to the past and present- in particular, respect for tradition, preservation of ‘face’, and fulfilling social obligations’. The scores for LTO were recalculated and further countries could be added to the index in the newest edition of Hofstede’s book ‘Cultures and Organizations: Software of the mind’ (2010) with the help of the new Co-author Misho Minkov.

After the success of the eastern cultural dimension, Hofstede considered to go further and tried to adopt this approach to Africa with the possibility of an emergent African value dimension (Hofstede, 2001). Even though six factors were produced and five of them correlated with the previous dimensions, the remaining factor ‘was no serious candidate for a new, African-inspired, cultural dimension’ (Hofstede, 2001, p.370). This is heavily criticised by Fougere and Moulettes (2006) as they argue that Hofstede thinks that Africa is not worth its own dimension. However, the evidence for creating a new African dimension was not enough and further researches needed to be done before considering a valid and reliable new dimension.

Indulgence vs. Restraint (IVR): In the last edition of Hofstede’s book ‘Cultures and Organizations: Software of the mind’ (2010) with the Co-authors Geert Jan Hofstede and Misho Minkov this new dimension was added: Indulgence versus Restraint. By re-analysing the enormous data of the World Value Survey (WVS), which is a global survey administered in more than one hundred countries and including more than 360 forced-choice items, Minkov extracted three dimensions. He named these dimension: exclusionism vs. universalism, which correlated with collectivism vs. individualism; indulgence vs. restraint and monumentalism vs. flexhumility, which correlated significantly with short- vs. long-term orientation. The analysis of the latter resulted in a new measurement of the LTO dimension and an enriched understanding of its implications and an increasing number of included countries (Hofstede et al., 2010).

The new emerged dimension, Indulgence versus Restraint, is focusing on happiness and life control. Indulgence ‘stands for a society that allows relatively free gratification and natural human drives related to enjoying life and having fun’ (Hofstede et al., 2010, p.281). Whereas, restraint reflects a society, which suppresses gratifications of needs, by regulating it with means of strict social norms (Hofstede and Hofstede, 2009a). People from indulgent societies are more likely to remember positive emotions, have less moral disciplines, have more extrovert personalities, have higher optimism and leisure time and having friends is very important. Individuals in restraint societies are less likely to remember positive emotions, leisure time and friends are less important, cynicism and moral discipline are stronger and people are more pessimistic (Hofstede et al., 2010).

Due to the recent publications and release of this new dimension, no critique or comments are available so far and Hofstede et al. (2010) state, that this dimension needs more study and further in-depth analyses.

2.2.3 Other cultural studies and comparison with Hofstede’s dimensions

French (2010) states, that Hofstede is the pioneer of cross-cultural study and the most influential organisational sociologist. Moreover, Hoecklin (1995) praises his pioneering work, and Powell (2006) claims that Hofstede created a milestone of cultural study and a driving force for other researchers to continue researching about culture.

However, there are several other influential and important studies about culture by Trompenaar, Schwartz, Kluckhohn and Strodtbeck, Hall and Hall, and recently the GLOBE project. These studies deepen the study of culture by making it more feasible and understandable. Hofstede (2001) states, that about 200 external comparative studies support the cultural differences measured by his indices. The most important ones, are the one stated above, which Hofstede uses within his book to support his dimensions. Each study correlates with some of the identified cultural dimensions, but none of them, except of the GLOBE project, which is built on Hofstede’s framework, included all dimensions. A comparison of Hofstede’s dimensions and other cultural studies is shown in Figure 3 below:

illustration not visible in this excerpt

FIGURE 3: COMPARISON OF HOFSTEDE'S CULTURAL DIMENSION WITH OTHER CULTURAL STUDIES

(Source: Own Illustration based on Neumann, 2008, p.5; Carr, 2004, p.24; Francesco and Gold, 2005, pp.20-33; Hoecklin, 1995, pp.27-46; Trompenaar and Hampden-Turner, 1997, p.8/9; Konopaske and Ivancevich, 2004, pp.32-35)

In the following section the main cultural studies are discussed briefly and the similarities of cultural differences with Hofstede’s (1980) dimensions are pointed out.

