michael richarme, ph.d. senior vice president decision analyst, inc
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Cultural DifferencesMichael Richarme, Ph.D.
Senior Vice PresidentDecision Analyst, Inc.
Two Main Items of DiscussionHow are people doing economically around
the world?
How are people similar or different?
Monthly Economic IndexConducted in the last week of each month for
over 11 yearsSample of over 30,000 consumers each
monthNine economic indicators measuredResults in a forward-looking index of 9-12
months in the future
United States in February 2010Decision Analyst Economic Index
United States
80
90
100
110
120
Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10
Month
Ind
ex
95
United States by Census Division
Decision Analyst U.S. Economic Index by Census Division (Three-Month Moving Average*)
Major Global EconomiesNorth America Index South America IndexCanada 100 Brazil 131
United States 95 Argentina 84
Mexico 90
Europe Index Asia-Pacific IndexGermany 97 China 139
Italy 95 India 117
Spain 88 Australia 99
Great Britain 87
France 81
Trading Blocks Suffer TogetherMajor trading blocks (North America,
European Union) are suffering similarly in this economic recession
Some areas of the world are countering that trend
The BRIC EconomiesBrazil, Russia, India, ChinaEconomic growth enginesAll but Russia doing very well in this
recessionChina and India are major exporters Brazil is heading toward energy self-
sufficiency and has a trading agreement with the EU
China Over the Past 3 YearsDecision Analyst Economic Index
China*
70
80
90
100
110
120
130
140
Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10
Month
Ind
ex
India Over Past 3 YearsDecision Analyst Economic Index
India
70
80
90
100
110
120
130
140
Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10
Month
Ind
ex
Brazil Over the Past 3 Years
Decision Analyst Economic IndexBrazil
70
80
90
100
110
120
130
140
Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10
Month
Ind
ex
A Study of Cultural DifferencesGeert Hofstede, the NetherlandsLarge scale study in the 1980’s
Over 116,000 questionnairesAbout 150 questions in lengthTwenty different languages50 countriesAdults
Fundamental Issues ExaminedWays in which organizations are structuredMotivations of people within organizationsIssues people face within their society
Four DimensionsPower DistanceUncertainty AvoidanceIndividualism/CollectivismMasculinity/Femininity
Power DistanceDefined as the degree to which power is
exerted in either an autocratic manner or a democratic manner
Autocratic – what the boss says, goesDemocratic – let’s discuss it before deciding
Typical PDI StatementsLow PDI – “Inequality in society should be
minimized; the system is to blame for things going wrong; cooperation among the powerless can be based on solidarity”
High PDI – “Everyone has his rightful place; power is a basic fact of society; the underdog is to blame for things that go wrong”
Countries PDICountry Power Distance Index World
Rank
Austria 11 1
Great Britain 35 10
Canada 39 15
United States 40 16
Japan 54 21
Korea 60 60
Chile 63 29
India 77 42
Philippines 94 47
Highly Autocratic Highly DemocraticLow scores High Scores
Uncertainty AvoidanceDegree of risk acceptance and tolerance for
uncertaintyLow Uncertainty – not a lot of anxiety about
the futureHigh Uncertainty – need reassurance about
what is going to happen
Typical Uncertainty StatementsLow UAI – “hard work is not a virtue; more
acceptance of dissent; authorities there to serve the citizens; belief in common sense”
High UAI – “Uncertainty is a continuous threat; time is money; strong need for consensus; ordinary citizens are incompetent compared with the authorities”
Countries UAICountry Uncertainty
Avoidance IndexWorld Rank
Austria 70 27
Great Britain 35 6
Canada 48 12
United States 46 11
Japan 92 44
Korea 85 34
Chile 86 36
India 40 9
Philippines 44 10
Highly Comfortable Highly AnxiousLow scores High Scores
Individualism/CollectivismIndividualism is the relative importance of
freedom, challenge, use of personal timeCollectivism is the relative importance of
training, use of skills, physical conditions, and benefits
This dimension indicates the degree to which a person “goes it alone as an entrepreneur” or “feels at home in the pack”
Typical Individualism StatementsLow IDV – “Belief in group decisions;
expertise, order, duty, security provided by organization or clan; identity is based on the social system”
High IDV – “Self-orientation; everybody has a right to a private life and opinion; belief in individual decisions; identity is based on the individual”
Countries IDVCountry Individual
Collectivism IndexWorld Rank
Austria 55 33
Great Britain 89 48
Canada 80 46
United States 91 50
Japan 46 28
Korea 18 11
Chile 23 15
India 48 30
Philippines 32 21
Highly Collective Highly IndividualLow scores High scores
Masculine/FeminineMasculine is the relative importance of
earnings, recognition, advancement, challenge, assertiveness, self-reliance
Feminine is the relative importance of cooperation, desirable living area, job security, nurturing, responsibility
This index shows the degree of the gender gap
Typical Masculinity StatementsLow MAS – “Service ideal; sex roles in society
should be fluid; small and slow are beautiful; differences in sex roles should not mean differences in power”
High MAS – “Money and things orientation; performance and growth are important; decisiveness; sex roles should be clearly differentiated; men should dominate”
Countries MASCountry Masculine Feminine
IndexWorld Rank
Austria 79 49
Great Britain 66 41
Canada 52 28
United States 62 36
Japan 95 50
Korea 39 13
Chile 28 8
India 56 30
Philippines 64 39
Highly Feminine Highly MasculineLow scores High MAS scores
Things to ConsiderDon’t make value judgments – it is OK for
people to have different cultural valuesThink about their cultural values before
trying to do business with themGo more than half-way to accommodate
differences between cultures
Questions or comments?
Michael Richarme, Ph.D.Senior Vice PresidentDecision Analyst, Inc.
604 Avenue H EastArlington, TX 76011
mrichar@decisionanalyst.com
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