Globalization and Organizational Culture

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  • 0:05 What Is National Culture?
  • 1:10 Aspects of National Culture
  • 2:27 Transporting Business Culture
  • 4:11 Lesson Summary
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Lesson Transcript
Instructor: Rob Wengrzyn
Culture influences almost every aspect of an organization. Globalization is one of the forces that influences organizational culture, and in this lesson we will talk about just how globalization impacts organizational culture.

What Is National Culture?

When we talk about national culture, we are referring to aspects of a nation's culture (right and wrong, good and evil, etc.) that are learned at an early age and are part of each individual's personality. National culture is the fabric of who we are as a nation and helps shape us as the nation grows and changes. From that viewpoint, we can see that a national culture could help or impede how an organization's culture could be transported to another country.

You see, organizational culture is shaped by national culture. The organization resides in a specific country, and that country's national culture helps form the thought processes of the organization. Think of it this way: in America, part of our national culture is that everyone should have an opportunity to succeed, so some of us work hard to climb the corporate ladder or even start our own businesses. The same is not true in other countries due to their national culture. For instance, look at North Korea. With a dictator in charge, there is little chance to climb a ladder of success as the country has remained poor and very much in the dictator's control.

Aspects of National Culture

Many years ago, a social psychologist named Geert Hofstede identified components that help make up national culture. He organized his work into a school of thought called cultural dimensions theory. While his work did not take into account art, music or even religion, he determined there were several dimensions that related to how a culture views life and business. Each country puts different value or emphasis on these dimensions, but when they are all assembled, they create the basis for national culture. Hofstede's dimensions include:

  • Power Distance: This relates to how power is distributed in a culture and the view that this distribution is unequal.
  • Individualism versus Collectivism: This aspect relates to a culture's preference to work individually or as a team.
  • Masculinity versus Femininity: The masculinity aspect refers to a culture's view of material achievement, whereas the feminine portion relates to cooperation and quality of life.
  • Uncertainty Avoidance: Some cultures are not good with uncertainty or ambiguity. This dimension relates to how a culture views uncertainty.
  • Long-term versus Short-term Orientation: Simply put, does a culture look for long-term solutions or do they have more of a short-term perspective?

Transporting Business Culture

As you can see from these aspects of culture, transporting a business or organizational culture to another market can be very challenging. The U.S., as we discussed, has a national culture, and that culture is made up of the same dimensions that Hofstede researched (they are present in every culture). Thus, in the U.S., businesses have their own culture, made up in part from the national cultural influences, and transporting that culture to another market is not an easy thing to do.

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