Trompenaar: Beside Hofstede, Trompenaar’s study on national culture differences is probably the second most popular study of cultural differences. Trompenaar and Hampden-Turner (1997) surveyed 15,000 managers from 28 nations and received around 500 valid responses from each country and developed seven dimensions on which culture diverge. Of those dimensions, five are used to describe how people deal with each other, while the other two refer to the concepts of time and environment (Warner and Joynt, 2003). The seven dimensions are:

illustration not visible in this excerpt

TABLE I: TROMPENAARS 7 DIMENSIONS

(Source: Hoecklin, 1995; Trompenaar and Hampden-Turner, 1997)

Several of those dimensions have overlaps with some of Hofstede’s cultural dimension. Individualism versus Communitarianism relates to Individualism versus Collectivism, Achievement versus Ascription to Power Distance and Sequential versus Synchronous to Long-term orientation. However, Hofstede (1996) criticised Trompenaar’s study for being cultural biased and questioned the representativeness of his study.

Schwartz: Shalom Schwartz, an Israeli psychologist concentrates on universal aspects of individual value content and structure. The dimensions of Schwartz are based on three issues all societies are confronted with: ‘(1) the nature of the relation or boundaries between the individual and the group, (2) how to guarantee responsible behaviour, and (3) how to regulate the relation of people to the natural and social world’ (Francesco and Gold, 2005, p.30). Over ten years, Schwartz collected data from over 60,000 people in 63 countries, where most of the respondents were teachers at universities and schools (Sagiv and Schwartz, 2000). From the results, Schwartz developed three bipolar dimensions of culture, which shows different solutions to the issues that confront societies (Schwartz, 1992). These dimensions are:

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TABLE II: SCHWARTZ'S DIMENSIONS

(Source: Francesco and Gold, 2005; Thomas and Inkson, 2003; Schwartz, 1992)

The first dimension of Embeddedness versus Autonomy relates to Individualism vs. Collectivism and Mastery versus Harmony relates to Short-/ Long-term orientation (Neumann, 2008). Triandis (2004) suggests that the dimension of Hierarchy versus Egalitarianism refers to Power Distance if Individualism/ Collectivism seen as vertical or horizontal, but Neumann (2008) claims that Harmony correlates positively with Uncertainty Avoidance which makes it unclear of its suitability as Power Distance.

Kluckhohn and Strodtbeck: Kluckhohn and Strodtbeck (1961), two anthropologists, focused within their pioneering study not on the realm of work but on culture more generally. Their Values Orientation theory is based on three assumptions, namely that there are limited number of common human problems for which all people have to find solutions, that these solutions are limited in number and universally known, and that different cultures have different preferences among those solutions (Kluckhohn and Strodtbeck, 1961). They developed the following dimensions:

illustration not visible in this excerpt

TABLE III: KLUCKHOHN'S AND STRODTBECK'S DIMENSION

(Source: Konopaske and Ivancevich, 2004)

The second dimension is similar to Short- and Long-term orientation and the dimension of ‘Relationship among others’ can be referred to Individualism/ Collectivism.

Hall and Hall: The American anthropologist, Edward T. Hall (1976) explains the differences in communication styles among cultures with the concept of context. ‘Context is the information that surrounds an event; it is inextricably bound up with the meaning of that event’ (Hall and Hall, 1989, p.64). These can be divided into:

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TABLE IV: HALL AND HALL COMMUNICATION STYLES

(Source: French, 2010; Francesco and Gold, 2005)

Moreover, Hall (1976) developed the concept of monochronic versus polychronic time orientation:

illustration not visible in this excerpt

TABLE V: HALL AND HALL TIME ORIENTATION

(Source:Hofstede and de Mooij, 2010)

While High- and low-context are characteristics of Collectivism and Individualism, the aspect of time orientation is related according to Neumann (2004) to short-/ long-term orientation. Even though the understanding of the word ‘time’ is basically different, the basic assumption is the same.

