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Culture-Specific Theories and Practices of Management

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Introduction

In the prevailing business environment which is marked by high level of competitiveness and a challenging international free market economy, business managers are required to have global cultural understanding skills in addition to their domestic cultural ones alone. Chen and Eastman (1997 p.454) mention: “despite differences in the level of analysis and standpoints of organizations versus subgroups, both the integration and differentiation perspectives on organizational culture are inadequate to address cultural conflicts associate with demographic diversity.

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” Considering the importance of cultural understanding in business management, this essay embarks on a quest to understand the characteristics of Chinese culture, which are relevant to management. It will highlight the implications of those characteristics for business managers. The essay will incorporate the author’s reflection upon two videos regarding life in China. The first one is titled “Shanghai Quest” by Kim Taylor and the second is “Man Zou: From Beijing to Shanghai” by Ian Connors & Jason Reid

The Culture Concept

Culture is complex and multi-dimensional. Culture is far too complex to be defined in simple terms (Hall, 1976). Kroeber and Kluckhohn (1952) have identified more than 160 different definitions of culture in their study. One of the earliest definition of culture in academia in that of Tylor (1887) who defines it as a “complex whole which includes knowledge, belief, arts, morals, law customs and other capabilities, and habits acquired by a man as a member of a society”. A recent and widely cited definition is that of Hofstede (1980). He defines culture as “the interactive aggregate of common characteristics that influence a group’s response to its environment.” He redefined culture as “the collective programming of the mind which distinguishes the members of one human group or category of people from another…..Culture, in this sense, includes systems of values; and values are among the building blocks of culture” (Hofstede, 1984).

Culture and Business Management

The business culture of a society is not just an outcome of its economic system. More often, it is to the contrary i.e. the economic life is shaped by the cultural foundation of a society. The videos viewed as part of this work, lead to that conclusion. All the three individuals in the documentary “Shanghai Quest” were struggling and trying to be successful entrepreneurs in their respective fields of interest in Shanghai, China. Shanghai’s quest towards urbanization and industrialization was an important cultural characteristic of the city that helped them throughout their way in seeking out opportunities.

Geert Hofstede, a renowned management thinker was among the first researchers to conclude that culture impacts upon the management styles of different economies. According to Hofstede (1984, 1991), culture can be distinguished by five fundamental dimensions. Hofstede, who was a one-time employee at IBM, conducted a survey of more than 116,000 IBM employees across seventy two different countries spread across different regions in the world. He developed an index ranging from 0-100 for each of his five cultural dimensions in order to measure and compare cultural differences among different nations. His five cultural dimensions are: power distance, uncertainty avoidance, individualism/collectivism, masculine/feminine and long-term versus short-term orientation.

Small vs. large power distance (PDI): The extent to which less powerful people accept that power is distributed unequally, that others have more power

Individualism vs. collectivism (IDV): Individualism is the tendency of people to look after themselves; collectivism to look after the members of their society in exchange for loyalty

Masculinity vs. femininity (MAS): Masculinity: dominant values are success, competition, and money Feminity: dominant values are caring for others

Weak vs. strong uncertainty avoidance (UAI): The extent to which people feel threatened by ambiguous situations and have created beliefs or institutions to avoid these feelings

Long vs. short term orientation (LTO): The extent to which people attach value to their future against their past or their present. Long term oriented cultures give more value to actions and attitudes affecting the future in contrast to the short term oriented cultures.[1]

China’s indices for these cultural dimensions are illustrated in the following figure (fig.1).

(Source: www.geert-hofstede.com)

Small vs. large power distance (PDI)

China scores high in power distance index indicating that the country has a high cultural tendency to accept differencees in individuals’ powers within their society. It implies that in China, the respect for elders is widely ingrained in their culture and both the leaders as well as the followers endorse society’s level of inequality. In term of business management, seniority demands respect and obedience. Elders are more likely to become leaders and considered as substantial role models. In doing business with Chinese people, it would be vital to win the confidence of authoritative and significant personals and appease them. While communicating with them, it would be ideal to use specific titles, with a high emphasis on respect and consideration for hierarchy and authority.

