What are the cultural challenges that international businesses face?
Hofstede’s six cultural dimensions is an influential framework developed by the Dutch psychologist Geert Hofstede which can be used to analyze different cultures and compare them against one another. These six dimensions include: Power Distance (or Uncertainty Avoidance), Individualism/Collectivism, Masculinity/Femininity and Long-Term/Short-Term Orientation.
High power distance indicates that people are accepting unequal authority distributions, while low power distance suggests more egalitarian relations among members. Uncertainty avoidance measures how cultures react to uncertain or unknown situations. Those with higher scores will seek more structure and regulation, while lower scores show greater tolerance for ambiguity. Individualism Vs Collectivism focuses on the extent to which individuals are encouraged to look out for themselves as opposed to relying on collective efforts while Masculinity Vs Femininity examines the predominance of either “masculine” traits such as competitiveness and assertiveness or “feminine” qualities like cooperation and empathy respectively in a given society. The Long-Term/Short-Term Orientation measures how the emphasis is placed on values and traditions versus immediate outcomes, while Indulgence vs. Restraint examines whether personal satisfaction within a given context can be considered acceptable.