GLOBE project: The ‘Global Leadership and Organizational Behaviour Effectiveness’ research project (GLOBE) reports the result of a ten-year research program and is designed to conceptualize, operationalize, test, and validate a cross-level integrated theory of the relationship between culture, societal, organisational and leadership effectiveness. 170 investigators from 62 cultures are working on this project and obtained data from 17,300 managers in 951 organisations (House et al, 2004). The third round of obtaining data from over 17,000 managers is taking place right now in the year 2010/2011 (Hofstede et al, 2010). The origins and foundations of the GLOBE approach are derived from the models and dimensions described above (House et al., 2004; Hofstede, 2006). The GLOBE dimensions mainly adopted Hofstede’s (1980) cultural dimensions, and hence identified the following dimensions out of their huge amount of data:

illustration not visible in this excerpt

TABLE VI: GLOBE DIMENSIONS

(Source: French, 2010; House et al., 2004)

These nine dimensions were developed out of 78 survey questions, where half of the questions were asking about their culture ‘as it is’ and the other half of the questions were asking about the ‘as it should be’. Thus, nine dimensions for each orientation were developed resulting in 18 dimensions (Hofstede et al., 2010). The GLOBE project is the most contemporary mammoth survey nowadays and is expanding Hofstede’s approach of cultural dimensions by the contribution of 170 investigators from 62 cultures, which secures the non- cultural bias (French, 2010). However, Hofstede et al. (2010, p.42) criticize the GLOBE project ‘for having formulated the questions in researchers’ jargon, not reflective of the problems on the responding (mainly first-line) managers’ minds’ and further for ignoring personal desires. Hofstede (2006, p.884) calls it a ‘debatable approach’ as he doubts the representation of the real picture by asking managers and hence he questions the validity.

Summary: While Hofstede’s (1980) study provided a breakthrough in the analysis of national cultural differences, the other researchers support the findings and further extend his work. Although the authors tend to criticize each other’s model or the research procedure, the models complement each other and increase the literature’s value. Moreover, there is not only one best approach of studying culture and cultural differences, as there are many ways of doing so especially when considering the number of different culture definitions (Warner and Joynt, 2003). For each and every model of cultural identification aroused praise and criticism and therefore made culture discussable and nameable. Table VII illustrates the most important cultural studies and their matching of dimensions and differences.

illustration not visible in this excerpt

TABLE VII: COMPARISON OF CULTURAL STUDIES

(Source: Own Illustration based on Neumann, 2008, p.18; Carr, 2004, p.24; Francesco and

Gold, 2005, pp.20-33; Hoecklin, 1995, pp.27-46; Trompenaar and Hampden-Turner, 1997,

p.8/9; Konopaske and Ivancevich, 2004, pp.32-35)

Resulting from Table VII, it is obvious that Hofstede’s (2001) cultural dimensions have got always one or more counterparts in several other studies and especially GLOBE is supporting every single dimension of Hofstede and even adding further ones. Thus, GLOBE can be seen as the contemporary, intensified and broader version of Hofstede’s cultural dimension. However, the appliance is not as simple as Hofstede’s and the huge amount of data and in total eighteen cultural dimensions are making its practical use even more difficult. The most significant culture dimensions with the most matching counterparts are the dimensions of Individualism versus Collectivism and Long-term versus Short-term orientation.

[...]

Fin de l'extrait de 148 pages

Résumé des informations

Titre
Critical analysis of Hofstede’s model of cultural dimensions
Sous-titre
To what extent are his findings reliable, valid and applicable to organisations in the 21st century?
Université
Oxford Brookes University
Note
1,0
Auteur
Année
2011
Pages
148
N° de catalogue
V169716
ISBN (ebook)
9783640881765
ISBN (Livre)
9783640881574
Taille d'un fichier
1979 KB
Langue
Anglais
mots-clé
Hofstede, Culture, Cultural Differences, Trompenaar, Cultural dimensions, Uncertainty Avoidance, Masculinity, Germany;, UK, cross-cultural management, diversity, globalisation, 21st century, cultural study, dimensions, survey
Citation du texte
Kristin Piepenburg (Auteur), 2011, Critical analysis of Hofstede’s model of cultural dimensions, Munich, GRIN Verlag, https://www.grin.com/document/169716

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