Strategy. Innovation. Brand.


Culture – Virtue and Truth

bowing businessmenDoes virtue come from truth? Or does truth come from virtue? It’s an ancient question and one that helps define the differences between cultures.

According to the father-son team of Gert Hofstede and Geert Jan Hofstede, these questions help determine whether a culture is long-term or short-term oriented (LTO or STO). LTO cultures foster “… virtues oriented toward future rewards — in particular, perseverance and thrift.” STO cultures, on the other hand, foster, “…virtues related to the past and present — in particular, respect for tradition, preservation of ‘face’, and fulfilling social obligations.”

Cultures that rank high on the LTO index tend to be eastern. Countries with the highest LTO indexes are: China (LTOI = 118), Hong Kong (96), Taiwan (87), Japan (80), Viet Nam (80), and South Korea (75). Cultures that rank lower tend to have a European heritage: Sweden (33), Germany (31), New Zealand (30), United States (29), Great Britain (25), Canada (23), and Spain (19).

According to the Hofstedes, a short –term culture emphasizes quick results, spending (as opposed to saving), respect for traditions, and concern with preserving social status and ‘face’. Longer-term cultures emphasize sustained efforts, thriftiness, respect for current circumstances (as opposed to tradition), and concern with personal adaptiveness (as opposed to status).

How does all this play out? Students in LTO cultures tend to link success to effort. In STO cultures, students may attribute success to many factors, including luck, social status, appearance, or “who you know”.

The differences crop up in myriad other ways as well. Marriage is a moral arrangement in an STO culture but more of a pragmatic solution in an LTO culture. Gifts for children tend to be playful in STO cultures but educational in LTO cultures. Old age is viewed as an unhappy period in STO cultures but the opposite in LTO cultures.

The extended family is typically more important in LTO cultures. In long-term societies, you’re born into a family and tradition and you adapt to situations that were created long before you arrived. Society imposes itself on you. Short-term cultures, on the other hand, tend to value the “self-made man” who can impose himself on society.

These differences affect organizations in various ways. STO businesses tend to focus on the bottom line and this year’s profits. LTO businesses focus more on market position and profits over the coming decade. Managers and workers are in two different camps in STO cultures; they share similar aspirations in LTO cultures.

But what about virtue and truth? The differences tend to follow an East/West (or, more generally an LTO/STO) divide.

Western religions (Judaism, Christianity, Islam) all have a Book disseminating a truth that individuals can apprehend. What you believe is important. Virtue comes from truth.

Eastern religions (Hinduism, Buddhism, Taosim) are not based on a Book containing eternal truth. Rather, they focus on living virtuously, which may include meditation, ritual, and self-abnegation. What you do is important. Living virtuously can lead you to spiritual awareness.  Truth comes from virtue.

Where virtue comes from truth, enlightenment can happen instantaneously. Think of Saul on the road to Damascus. Where truth comes from virtue, enlightenment may take considerably longer.

Culture – Ambiguity and Anxiety

Dessert! Why wait?

Dessert! Why wait?

The future is uncertain. Eat dessert first.

If you act on this sage advice, you may well come from a culture that’s high on the Uncertainty Avoidance Index (UAI). As Geert and Gert Jan Hofstede have pointed out, the desire to avoid uncertainty varies dramatically from culture to culture and fundamentally affects how people think and behave.

The Hofstedes (father and son) study the influence of national cultures on organizational behavior. They write that there are five basic dimensions of culture: 1) power distance; 2) individualist/ collectivist; 3) masculine/feminine; 4) Uncertainty avoidance; 5) short-term/long-term orientation. I’ve written about the first three previously (herehere, and here). Today, let’s talk about uncertainty avoidance.

The Uncertainty Avoidance Index measures the degree to which a culture believes that what’s different is dangerous. Countries with high UAIs tend to be anxious about ambiguity and the future in general. They often establish laws, behavioral codes, religions, and technologies that reduce ambiguity. Countries with high UAIs include Greece (UAI = 114), Poland (93), Japan (92), France (86), South Korea (85), Israel (81), and Italy (75).

Countries with low UAIs tend to believe that what’s difference is curious. They are generally less rules-oriented and less anxious about the future. They tend to see the world as a relatively benevolent place and to give the benefit of the doubt to new ideas, situations, and people. Countries with low UAIs include the United States (46), India (40), Great Britain (35), Ireland (35), Sweden (29), and Denmark (23).

