The Cultural Relativity of Organizational Practices and Theories

This paper summarizes the author's recently published findings about differences in people's work-related values among 50 countries. In view of these differences, ethnocentric management theories (those based on the value system of one particular country) have become untenable. This concept is illustrated for the fields of leadership, organization, and motivation. * A key issue for organization science is the influence of national cultures on INTRODUCTION management. Twenty or even 10 years ago, the existence of a relationship beManagement and tween management and national cultures was far from obvious to many, and it National Cultures may not be obvious to everyone even now. In the 1950s and 60s, the dominant belief, at least in Europe and the U.S., was that management was something universal. There were principles of sound management, which existed regardless of national environments. If national or local practice deviated from these principles, it was time to change local practice. In the future, the universality of sound management practices would lead to societies becoming more and more alike. This applied even to the poor countries of the Third World, which would become rich as well and would be managed just like the rich countries. Also, the differences between management in the First and Second World (capitalist and socialist) would disappear; in fact, under the surface they were thought to be a lot smaller than was officially recognized. This way of thinking, which dominated the 1950s and 60s, is known as the "convergence hypothesis." During the 1970s, the belief in the unavoidable convergence of management practices waned. It was too obviously in conflict with the reality we saw around us. At the same time supranational organizations like the European Common Market, which were founded very much on the convergence belief, had to recognize the stubbornness of national differences. Even within existing nations, regional differences became more rather than less accentuated. The Welsh, the Flemish, the Basques, the Bangladeshi, the Quebecois defended their own identity, and this was difficult to reconcile with a management philosophy of convergence. It slowly became clear that national and even regional cultures do matter for management. The national and regional differences are not disappearing; they are here to stay. In fact, these differences may become one of the most crucial problems for management-in particular for the management of multinational, multicultural organizations, whether public or private. Nationality is important to management for at least 3 reasons. The first, very obviThe Importance ously, is political. Nations are political units, rooted in history, with their own instiof Nationality tutions: forms of government, legal systems, educational systems, labor and employer's association systems. Not only do the formal institutions differ, but even if we could equalize them, the informal ways of using them differ. For example, formal law in France protects the rights of the individual against the state much better than formal law in Great Britain or Holland. However, few French citizens have ever won court cases against the state, whereas this happens quite regularly in Holland or Britain. Such informal political realities are quite resistant to change. *Geert Hofstede is Director of the Institute for Research on Intercultural Cooperation at Arnhem, the Netherlands. He has worked as a manager in industry and as an academic teacher and researcher in a number of international institutes in Europe. Journal of International Business Studies, Fall 1983 75 Palgrave Macmillan Journals is collaborating with JSTOR to digitize, preserve, and extend access to Journal of International Business Studies www.jstor.org ® The second reason why nationality is important is sociological. Nationality or regionality has a symbolic value to citizens. We all derive part of our identity from it; it is part of the 'who am L." The symbolic value of the fact of belonging to a nation or region has been and still is sufficient reason for people to go to war, when they feel their common identity to be threatened. National and regional differences are felt by people to be a reality-and therefore they are a reality. The third reason why nationality is important is psychological. Our thinking is partly conditioned by national culture factors. This is an effect of early life experiences in the family and later educational experiences in schools and organizations, which are not the same across national borders. In a classroom. I can easily demonstrate the process of conditioning by experience. For this purpose I use an ambiguous picture: one that can be interpreted in 2 different ways. One such picture represents either an attractive young girl or an ugly old woman, depending on the way you look at it. In order to demonstrate the process of conditioning, I ask one half of the class to close their eyes. To the other half. I show for 5 seconds a slightly changed version of the picture, in which only the young girl can be seen. Then I ask the other half to close their eyes, and to the first half I show, also for 5 seconds, a version in which only the old woman can be seen. After this preparation, I show the ambiguous picture to everyone at the same time. The results are amazing: the vast majority of those "conditioned" by seeing the young girl first, now see only the young girl in the ambiguous picture; and most of those "conditioned" by seeing the old woman first can see only the old woman afterwards. Mental This very simple experiment shows that, as a teacher, I can in 5 seconds condition Programming a randomly taken half of a class to see something else in a picture than would the other half. If this is so, how much stronger should the differences in perception of the same reality be between people who have been "conditioned" by