Cross Cultural Management Between China And Australia

     Cultures are varying among different parts of the globe. People with different cultures have different characteristics and viewpoints on the subjects due to diverse understanding and method of learning. During the past few decades, the international trade grows in a very rapid rate due to the advantages that it provides; “increased sales, operational efficiencies, exposure to new technologies and broader consumer choices” (Heslin). Therefore, when considering the culture aspect to current business world, it is crucial for business to understand the culture aspect because of the tremendous growth of international business as well as utilize the international market to its maximum

When a business decides to venture internationally into different countries with its products, services, and operations, it is very important that the company gains an understanding of how the culture of the different societies affects the values found in those societies. Geert Hofstede conducted one of the most famous and most used studies on how culture relates to values. Hofstede study enabled him to compare dimensions of culture across 40 countries. He originally isolated four dimensions of what he claimed summarized different cultures — power distance, uncertainty avoidance, individualism versus collectivism, and masculinity versus femininity (Hill, 2013, p.110). To cover aspects of values not discussed in the original paradigm Hofstede has since added two more dimensions — Confucianism or long-term orientation and indulgence versus self-restraint (Hofstede, n.d.). Because of the way Hofstede’s cultural dimensions are given an index score from 0-100, it is easy for a company to get a general comparison between the cultures they are expanding into and the culture they are already in.

Mismanaging cultural differences can render otherwise successful managers and organisations ineffective when working across cultures. As stated byOsland (1990, p. 4) ``The single greatest barrier to business success is the one erected by culture''. Hofstede (1983) defines culture as "the mental programming of the mind which distinguishes the members of one human group from another" (Hofstede 1983 p. 25). Through the comparison of Chinese culture and Australian culture using Hofstedes five cross-cultural dimensions: power distance, uncertainty avoidance, masculinity, individualism, and long-term orientation an insightful view into the differences and similarities of the cultures can be obtained (Chong & Park 2003). Human Resource Management

What if I told you culture has a bigger role in your life than you think? Well according to Gerard Hendrik Hofstede, a Dutch social psychologist, culture is an enormous factor when it comes to analyzing a society’s values and behavior. Hofstede traveled all over the globe and interviewed several employees on their values and with that he developed an immense database that analyzed the ways cultures differ from one another. Hofstede’s culture dimensions theory consists of six dimensions: power distance index, individualism vs. collectivism, uncertainty avoidance index, masculinity vs. femininity, long-term orientation vs. short-term orientation, and indulgence vs. restraint. Culture is more than one’s heritage; culture determines and justifies a society’s behavior and values.

In today’s high tech global community, it is not uncommon to have companies in one country doing work with others clear across the world. It is important to keep in mind that understanding the role of culture, in the international business setting, is key to success and prosperity. It is essential and know that each nation has their own set of values and ways of interacting. For example, although the United States and China frequently do business together and are equally seen as leaders on the global market, they still have very apparent differences in cultural norms. These contrasting characteristics are grouped under Geert Hofstede’s six dimensions of culture. They include, the level of uncertainty avoidance, masculinity versus femininity, individualism versus collectivism, power distance, long-term versus short-term orientation, and indulgence versus restraint (Hofstede, 2001). Once one is able to properly distinguish cultural differences, can they then successfully communicate, thrive, and potentially lead in the global economy.

Although we may not notice it, differences in culture affect our everyday lives including business. In the business world, it is inevitable that you will cross paths with people of differ from you. Understanding these differences can play a major factor to being successful in business. Improving your level of knowledge of international cultural difference in business can help in building international skills as well as empowering you to increase competitive advantage. Hofstede’s theory allows for statistical comparison of cultures through various studies. His extensive work gives an insight of the culture and how its impacts business strategies of members of that society. Hofstede studied and categorized cultures into 5 different sections; Uncertainty Avoidance, Individualism, Long-term orientation, Masculinity and Power index. There are always a few generally clear signs you should notice that shows how a country cultural and business are created. Hofstede’s study results show vast differences between the United States and Japan’s culture and business. A clear majority of Americas population is made up and individuals who have fled their countries to explore new options in a new land.

