Question

Select one country using Hofstede's framework, list 5 elements of its cultural environment. For each cultural element, explain the impact on international business?

Answer 1

The selected country is India:

5 elements of cultural dimensions as prescribed by Hofstede's framework are as follows.:

1. Power Distance

2. Individualism V/S collectivism

3. Masculinity

4. Uncertainty Avoidance index

5. Indulgence

Above elements o cultural dimensions affect the approach taken up by the organizations and adjust their strategy that can suit their international business. The first element is power distance and at this, India scores 77. It means that there is a strong presence of power distance and there is a huge importance of organizational hierarchy in organizations or in society. Accordingly, the MNCs adapt the organizational structure that can suit to the cultural element of India. Further, the marketing communication will also give due respect to those who lead the family, to get effective results.

The second element is individualism that scores 48 for India. It means that India give high value to the family and collectivism, MNCs should focus upon the family as whole for society and team work in organization to succeed. The third element is masculinity that has score of 56 for India. It means that Indian culture is slightly in favor of male dominance. Head of the family is still a man in India culture. So, enterprises should show men as leaders while pursuing international business in India, while giving due respect and position to female as well.

The fourth element is uncertainty avoidance index that 40 for Indian culture. It means that Indian societies are open to new ideas and they can taste new things. It is an opportunity for the MNCs to come and explore the possibilities by offering new goods and services. The fifth element is indulgence that scores 26 for India. It means that family values and traditions are given adequate respect and importance. They can indulge with new products and services, but they will not leave when they have traditionally. So, any organization pursuing IB, should link the products and services with the present value system of the Indian culture.