different educational and life experiences not for a mere 5 seconds, but for 20, 30, or 40 years? Through our experiences we become "mentally programmed" to interpret new experiences in a certain way. My favorite definition of "culture" is precisely that its essence is collective mental programming: it is that part of our conditioning that we share with other members of our nation, region, or group but not with members of other nations, regions, or groups. Examples of differences in mental programming between members of different nations can be observed all around us. One source of difference is, of course, language and all that comes with it, but there is much more. In Europe, British people wiil form a neat queue whenever they have to wait; not so, the French. Dutch people will as a rule greet strangers when they enter a small, closed space like a railway compartment, doctor's waiting room, or lift; not so, the Belgians. Austrians will wait at a red pedestrian traffic light even when there is no traffic; not so the Dutch. Swiss tend to become very angry when somebody-say, a foreignermakes a mistake in traffic; not so the Swedes. All these are part of an invisible set of mental programs which belongs to these countries' national cultures. Such cultural programs are difficult to change, unless one detaches the individual from his or her culture. Within a nation or a part of it, culture changes only slowly. This is the more so because what is in the minds of the people has also become crystallized in the institutions mentioned earlier: government, legal systems, educational systems, industrial relations systems, family structures, religious organizations, sports clubs, settlement patterns, literature, architecture, and even scientific theories. All these reflect traditions and common ways of thinking, which are rooted in the common culture but may be different for other cultures. The institutions constrain and reinforce the ways of thinking on which they are based. One well-known mechanism by which culturally determined ways of thinking perpetuate themselves is the self-fulfilling prophecy. If, for example, the belief is held that 76 Journal of International Business Studies, Fall 1983 people from a certain minority are irresponsible, the institutions in such an environment will not admit these people into positions of responsibility: never being given responsibility, minority people will be unable to learn it, and very likely they will actually behave irresponsibly. So, everyone remains caught in the beliefincluding, probably, the minority people themselves. Another example of the selffulfilling prophecy: if the dominant way of thinking in a society is that all people are ultimately motivated by self-interest, those who do not pursue self-interest are considered as deviant. As it is unpleasant to be a deviant, most people in such an environment will justify whatever they want to do with some reference to selfinterest, thereby reinforcing the dominant way of thinking. People in such a society cannot even imagine motives that cannot be reduced to self-interest. This paper shall be limited to national cultures, excluding cultural differences beNational tween groups within nations; such as, those based on regions, social classes, ocCharacter cupations, religion, age, sex, or even families. These differences in culture within nations, of course, do exist, but for most nations we can still distinguish some ways of thinking that most inhabitants share and that we can consider part of their national culture or national character. National characters are more clearly distinguishable to foreigners than to the nationals themselves. When we live within a country, we do not discover what we have in common with our compatriots, only what makes us different from them. Statements about national culture or national character smell of superficiality and false generalization. There are 2 reasons for this. First, there is no commonly accepted language to describe such a complex thing as a "culture." We meet the same problem if we want to describe someone's "personality": we risk being subjective and superficial. In the case of "personality," however, psychology has at least developed terms like intelligence, energy level, introversion-extroversion and emotional stability, to mention a few, which are more or less commonly understood. In the case of "culture," such a scientific language does not exist. In the second place, statements about national character have often been based on impressions only, not on systematic study. Such statements can indeed be considered false generalizations. My own research into national cultures was carried out between 1967 and 1978. It A RESEARCH has attempted to meet the 2 objectives I just mentioned: to develop a commonly PROJECT acceptable, well-defined, and empirically based terminology to describe cultures, ACROSS 50 and to use systematically collected data about a large number of cultures, rather COUNTRIES than just impressions. I obtained these data more or less by accident. From 1967 to 1971 I worked as a psychologist on the international staff of a large multinational corporation. As part of my job I collected data on the employees' attitudes and values, by means of standardized paper-and-pencil questionnaires. Virtual"y all employees of the corporation were surveyed, from unskilled workers to -esearch scientists in many countries around the globe. Then from 1971 to 1973 the surveys were repeated once more with the same group of employees. All in all the corporation collected over 116,000 questionnaires which were stored in a computerized data bank. For 40 countries, there were sufficient data for systematic analysis. It soon appeared that those items in the questionnaires that dealt with employee values rather than attitudes showed remarkable and very stable differences between countries. By an attitude I mean the response to a question like "how do you