National Culture and Management in Subsidiary Businesses, Essay Sample

Introduction

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Culture is the way of life of people and entails their religion, social habits, music, art, attitude, and beliefs. Therefore, national culture is standing together as people of the same territory to protect or fight for your values, beliefs, attitudes, religion, social habits among others (Smith, 2011). Professor Geert Hofstede's study came up with a model of national culture consisting of six dimensions. He conducted the study in over 76 countries hence assisting in distinguishing countries from each other as per their independent preferences (Hofstede, 2011). Since human beings are unique, the country score on the dimensions is relative.

The six dimensions of national culture are power distance index, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance index, long-term orientation versus short-term orientation (Hofstede, 2011). Individualism is preferred in country's with a loosely-knit social framework where everyone is to fend for themselves and their family. In contrast, collectivism is preferred in a tight-knit society where an individual expect other people whom they are related to look after them in exchange for unquestioning loyalty (Hofstede, 2011). Masculinity and femininity are also termed to tough versus tender. Masculine society is characterized by assertiveness, aggressiveness, achievement, heroism, and material reward for success (Hofstede, 2011). On the other hand, femininity has a soft touch to it, and it includes cooperation, modest, and caring for the weak and others. Power distance index simply explains how a society handles inequality. Hence society with high degrees of power distance, accept social strata where everyone has a place, and there is no need for justification. On the other hand, societies with low power distance people demand justification for any inequalities and power distribution is equalized.

The uncertainty avoidance dimension describes the extent to which individual in the society feel uncomfortable with uncertainty and ambiguity that lays in the future. Therefore a society with firm uncertainty avoidance index is tolerant of the conventional ideas and behaviors (Hofstede, 2011). On the other hand, countries with weak uncertainty avoidance index have a more relaxed attitude, and they value practice more than principles. Long term orientation dimension deals with the challenges of the present and past. Societies which score low on this dimension are conservative and view change with a suspicion (Hofstede, 2011). However, those that have high score are liberals and encourage efforts in modern education as a way to prepare for the future. Lastly, indulgence stands for allowing people to enjoy life, have fun, and they enjoy their rights. Contrary, restraint there strict rules and norms and everyone has to follow failure will lead to severe punishment.

National Culture and Business Management

The villagization of countries due to globalization has seen people being employed by foreign-owned companies established in their countries. Therefore, it is an added advantage for managers to understand cultural differences among their employees (Moran et al., 2014). Moreover, managers from foreign mother companies need to understand the local employees from the host country which entails having different business structures and human resource management procedures.

Culture plays a significant role in different business context. Adopting a cultural-sensitive measure in the products, services, marketing, and advertising ensures the success of any foreign company (Ang and Van, 2015). Also, the understanding of the culture of different people will help in one on one meetings since language and behavior vary in cultures hence communication between them will be efficient and effective. Moreover, organizations mainly determine what decision-making practices to use basing on their cultures and subcultures (Ang et al., 2007). Thus, for alliances and partnerships to be successful, it is wise for the managers to understand the organizational difference between them. Lastly, culture determines the behavioral patterns and preference of customers. Therefore, for a foreign organization to succeed the manager need to adapt their goods and services to meet the need of the local people.

Understanding cultural differences will always remain significant in any international company despite increased patterns and process of globalization. Though there has been increased common access of various media and the internet, cultural differences are still present in various aspects of life. Cultural convergence or Americanization- the homogenization of global consumer preferences- assumes the similarities among groups of people around the world (Luthans and Doh, 2009). Hence managers should be aware that culture vary and this lead to significant differences in the way people work and companies operate.

Application of National Culture Framework

Cultural differences result in differences in communication styles. If not observed these differences may lead to workplace misunderstanding, poor interpersonal and intergroup relationships, inefficiency and high cost (Kinloch and Metge, 2014). To understand more about difference communication, it will be of great help to analyze different countries with different cultures.

The United States managers focus more on performance and are highly assertive compared to managers from other parts of the world. They tend to be direct and explicit when interacting with other people (Adler and Gundersen, 2007). The main focus of workplace interaction is to use facts, figures, and logic to link specific steps to measurable outcomes. The Greeks and Russians are the total opposite of the Americans. They are less individualistic, less performance-oriented and show low levels of uncertainty avoidance index (Javidan et al., 2006). The Greeks and Russians find United States counterparts more direct and result-focused when interacting. Greeks and Russians believe communication is for mutual learning and exploration than explicit consensus on particular expectations and outcomes. Similarly, Swedish managers find the United States approach too aggressive and unfriendly. Their main focus of workplace interaction is working against the relationship-building process.

