Contemporary Issues in Management: Working With Diversity and Across Cultures

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Introduction

Diversity management is one of the most relevant issues in contemporary management because of the influx of employees from different cultures in the workplace. Furthermore, the spread of globalisation across multiple continents and the rising prominence of multinational companies in global commerce has made cross-cultural management one of the most discussed topics in both academic and professional literature (Beugelsdijk et al., 2018; Fuentelsaz, González and Maicas, 2019; Jackson, 2018; Corporate Finance Institute, 2019; Hofstede Insights, 2019).

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This trend has made it difficult to balance varied interests, norms, and values in a business environment that requires synergy to accomplish organisational goals (Gobel et al., 2018; Gnanakumar, 2020). Therefore, researchers have highlighted diversity management as one of the most impactful leadership issues in the 21st century (EstradaCruz, VerdúJover, and GómezGras, 2019; Beugelsdijk et al., 2018; Fuentelsaz, González and Maicas, 2019; Jackson, 2018).

In this report, I reflect on my personal experience working as a sales representative in two countries with significantly diverse cultures – the UK and China. My experience with diversity management started in China where I worked as a salesperson in my Uncle’s insurance company. When I travelled to the United Kingdom (UK), I also accepted a job to sell a similar product through a Liverpool-based Insurance agency to supplement my income. Having worked in the same capacity as a sales representative in China and the UK, I observed significant cultural differences among employees and clients in both countries. This report describes my experiences as an employee through the Hofstede cultural framework.

Additional analysis will be undertaken using the contingency theory to support recommendations that will be highlighted in the last section of the document. However, before delving into these insights, the section below describes key tenets of the Hofstede cultural dimensions theory as the reflective framework for my experience in cross-cultural management.

Theoretical Foundation

Hofstede’s cultural dimensions theory provides a basis for implementing diversity management because it demonstrates how culture influences people’s behaviours. The theory presupposes that five cultural dimensions influence human conduct: power distance, collectivism vs. individualism, uncertainty avoidance index, feminism vs. masculinity, short-term vs. long-term orientation, and restraint vs. indulgence (Corporate Finance Institute, 2019; Hofstede Insights, 2019). Figure 1 below shows the scores for the UK and China based on the cultural dimensions highlighted above.

UK-China Country Comparison
Figure 1. UK-China Country Comparison (Source: Hofstede Insights, 2019)

According to figure 1 above, China has a high power distance and long-term orientation more than the UK. Comparatively, UK citizens tend to show higher levels of individualism, indulgence, and uncertainty avoidance compared to China. However, citizens from both countries have similar levels of masculinity. These cultural dimensions will be used to appraise my experience as a sales representative in the UK as outlined below.

Power Distance

The concept of power distance refers to how people manage inequalities in society. Mehdi (2018) and Stamenova (2018) add that power distance denotes the extent that people in a given society agree and accept that power is distributed unequally. Therefore, employees who work in countries that have a high power distance tend to be excluded from important decision-making processes, while those who work in countries that have a low power distance tend to be included in major decisions (Corporate Finance Institute, 2019; Hofstede Insights, 2019). In my experience as a sales representative, I found that my UK colleagues questioned authority more than my Chinese counterparts did.

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The only Chinese employees who questioned superiors were high-ranking employees and they did so discreetly. Hofstede’s power distance scores for China and the UK explain this disparity in behaviour because China has a score of 80, while the UK has 35 points (Hofstede Insights, 2019). These scores mean that China’s power distance is twice that of the UK. Therefore, it is no surprise that UK employees were comfortable questioning management’s decisions while my Chinese colleagues rarely did so.

Uncertainty Avoidance

The insurance business is rooted in the need to manage uncertainty. According to Bedford and Carayannis (2018), uncertainty avoidance refers to how well people in a country deal with future ambiguities. In this context, the main question to ask is whether people would want to control future outcomes, or not. The dilemma could be associated with anxiety and societies have learned to cope with it differently. My experience as a sales representative in the UK insurance industry is consistent with that of Hofstede’s cultural dimensions theory, which suggests that the UK has a higher uncertainty avoidance score than China.

I established this fact after having discussions with potential clients in a Chinese retail company who were motivated to buy life insurance policies because they wanted to protect their families from financial ruin in case of death or disability. One of them told me that he came from a poor family and he feared death or disability because it would leave his family with a lot of debt to pay off. Therefore, the insurance policy protected them from this problem. While this admission made it easier for me to close a sale, it described the extent that Chinese attitudes towards uncertainty avoidance influenced their purchasing decisions. My UK experience did not manifest the same level of commitment towards avoiding uncertainties as most clients bought a policy as a “safeguard” in their lives.

