The Major Elements and Dimensions of the Business Culture in Spain - Assignment Example

? Export Import Research Paper of the Determine the major elements and dimensions of the business culture in the selected country. The Spanish business culture can be explored with the help of Hofstede's theory of cultural dimensions. Hofstede has identified five dimensions of culture which will affect the culture of the society as well as the values ingrained in the members of the society (Hofstede, 2001). The various dimensions of business culture with respect to Spain can be explained as follows; A. Power distance According to the power distance dimension theory, inequality exists in individuals of the society and business. The dimension evaluates the cultural attitudes towards these inequalities among the individuals. Power distance can be defined as the unequal distribution of the power within less powerful members of the country. The score of Spain is 57 in this dimension. According to the theory, hierarchy is accepted by individuals in a business or organization and powerful people hold special positions within the organization (Hofstede & McCrae, 2004). Subordinates strictly adhere to the orders of their bosses and negative feedback is highly disregarded. B. Individualism The basic issue which is addressed through this dimension is the extent of interdependence individuals and society establishes. According to this theory, members of the society can be categorized into individualist and collectivist. In individualist societies, people are expected to look after themselves and their families. However, in a collectivist society, people create groups and are loyal to these groups. In turn, these groups expect security and safety from each other (Oyserman, Coon & Kemmelmeier, 2002). Spain scores 51 in this dimension. When compared with rest of the countries in Europe, Spain is categorized as a collectivist. However, when compared with rest of the world, the country comes as individualist. Thus, it is easier for Spain to relate in business with non-European countries while other most of the European nations will be perceived as blunt and aggressive. Apart from this, team work is common in business. C. Masculinity / Femininity A high score denoted masculinity in the society while a low score indicates femininity. A high score suggests that achievement, competition and success are the drivers of that society. Success is defined by the best or winner in a particular field or business. This kind of value system generally starts during schools and continuous throughout the later stages of life, including organizational behavior and business culture. According to Hofstede's matrix, Spain is not polarized and has developed a consensus between the two extremes. In an organization, emphasis is given on harmony and diplomacy. People are sympathetic in general and concern for their surroundings. Harmony and collaboration is maintained in business management and proper consultation is taken from the subordinates before making crucial decisions in business. D. Uncertainty avoidance Uncertainty avoidance can be described as the degree to which the individuals of a culture are feared or threatened by unknown or ambiguous situations. These members have created institutions and beliefs which, according to them will avoid these uncertainties. The business culture of uncertainty avoidance is very high in Spain. In terms of business, people in Spain always follow rules and regulation and even little deviation from rules and laws creates stress. Individuals expect a stress free life so every action which might result in stress is avoided. Also it is been found out that majority of youngsters opted for civil services and other government services as career. E. Long term orientation Long term orientation can be described as the inclination of the culture either towards the past or towards the future. Culture of Spain is more of present oriented and like to enjoy life. People expect quick results and avoid delays. In term of future and long term planning, there is pragmatism and the businesses need a more structured approach (Adams & Eerde, 2010). 2. Determine how these elements and dimensions are integrated by local residents conducting business in the country. From the above discussion it is clear that Spain is a high power distance, less masculine, collectivist and risk averse culture. The impact of culture can be seen in the deeper values of the individuals. Spain is more of a collaborative culture where people believe in harmony and diplomacy. While doing business, respect is given to authority and rules. People are law abiding and uncertain as well as risky business are avoided. People are highly dependent on each other; as a result trust and faith while doing business are extremely important. While doing business, the major conflict occurs in terms of pride, losing face and stress due to difficulty in maintaining family and business life. Once a business deal is established between two parties, regular calls and communications, invitations to major and special events, invitation to meals and giving gifts and presentations are few of the strategies which are regularly followed in order to maintain a positive and healthy relationship with the business partners. 3. Compare both the major elements and dimensions with U.S. culture and business. In the previous question, elements and the cultural dimensions of Spain were discussed. The comparison between the two countries can be discussed as follows; Power Distance The power distance dimension is case of Spain was 57, which meant that the business culture favors hierarchy and authority. However, the power dimension was 40 in case of United States which was very low. This indicates that the business culture is more focused on equality and providing fundamental rights to all. Hierarchy system in United States in not very strong and in organizations higher management is available for discussions and suggestions. Communication in business is direct, informal and participative, unlike Spain, where it is more formal and authoritative. Individualism There is a huge difference between the two countries in terms of this dimension. Spain scores 51 in this dimension. However, the score of United States is 91 which are very high. Individuals in United States are expected to look after themselves and their immediate family members. In business, mobility is very common. Hiring and promotions are based on merit and achievement. People involved in business display initiative and are self-reliant. This is in contrast with the business culture of Spain which is more inclined towards collectivism and group dynamism. Masculinity / Femininity The masculine/ feminine index of Spain is 42, which is low. This indicates a business culture dominated by harmony and diplomacy. Individuals are sympathetic towards each other and towards the society as well as organizations where they work. However, the masculine/ feminine index of US has been found to be 62, which is high. Thus, United States can be considered as a masculine society. Most of the business and organization values taught are thriving for success and winning. In terms of business culture, individuals are more open and vocal about their successes and achievements (Lingham, Richley & Serlavos, 2009). Uncertainty avoidance Compared to Spain, whose uncertainty avoidance dimension is 46, Unites States scores as high as 86 in this dimension. The business culture of United States accepts uncertainty. Business culture of America can be described as innovative, risk taking and creative. Freedom of expression and creativity is favored in every field or occupation. In contrast, the business culture of Spain has always tried to avoid any change or initiatives in organization or society. Compared to Spain, emotional expression in business is less in Americans and they generally dislike rules and regulations. Long term orientation Spain scores low in terms of long term orientation. The score is 19 which is extremely low. However, the score of US on long term dimension is 29. This means United States believes in achievement of short term objectives and goals in business. The motive is similar to the individuals in Spain, where people look for quick results in business. 4. Determine the challenges for U.S. businesses that wish to conduct business in that country. The major challenges for United States Business will be in terms of cultural conflict, organizational culture, individualism and willingness to take risks (Minkov, 2011). Compared to US, Spain has a high power distance culture. Thus, the top management dislikes negotiation. However, in United States, re-negotiation or adjustment will be de-motivating. In situations such as hiring and recruitment, there can be varied difference between perception of recruiters and candidates from the host country. Since masculinity is high in United States, recruiters from United States will expect aggressive and vocal candidates. However, Spain being low in masculinity, might find it difficult to adjust with the corporate culture of United States (Claver, et al., 2012). Another challenge which United States might face while conducting business is providing training to the host country employees. Being a high power distance nation, employees prefer little participation in debates and arguments with the seniors and strictly comply with the instructor (Schwartz & Bardi, 2001). However, Instructors and trainers from US would expect open participation and more involvement from the trainees. This might result in stress and unproductive employees (Carlier, Llorente & Grau, 2012). Reward system is another area of concern which varies greatly with different business culture. In United States, a cash oriented path is followed to get people going. Performances are increased by providing cash rewards and bonuses (Swift & Lawrence, 2003). However, similar system will be considered as cheap in a more feminine business culture like Spain. Here, people will expect rewards in form of bigger responsibilities, wider territories, larger control etc. Thus, the management will have to make sure that the culture and its values are completely understood before entering into any business with Spain. 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