1. Global Business Environment
Joan Lofgren
Lecture 4b
Focus on Hofstede/Trompenaars
September 7, 2017

2. Have you heard of Hofstede?
Joan Lofgren, September 7, 2017

3. Geert Hofstede’s four cultural dimensions
Power distance: measures the degree to which less powerful members of organizations and institutions accept the fact that power is not distributed equally.
Uncertainty avoidance: measures the extent to which people feel threatened by ambiguous situations and have created institutions and beliefs for minimizing or avoiding those uncertainties.
Joan Lofgren, September 7, 2017

4. Hofstede’s four cultural dimensions (cont.)
Individualism vs. collectivism
Individualism: the tendency of people to look after themselves and their immediate family only.
Collectivism: the tendency of people to belong to groups who look after each other in exchange for loyalty.
Joan Lofgren, September 7, 2017

5. Hofstede’s four cultural dimensions (cont.)
Masculinity vs. femininity
Masculinity: the degree to which the dominant values of a society are success, money and material goods.
Femininity: the degree to which the dominant values of a society are caring for others and the quality of life.
Later added:
Long-term versus short-term orientation
Indulgence versus restraint
Joan Lofgren, September 7, 2017

6. Hofstede found….
cultural norms and values very powerful in the workplace
organizational culture less influential than national cultures
successful management in one culture no guarantee of success in another
countries may not have a single national culture
Joan Lofgren, September 7, 2017

7. Hofstede’s cultural dimensions (cont.)
Hofstede will become a familiar name in your studies!
Many other scholars have built upon his approach.
Joan Lofgren, September 7, 2017

8. Joan Lofgren, September 7, 2017
Figure 5.2 Hofstede’s power distance against individualism for 20 countries
Source: Hofstede, G. (1983). The cultural relativity of organizational practices and theories, Journal of International Business Studies, Fall, p. 92. Copyright © Geert Hofstede
Joan Lofgren, September 7, 2017

9. Fons Trompenaars’ seven cultural dimensions
1. Universalism vs. particularism
Universalism: the belief that ideas and practices can be applied everywhere in the world without modification.
Particularism: the belief that circumstances dictate how ideas and practices should be applied and some things cannot be done the same everywhere.
Joan Lofgren, September 7, 2017

10. Fons Trompenaars’ seven cultural dimensions (cont.)
2. Individualism vs. collectivism: centres on whether individual rights and values are dominant or subordinate to those of the collective society.
3. Neutral culture vs. emotional culture:
Neutral culture: A culture in which emotions are held in check.
Emotional culture: A culture in which emotions are expressed openly and naturally.
Joan Lofgren, September 7, 2017

11. Fons Trompenaars’ seven cultural dimensions (cont.)
4. Specific vs. Diffuse: measures whether work relationships (e.g. the hierarchical relationship between a senior manager and a subordinate) are workplace ‘specific’ or extend (diffuse) into the social context outside the workplace.
5. Achievement vs. Ascription: measures whether one’s status within organizations is based on merit (“achieved”) or on class, gender, education or age (“ascribed”).
Joan Lofgren, September 7, 2017

12. Fons Trompenaars’ seven cultural dimensions (cont.)
6. Attitudes toward time
Sequential: cultures that view time in a sequential or linear fashion; order comes from separating activities and commitments.
Synchronic: cultures that view events in parallel over time; order comes from coordinating multiple activities and commitments.
Joan Lofgren, September 7, 2017

13. Fons Trompenaars’ seven cultural dimensions (cont.)
7. Attitudes toward the environment: measures the emphasis, a particular culture places on people’s relationship with nature and the natural environment.
Joan Lofgren, September 7, 2017

14. Relevance of culture for IB
Culture underlies all social activity, thus also business
International business by nature crosses cultural boundaries as it moves from one national economy to another
Managers in foreign countries often face a choice of adapting to local practices vs following those of the company/home culture.
Is globalization leading to a homogenization or convergence of cultures (eg McDonaldization)?
Joan Lofgren, September 7, 2017

15. Learning about a foreign culture
As a means of information gathering and evaluation—the manager need not depend on the perceptions and opinions of others about the local market, the situation in the company.
Interpreting cultural contexts that influence business operations, eg in negotiations.
Your own experiences?
Joan Lofgren, September 7, 2017

16. Activity on cultural identity
Prepare a mind map of your cultural identity. Put your name on the top.
You will then share highlights from your mind map in a small group.
Note: You are not expected to share anything confidential with the class as a whole, although I will ask for voluntary comments.
Please turn in your mind map to me.
Joan Lofgren, September 7, 2017