Individualism vs. collectivism (IDV)

On the individualism index, China scores only 20 points indicating the country is highly collectivist. It implies that Chinese people have great consideration for others; they keep the interest of others in mind while doings things and encourage the phenomenon of unity. They believe that groups are primary unit of survival rather than individuals. The connotation ‘we’ is deeply ingrained in their psyche, determining an individual to be in a surrounding which he/she owns and incorporates with. Chinese people tend to do everything collectively. The ‘we’ awareness persists in their workplace and they would be most happy in doing team work and group work. Hofstede (1980) mentions that in societies with a high level of collectivism, people tend to depend emotionally upon their outer circle. In business, themes such as loyalty, community relations, national identity, and family are of great significance. The Chinese collectivism is reflected in the Shanghai Quest video when ‘Benji’ speaks with Chinese fellows in their native language. He is often seen to be positively remarked upon that. The Chinese people value the idea that a foreigner speaks to them in their native language fluently, as for them it reflects a sense of familiarity and unity.

Masculinity vs. femininity (MAS)

Masculinity index is often seen to correspond with the power distant index. Societies with a high power distance index usually have a higher masculinity index in which more emphasis is towards success, competition and wealth. China, and specially Shanghai, is on a verge of mass industrialization and urbanization. As mentioned in the second video “Man Zou: From Beijing to Shanghai”, Shanghai is the city that China wants to portray to the entire world as the country’s face due to its contribution to the rapidity of China’s urbanization and industrialization. The forces of urbanization and industrialization incur a higher level of masculinity in the city and overall country’s culture.

Weak vs. strong uncertainty avoidance (UAI)

In uncertainty avoidance index, China scores a low of 30 points. It implies that Chinese people are generally risk taking people and feel less threatened by ambiguous situations. They are willing to wander in uncharted waters, try new things, and experiment. This is clearly reflected in the case on the three individuals from the first video. One of them is from US, who has also lived in England for 6 years, and Australia for 2 years, before settling in China. He wants to be an American-Chinese pop star and a performing entertainer, having his foot in TV, videos, modeling, commercial etc. He mentions that it is pretty unusual and for the first time that an American wants to be a Chinese singer. It brings an element of uncertainty and risks. The second person portrayed in the videos in from Paris and was raised mostly in Britain and he being all over the world. He wants to be entrepreneur, exporting of the self item to buyers across the globe. The third one is a dancer, who provides his services as a party entertainer along with his girlfriend. The provision of opportunities for all these individuals reflects that cultural characteristics of China in accepting new phenomena, changes, versatility, adventuring and experimentation. Chinese people are adapting and entrepreneurial. The commentary of the second videos also coincides with the same view. The commentator mentions that “China makes you present all the time. It’s a country on a fast track towards urbanization and industrialization. It’s a Place to be. It’s a happening place.”

Long vs. short term orientation (LTO)

China’s high score on long term orientation index reflects its focus upon persistence and perseverance. In economic terms, it implies that investments and business decisions tend to base on the provision of long term stability and benefits. Their thinking ways focus on either complete or no-confidence rather than on probabilistic views.

Conclusion

The aforementioned cultural traits have a deep impact upon the Chinese economic system. They also impact upon how Chinese people conduct business in the international arena and how global businesses should engage with them. Moreover, these cultural dimensions have implications for communication, leadership development, human resource management and decision making processes involving Chinese.

References

Chen, C. C., & W. Eastman (1997). Toward a Civic Culture for Multicultural Organizations. Journal of Applied Behavioral Sciences, 33,454-470.

Hall, E. T. (1976). Beyond culture. Doubleday. New York

Hofstede, G. (1991). Cultures and organizations: Software of the mind. London: McGraw-Hill.

Hofstede, G. (1980). Culture’s consequences: International differences in work related values. Sage. Newbury Park

Hofstede, G. (1984). Culture’s consequences: International differences in work related values (Abridged ed.) CA: Sage. Beverly Hills,

Kroeber, A. L and Kluckhohn,C. (1952) Culture: A critical Review of Concepts and Definitions. Paper of Peobody Museum of American Archeology 47 (1)

Tylor, E (1871) Origins of Culture. Harper and Row. NY.

[1] These cultural differences are a representation of averages or tendencies and not the precise individual characteristics belonging to a society.

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