Challenges of a High-Power Distance of Culture

Question 1

Explain the challenges that a team member from a culture with high power distance faces when working with another team member from a low power distance culture. Explore the main problems that each team member could face in this situation and what they could do to overcome those problems? Also, explore the role of the team leader in the situation.

Managing across cultures is not a new phenomenon in this world, but it become more important now than ever before. The cultural environment has a deep influence on employee behaviour in organisations. In an increasingly diverse workplace and in a more globalized business world, if managers want to be more effective, they need to appreciate the behavioural implications of cultural values. This paper has synthesised the findings from a vast array of research studies in the Hofstedeís (1991) framework. In the next paragraphs, the paper tries to explain the challenges that a team member who has a high-power distance of culture work with the other team member who has low power distance of culture. Moreover, making some thinking about the main problems that everyone could face in the workplace and how to overcome these problems. Also, explore the role of the team leader in the situation.

Power distance is the first dimension that distinguishes culture from another culture. It means the individual acceptance of unequal distribution of power in an organization. Hofstedeís (1991) mainly to analyze the influence of culture on the organization from a social perspective. The extent of distribution in society and organization are unequal. For this dimension, each country hasn’t the same meanings of the power distance, so there are also many differences. According to the model, in a high PDI country, such as Malaysia. In organisations operating in a high-power distance Cultural milieu, a superior is expected to make decisions Without consulting his or her subordinates, because Subordinates may view their involvement in decisions by their superiors as a sign of incompetence or weakness on the part of the superior (Francesco and Chen, 2000). Team members will not initiate any action, and these countries like to be guided and directed to complete a task. If a manager doesn’t take charge, they may think that the task isn’t important. On the other hand, Examples of countries with low PDI are the Netherlands, the United Kingdom, the United States, Germany, and the Nordic countries.

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Firstly, there are many challenges when a team member from a culture with high power distance faces when working with another team member from a low power distance culture. As Manktelow (2010) said in a organizations environment with high power distance, workers always have a relatively low position and very respect their superiors. Employees are often getting used to the status quo of work and rarely give advice. Instead, employees want their boss to be able to issue orders directly, so they just must follow the order to do it. In turn, superiors can order more than advising their employees when making decisions. And Employers or managers will not eat together with their team members and may have special facilities, such as rooms, parks and elevators. On the other hand, in a workplace with low power distance that bosses are not paying attention to the position of the employees and will be more open to employees’ discussion and participation. Employees are less submissive to their leaders, and employees have a greater chance of opposing leadership or company decisions. Low-powered employees in society are more concerned about the right to freedom, and they want more opportunities for decision-making, especially for those related to their own work. These employees may reflect their opinions through trade unions or employee satisfaction surveys.

Many specific problems will be encountered when a team member from a culture with high power distance faces when working with another team member from a low power distance culture. When the team leader or member in a high-power distance context, other employees who have a background of low power distance culture are unwilling to passively participate in work and only comply with leadership decisions and implications. As Khatri (2009) said the employee’s jobs are narrowly and serious, giving the employees limited discretion. The communication takes place vertical downwards, with no or little horizontal communication. Overall communication is anaemic.

Kim (1999) found that communication within a high-power distance culture like Korea displays a vertical pattern. Formal communication is largely top-down, flowing through the designated pyramidal chain of command. Also, voluntary feedback from the bottom is less. In a typical encounter between a superior and subordinate, a superior does most of the talking and subordinate merely nods his or her head in affirmation. Khare (1999) points out that, due to the organisation’s spatial configuration in Indian organisations (India is a high-power distance culture), the communication between superiors and subordinates is limited to formal channels. Moreover, detailed and tight job descriptions for each employee give rise to the compartmentalisation of work. This results in a few informal interactions between superiors and subordinates. Hofstede (2001) also argues that organisations and cultures characterised by high power distance lack informal communication across levels in the hierarchy and favour the concentration of authority and decision-making in a few hands at the top.

 A large communication gap exists between superiors and their subordinates because it is hard for the employees to express their own opinions. The power distance gives managers unlimited power and control over subordinates. On the other hand, employees will have an unquestioning submissive attitude. Older and senior employees get respect from junior employees not because of the former’s ability but because of age and long tenure in the organisation. Furthermore, in a high-power distance culture, decisions are made by senior leaders. Because there just little resistance from lower-level employees, so the decisions are made and implemented faster in a high-power distance organisation. However, because of the lack of input from lower level employees as well as poor communication and information sharing, the quality of decisions is poorer in a high-power distance organisation.