Long-Term Orientation

The concept of long-term orientation focuses on analysing how people address present and future challenges while maintaining links with their history. According to Genner (2017) and Abdullah (2017), different societies prioritise short-term and long-term goals based on this criterion. For example, long-term-oriented communities commonly protect their traditions more than those that have a short-term orientation.

Therefore, long-term-oriented societies tend to view change suspiciously, while cultures that have a short-term orientation welcome it. In my experience, I found that both Chinese and UK clients had long-term oriented cultures because they always planned for the future in terms of their business and personal goals. I also observed that both societies have a pragmatic understanding of situational contexts because they believed that truths largely depended on time and context. However, my observations differ from the findings highlighted in figure 1 above, which show that China has a higher long-term orientation score (85 vs. 51) compared to the UK (Hofstede Insights, 2019).

These scores imply that China has a more long-term orientated culture compared to the UK. However, I did not observe the same outcome. Perhaps the disparity could be explained by the changing workplace cultures and systems in both countries that promote a long-term approach to solving organisational problems. Alternatively, generational differences could have influenced how employees and clients view this aspect of cultural behaviour, as suggested by Pyöriä et al. (2017) and Muñoz-Bullon, Sanchez-Bueno, and Suárez-González (2018).

Masculinity

The concept of masculinity, as highlighted in Hofstede’s cultural dimensions theory, refers to how much societies are willing to engage in competitive behaviours that are motivated by achievement and success. Alternatively, a culture that scores low on the masculinity index means that its people are motivated to care for others above all other concerns. My experience in China showed that most people were driven by a competitive spirit to work and accomplish their goals. I also observed the same attitude in the UK but my Chinese clients exhibited a higher masculinity index because they wanted to honour themselves and their families through their work.

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This observation is consistent with the findings of Hofstede Insights (2019) and Zhou et al. (2018), which show that a majority of the Chinese will sacrifice leisure and family to fulfil work obligations. I affirm the same view because I know of a widow who had two children, owned a hair salon, and worked late into the night to make enough money to pay for her family’s expenses and insurance premiums on time.

This dedication and commitment to “win” is part of a masculine culture that exists in China. My UK experience was similar, except that leisure time was more valued than in China. Hofstede’s cultural dimensions suggest that both the UK and China had equal scores of 66 on the masculinity index. This finding affirms my aforementioned views because I observed a masculine attitude in both countries.

Individualism

According to Hofstede’s cultural dimension theory, the concept of individualism refers to the degree that a country’s citizens are interdependent (Corporate Finance Institute, 2019). Therefore, people’s behaviours are assessed based on whether they think of themselves through a collective or an individualistic lens. Individualistic cultures are those that emphasise the importance of taking care of oneself and the nuclear family. Comparatively, a collectivist society encourages people to take care of others. Working as a sales representative in China and the UK, I have observed these two cultural extremes because my UK and Chinese consumers had different views on this cultural dimension.

For example, my UK customers were motivated by the need to fulfil their selfish interests when purchasing life insurance policies, while my Chinese customers were motivated by collective gains. This difference in cultural orientation led to higher sales in the UK as opposed to China because I sold more products to individuals as opposed to groups. My observations are consistent with Hofstede’s views on individualism in the UK and China (89 vs. 20) (Hofstede Insights, 2019). These scores imply that individualism in the UK is four times more prevalent than in China. This finding reflects that of Latif et al. (2019), which showed that Chinese consumers are less individualistic than their western counterparts are.

Indulgence

The last cultural dimension outlined in Hofstede’s theory is the propensity for societies to indulge. It refers to the extent that people within a specific community strive to control their desires or impulses. Societies that have low levels of restraint are deemed more indulgent than those that have stronger restraints (Cheek, Ownby, and Fogel, 2018). Therefore, highly indulgent societies allow people to pursue their desires or impulses with few restrictions. I found this to be true in the UK because my colleagues often celebrated sales milestones by throwing extravagant parties and ceremonies.

Our team leader also made a “big deal” of every success made by a member. I did not obverse the same practice in China because no party was ever held for high achievers. Instead, management gave employees bonuses and orally recognised their contribution in team meetings without much fanfare. Broadly, my observation is consistent with Hofstede’s indulgence score because the UK has a high score on this index (69), while China has a low score of 24 points (Hofstede Insights, 2019).

These findings show that UK consumers could be three times more indulgent than their Chinese counterparts. From a cultural perspective, Anshu, Lachapelle, and Galway (2018) say that the disparity in indulgence scores between both nations comes from Chinese mythology, which is based on Confucian principles that do not encourage indulgence.

