When McDonald’s forayed into the Japanese market in 1971, the registers were not ringing as expected. This had the entire hierarchy wondering what had gone wrong? The answer came from one of the store managers from Japan. He told the management that the problem lies in the way the food is ordered and served at McDonald’s restaurants. As a norm, once the customer places the order at the counter, the attendant behind the counter yells and passes on the order to the kitchen staff. This is something that Japanese people were not accustomed to and considered a cultural violation. Once the modus operandi was changed, to a more culturally acceptable process, customers started trickling in and finally the company was able to successfully expand and achieve sales figures in excess of $1 million in 1978. Global expansion have undergone a sea of change since then (even in the Japanese market). Businesses no longer blindly enter a new market without fully understanding the market in its entirety, particularly the cultural aspect.
Cultural Differences 101:
Clearly, we need to pay attention to various cultural aspects of our potential business partners. In this context, it is good to keep in mind the findings of the psychologist, Dr. Geert Hofstede.
Dr. Hofstede has perhaps conducted one of the most detailed surveys on how culture influences values and the way work is done in a workplace. Based on his findings, he has developed a model that identifies five primary dimensions to differentiate cultures:
- Power Distance Index (PDI)
- Individualism (IDV)
- Masculinity (MAS)
- Uncertainty Avoidance Index (UAI)
- Long-Term Orientation (LTO)
This means that when you are in a particular culture, examine it in light of these 5 dimensions. Here’s a look into what each of these dimensions mean:
- PDI: This dimension pertains to the degree of equality or inequality between people in the country’s society. When a society’s PDI is high, it is more likely to follow a rigid caste system. In such a set-up, you may find that hierarchies are inflexible and citizens are generally not upwardly mobile. A low PDI indicates that the society values equal opportunities for its citizens.
- IDV: When a society has a high individualism or IDV ranking, it generally rates individual rights over collective rights. When you meet a person from a high IDV ranking society, he or she may be interested in what you do. On the other hand, an individual from a low IDV ranking society will want to know what your family does.
- MAS: This cultural dimension is a barometer on the extent of gender differences that exist in society. A high MAS ranking indicates that a society has sharp differences between men and women. Males tend to dominate here. In a low MAS ranking society, gender equality is more prevalent.
- UAI: This dimension is a great indicator of how open a culture is to dealing with ambiguous situations and taking risks. A society with high UAI generally is stringently regulated to avoid any kind of uncertainty. Low UAI rankings indicate that a society is more willing to try something new.
- LTO: This dimension is based on Confucian dynamism and was added after Dr. Hofstede conducted a survey on Chinese managers and employees. A high LTO indicates that a society will believe in tradition and long-term rewards. For example, this society will support a work ethic where it is believed that rewards will come in the distant future and will be based on hard work being performed in the present.
These are some pointers you can use to gauge and study a new culture. However, guard against making snap judgments or harboring prejudices.
Remember that when you extend your hand and say hello, and the other person takes it and responds, it is not just an interaction between two people. It becomes an interaction between two cultural contexts.
And these contexts were set way back in time…before that first board meeting.
As in every issue, look forward to detailed articles about career advancement and success in the expanding global workforce and global markets.