Summary of article 34
The Business of International Business Is Culture National cultures are distinguished from organizational cultures. Cultures can be
defined as the collective programming of the mind which distinguishes the members
of one category of people from another. The “category of people” can be nation,
region, or ethnic group, women versus men, old versus young, a social class, a
profession or occupation, a type of business, a work organization or part of it, or even
a family. With the wide range of studies, five dimensions of national culture
differences were identified. There are:
1. Power distance: It is the extent to which the less powerful members of
organizations and institutions accept and expect the power is distributed
2. Individualism versus Collectivism: Individualism on the one side versus its
opposite, collectivism, is the degree to which individuals are integrated into
3. Masculinity versus Femininity: Masculinity versus its opposite, femininity, refers
to the distribution of roles between the sexes which is another fundamental issue
for any society to which a range of solutions are found.
4. Uncertainty avoidance: It deals with a society’s tolerance for uncertainty and
ambiguity: it ultimately refers to man’s search for truth. It indicates to what extent
a culture programs its members to feel either uncomfortable or comfortable in
5. Long term versus Short term Orientation: It deals with virtue regardless of truth.
Value associated with long term orientation are thrift and perseverance; values
associated with short term orientation are respect for tradition, fulfilling social
obligations, and protecting one’s “face”.
With these dimensions, we can categorize different countries into different groups.
Besides these five dimensions, national culture also correlated with multitude of other
date about the countries. Different groups have some unique culture characteristics.
So, cultural differences limit practice of some management theories, such as
performance appraisal systems, management by objectives, strategic management,
and humanization of work. Besides these, the basic thinking way between East and
West also different with different culture background. National culture differ mostly at the level of basic values while organization cultures differ mostly at the level of the
more superficial practices: symbols, heroes, and rituals. Organizational cultures are
composed of practices rather than values, they are somewhat manageable: they can be
managed by changing the practices. In this article, with the research by IRIC, six
independent dimensions can be used to describe most of the variety in organizational
practices. They are 1. Process-oriented versus Results-oriented cultures 2.
Job-oriented versus Employer-oriented cultures 3. Professional versus Parochial
cultures 4. Open system versus Closed system cultures 5. Tightly versus Loosely
controlled cultures 6. Pragmatic versus Normative cultures. Managing international
business means handling both national and organizational culture differences at the
same time. The top management’s major strategic choice is either to accept and
optimally use the exiting culture or to try to change it. Turning around organizational culture demands visible leadership, supported by different level of employees, maintain control for the structure, and persist for a relative long time. When managing in multinationals with different cultures, the structure should follow culture. The decisive factor is whether business know-how or national cultural know-how is more crucial for the success of the operation. The best structure at a given moment depends primarily on the availability of suitable people. Timely recruiting of future managerial talent from different nationalities, absorbing corporate culture through planned transfer within the corporation, with these methods, the multinational corporations will win in the future. Increasing integration of organizations across national borders demands that managers have an organizational life like organization structures, leadership styles, motivation patterns, and training and development models are culturally relative need to be reconsidered when borders are crossed. It also calls for self-insight on the part of the managers involved, who have to be able to compare their ways of thinking, feeling and acting to those of others, without immediately passing judgment.