Hofstede’s Cultural Dimensions: Impact on International Business
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Essay on: “Hofstede’s Cultural Dimensions”
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Essay on: “Hofstede’s Cultural Dimensions”
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Table of Contents
Introduction......................................................................................................................................3
Body.................................................................................................................................................4
Conclusion.......................................................................................................................................8
Reference List..................................................................................................................................9
2
Introduction......................................................................................................................................3
Body.................................................................................................................................................4
Conclusion.......................................................................................................................................8
Reference List..................................................................................................................................9
2

Introduction
The cultural dimensions developed by Hofstede can b applied within the organisational structure
of any unit. These dimensions provide an understanding of the issues that are prevalent within
the unit and the ways operators within the unit resolve their issues to maintain unity. The
following study will provide a brief overview of the dimensions of Hofstede’s cultural
dimensions in lieu of human behaviour within an organisational context as well as within the
international business environment. By understanding the influence of the power index,
individualism/collectivism and uncertainty avoidance aspects within an organisational culture,
business relations would enhance communication and trade.
3
The cultural dimensions developed by Hofstede can b applied within the organisational structure
of any unit. These dimensions provide an understanding of the issues that are prevalent within
the unit and the ways operators within the unit resolve their issues to maintain unity. The
following study will provide a brief overview of the dimensions of Hofstede’s cultural
dimensions in lieu of human behaviour within an organisational context as well as within the
international business environment. By understanding the influence of the power index,
individualism/collectivism and uncertainty avoidance aspects within an organisational culture,
business relations would enhance communication and trade.
3
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Body
Hofstede’s cultural dimensions
The society of different countries operates using various cultural attributes based on the regional
history and societal behaviour. Hofstede’s cultural dimensions provide an analysis of the cultural
landscape of regions. These indices are developed according to certain factors that were
identified through an extensive study on the behavioural pattern of employees and organisational
operations. The cultural dimensions of every society can be divided according to the indices of
power distance index, individualistic/collectivism and uncertainty avoidance factor. Hofstede
divided the global society into rankings based on these indices to identify the difference of
culture among different cultures of the world.
Figure 1: Individualism/Collectivism
(Source: Geert Hofstede, 2019)
Individual/collectivism factor determine the cultural trend of a region to observe the factors that
influence individuals and businesses while taking decisions. These factors provide a brief
outlook regarding the individualistic or collective approach to decision-making that businesses
operating in a region implement. The power distance factor provides the individuals and
businesses with the ability to take decisions according to the superior’s choice or their individual
decisions. The uncertainty avoidance factor provides a view of the culture prevalent within the
society and businesses’ concern following methods that are proved effective in the end.
4
Hofstede’s cultural dimensions
The society of different countries operates using various cultural attributes based on the regional
history and societal behaviour. Hofstede’s cultural dimensions provide an analysis of the cultural
landscape of regions. These indices are developed according to certain factors that were
identified through an extensive study on the behavioural pattern of employees and organisational
operations. The cultural dimensions of every society can be divided according to the indices of
power distance index, individualistic/collectivism and uncertainty avoidance factor. Hofstede
divided the global society into rankings based on these indices to identify the difference of
culture among different cultures of the world.
Figure 1: Individualism/Collectivism
(Source: Geert Hofstede, 2019)
Individual/collectivism factor determine the cultural trend of a region to observe the factors that
influence individuals and businesses while taking decisions. These factors provide a brief
outlook regarding the individualistic or collective approach to decision-making that businesses
operating in a region implement. The power distance factor provides the individuals and
businesses with the ability to take decisions according to the superior’s choice or their individual
decisions. The uncertainty avoidance factor provides a view of the culture prevalent within the
society and businesses’ concern following methods that are proved effective in the end.
4
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Figure 2: Power distance index
(Source: Geert Hofstede, 2019)
These factors are effective and beneficial in context of conducting international business as it
enables business organisations from different cultures to collaborate and improve the global
business context. These factors allow the business individuals to develop a comprehensive
understanding of the cultural differences in the business environment. Despite the benefits, these
factors provide to the business individuals and organisations regarding the cultural differences,
these indicators cannot be considered as an accurate indicator of all the cultural aspects in the
global business environment.
Figure 3: Uncertainty avoidance
5
(Source: Geert Hofstede, 2019)
These factors are effective and beneficial in context of conducting international business as it
enables business organisations from different cultures to collaborate and improve the global
business context. These factors allow the business individuals to develop a comprehensive
understanding of the cultural differences in the business environment. Despite the benefits, these
factors provide to the business individuals and organisations regarding the cultural differences,
these indicators cannot be considered as an accurate indicator of all the cultural aspects in the
global business environment.
