Hofstede's Cultural Dimensions in International Business

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Please see the attached file for answers.

Sources: Use has been made of the following resources in preparing this response.

1) National Cultural Differences and Multinational Business (Globalization Note Series- Pankaj Ghemawat and Sebastian Reiche)

2) https://www.hofstede-insights.com/country-comparison

Use Hofstede's characteristics to differentiate international and domestic business operations. Identify the key characteristics that drive business decisions on an international and domestic level.

International and domestic business operations are not the same. There are differences in cultures, politics, legal systems, technology, level of competition, logistics, and media. A company may encounter different customer buying habits in a new country it is entering and will have to change its marketing strategies and materials to make its offerings attractive. In international business, the way a company operates its business is determined by the culture of the market it is enetering and not the culture of its country of origin.

No two cultures are the same and if a company wants to succeed in another country, it needs to understand both its social and business culture. Culture defines everything a society does, from its business practices, to its response to advertising and marketing, to negotiating sales.

Hofstede developed cultural dimensions theory as a framework for cross-cultural communication. A society's culture affects the values of its members and these values in turn affect behavior. The dimensions along which the cultural values can be examined are six:
1) Individualism-Collectivism
2) Uncertainty avoidance
3) Power distance (strength of social hierarchy)
4) Masculinity-femininity (task orientation versus person-orientation)
5) Long-term orientation:
6) Indulgence versus self-restraint

Characteristic Description High Low
1 Power distance (hierarchy) Degree to which a culture accepts and reinforces the fact that power is distributed unevenly in society. High power distance cultures: accept status differences; expected to show proper respect to their superiors. Low power distance cultures: less comfortable with differences in organizational rank or social class; more participation in decision-making and a frequent disregard of hierarchical level.
2 Individualism vs. collectivism* Individualist cultures: a relative preference for the individual in contrast to the group; maintain loose social structures ...