In Korea and Japan, men dominate in decision-making and lead most of the one-on-one meetings. Men in these societies set the agenda for discussion. However, forms of traditional cultural language differ with regards to age and gender (Schein, 2010). Therefore, roles, responsibilities, and behaviors related to gender and age are deeply encompassed in language and customs. On the other hand, Poland and Denmark have a different view on the issue of gender differentiation (Moran et al., 2014). They are at a high risk of embarrassing their counterparts who come from different regions due to the lack of awareness of the cultural differences that exist between them. Thus, this clash can be a roadblock to making negotiations and interactions difficult between these groups.

In the United Kingdom, the United States and northern European, organizations have developed participative management based on their characteristically low power distance and flat organizational hierarchies to improve productivity (Thomas and Peterson, 2014). For instance, techniques such as 360-degree feedback system. However, in countries such as Mexico, Thailand, Panama, and Russia that have high power distance, such system are not likely to work. The reason for this is that subordinates are afraid to be asked to evaluate their senior managers and managers view subordinates as unqualified to comment on their performance (Thomas and Peterson, 2014). In some countries, a subordinate commenting on a manager is a clear indication the manager does not know what they are doing, and employees will lack trust in them.

Cross-Cultural Communication

Cross-cultural communication is important for organization and businesses that have a diverse workforce. Cross-cultural concept deals with understanding different business customs, beliefs and communication plans (Bochner, 2013). Also language differences, non-verbal differences, high context and low context cultures, and power differences. High and low context culture deals with how a person's thoughts, opinions and upbringing impacts on their behavior in a particular culture. People in North America and Western Europe tend to have low context culture. Meaning they have individualistic and direct employees who base decisions on facts and are likely to have trust issues (Carbaugh, 2013). High context culture individuals, on the other hand, are collectivist and focus on interpersonal relationships. They believe in getting to know the person they are conducting business with so as to get a gut feeling of decision making (Carbaugh, 2013). Countries such as Middle-east, Asia, and Africa are known to be high-context individuals.

The two main areas of nonverbal communication that are used differently across cultures are gestures and eye contact. For instance, when giving nonverbal direction pointing fingers is considered rude among the Japanese whereas in some parts of the United States it is considered appropriated. Eye contact in the United States is seen viewed as a good thing and signifies honesty and straightforwardness (Stewart and Bennett, 2011). However, in Middle Eastern and Asian cultures, prolonged eye contact signifies rudeness and aggressiveness in some situations (Semnani-Azad and Adair, 2011). To women in these countries, prolonged eye contact signifies sexual interest. One of the major challenges of having a diverse workforce is language barriers. Therefore, such companies can hire employees who have proficiency in other languages. Lastly power distance deals with power distribution in an organization (Hofstede, 2013). Organizations with low power distance have a flat hierarchy, and there is an interaction between the managers and employees whereas high power distance organizations there is a very high hierarchy and severe differences in authority.

Conclusion

National culture is an important aspect in determining the operation of subsidiary businesses. When managers understand the diverse cultural aspects of employees, then they are in a better position to come up with good decisions and strategies that would increase productivity and ensure the success of the business. On the other hand, a poor understanding of national culture may lead to misunderstandings and conflicts in the workplace hence negatively affecting the operations of the company. Therefore, it is important for managers to understand national culture for efficient operations of subsidiary businesses.

References

Adler, N.J. and Gundersen, A., 2007. International dimensions of organizational behavior. Cengage Learning.

Ang, S. and Van Dyne, L., 2015. Handbook of cultural intelligence. Routledge.

Ang, S., Van Dyne, L., Koh, C., Ng, K.Y., Templer, K.J., Tay, C. and Chandrasekar, N.A., 2007. Cultural Intelligence: Its measurement and effects on cultural judgment and decision making, cultural adaptation, and task performance. Management and organization review, 3(3), pp.335-371.

Bochner, S. ed., 2013. Cultures in contact: Studies in cross-cultural interaction (Vol. 1). Elsevier.

Carbaugh, D., 2013. Cultural communication and intercultural contact. Routledge.

Hofstede, G., 2011. Dimensionalizing cultures: The Hofstede model in context. Online readings in psychology and culture, 2(1), p.8.

Hofstede, G., 2013. Hierarchical power distance in forty countries. Organizations Alike and Unlike, ed. CJ Lammers and DJ Hickson (London: Routledge and Ke...