Uncertainty avoidance expresses itself in many different ways. Very generally speaking, families in affluent countries with high UAIs have fewer children than those in affluent countries with low UA indexes. People in high UAI cultures tend to be more stressed and rules for children are quite firm. People in low UAI culture tend to be more agreeable and more blasé about children’s play habits. They worry less about health and money.

Let’s say you want to market a product internationally, including both low and high UAI countries. Your message will need to be very different. In high UAI countries, consumers will want to know about the purity and cleanliness of the product. They also value expert opinion in their advertising. In low UAI countries, consumers tend to seek convenience rather than purity and prefer humorous ads.

Similarly, consumers in low UAI countries find used cars acceptable and are more likely to be do-it-yourself enthusiasts. They also tend to be early adopters of new technologies. Consumers in high UAI countries tend to prefer new cars and hire experts to do their home repairs. They’re also slower to adopt new technologies.

In the workplace, differences are equally pronounced. High UAI cultures emphasize the importance of rules – even those that are not obeyed.  They also prefer more structure, precision, and formality. Managers should be technical experts and tend to focus on daily operations.

Low UAI cultures have fewer rules in the workplace and value managers who are known more for common sense than technical expertise. Managers focus more on strategy than daily operations. Low UAI workplaces tend to be better at inventing new processes but high UAI workplaces are better at implementing them.

It’s a very interesting mix, especially when you combine uncertainty with masculinity, individualism, and power distance. To learn more, get the Hofstede’s book.

Culture — I versus We

I'm the center of the universe.

I’m the center of the universe.

What’s more important: you or the group you were born into? According to Geert and Gert Jan Hofstede, the answer to that question is a basic dimension of culture and can be measured and compared. (I introduced the Hofstedes’ intercultural research last week, with a discussion of the Power Distance Index).

The Hofstedes refer to this second dimension of culture as the individualist/collectivist continuum. In cultures that lean toward the collectivist end of the spectrum, “… the interest of the group prevails over the interests of the individual.” In individualist cultures, it’s just the opposite: “…ties between individuals are loose: everyone is expected to look after himself or herself and his or her immediate family.” In collectivist societies, you give your “unquestioning loyalty” to the group in exchange for protection, status, and general welfare. As the Hofstedes point out, a great majority of the world’s population lives in collectivist cultures.

The Hofstedes created an Individualism Index (IDV) and applied it to 74 countries. The most individualistic countries were: United States (IDV = 91), Australia (90), Great Britain (89), and Canada, Hungary, and the Netherlands, tied at 80. The least individualistic countries were: Colombia (13), Venezuela (12), Panama (11), Ecuador (8), and Guatemala (6).

Broadly speaking, the Individualism Index is inversely related to the Power Distance Index. In other words, individualistic countries tend to be relatively egalitarian. Collectivist countries, on the other hand, tend to rely upon powerful individuals, “imbued with strong moral authority”, to lead the group. The leader might be the head of a family, an ethnic group, a religion, or a country.

The difference between individualist and collectivist cultures can be quite subtle. In collectivist societies, a great deal of information is simply “understood” and messages are relatively brief, a phenomenon known as high-context communication. The context of the message is understood; it doesn’t need to be explained. In individualist societies, low-context communication is more typical. Messages need to be explicit, since individuals are loosely joined. The Hofstedes point out that “American (IDV= 91) business contracts are much longer than Japanese (IDV = 46) business contracts.”

In collectivist societies, “harmony should always be maintained”; in individualist societies, “speaking one’s mind” is admired. In collectivist societies, “resources should be shared with relatives”; in individualist societies, individual ownership is the rule, even for children. This dimension even affects walking speed. In individualist societies, people walk faster. In collectivist societies, they walk slower.

In business, the individualist/collectivist continuum can create significant misunderstandings. In individualist societies, “business is done with a company.”  In collectivist cultures, business is done “…with a person whom one has learned to know and trust.” Employee relations are also affected. “Management” means management of individuals in individualist cultures but management of groups in collectivist societies. Occupational mobility is higher in individualistic cultures and companies strive to treat every customer equally. In collectivist societies, in-groups may (should) be given preferential treatment in hiring, promotions, and customer care.

Perhaps as a consequence of all this, per capita GNP tends to be lower in collectivist societies. Individualist cultures tend to be wealthier. Does wealth cause individualism or vice versa? The Hofstedes makes a strong argument that rising wealth leads to individualism rather than the other way round. They conclude that poor countries, “…cannot be expected to become more individualist as long as they remain poor.”

You can learn more in the Hofstedes’ book: Cultures and Organizations: Software of the Mind.


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