Chapter 3 – Impact of Culture on IHRM
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Transcript of Chapter 3 – Impact of Culture on IHRM
CHAPTER 3 – Impact of Culture on IHRM
Learning Outcomes:Definition of cultureImportance of culture in international
businessImportance of culture to IHRMDifferentiating between convergence,
divergence and cross-vergence
Definition of what we called a “culture”:Culture is the characteristic way of behaving
and believing that a group of people have developed overtime and share. Groups culture consist of:
- gives them a sense of who they are, of belonging, of how they should behave.
- capacity to adapt to circumstances (culture defines what is appropriate)
- affects every aspect of the management process (how people think, solve problems and make decisions)
National Culture and Organizational culture:Organizational culture:
“ in organizational theory, culture is shaped by organization’s unique history and situational growth. It can be defined as the values, beliefs and expectations more or less shared by the organization’s members . It effects the way a company does business and makes known relevant employees, customers, suppliers, competitors.
National Culture:“A nation’s culture, similar to that of an organization,
is comprised of the symbols, values, rituals, and traditions of the people living in a particular region. Language, food, and family traditions are all rooted in national culture. How people behave in public verse how they behave within their own home is also associated with values and standards of their nation. Cultures usually differ in relationships between the individual and society, ways of dealing with conflict, relationships to authority, and conceptions of class and gender.”
The 4 “Dimensions” of culture:Dutch scientist, “Greet Hofstede” identified
four cultural dimensions around which counties have been clustered, with people in each group exhibiting identical behaviours. The four dimensions are Power distance, uncertainty avoidance, individualism and masculinity.
1. Power Distance: power distance is the extent to which power
is distributed unequally. High power distance countires have norm, values and beliefs such as:
inequality is fundamentally goodEveryone has a place, some are high, some
are lowMost people should be dependent on a leaderThe power is entitled to privilegesThe powerful should not hide their power
Eg: managers adopt theory X leadership style. i.e they must be authoritarian, must force workers to perform and must supervise closely.
2. Uncertainty Avoidance: Uncertainty avoidance is the extent to which
people feel threatened by ambiguous situations, and have created beliefs and institutions that they try to avoid these. Countries with citizens who do not like uncertainty tend to have a high need for security and a strong belief in experts and their knowledge. The characteristics of such culture are:
Conflict should be avoidedDeviant people and ideas should not be toleratedLaws are very important and should be followedExperts and authorities are usually correct and Consensus is important
3. Individualism: individualism is the tendency of people to
look after themselves and their family only. The opposite of this is collectivism. The characters of such culture are:
People are responsible for themselves,Individual achievement is idealPeople need not be emotionally dependent on
organizations or groups.
4. Masculinity: It refers to a situation in which the dominant
values in a society are success, money and other material things. High masculine culture have norms, values and beliefs that:
Gender roles should be clearly distinguishedMen are more assertive and dominant,Machismo and exaggerated maleness is goodPeople-especially men-should be decisiveWorks take priority over other things such as
familyAdvancement, success and money are important.
the opposite of masculinity is FEMINITY
Managing Across Culture:Managing multiculturalism or cross-cultural
management is of considerable significance as it offers the following potential benefits:
Increase creativity and innovation Demonstrating more sensitivity in dealing with foreign
customers Hiring the best talent from anywhere Demonstrating a global perspective Creating a “super-organisational culture”, using the
best of all cultures Greater flexibility within the organisation both to adapt
to a wider range of environments and to change within these environments
To evolve universally acceptable HR policies and practices.
Competencies needed for cross-cultural management:Possess a strong personal identityHave knowledge of and felicity with the
beliefs and values of cultureDisplay sensitivity to the effective processes
of the cultureAble to communicate with the language of
the cultural group Perform specially sanctioned behaviourMaintain active social relations
Leadership across cultures:The leader of an MNC needs to be endowed with the
following skills and abilities:
Cosmopolitan: flexible to operate comfortably in pluralistic cultural environment
Skilled at International Communication: knowing atleast one foreign language and understand foriegners
Culturally sensitive: use experience in different national, regional and organizational cultures to build relationships
Capability of rapid Acculturation: adjusting to different cultural settings
Knowledge about cultural and institutional influences on Management: understand how national culture and social institutions affect the entire management
A Facilitator of subordinates’ intercultural performance: prepare expatriates for overseas assignment taking in mind deep cultural difference.
User of cultural synergy: combine the strength of each cultural group and with performance standardes across culture.
A promoter and user of the growing World Culture
A commitment to continuous improvement in self-awareness and renewal
Global findings Participative leader is more acceptable in Canada,
Brazil and Australia.Americans like 2 kinds of leaders – those who provide
employees with empowerment, autonomy and those who are bold, fearful and risk takers.
Malaysians expect leaders to be humble, modest, dignified and they remain in power.
Arab treat leaders as HeroesIranians expect their leaders to exhibit power and
strengthFrench expect their leaders to appreciate the finer
aspects of French culture and arts and have good knowledge of mathematics
Dutch value equality.
What is the impact of culture on IHRM ?