Culture's Consequences for Management in Hong Kong

In a recent review of Hofstede's comparative study of business practice and national cultures, 61 works replicating his methods are identified, and the critical four differences in the cultural dimension are ‘largely confirmed’. The only replication of Hofstede's study within IBM (his original sample vehicle) has largely validated the original model some twenty years later. These results seem to confirm the valuable contribution of Hofstede's work, although his model contains the limitations of all models; the simplification of reality into an understandable form cannot do justice to its complexity. In this paper, the main consequences of Hofstede's work for Hong Kong are reviewed. His proposition that culture and particularly social values influence economic activity and management, which is consequently ‘culture-bound’, is restated and supported by more recent studies.     

The Cultural Convergence of MBA Education Across Australia,Singapore and Malaysia

A commonly held view among international researchers is that markets and cultures are growing closer together. This cultural convergence is believed to result from the homogenising effect of technology transfer. One force which emerges from technology transfer is the convergence of education, in particular management education This study examined the MBA experience as a factor potentially causing cultural convergence. Students in five MBA programs in Australia, Malaysia and Singapore were surveyed on cultural dimensions using Hofstede's (1980) Values Survey Module to determine whether there was cultural convergence between Hofstede's cultural dimensions and the three countries. The results indicated that there was convergence between Hofstede's Uncertainty Avoidance and Power Distance distributions for the three countries.     

A comparative evaluation of seven instruments for measuring values comprising Hofstede's model of culture

Culture and its measurement are foundational to International Business research. Hofstede's model of culture dominates cross-cultural research. Unfortunately, the evidence of poor psychometric properties of Hofstede's instrument for measuring cultural values, the VSM, has been mounting, which prompted the development of numerous alternative instruments for measuring cultural values comprising Hofstede's model of culture. The abundance of choices makes it challenging to determine which of the instruments is most suitable for a given study. Using a large international sample (N = 12,462), we evaluated the psychometric properties of seven different instruments for measuring individual-level values in Hofstede's cultural framework and assessed their content validity, reliability, factor structure, and measurement equivalence. Our tests confirmed that Hofstede's instrument suffers from several psychometric deficiencies, while other instruments, notably those developed by Dorfman and Howell (1988), Yoo et al. (2011), and Taras et al. (2013), showed good reliability and validity. Guidelines for selecting the most suitable instrument and directions for future instrument development are provided.     

How Much are Health Websites Influenced by Culture? Content Analysis of Online Diet Programs in the United States,the United Kingdom,and Korea

This study investigates the content of diet websites in the United States (US), United Kingdom (UK), and Korea from a cross-cultural perspective using two cultural typologies: Hofstede's individualism-collectivism and Hall's low-high context. The results show a balance of the universal features and culture specific characteristics in the websites. Interestingly, the UK was in the middle between the US and Korea in several features even though the UK and the US typically had been generally included in the same cultural group in advertising studies. It was also determined that neither Hofstede's typology nor Hall's high-low context is enough to explain the cultural representations found on the websites. The need for new typologies for explaining or categorizing the cultural characteristics in advertising is suggested.     

The role of national culture in financial literacy: Cross-country evidence

This paper examines the effect of national culture on adult financial literacy levels in 12 countries. Contrary to earlier financial literacy studies, our results are directly comparable across countries given that we use the standardized OECD/INFE financial literacy survey data and Hofstede's, 2001, cultural dimensions to capture financial literacy and national culture. In line with the financial socialization theory, we find that uncertainty avoidance positively influences financial literacy, while individualism negatively influences financial literacy. We conclude that national culture affects financial literacy and that it is important to account for cultural dimensions in future international financial literacy research.     

Hofstede,Schwartz, or managerial perceptions? The effects of different cultural distance measures on establishment mode choices by multinational enterprises