Figure 3: Uncertainty avoidance
5

(Source: Geert Hofstede, 2019)
The Hofstede’s cultural dimensions are effective in the international business environment as it
allows business organisation to develop their collaborative activities accordingly. These factors
are relevant in the international business context to certain extent, as these indicators do not
apply to every culture in the global business environment.
Cultural dimensions in adherence to the international business context
The cultural differences between business organisations hinder the efficiency of business
procedure in a global business context. The cultural dimensions of Hofstede enable the business
entities to assume certain aspects of different cultures and form their business strategy
accordingly. The study performed by Tukur and Adam (2017), proves that cultural attributes
within a business environment are essential for the development of effective strategies and
enhanced communication. The power distance factor essentially provides the business
organisations to identify the hindering factors that could facilitate any spontaneous business
decision-making process. The individual/collective indicator of cultural dimension provides the
businesses with an understanding of the difference between the decision-making powers of
individuals in a business context.
Cultural dimensions in non-compliance to business context
The cultural factors provide an understanding of the attributes within the business context of
various regions as per the local psychology and cultural facets. The cultural dimension model
determines the factors that enable businesses to collaborate with foreign culture in ways that
would increase the efficiency of the business process. The power distance and
individual/collective behaviour of organisations are effective in the international business context
as it provides businesses with an appropriate understanding of the aspects that facilitate their
business decision-making procedure. The aspect of uncertainty avoidance in the business world
cannot be considered as an appropriate identifier in the international business context. As
observed in the study performed by Liñán et al. (2016), the decision-making process for
organisations is influenced by the personal and cultural beliefs. The study enhances the fact that
in a globalised business environment, cultural dimensions play a general role but does not
command the decision-making ability of the entrepreneurs.
6
The Hofstede’s cultural dimensions are effective in the international business environment as it
allows business organisation to develop their collaborative activities accordingly. These factors
are relevant in the international business context to certain extent, as these indicators do not
apply to every culture in the global business environment.
Cultural dimensions in adherence to the international business context
The cultural differences between business organisations hinder the efficiency of business
procedure in a global business context. The cultural dimensions of Hofstede enable the business
entities to assume certain aspects of different cultures and form their business strategy
accordingly. The study performed by Tukur and Adam (2017), proves that cultural attributes
within a business environment are essential for the development of effective strategies and
enhanced communication. The power distance factor essentially provides the business
organisations to identify the hindering factors that could facilitate any spontaneous business
decision-making process. The individual/collective indicator of cultural dimension provides the
businesses with an understanding of the difference between the decision-making powers of
individuals in a business context.
Cultural dimensions in non-compliance to business context
The cultural factors provide an understanding of the attributes within the business context of
various regions as per the local psychology and cultural facets. The cultural dimension model
determines the factors that enable businesses to collaborate with foreign culture in ways that
would increase the efficiency of the business process. The power distance and
individual/collective behaviour of organisations are effective in the international business context
as it provides businesses with an appropriate understanding of the aspects that facilitate their
business decision-making procedure. The aspect of uncertainty avoidance in the business world
cannot be considered as an appropriate identifier in the international business context. As
observed in the study performed by Liñán et al. (2016), the decision-making process for
organisations is influenced by the personal and cultural beliefs. The study enhances the fact that
in a globalised business environment, cultural dimensions play a general role but does not
command the decision-making ability of the entrepreneurs.
6
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Credibility of Hofstede’s cultural dimensions
In the current business scenario, globalisation has reduced the cultural gap between organisations
from different regions. The Power Distance Index (PDI) in Japanese and American society has
reduced due to increased globalisation (Dumetz and Cadil, 2018). The cultural differences
between the societies remain the same though the business sentiments have developed over the
years. Considering the study performed by Buckley and Ghauri (2015), it can be stated that
Hofstede’s cultural dimensions play an essential attribute to the business environment. The
factors enable organisations to develop collaborative strategy with foreign companies
successfully. The attributes of cultural difference in the international business context plays a
major role in the globalised business environment but the success of business collaborations are
not limited to the cultural aspect of organisations.
Hofstede’s cultural dimensions needs to be updated considering the globalised business
environment companies operate within. The dimensions were developed at a time when
globalisation has not yet influenced the international business environment. Updating the cultural
indicators will allow organisations to develop their business strategies appropriately (Moore,
2016). Culture of a region evolves according to time passed hence it is essential for Hofstede’s
cultural dimensions to acquire the modifications that apply to the current international business
environment (Morrison, 2015).
