Difference between Entering the Markets USA and Austria - Essay Example

? Difference between entering the markets U.S.A and Austria Introduction Accommodation of new cultures in a market requires sensitivity and a lot of research on different values and principles that come in with the parties involved. Hofstede’s cultural category theory is a framework against which cross cultural communication is based. The theory describes the effect of a social set up’s culture on the values of the members present and how these values relate to behavior. The theory engages five types that include an individualism-collectivism, uncertainty avoidance, masculinity-femininity, power distance, long-term orientation, and indulgence versus self-restraint (Ball et al., 2005). The first category, that is; power distance measures less powerful members of asocial set up to the extent of acceptance of inequality. High gets in power distance indicate that a person workers or employers will not be granted advancement according to merit but rather what social set up has dictated for them. In individualism –collectivism high gets reflect strong person’s independence and a responsibility to one’s own actions.in Hofstede’s cultural dimensions; Masculinity-femininity affected very many societies. The values of women were relatively the same; meaning levels of modesty, caring, and sensitivity were relatively similar. Theworld’saverage in this category is 50. An average score implies that there is a balance between feminine and masculine qualities in a country. When it comes to uncertainty avoidance index, the world’s average in this category is 64. Rules and regulations in terms of intricate planning would be more prominent in higher scoring countries. In his final cultural category; that is long term orientation Hofstede examines the preference for short term and long term goals in different countries. High scorers in this categoryindicate their culture is more persistent and thrifty (Ball et al., 2005). I will use Hofstede’s cultural dimensions to discuss the differences between entering the market in the U.S.A and Austria. Research from other sources will be involved. Power Distance This category brings out the attitude of the culture towards these disparities amongst persons. Power distance can be defined as the extent to which the less powerful members of the social set upor organizations within a state expect and accept that power is distributed unequally. The fact that disparities exist within a social set up is accepted by the subjects as well as by their leaders. The U.S.A has a low score on this category (40) which implies that the American liberty and justice for all has been underscored. This can be proved by the focus on equal rights in most aspects of the American social set up and government. Hierarchy is established for convenience for all American organizations just as superiors are always accessible and employers rely in a personworkers and teams for their experience. Both employers and workers in the American social set up expect to be consulted and information is shared frequently.at the same time, their communication is straight, casual and participative. Austria on the other hand gets as low as 11 in this category. This means that Austria is characterized by the following; there is a lot of independence, there is hierarchy for convenience purposesonly, persons have equal rights, superiors are easily accessible, leaders are viewed as coaches, their management facilitates and empowers workers. Power is not centralized and employers count on the participation and experience of their team members. Workers also expect to be consulted. Control on workers is unlikely and attitude towards employers are informal and on first name basis. Communication is express and participative (Hofstede, 2003). Individualism The most important issue addressed by this category is the degree of interdependence a social set up maintains among its members. This includesself-image defined in terms of “I” or “we” .individuals in a individualistic societies are responsible for themselves and their families only while in a collectivist social set upindividuals belong to groups that take care of them in exchange of loyalty. In the United States the score for this category is 91. This implies that the U.S.A is a highly a individualistic nation. This portrays a loosely knit social set up where the expectations are that individuals look after themselves and their immediate families only. There is also a high rate of geographic mobility in the US and most a people find it comfortable to do business with strangers.in result American citizens are not shy about approaching their prospective counterparts in order to see information.in the business world of work ,workers are expected to rely on themselves and areinitiative. Hiring and promotion decisions are according to merit or evidence of what one has achieved ore can achieve. Austria on the other hand has a score of 55.the increased score however does not change the fact that there is a high preference for a loosely knit social framework. People in Austria like in the US are expected to take care of themselves and their immediate families.in this kind of social set up’s offence causes guilt and lose of self-esteem. The relationship between employer and employee is a contract according