In recent years, scholars have become increasingly critical of Kogut and Singh's [(1988). The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3), 411–432] cultural distance index and of Hofstede's [(1980). Culture's consequences: International differences in work-related values. Beverly Hills: Sage Publications] underlying national culture framework. We therefore examine and compare the effects of five cultural distance measures on the choice by multinational enterprises (MNEs) between expanding abroad through greenfield or acquisition. Two of these measures are based on Hofstede (1980), another two on Schwartz [(1994). Beyond individualism/collectivism: New cultural dimensions of values. In U. Kim, H. C. Triandis, C. Kagitcibasi, S. C. Choi, & G. Yoon (Eds.), Individualism and collectivism: Theory, methods, and applications (pp. 85–119). Thousand Oaks: Sage Publications; (1999). A theory of cultural values and some implications for work. Applied Psychology: An International Review, 48(1), 12–47], and one on managerial perceptions. Analyzing a sample of foreign expansions by Dutch MNEs and controlling for other factors, we find that high scores on all cultural distance measures significantly increase the likelihood that MNEs choose greenfields, and that the explanatory power of the Hofstede and Schwartz-based measures is comparable, while that of the perceptual one is somewhat lower. We conclude that it may thus be premature to dismiss Hofstede's work as outdated or as inaccurately reflecting national cultures, and to consider Schwartz's framework to be superior.     

Cultural Differences Between U.S. and Russian Students

Abstract

The study explores differences in U.S. and Russian national work-related values. Comparing the results obtained using Hofstede's 1994 instrument with earlier, but very limited U.S. and Russian studies, differences in value orientation of U.S. and Russian cultures were found. A comparative examination of value orientations of U.S. (n = 73) and Russian (n = 75) students found differences that may affect international alliances. Despite exposure of Russian students to Western values, their cultural values remained almost totally unchanged. The study upheld cultural divergence. Implications for practice and future research are offered.     

National Culture and Default on Mortgages

In this paper, we investigate the relationship between national cultural characteristics and default on mortgages (DOM). Using Hofstede's constructs and controlling for other relevant determinants of DOM, our regression analyses show that borrowers from countries with high individualism may default more on their mortgages in both a relatively stable economic period and during a period of crisis. Moreover, we find that borrowers from societies showing lower level of pragmatism and higher level of indulgence default more on their mortgages in a stable economic period. Our findings suggest important implications for multinational financial institutions that provide mortgages across countries.     

Hermes Revisited: A Replication of Hofstede's Study in Hong Kong and the UK

Hofstedes' well-known study of cross-cultural values has come to be regarded as among the most influential in the field, and the subsequent extensive citation of a study, which involved the measurement of international differences in cultural values within IBM or ‘Hermes’, is testimony to its seminal status. Unfortunately, this success has not been matched by increased co-operative research amongst social scientists into cultural issues, namely through an ‘intersubjective’ approach which was one of Hofstede's hopes for subsequent development. Hofstede's approach, based on the comparative explanation of work-related values, is categorized and labelled variously and using different typologies, thus re-emphasizing that his approach is not the only perspective.     

The Roles of Cultural Elements in International Retailing of Cultural Products: An Application to the Motion Picture Industry

We investigate factors influencing the international retailing of cultural products by concentrating on two cultural elements: (1) consumer-perceived cultural content embedded in the product and (2) the general cultural environment of the foreign market. To test cross-culture predictability in international retailing, we develop a novel text mining procedure to elicit the specific cultural content of the product using consumers’ online product reviews. In addition, to measure the general cultural environment of the market, we apply Hofstede's cultural distance measure. To explain foreign markets’ acceptance of culturally specific elements, we theorize that the relationship between inter-country cultural distance and product sales is U shaped because of both cultural discount and cultural premium. In our empirical analysis using American movies in international retailing, we find that the two specified types of cultural factors determine a movie's success, along with the movie's characteristics and the market's economic environment. From a managerial perspective, international retailers that understand the delicate implications of the match/mismatch of their general national culture and the imported product's specific cultural content can better predict the international success of imported cultural products.     

Cultural Paradox in Advertising: Evidence from Finland

This study examines whether the use of appeals in advertisements can be attributed to cultural practices or values. A convenience sample and a survey method were used to collect data from professionals and students living in Finland. Results show that in Finland cultural practices are more hierarchical and masculine than Hofstede's cultural values. Furthermore, advertisers use significantly more high power distance and masculinity appeals than low power distance and feminine appeals. These frequently used appeals are associated with cultural practices rather than cultural values. These findings suggest that due to the value paradox, cultural practices explain the reflection of culture in advertising.     