like your job?" or "how do you like your boss?" By a value I mean answers to questions of whether people prefer one type of boss over another, or their choice of factors to describe an ideal job. Values indicate their desires, not their perceptions of Journal of International Business Studies, Fall 1983 77 what actually went on. These values, not the attitudes, reflect differences in mental programming and national character. These differences, however, were always statistical in nature. Suppose people were asked whether they strongly agreed, agreed, were undecided, disagreed, or strongly disagreed with a certain value statement. In such a case we would not find that all employees in country A agreed and all in country B disagreed; instead we might find that 60 percent of the employees in country A agreed, while only 40 percent in country B agreed. Characterizing a national culture does not mean that every individual within that culture is mentally programmed in the same way. The national culture found is a kind of average pattern of beliefs and values, around which individuals in the country vary. For example, I found that, on average, Japanese have a greater desire for a strong authority than English; but some English have a greater desire for a strong authority than quite a few Japanese. In describing national cultures we refer to common elements within each nation, but we should not generalize to every individual within that nation. In 1971 I went as a teacher to an international business school, where I asked the course participants, who were managers from many different countries, to answer the same vaiues questions we used in the multinational corporation. The answers reveaied the same type of pattern of differences between countries, showing that we were not dealing with a phenomenon particular to this one company. Then in my later research, from 1973 to 1979, at the European Institute for Advanced Studies in Brussels, I looked for other studies comparing aspects of national character across countries. I found about 40 such studies comparing 5 or more countries which showed differences confirming the ones found in the multinational corporation. All this material together forms the basis for my book Culture's Consequences [Hofstede 1980]. Later, supplementary data became available for another 10 countries and 3 multi-country regions, thereby raising the total number of countries to 50 [Hofstede 1983]. FOUR My terminology for describing national cultures consists of 4 different criteria DIMENSIONS OF which I call "dimensions" because they occur in nearly all possible combinations. NATIONAL They are largely independent of each other: CULTURE 1. Individualism versus Collectivism; 2. Large or Small Power Distance; 3. Strong or Weak Uncertainty Avoidance; and 4. Masculinity versus Femininity. The research data have allowed me to attribute to each of the 40 countries represented in the data bank of the multinational corporation an index value (between 0 and about 100) on each of these 4 dimensions. The 4 dimensions were found through a combination of multivariate statistics (factor analysis) and theoretical reasoning. The cases analysed in the factor analysis were the 40 countries; the variables were the mean scores or answer percentages for the different value questions, as produced by the multinational corporation's employees within these countries. This factor analysis showed that 50 percent of the variance in answer patterns between countries on the value questions could be explained by 3 factors, corresponding to the dimensions 1 + 2, 3 and 4. Theoretical reasoning led to the further splitting of the first factor into 2 dimensions. The theoretical reasoning meant that each dimension should be conceptually linkable to some very fundamental problem in human societies, but a problem to which different societies have found different answers. These are the issues studied in primitive, nonliterate societies by cultural anthropologists, such as, the distribution of power, or the distribution of roles between the sexes. There is no reason why such issues should be relevant only for primitive societies. 78 Journal of International Business Studies. Fall 1983 The first dimension is labeled "Individualism versus Collectivism." The fundaIndividualismmental issue involved is the relation between an individual and his or her fellow inCollectivism dividuals. At one end of the scale we find societies in which the ties between individuals are very loose. Everybody is supposed to look after his or her own selfinterest and maybe the interest of his or her immediate family. This is made possible by a large amount of freedom that such a society leaves individuals. At the other end of the scale we find societies in which the ties between individuals are very tight. People are born into collectivities or ingroups which may be their extended family (including grandparents, uncles, aunts, and so on), their tribe, or their village. Everybody is supposed to look after the interest of his or her ingroup and to have no other opinions and beliefs than the opinions and beliefs in their ingroup. In exchange, the ingroup will protect them when they are in trouble. We see that both the Individualist and the Collectivist society are integrated wholes, but the Individualist society is loosely integrated, and the Collectivist society tightly integrated. All 50 countries studied can be placed somewhere along the IndividualistCollectivist scale. On the basis of the answers obtained on the questionnaire in the multinational corporation, each country was given an Individualism index score. The score is such that 100 represents a strongly Individualist society, and 0 a strongly Collectivist society: all 50 countries are somewhere between these extremes. It appears that the degree of Individualism in a country is statistically related to that country's wealth. Figure 1 shows the list of countries used, and Figure 2