The United States and China boast the two largest economies in the world but, despite this fact, these two countries have very little in common. At first glance, this may seem very obvious to most people but, what exactly is it that makes these two countries so different? How is it that such different perspectives and approaches can both lead to great success? Hofstede’s six dimensions of culture are an attempt to answer these questions and more. Dr. Geert Hofstede, studied employees of the computer firm IBM in over fifty different countries. When he examined his findings he found “clear patterns of similarity and difference along the four dimensions” (Manktelow, Jackson Edwards, Eyre, Cook and Khan, n.d.). The fact that he focused his research on solely IBM employees allowed him to eliminate company culture as a differentiating factor and “attribute those patterns to national and social differences” (n.d.). He used his findings to originally identify four dimensions, later expanded to six, that could “distinguish one culture from another” (n.d.). The six dimensions all on a scale from 0 to 100 are:

Hofstede (1980, 2001) referred power distance as the extent to which the individuals, societies and nations accept the inequalities and power hierarchy as legitimate in institutions and organisations. Power distance can be considered as greatest challenge for multinational corporations because it can give significant impact to the employees and also the organisational performance.

Cultural differences and dimensions are very important when it comes to the corporate world. There have been numerous studies done on individual differences that are seeking out to identify the reasons why people behave in which the way they do. In the United States, it is important to understand each dimension and which cultural dimension we focus on most. In this paper, the five cultural dimensions and how they are implemented in the corporate world will be discussed.

Culture is a predominant social aspect of society, which guides the way people think and act in their environment. Culture develops differently for all the various nations of the world, and in the context of international business, the challenge that arises for today’s managers is managing across these varied cultures effectively enough to render positive growth and productivity for the business organization. The influential factors such as individualism versus collectivism and masculinity versus femininity amongst others help categorize and identify cultural differences. The manager of international business has to be well aware of these differences and show consideration and care in dealing with cultural disparities that may be

The seven cultural variables are the way different people inside contrasting societies are able to communicate with each other and understand what is happening. These contrasting attitudes, beliefs and ideas will shape how they relate to one another and their focus on interacting with numerous individuals. For example, inside the United States the most effective way of discussing what is happening is through presenting objective information directly. While other societies (such as: Sweden), are focusing on two way discourse and establishing friendly relationships. These differences are showing how there are contrasting views as to how various people interact with each other and understand what is happening. (Sepehri, 2011)

Hofstede's cultural dimensions theory is a framework for cross-cultural communication. It describes the effects of a society's culture on the values of its members, and how these values relate to behavior, using a structure derived from factor analysis.( Organizational Culture Introduction. 2016)

The Hofstede model of culture can be used to give the wide-ranging outline and the estimated in the understanding of other cultures, on what one can anticipate from them and how one can act upon groupings from other states. Hampden-turner and trompenaars model expands the core level of the basic model of two layers instead of outer level. Edward hall’s model of cultures is among the dominant theoretical frameworks for interpreting the communication of intercultural. His model develops the perception of social cohesion in relating how people behave and respond in various types of culturally definite personal space.

In times of rapid globalisation and economic development growth, the environment of business has become more and more complicated as a huge number of firms want to globally expand their businesses. Subsequently, the managerial implications of cross-cultural management is the challenge of this development. As Abbe (2007) states, cross-cultural leadership has developed as a way to understand leaders who work in the global markets. Culture is the “software of mind” that can influence people’s patterns of thinking and behaving.

The United States is a low power distance nation that encourages a decentralized structure, empowerment, autonomy and interaction between superiors and subordinates in and out of the workplace in contrast to China and India and more akin to the UK (Garcia, Mendez, Ellis, & Gautney,