Determinants and Effects of Cultural Context: A Review,Conceptual Model,and Propositions

Edward Hall's pioneering work on “Silent Languages” of time, space, material possessions, friendship patterns, and agreements and his conceptualization of cultures as low-context and high-context have inspired numerous research studies on international and cross-cultural marketing. Despite these widespread applications, there is no research to date that integrates the theoretical foundations and applications of Hall's work in a single study. In this context, the current research delivers on the following three goals: (a) an extensive literature review of Hall's work on cultural context is done; (b) a conceptual model is developed that depicts the determinants and effects of cultural context; and (c) 12 propositions are developed, contrasting the effect of low- versus high-context cultures on a variety of cultural themes, such as Hofstede's five cultural dimensions, mono-chronic or M-time versus polychronic or P-time orientation, and relationship building etc. International marketing implications of this research and directions for future research are discussed.     

Creating the right customer experience online: The influence of culture

The effective role of experiential marketing in the differentiation of brands has been documented in both traditional and online services. The digital context of e-retailing makes it both a suitable platform for experiential consumption and an easily accessible shopping method across cultures. In spite of this, investigation of the impacts of cultural differences on the desire for experiential benefits has been very limited in the e-retailing literature. Using Hofstede's (2001) cultural dimensions, this article studies how two student samples of North American and Chinese customers react differently to the experiential values offered on the websites of e-retailing services. The findings support our hypotheses and suggest that offering experiential values on a company's website is more influential for North American than for Chinese customers. More specifically, the influences of experiential values on site involvement and customers' patronage intentions are stronger for North Americans than for Chinese visitors. On the other hand, the impacts of site involvement on site attitudes and the influence of site attitudes on patronage intentions are stronger for Chinese compared with North American customers.     

Effectiveness of Absurdity in Advertising Across Cultures

This paper examines the effect of absurd advertising on memory and persuasion across cultures. Drawing on Hofstede's cultural dimensions, it is hypothesized that the effect of absurdity on recall is culturally invariant, whereas the effect on attitude toward the ad is contingent on the recipients’ cultural orientation. The assumptions are tested using a between-subjects experimental design, in which we manipulated type of absurdity and used the cultural dimensions as blocking variables. Data was collected from 274 students in the United States, Germany, Russia, and China. We discuss theoretical and managerial implications of these findings as well as guidelines for further research.     

Organizational acculturation in foreign subsidiaries

Organizational acculturation refers to the influence of parent organizational culture resulting in change of work values of local employees in foreign subsidiaries. A study of host country national middle managers in Southeast Asia explored the impact of organizational acculturation. In the first phase, the work-related cultural values of managers employed by Swedish subsidiaries in Singapore were compared with those of a control group of managers employed by non-Swedish companies. The second phase investigated the work values of managers in Hong Kong, Singapore, and Thailand, based on Hofstede's four cultural dimensions. The findings clearly indicated that local managers in Swedish subsidiaries had experienced organizational acculturation, as distinct Swedish values had been adopted. However, cultural change did not occur to an equal extent among the three countries nor between different cultural values. Implications of the findings for international human resource management are discussed. © 1993 John Wiley & Sons, Inc.     

The Cultural Roots of Guanxi: An Exploratory Study

This paper first describes the cultural roots and characteristics of guanxi in Chinese society. It then goes on to test some propositions about the perceived relationship between these characteristics and (i) Hofstede's conceptualisation of collectivism and power distance and (ii) the content and quality of formal institutions. The sampling frame used consisted of three groups of students –viz. Chinese Singaporeans, Non‐Chinese Singaporeans and Mainland Chinese, studying in tertiary institutions in Singapore. Our findings suggest that, while the perceptions of guanxi were positively and significantly related to Hofstede's culturally related variables, this was not so in the case of formal institutions. This latter result suggests that, in East Asian countries, guanxi may well be regarded as, at least, a partial substitute for formal institutions.     

Cultural Change and Marketing

ABSTRACT

The results of this study suggest that marketing strategies need to be adjusted to changing cultures. Culture affects marketing decisions regarding product, price, promotion and place (the 4 Ps). Many marketing studies have been reported based on Hofstede's seminal work on national culture (1980). Marketing managers need to be cautious about assuming the validity of the Anglo cluster equating the cultures of the United States (U.S.) and Canada. We should recognize that national cultures are changing in the U.S., Canada and Mexico, as well as most other countries in the world. Our findings for a very recent sample of people attending executive and MBA programs would seem to apply to the upwardly-mobile business class. Contrary to the ubiquitous Hofstede data found in textbooks, we found no significant differences in Power Distance between the U.S., Mexico and Canada. Our findings regarding differences in Uncertainty Avoidance show that Mexico did not have a significantly higher mean than the U.S., but that the U.S. had a higher mean than Canada. The U.S. and Canada did not differ significantly on Individualism/Collectivism. Our results suggest that caution should be taken in automatically assuming cultural parity between the U.S. and Canada and that established cultural positions between the North American Free Trade Agreement (NAFTA) member nations may be changing.     