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Summary

In this report, I have demonstrated how Hofstede’s five cultural dimensions can explain cross-cultural management issues in the UK and China. Except for long-term orientation, my experience as a sales representative in both countries, relative to other cultural dimensions, is consistent with the national scores for both markets in Hofstede’s model. Again, this difference could stem from generational differences or evolving managerial styles in both countries. Nonetheless, working in a multicultural environment, characterised by varying interests and norms has taught me how to accommodate people with varying views.

Broadly, the findings highlighted in this report could help to improve management and leadership decisions for companies operating in the UK or China. Particularly, they should help to model effective leadership styles based on the aggregate effect of these cultural dynamics on organisational performance. This proposal supports the contingency theory, which suggests that there is no best way to manage an organisation (Vidal et al., 2017). However, the best strategy to follow should be one that addresses internal and external factors affecting organisational performance. A review of the cultural dimensions in both countries is the first step in understanding these macro factors impacting performance.

Reference List

Abdullah, A. (2017) Managing the psychological contract: employee relations in South Asia. London: Springer.

Anshu, S., Lachapelle, F. and Galway, M. (2018) ‘The recasting of Chinese socialism: the Chinese new left since 2000’, China Information, 32(1), pp. 139-159.

Bedford, D. and Carayannis, E. (2018) ICIE 2018 6th International Conference On Innovation And Entrepreneurship: ICIE 2018. London: Academic Conferences and publishing limited.

Beugelsdijk, S. et al. (2018) ‘Cultural distance and firm internationalization: a meta-analytical review and theoretical implications’, Journal of Management, 44(1), pp. 89-130.

Beugelsdijk, S. and Welzel, C. (2018) ‘Dimensions and dynamics of national culture: synthesizing Hofstede with Inglehart’, Journal of Cross-Cultural Psychology, 49(10), pp. 1469-1505.

Cheek, T., Ownby, D. and Fogel, J. (2018) ‘Mapping the intellectual public sphere in China today’, China Information, 32(1), pp. 107-120.

Corporate Finance Institute. (2019) Hofstede’s cultural dimensions theory. Web.

EstradaCruz, M., VerdúJover, A. J. and GómezGras, J. M. (2019) ‘The influence of culture on the relationship between the entrepreneur’s social identity and decision-making: effectual and causal logic’, BRQ Business Research Quarterly, 22(4), pp. 226-244.

Fuentelsaz, L., González, C. and Maicas, J. P. (2019) ‘Formal institutions and opportunity entrepreneurship. The contingent role of informal institutions’, BRQ Business Research Quarterly, 22(1), pp. 5-24.

Genner, S. (2017) On/off: risks and rewards of the anytime-anywhere internet. Zurich: Hochschulverlag.

Gnanakumar, P. B. (2020) ‘Reinforcement of brands inspired by faith with the paradox of cultural divergence in Indian FMCG market’, IIM Kozhikode Society & Management Review, 9(1), pp. 96-107.

Gobel, M. S. et al. (2018) ‘Europe’s culture(s): negotiating cultural meanings, values, and identities in the European context’, Journal of Cross-Cultural Psychology, 49(6), pp. 858-867.

Hofstede Insights. (2019) Country comparison. Web.

Jackson, T. (2018) ‘Ideology and culture in cross-cultural management scholarship’, International Journal of Cross Cultural Management, 18(2), pp. 121-123.

Latif, K. et al. (2019) ‘Individual cultural values and consumer animosity: Chinese consumers’ attitude toward American products’, SAGE Open, 4(1), pp. 1-10.

Mehdi, K. (2018) Advanced methodologies and technologies in network architecture, mobile computing, and data analytics. London: IGI Global.

Muñoz-Bullon, F., Sanchez-Bueno, M. J. and Suárez-González, I. (2018) ‘Diversification decisions among family firms: the role of family involvement and generational stage’, BRQ Business Research Quarterly, 21(1), pp. 39-52.

Pyöriä, P. et al. (2017) ‘The millennial generation: a new breed of labour?’, SAGE Open, 3(2), pp. 1-10.

Stamenova, S. (2018) Chinese and British consumer behavior differences with reference to Hofstede’s cultural dimensions: marketing mix of project “Eden” in Qingdao. London: GRIN Verlag.

Vidal, G. G. et al. (2017) ‘Contingency theory to study leadership styles of small businesses owner-managers at Santo Domingo, Ecuador’, International Journal of Engineering Business Management, 9(1), pp. 1-10.

Zhou, C. et al. (2018) ‘Perception of cross-generational differences in child behavior and parent socialization: a mixed-method interview study with grandmothers in China’, Journal of Cross-Cultural Psychology, 49(1), pp. 62-81.

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BusinessEssay. 2022. "Contemporary Issues in Management: Working With Diversity and Across Cultures." January 3, 2022. https://business-essay.com/contemporary-issues-in-management-working-with-diversity-and-across-cultures/.

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