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Huawei Company’s Business Expansion Research Paper


Hofstede 5 Cultural Dimensions

Hofstede’s five cultural dimensions model emerged in the period between 1965- 1990s when Geert Hofstede developed research on a team working for IBM to study various cultural orientation and values. The research focused on understanding how cultural views dictated individual values and attitudes. Initially, the study looked at the four dimensions, which included uncertainty avoidance (UAI), individualism and collectivism (IDV), power distance (PDI), and masculinity versus femininity (MAS) (Robbins et al. 2014). In the 1990s, the dimensions increased to five when Hofstede incorporated long and short-term orientation to the four dimensions.

Fundamentally, several scholars have defined the terms in various ways that revolve around individual behaviour. Mazanec et al. (2015) define uncertainty avoidance as the scale of accepting new ideas and innovation. In the UA index (UAI), people who have the highest score are less inclusive and unwilling to try new ways of undertaking an operation. On the contrary, those who have a low score in the index are inclusive and ready to adopt innovative ways that may be risky.

Consequently, Beugelsdijk, Maseland, and Hoorn (2015) define individualism and collectivism as the character of embracing individual or societal requirements. In individualistic societies, people are more concerned with their own affairs and care for their immediate families, whereas those in collectivist societies care for extended families and undertake acts that generate benefits to the community.

In the words of Hanzlick (2015), power distance index implies the extent to which people accept the distribution of power and their place in the hierarchy of an organization or a society. Entities, which have a higher index, demonstrate a clear set of power and individuals understand their positions in the hierarchy. On the contrary, societies that have low scores question any unequal distribution of power and make it a subject of serious scrutiny. Masculinity is another dimension found in the Hofstede model and refers to the societal allocation of masculine and feminine roles.

In societies deemed to be masculine, success is a derivative of competition and people care less about the welfare of others. However, in places that nurture the feminine culture, individuals arrive at a certain objective through discussions and consensus is all-inclusive. The fifth dimension in Hofstede model is short and long-term orientation. In the explanation provided by Beugelsdijk, Maseland, and Hoorn (2015), the long-term dimension relates to countries where people and entities focus on gains earned over a projected period. The norm is unlike in those places where people and organizations evaluate their gains within a short period.

Assessment

China Australia Germany Mexico
Cultural Profile China has a conservative culture that focuses on communal success over individual welfare. Australia practises a capitalistic and liberal culture where success hinges on the individual. The culture of people in Germany is liberal and does not emphasize communal success. In Mexico, people have a higher focus on conservative culture and societal welfare.
Similarities and Differences
Power Distance The Chinese community has a clear-cut description of power among organizations. Entities have hierarchical models characterised by a defined chain of command (Kolstad & Gjesvik 2014). In Australia, people do not have defined distinctions between subordinates and management. Hanzlick (2015) explains that unlike in China, consultation and decision-making is an all-inclusive process. Unlike the Chinese community who accept power and hierarchy, Germans do not like it. Therefore, Germans embrace consultation and inclusivity in decision-making. One of the similarities between China and Mexico is power distance implying that both countries have clearly defined distinctions between subordinates and superiors (Robbins et al. 2014).
Uncertainty Avoidance According to Gremme (2015), Chinese people are highly receptive to new enterprises and foreign products with a UAI of 40. One of the similarities between the Chinese and Australians is their receptiveness to new products and concepts, a factor that places them at an intermediate scale of 50. One of the major differences evident between Mexico and China is the willingness to adopt new ideas. While China has a score of 40, Mexico is at an index of 82 (Gremme 2015).
Individualism/Collectivism Chinese societies practise collectivism culture where the values of the community supersede individual preferences. Unlike China, Australia is an individualistic society. As such, people focus on personal achievements. Robbins et al. (2014) highlight that in Australia, individuals and their immediate families are the major beneficiaries of a particular success. Germany is different from China because of its individualistic ideals. The focus of Germans is on their immediate families and personal success (Gremme 2015). Just like China, Mexico is a collectivistic society where communal success overrides individual preferences. Hanzlick (2015) places Mexico at an index of 30, which is collectivistic.
Masculinity/Feminity The country encourages performance and competition. Kolstad and Gjesvik (2014) note that Chinese people value work more than families and can even work for months in foreign countries before coming to visit their families Another similarity between Australia and China is their masculine culture. Just like the Chinese, Australians focus on success and good performance (Gremme 2015). Masculinity is one of the similarities evident between Germany and China. According to Hanzlick (2015), the two countries have a score of 66 implying that they value performance, success, and competition.
Long/Short Term Orientation Gremme (2015) ranks China in position 118th of the long and short-term orientation index implying that the country focuses much on the success quantified over a long period. Long negotiation processes, which characterise Chinese businesses, are a sign of their long-termed nature (Kolstad & Gjesvik 2014). Another similarity between China and Germany lies in their long-term orientation. Just like their counterparts in China, Germans love long-lived investments and gains acquired after a long process of waiting. Another quality that differentiates Mexicans from the Chinese is the time orientation. Robbins et al. (2014) assert that unlike Chinese people who are patient, Mexicans look at the short-term gain in a venture.

Recommendations for Huawei’s Successful Expansion into Germany

For Huawei to penetrate the German market successfully, it should adopt certain strategies. Some of the recommendations that also serve as strategies useful for the company’s expansion into Germany include the focus on quality, understanding the German culture, and the market. While Chinese buyers associate the quality of a product with its price, Germans do not focus on the price but look at the quality of a product (Daft & Samson 2014).

Therefore, to penetrate the market, the company should ensure that its products are top-notch in relation to quality and price. Consequently, the culture of Germans is quite different from that of the Chinese.

While Chinese buyers take referrals and ideas shared by the community seriously, their counterparts in Germany rarely focus on societal opinions. The little focus accorded to societal opinions emanates from their culture, which is more individualistic as shown by the table in Part B. Another recommendation that is useful in the German market is an understanding of its decentralized nature. According to Beckstein (2015), Coca Cola Company only became successful in Germany after adopting a strategy that matched the needs of clients in all the regions of the country. Fundamentally, utilisation of the three recommendations plays an instrumental role in helping Huawei to expand into Germany successfully.

Reference List

Beckstein, M 2015, The politics of economic life, Routledge, New York.

Beugelsdijk, S, Maseland, R & Hoorn, A 2015, ‘Are scores on Hofstede’s dimensions of national culture stable over time? A cohort analysis’, Global Strategy Journal, vol. 3, no. 1, pp. 223-240.

Daft, R & Samson, D 2014, Fundamentals of management: Asia pacific edition PDF, Cengage Learning Australia, Sydney.

Gremme, M 2015, Comparison of Germany-China on the basis of Geert Hofstede’s dimensions of national culture, GRIN Publishing, Berlin.

Hanzlick, M 2015, Management control systems and cross-cultural research: empirical evidence on performance measurement, performance evaluation and rewards in a cross-cultural comparison, Lohmar Publishers, Berlin.

Kolstad, A & Gjesvik, N 2014, ‘Collectivism, individualism, and pragmatism in China: implications for perceptions of mental health’, Transcultural Psychiatry, vol. 51, no. 2, pp. 264-285.

Mazanec, J, Crotts, J, Gursoy, D & Lu, L 2015, ‘Homogeneity versus heterogeneity of cultural values: an item-response theoretical approach applying Hofstede’s cultural dimensions in a single nation’, Tourism Management, vol. 48, no. 1, pp. 299-304.

Robbins, S, Bergman, R, Stagg, I & Coulter, M 2014, Management VS. Sydney, Pearson Education Australia, Sydney.

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