So, what could a leader do to overcome these problems in this situation?

The ideal situation for leadership in the cross‐cultural workplace is everyone should be well prepared for the different cultural background. Leaders must be taught to recognize and understand the limitations of “expected culture”, and to respect and need to learn the “manifest culture”. More importantly, they must be prepared to carefully review and learn while participating in cross-cultural leadership.

They must also be aware of how their own culture and language can influence their expectations of other cultures. All of this content is fully prepared for active learning by cross-cultural leaders. (Bond, 1992).

Conclusion

As studies have shown, there is a strong relationship between cultural dimensions and successful performance in organizations in different societies. This makes it extremely important to consider and appropriately modify a person’s management style to suit foreign social norms and cultures. Cultural norms play a large part in interpersonal relationships at work. Culture in this sense is a powerful force that shapes and influences the cognitions and behaviours of people (Erez, 1994) When you grow up in a certain culture, you will take your social behaviour as a matter of course. As long as you don’t deviate from the central trend of society, you don’t have to think about your preferences and reactions. However, when you step into a foreign culture, things suddenly seem different, and you don’t want to cause offence. By using Hofstede’s Cultural Dimensions as a starting point, you can evaluate your approach, your decisions, and your actions, based on a general sense of how people might think and react in a particular society. Of course, everyone is unique. No society is unified, but you can use this model to reduce the unknown troubles, avoid making mistakes, and provide much-needed confidence in working in an unfamiliar country.

Question2

Do you think that performance will be always higher when teams have a high diversity in terms of gender (identity)? Explain your arguments.

 

Introduction

With the increase in the number of female labourers and female executives, women’s status and power are increasingly concerned by academics and practitioners. Gender diversity has become one of the important research directions in the field of organizational behaviour. Many scholars have studied the relationship between gender diversity and organizational performance but have not reached a consensus conclusion. The topic of gender diversity was first proposed by foreign scholar Kanter in his book “Men And Women In The Corporation”, which refers to the distribution of male to female proportions in the organization, and can also be measured by the gender composition of the members of the organization. In recent years, many scholars began to pay attention to the impact of gender diversity on organizational performance. This paper reviews the research on the impact of gender diversity on organizational performance from the corporate governance perspective. It attempts to sort out the research background of gender diversity and prospects in future research directions.

Main body

In recent years, the gender diversity of the board of directors has increasingly become an important issue in corporate governance standards. A series of scholars have studied the impact of gender diversity on organizational performance from the perspective of corporate governance. A core issue of corporate governance is the constraint, supervision and incentives for operators. The research in this perspective focuses on the performance of directors’ duties and the effectiveness of corporate governance structures.

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First, gender diversity is good for better fulfilling directors’ responsibilities and improving organizational performance. As the specific executor of the operation of the management company (Cheng Wei, 2013), the director has two main types of responsibilities (Fang Fangyu, 1996). One is to ensure that the company accepts certain development strategies and business policies to improve the company’s performance. The other is to ensure that the company fulfils the strategies, policies, procedures and plans set by the board of directors so that the company is coordinated. Specifically, at the first type of responsibilities, directors need to use their knowledge and experience to provide know-how, professional abilities, and external information. When performing the second type of responsibilities, directors not only need to question the assumptions of the board of directors but also Supervise management to safeguard the legitimate rights and interests of shareholders and stakeholders. Campbell and MínguezVera (2008) pointed out that in countries with weak external supervision, the supervisory role of directors is very important, and the gender composition of directors will affect the financial performance of the company by affecting the quality of the role.

Second, gender diversity is conducive to improving the effectiveness of corporate governance structures and promoting organizational performance growth. According to agency theory, an enterprise consists of a series of contracts, including contracts between enterprise resource providers and users. There are three types of agency costs for an enterprise, namely, supervision costs, compliance costs, and residual losses. A reasonable board structure is benefiting to reducing the agency costs of enterprises and improving the agency effect of directors on shareholders. Francoeur et al. (2008) proposed that gender diversity not only enables the board to better represent the interests of shareholders but also helps female directors to better perform their supervisory functions, directly affecting the governance structure and contributing to organizational performance. Based on the above analysis, some scholars have theoretically studied the relationship between gender diversity and organizational performance from the perspective of corporate governance and have been positively influenced. It is effectively improving the structure of corporate governance and the efficiency of governance by increasing the proportion of female directors, enterprises.

