Culture IHRM IBO 2014 1

Topics: Geert Hofstede, Culture, Cross-cultural communication Pages: 43 (2838 words) Published: March 4, 2015
BO6201 - IBO

- Culture & IHRM
• Culture and its importance in
international business
– National, organisational and
industry cultures
– Dimensions of culture
– Cross cultural negotiations
• International HRM
– Its roles
– Ex-pats, locals and TCNs

© Chris Davison

22 Oct 2014

Chris Davison
c.davison@kingston.ac.uk
tel: +44 7910 764 758

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1

Globalisation is leading to . . .
• Physical mobility
– Dramatically increased flows and mobility of
international talent
• Short- vs long-term
• Self- vs organisation initiated
• Developing vs developed world

• Virtual mobility
– Increasingly complex configuration of teams
• Multicultural
• Matrices
• Extra organisational
Source: Christina Butler 2014
© Chris Davison

22 Oct 2014

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2

Importance of Culture in
International Business
• Employees
– How can we best motivate and engage our people?
• Overseas staff?
• Suppliers & Distributors?
• Customers
– Is our offer suitable for the foreign market?
• Product or service itself?
• How should we promote it?
• How should we distribute it?
Offer  product or service
© Chris Davison

22 Oct 2014

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3

What is Culture?
• Culture is “the collective programming of mind which
distinguishes one category of people from another”
• Geert Hofsted 1980

• Culture is how things are done around here.
• Drennan 1992

• Corporate culture is the implicit, intrinsic and informal consciousness of the organisation
• Scholz 1987

© Chris Davison

22 Oct 2014

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Three Layers of Culture

© Chris Davison

22 Oct 2014

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Danger of Self Reference Criterion
• We tend to assume that foreigners will have the same
values and attitudes as ourselves. (Self-reference
criterion)
Lee 1966

• To avoid the SRC we need to research foreign cultures
and adapt our business practices accordingly

© Chris Davison

22 Oct 2014

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© Chris Davison

22 Oct 2014

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Interaction of Cultures
Culture is learned from
ones environment

Professional

An individual’s culture
is an amalgam of their
past and present experience
& multiple cultures.
© Chris Davison

22 Oct 2014

National
or
Ethnic

Organisation

Industrial

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Culture’s Components
Values
Attitudes

Non-verbal
language

Language

Culture
Gender
roles

Religion
Humour

© Chris Davison

22 Oct 2014

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9

Dangers in the Unspoken Language

© Chris Davison

22 Oct 2014

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10

National Culture Differences
Culture is “the collective programming of mind which
distinguishes one category of people from another”
Geert Hofstede

© Chris Davison

22 Oct 2014

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HSBC importance of culture
© Chris Davison

22 Oct 2014

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Hofstede’s Dimensions of Culture






Power distance
Individualism
Masculinity vs femininity
Uncertainty avoidance
Long-termism
Hofstede’s work done with 64 IBM sites worldwide

© Chris Davison

22 Oct 2014

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Power Distance
• Power distance is the extent to which the less powerful
members of an organisation accept the inequality
– UK
PDI=35
• Small power distance society
– Austria PDI=11
– Israel PDI=13
• Hierarchy means inequality of roles is established for
convenience
• Subordinates expect to be consulted
• Ideal boss is a resourceful democrat
© Chris Davison

22 Oct 2014

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Large Power Distance
• Philippines
PDI=94
• India
PDI=77
• France
PDI=68
– Hierarchy mean existential inequality
– Subordinates expect to be told what to do
– Ideal boss is benevolent autocrat

© Chris Davison

22 Oct 2014

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15

Individualism vs Collectivism
• Individualism is the extent to which individuals are
integrated into groups
UK IDV=89
• Individualist societies
– USA IDV=91
• Others seen as resources
• Task prevails over relationship
• Calculative...
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