1. Cultural Differences What makes cultures different?
Why causes cultural differences problems?
One example of cultural differences in business is between the Middle Eastern countries and the Western countries, especially the United States.ﾊWhen negotiating in Western countries, the objective is to work toward a target of mutual understanding and agreement and 'shake-hands' when that agreement is reached - a cultural signal of the end of negotiations and the start of 'working together'.ﾊIn Middle Eastern countries much negotiation takes place leading into the 'agreement', signified by shaking hands. However, the deal is not complete in the Middle Eastern culture. In fact, it is a cultural sign that 'serious' negotiations are just beginning.ﾊImagine the problems this creates when each party in a negotiation is operating under diametrically opposed 'rules and conventions.'ﾊThis is just one example why it is critical to understand other cultures you may be doing business with - whether on a vacation in a foreign country, or negotiating a multi-million dollar deal for your company.

2. The Geert Hofstede model
“Culture is more often a source of conflict than of synergy. Cultural differences are a nuisance at best and often a disaster.”
Power distance => PDI
Indivualism => IDV
Uncertainty Avoidance => UAI
Masculinity => MAS
Long Time Orientation => LTO
Prof. Geert Hofstede conducted perhaps the most comprehensive study of how values in the workplace are influenced by culture. From to 1973, while working at IBM as a psychologist, he collected and analyzed data from over 100,000 individuals from 50 countries and 3 regions.
Subsequent studies validating the earlier results have included commercial airline pilots and students in 23 countries, civil service managers in 14 counties, 'up-market' consumers in 15 countries and 'elites' in 19 countries.
From the initial results, and later additions, Hofstede developed a model that identifies four primary Dimensions to assist in differentiating cultures: Power Distance - PDI, Individualism - IDV, Masculinity - MAS, and Uncertainty Avoidance - UAI.
Geert Hofstede added a fifth Dimension after conducting an additional international study with a survey instrument developed with Chinese employees and managers. That Dimension, based on Confucian dynamism, is Long-Term Orientation - LTO and was applied to 23 countries.
These five Hofstede Dimensions can also be found to correlate with other country and cultural paradigms.

3. Power Distance Index (PDI)
Definition: “The extend to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally.” Hofstede 1991: 28
Country
Power Distance Index (PDI)
Mexico 81
France 68
USA 40
Germany 35
Denmark 18

4. Individualism vs. Collectivism
Country
Individualism Index (IDV)
USA 91
France 71
Germany 40
Turkey 37
Mexico 30

5. Masculinity vs. Femininity
Masculinity = clearly distinct gender roles
men:
assertive, tough
focused on material success
women:
modest, tender
concerned with quality of life
Femininity = overlapping gender roles
both men and women:
modest, tender
concerned with quality of life
Masculinity pertains to societies in which social gender roles are clearly distinct (i.e., men are supposed to be assertive, tough, and focused on material success, whereas women are supposed to be modest, tender and concerned with quality of life).
Femininity pertains to in which social gender roles overlap (i.e, both men and women are supposed to be modest, tender and concerned with quality of life).

6. Masculinity vs. Femininity
Country
Masculinity Index (MAS)
Japan 91
Germany 66
USA 62
France 43
Sweden 5

7. Ländercodes

8. Uncertainty Avoidance

9. Uncertainty Avoidance

10. Uncertainty Avoidance
Country
Uncertainty Avoidance Index (UAI)
Greece
112
Mexico 82
Germany 65
USA 46
Sweden 29

11. Long Time Orientation
Geert Hofstede added the following fifth (5th) dimension after conducting an additional international study using a survey instrument developed with Chinese employees and managers. That survey resulted in addition of the Confucian dynamism. Subsequently, Hofstede described that dimension as a culture's long-term Orientation.
Long-Term Orientation (LTO) focuses on the degree the society embraces, or does not embrace, long-term devotion to traditional, forward thinking values. High Long-Term Orientation ranking indicates the country prescribes to the values of long-term commitments and respect for tradition. This is thought to support a strong work ethic where long-term rewards are expected as a result of today's hard work. However, business may take longer to develop in this society, particularly for an "outsider". A Low Long-Term Orientation ranking indicates the country does not reinforce the concept of long-term, traditional orientation. In this culture, change can occur more rapidly as long-term traditions and commitments do not become impediments to change.

12. Germany – USA Individualism is higher in the USA
Uncertainty Avoidance is more important in Germany

13. Literature Crosscultural Communication:
Geert Hofstede: Cultures and Organizations
Charles M. Hampden Turner, Fons Trompenaars: Building Cross-Cultural Competence
Edward T. Hall: Beyond Culture
Philip R. Harris, Robert T. Moran, Sarah V. Moran: Managing Cultural Differences, Sixth Edition: Global Leadership Strategies for the 21st Century
Edgar H. Schein: The Corporate Culture Survival Guide
Author: Rolf Schwermer, September 2006