Most scholars believe that gender diversity has a positive impact on organizational performance, a few scholars believe it is a negative impact, and some scholars have other conclusions. To begin with, the empirical research that positively influences the positive impact of gender diversity on organizational performance can be summarized into two aspects. First aspect is the direct impact of gender diversity on organizational performance, mainly based on the enterprise financial indicator system. Second aspect is gender diversity will indirect impact on organizational performance, including the role of related mediation and regulation. Moreover, a few studies examine the direct role of gender diversity in organizational performance and provide empirical support for positive impacts. Kiavitz (2003) not only validates the positive effects of gender diversity but also suggests that the ratio of male to female is 1:1. And previous studies have basically reached a consensus that gender diversity will have a positive impact on organizational performance through intermediaries and is regulated by certain variables.

On the other hand, the empirical research that the negative impact of gender diversity on organizational performance can be grouped into two areas. First, providing empirical support. Second, testing regulatory effects. And then the conclusion of the negative impact through empirical testing. Kou Xuewen et al. (2012) found that the proportion of female directors was significantly negatively correlated with corporate accounting performance and market performance. It would damage the company’s financial performance to a certain extent, and it was not wise to over-appoint female directors. Boubaker (2014) conducted an empirical study of the top 120 French companies in the market value of the Paris Stock Exchange from 2009 to 2011 and found that the increase of female directors is a trend to eliminate discrimination, which only produces low levels of productivity. Lead to negative corporate financial performance.

Conclusion

 As a team have become a backbone of business activity, research has increasingly become focused on what elements make the team most successful. One potential determinant of a team’s effectiveness is its gender diversity, as the gender mix of a team may offer an assortment of knowledge and skills. (Hoogendoorn, 2013) Gender diversity research is a very important way to improve organizational performance. The impact of gender diversity on organizational performance could be positive and negative. As Trena M (2007) said the main difference is whether the focus of the mechanism is within the group or between groups. If the focus of attention is on the interaction of members within the group, gender diversity will increase the individuality of each group within the organization. People can be seen as a resource that contributes and provides diversity.  It can weaken the mutual comparison of all members and reduce the internal friction in the organization, thus contributing to the improvement of organizational performance. Furthermore, if the focus is on the interaction between groups, gender diversity will be weakened. Social identity among groups increases the friction between groups and communication costs, which is not conducive to organizational performance.

Hoogendoorn, S. (2013). The Impact of Gender Diversity on the Performance of Business Teams: Evidence from a Field Experiment. [online] Gender Action Portal. Available at: http://gap.hks.harvard.edu/impact-gender-diversity-performance-business-teams-evidence-field-experiment [Accessed 17 Feb. 2019].

Khatri, N. (2009). Consequences of Power Distance Orientation in Organisations. Vision: The Journal of Business Perspective, 13(1), pp.1-9.

Hofstede, G., Hofstede, G.J. and Minkov, M., 1991. Cultures and Organizations: Software of the Mind McGraw-Hill. New York.

Trena M, P. (2007). [online] Tandfonline.com. Available at: https://www.tandfonline.com/doi/full/10.1080/1356251052000305525?scroll=top&needAccess=true& [Accessed 17 Feb. 2019].

Manktelow, J. (2010). Hofstede’s Cultural Dimensions – Understanding Different Countries. [online] Mindtools.com. Available at: https://www.mindtools.com/pages/article/newLDR_66.htm [Accessed 17 Feb. 2019].

Francesco, A.M. and Chen, Z.X., (2000), “Cross-cultural Differences within a Single Culture: Power Distance as a Moderator of the Participation – Outcome Relationship in the People’s Republic of China,” BRC Papers on CrossCultural Management. Retrieved from http:// net2.hkbu. edu. hk/-brc/CCMP200007.pdfon 01/02/2002.

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Hofstede, G., (2001), Culture s Consequences: Comparing Values, Behaviours, Institutions and Organisations across Nations, Thousand Oaks, CA.

Kim, S.U., (1999), “Determinants and Characteristics of the Corporate Culture of Korean Enterprises,” in Kao, H.S.R., Sinha, D., and Wilpert, B., (Eds.), Management and Cultural Values – The Indigenisation of Organisations in Asia, pp.86 -101, Sage Publication, New Delhi.