An examination of the antecedents of e-customer loyalty in a confucian culture: The case of South Korea

As the Internet is posing revolutionary changes to customer service and the way customers interact and purchase from businesses, loyal e-customers are crucial for the long-term survival and profitability of a business. Driven by high connectivity, reach and richness of information in today's global business environment, the task of retaining and creating loyal e-customers calls for an appreciation of cultural factors and their impact on e-customer service and loyalty. Specifically, this study examines the impact of Confucian culture on e-customer loyalty in South Korea. Since no research has yet examined the link between Confucian values and e-customer loyalty, the study proposes a conceptual model for empirical analysis by drawing on insights from Hofstede's cultural dimensions and previous studies on e-customer loyalty in European contexts. The main results show that high power distance in Confucian culture is positively associated with affiliation. But this high power distance in Confucian culture is moderated by marketing activities that lead to lock-in. This indicates the profound influence of collectivism in Confucian culture and emphasises the importance of referral and community participation in increasing stickiness and hence loyal e-customers.     

An exploratory study of motives for Mexican nationals to shop in the US: More than meets the eye

Outshopping within a country's boundaries and international outshopping across national borders has been long researched. Previous studies have mainly focused on immediate (outer) motives as the fundamental reasons for outshopping. Building on this tradition, we categorized immediate motives for outshopping into the following four groups: (1) product quality, (2) service quality, (3) fashion consciousness, and (4) shopping enjoyment. Our results confirmed previous findings that those four motives are positively related to outshopping frequency. A point of departure from previous research, however, is that based on Hofstede's works [1980. Culture's Consequences: International Differences in Work-Related Values. Sage Publications, Newbury Park, CA; 2001. Comparing Values, Behaviors, Institutions and Organizations Across Nations, second ed. Sage Publications, Thousand Oaks, CA] we identified four inner motives: (1) desire for showing off power, (2) desire for rule of law, (3) egoism, and (4) masculinity. Through structure modeling technique, these psychological needs that exist at a higher level not only influence the outer motives, but also have a direct impact on outshopping frequency. In other words, cross-border shopping can fulfill shoppers’ obvious secular needs existing at a low level, as well as their psychological needs hidden at a higher level. Although our study examined why Mexican nationals choose to shop in the US, the results are applicable to outshopping in general where shopping environments differ in terms of economic, social, and cultural development in different countries. Managerial and research implications are also discussed.     

A Comparison of Native Culture,Non-Native Culture and New Management Ideology

Abstract Based on a case study of a Native-operated criminal justice organization, this article uses Hofstede'sfive dimensions of national cultural differences to examine the connections between cultural values and management practices. It concludes that Hofstede's dimensions can provide insights into the differences between Native and non-Native cultures and how Native organizations may draw on traditional cultural values to improve organizational effectiveness. In general, Native cultures are described as collectivist, egalitarian, adaptive, and tolerant. The argument is made that the cultural context in which Native organizations operate is in many ways more compatible with the new management ideology than is the society in which this ideology prevails. Résumé Fondée sur une étude de cas d'un organisme de justice pénale géré par les autochtones, la présente recherche examine les liens entre des valeurs culturelles et des pratiques de gestion en se référant aux cinq dimensions des différences culturelles nationales de Hofstede. Elle con-clut que ces dimensions peuvent jeter une lumière nou-velle sur les différences entre cultures autochtones et allochtones, et sur la façon dont les organismes autochtones peuvent tirer parti de leurs valeurs culturelles traditionnelles pour rehausser I'efficacité orga-nisationnelle. En général, les cultures autochtones sont perçues comme collectivistes, égalitaires, flexibles et tolérantes. Nous proposons l'idée que le contexte cul-turel dans lequel fonctionnent les organismes autochtones est à de nombreux égards plus compatible avec la nouvelle idéologic de gestion que ne Vest la société où prévaut cette idéologic.