7
In the current business scenario, globalisation has reduced the cultural gap between organisations
from different regions. The Power Distance Index (PDI) in Japanese and American society has
reduced due to increased globalisation (Dumetz and Cadil, 2018). The cultural differences
between the societies remain the same though the business sentiments have developed over the
years. Considering the study performed by Buckley and Ghauri (2015), it can be stated that
Hofstede’s cultural dimensions play an essential attribute to the business environment. The
factors enable organisations to develop collaborative strategy with foreign companies
successfully. The attributes of cultural difference in the international business context plays a
major role in the globalised business environment but the success of business collaborations are
not limited to the cultural aspect of organisations.
Hofstede’s cultural dimensions needs to be updated considering the globalised business
environment companies operate within. The dimensions were developed at a time when
globalisation has not yet influenced the international business environment. Updating the cultural
indicators will allow organisations to develop their business strategies appropriately (Moore,
2016). Culture of a region evolves according to time passed hence it is essential for Hofstede’s
cultural dimensions to acquire the modifications that apply to the current international business
environment (Morrison, 2015).
7
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Conclusion
The study provides the effectiveness of the cultural factors that ensure business operations are
concluded successfully in the international business environment. The appropriate usage of
cultural dimensions in business context enabled the businesses to develop strategies relevant to
the business procedure. It can be stated that the organisational culture varies according to the
societal culture prevalent in the business environment.
The study thus proves that Hofstede’s cultural dimensions applied in the international business
context needs to be developed further in order to maintain synchronicity with the age and time of
the international business environment.
8
The study provides the effectiveness of the cultural factors that ensure business operations are
concluded successfully in the international business environment. The appropriate usage of
cultural dimensions in business context enabled the businesses to develop strategies relevant to
the business procedure. It can be stated that the organisational culture varies according to the
societal culture prevalent in the business environment.
The study thus proves that Hofstede’s cultural dimensions applied in the international business
context needs to be developed further in order to maintain synchronicity with the age and time of
the international business environment.
8

Reference List
Buckley, P.J. and Ghauri, P. eds., 2015. International business strategy: theory and practice.
Routledge.
Dumetz, J. and Cadil, J., 2018. Challenging the Masculinity index: The end of a cross-cultural
myth.
Geert Hofstede. 2019. The 6 dimensions model of national culture by Geert Hofstede. [online]
Available at: https://geerthofstede.com/culture-geert-hofstede-gert-jan-hofstede/6d-model-of-
national-culture/ [Accessed 27 Mar. 2019].
Liñán, F., Moriano, J.A. and Jaén, I., 2016. Individualism and entrepreneurship: Does the pattern
depend on the social context?. International Small Business Journal, 34(6), pp.760-776.
Moore, F., 2016. Transnational business cultures: Life and work in a multinational corporation.
Routledge.
Morrison, J., 2015. Business ethics: New challenges in a globalised world. Macmillan
International Higher Education.
Tukur, M.N. and Adam, S.I., 2017. Culture and Entrepreneurship: An Overview of Hofstede’s
Cultural Dimensions. Journal of Economics and Finance (DRJ-JEF), 2(7), pp.17-21.
9
Buckley, P.J. and Ghauri, P. eds., 2015. International business strategy: theory and practice.
Routledge.
Dumetz, J. and Cadil, J., 2018. Challenging the Masculinity index: The end of a cross-cultural
myth.
Geert Hofstede. 2019. The 6 dimensions model of national culture by Geert Hofstede. [online]
Available at: https://geerthofstede.com/culture-geert-hofstede-gert-jan-hofstede/6d-model-of-
national-culture/ [Accessed 27 Mar. 2019].
Liñán, F., Moriano, J.A. and Jaén, I., 2016. Individualism and entrepreneurship: Does the pattern
depend on the social context?. International Small Business Journal, 34(6), pp.760-776.
Moore, F., 2016. Transnational business cultures: Life and work in a multinational corporation.
Routledge.
Morrison, J., 2015. Business ethics: New challenges in a globalised world. Macmillan
International Higher Education.
Tukur, M.N. and Adam, S.I., 2017. Culture and Entrepreneurship: An Overview of Hofstede’s
Cultural Dimensions. Journal of Economics and Finance (DRJ-JEF), 2(7), pp.17-21.
9
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