to that has very high mutual benefit. Hiring and promotion choices are supposed to be according to merit only. Management is usually done for a person (Hofstede, 2003). Masculinity-femininity A high score (masculine) in this category indicates a social set upmotivated by competition, achievement and success. Success in this case is defined as the best in the field or the winner. These values start in the school and continue throughout one’s life both in work and at leisure pursuits. A low score (feminine) means that the dominant values of the social set up are caring for others and quality of life. A feminine social set up portrays the quality of life as the sign of success and standing out from the crowd is not admirable (Tavakoli, Keenan & Cranjak-Karanovic, 2003). The basic concept here is what motivates individuals, wanting to be the best (masculine) or liking what you do (feminine). The US gets 62 on this category and the following facts are withdrawn from that. TheUnited States is considered a masculine social set up, behaviors are according to shared values that’s individuals should strive to be the best they can. Due to this American citizens will tend to display and talk freely abouttheirsuccess. The success achieved bya person is another basis for hiring and promotions at workplaces (Law, 2006). Typically American citizens live to work so that they earn monetary rewards. Conflicts can be solved at a person levels and the goal is to win. Austria which gets 79 in this category is also a masculine social set up.it is highly motivated by success. Conflicts are solved by fighting them out. A clear example is seen around election time, no-holds barred battles and with ferocious between candidates (Hofstede, 2003). Uncertainty Avoidance In this category the extent to which members of a culture feel threatened by ambiguous unknown situations and have created beliefs and institutions that try to avoid these is reflected. Austria gets 46 on this category and therefore, America social set up can be described as uncertainly accepting. New ideas are accepted easily, innovative products and willingness to try something new is highly observed. American citizens do not require a lot of rules and are less emotionally expressed than higher scoring societies (Hofstede & Bond, 2004). Austria gets 70 in this category and therefore has a strong preference for avoiding uncertainty.in this culture there is an emotional requirement for rules even when they never seem to work. Time is considered as money and individuals have an inner urge to be busy and work hard .Innovation may not be accepted, security is necessary for a person’s motivation. Decisions are made after critical analysis of all available options (Yeh & Lawrence, 2005). Long term orientation This involves the extent to which a social set up shows a pragmatic future oriented perspective rather than a conventional historical short term point of view. The United States gets 29 on this category and is short-term oriented culture .due to this traditions culture is focused and social obligations are fulfilled. This motivates a person to strive for fast results at the work places. Absolute truth is also necessary in all matters. Austria gets 31 which could indicate a short term orientation culture. Societies it the western region are typically found at the short term end of this category, same as the countries in the Middle East (Hofstede & Minkov, 2001). After reviewing the scoring differences between the two nations it is important to notice that there are patterns and correlation within these two countries. This means that foreign countries might be similar in entry to their market because of similar structural organization and behaviors. When beginning to do a business in any of these countries we should not assume that cultural differences will be accepted and business will go on as usual .the proper process however for entering environments that are unfamiliar requires Hofstede’s dimensions to educate workers and managements in cultural sensitivity (TIM, 2008). References Ball, D., McCulloch Jr., W., Geringer, J., Minor, M., and McNett, J. (2005) (11th ed.) International Business: The Challenge of Global Competition. McGraw-Hill. Hofstede, G. (2003). Cultural categorys in management and planning. Asia Pacific journal of management, 1(2), 81-99. Hofstede, G. J., & Minkov, M. (2001). Cultures and organizations: Software of the mind (Vol. 2). London: McGraw-Hill. Hofstede, G., & Bond, M. H. (2004). Hofstede's Culture CategorysAn Independent Validation Using Rokeach's Value Survey. Journal of cross-cultural psychology, 15(4), 417-433. Law, W. (2006) Information Resources Management: Global Changes. Idea Group Publishing: London, England. Tavakoli, A. A., Keenan, J. P., & Cranjak-Karanovic, B. (2003). Culture and whistleblowing an empirical study of Croatian and United States employers utilizing Hofstede's cultural categorys. Journal of Business Ethics, 43(1-2), 49-64. TIM International. (2003) Geert Hofstede™ Cultural Categorys: Australia, Canada, China, and the United States. Retrieved March 6, 2008, from http://www.geert- hofstede.com/geert_hofstede_resources.sht Yeh, R. S., & Lawrence, J. J. (2005). A personism and Confucian dynamism: a note on cultural root to economic growth. Journal of international business studies, 655-669. Read More