According to Dr. Geert Hofstede, ‘Culture is more often a source of conflict than of synergy. Cultural differences are a trouble and always a disaster.’
Professor Hofstede established a model using the results of the study which identifies four dimensions to differentiate cultures. Later, a fifth dimension called ‘long-term outlook’ was added.
The following are the five cultural dimensions:
Power Distance Index (PDI)
This focuses on the level of equality or inequality between individuals in a nation’s society. A country with high power distance ranking depicts that inequality of power and wealth has been allowed to grow within the society.
These societies follow caste system that does not allow upward mobility of its people. A country with low power distance ranking depicts a society which de-emphasises the differences between its people’s power and wealth.
Individualism
This dimension focuses on the extent to which the society reinforces individual or collective achievement and interpersonal relationships. A high individualism ranking (western countries, Canada, Hungary) depicts that individuality and individual rights are dominant within the society.
Individuals in these societies form a larger number of looser relationships. A low individualism ranking (Asian and African countries like Indonesia and Colombia) characterises societies of a more collective nature with close links between individuals.
Masculinity
This focuses on the extent to which the society supports or discourages the traditional masculine-work role model of male achievement, power, and control. A country with high masculinity ranking (like Japan, Venezuela, Hungary) shows the country experiences high level of gender differentiation.
In these cultures, men dominate the society and power structure, with women being controlled and dominated by men.
Uncertainty Avoidance Index (UAI)
This focuses on the degree of tolerance for uncertainty and ambiguity within the society. A country with high uncertainty avoidance ranking shows that the country has low tolerance for uncertainty and ambiguity.
A rule-oriented society that incorporates rules, regulations, laws, and controls is created to minimise the amount of uncertainty. A country with low uncertainty avoidance ranking shows that the country has fewer concerns about ambiguity and uncertainty and has high tolerance for a variety of opinions.
Long-Term Orientation (LTO)
It describes the range at which a society illustrates a pragmatic future oriented perspective instead of a conventional historic or short term point of view.
The Asian countries (China, Japan, Honk Kong) score high on this dimension. These countries have a long term orientation, believe in many truths, accept changes easily, and have thrift for investment.
