The organizational culture influences the decisional process significantly. Culture have a lot of aspects however in this report we just analyze the partnership between G. Hofstede's dimensions of the cultures - power distance, individualism/collectivism, uncertainty avoidance, masculinity/feminity, and permanent oriented approach (Geert-hofstede, 2009) - and the steps of the decisional process -problem recognition, information search, Constructing alternatives, selecting and implementation of the chosen alternative (Nancy J. Adler with Alidson Gundersen, 2008)
We understand that in the globalization market, the influence of culture on decision-making styles and processes become more and much more important. During 8 years of experience in many international companies I realized many situations and issues that could be resolved in better way if managers understand about the culture.
In the organization with higher level of power distance we observed that always the process of problem recognition is longer than in culture with lower power distance score. It is as a result of actual issue should be escalated through many levels before finally be named a problem. It is actually happened in many Russian and Vietnamese companies that I have worked before, when the issue escalated to director's level became very serious and take big impact to the company's business. So in these cultures to be able to obtain good problem recognition process, company should establish the good system of information management to ensure the information about any big issue should come to decision's level in appropriate time.
In the organizations with a culture with higher level of uncertainty avoidance, top management manifests a special rely upon planning and hardly accepts the idea of existing of an urgent decisional problem, the awareness being sometimes delayed, even late. There are also neglected the signals concerning certain dissonances, there is a give attention to formal reports, usually financial- accountant ones, with historical information. Within the organizations with a culture tolerant to uncertainty, the acceptance of the dissonances is a lot easier, this wouldn't be seen as a situation with no exit, but, on the other hand, as a conjuncture which provokes creativity.
One of the major dimension affect to the problem recognition is masculinity/feminity. Inside the feminity culture, the approach to problem recognition is more subjective while in masculinity culture it is more objective. Western approach is dependant on the concrete proof the condition it mean that a while they realize about the challenge only after it happen but feminity culture's approach base more on the sense of individuals. It have disadvantage because some time their considering the condition is not correct but their advantage is they usually can foresee the challenge before western counterparts. Another finding related to the dimension is Western managers believe strongly in self-determination and perceive problem situations as something they can control and should resolve. However, managers in a great many other countries, Vietnam and Malaysia among them, are resigned to problem situations or looking forward to a solution from other people. (Deresky H. , 2006)
Another dimension affect the procedure is individualist/collectivist, we observed that American managers may identify the situation long before their Asian counterpart (Indo, Thai, Malay, Vietnam) would choose to define the situation as problems. If you ask me It can be explained because Asian culture is more collectivist that why when one person realize problems, they should convince other folks in group to agree with him, and the process to getting agreement usually devote some time.
In our observation we see that the culture with an increase of short-term oriented and much more individualistic usually gather information base on the actual fact of situation, while other cultures tend more intuitive. They may be more frequently gather ideas from days gone by and future in their attempt to understand the situation. It helps those to have full picture of the challenge but it addittionally take additional time. In my previous company we have board of director which includes American and Vietnamese, the conflict in the look process happen frequently while American director just take information in the current report from his direct subordinate while other directors were looking for more complex information from other department, report from the past and market forecast. In some cases in order to match with the change of the situation we have to limit enough time of information collection so I think in this task it is very important for the manager to define the acceptable level of information he need to make a decision timely.
Moreover with culture characterized with high level of Uncertainty avoidance, searching for information also limited because people there are more conservative and inside our finding these folks are simpler to see and know very well what they were acquainted with. If you ask me while i was employed in a Russian company, the majority of managers always consider certain predefined range of KPI like revenue, benefit, market share etc to judge the business performance plus they did not care much about other factors as customer behavior, market trend, sales force etc. So time their information didn't describe full picture of the situation and poorly effect to the step of constructing alternatives.
In this task we will look into 3 of the five dimensions recognized by G. Hofstede, such as: long/short power distance, uncertainty avoidance, long/short term orientation.
In organizations with a culture seen as a big uncertainty avoidance it is discovered a small volume of alternatives, generally predefined, in the moment of elaboration the planning. New information/alternatives is treated superficially. On the contrary, in organizations with a tolerant culture to uncertainty it is paid attention to all information, including the one obtained on an informal way, and are believed and analyzed all possible alternatives. In my own company now our company is facing the situation with the conflict between different management style Russian and Vietnamese that have very big different in uncertainty avoidance score. Inside our network planning process Russian managers usually use standard and pre-defined model that they already successful implemented in Russia, nor care much about the neighborhood factors of Vietnam as geography, population density, weather etc. The truth is these factors in Vietnam are much unique of in Russia and make a difference strongly to the network's quality. We usually should spend lots of time simply for discussing about factors that require to take into the consideration of the planning process.
In organizations characterized by cultures with long power distance, this activity is the privilege of the overall manager/leader. In cultures with sort distance towards power, in order to elaborate the decisional alternatives, consideration the subordinate's ideas are taken. My company characterized by Vietnames-Russian culture with long power distance usually shows the same situation, managers using level will be the ones who forming the alternatives. But in our fast growing business I see the trend of moving to lessen power distance because I see more and more cases that managers encourage their staffs to propose solution and take subordinate's recommendations into their consideration.
People from more long-term oriented cultures tent to have more new alternatives than individuals in short term oriented cultures. For example all people over the world can realize the problem of running out of nature resource (oil, gas ) in near future and the permanent oriented people as Japan are care more about next generation, and they're the first one who introduced hybrid car to the entire world.
Who make the decision in the business?
First we must have a discussion regarding the criteria taken into account to differentiate the alternatives. Thus, within an organization with a culture seen as a individualism, only single manager make decision. In THE UNITED STATES the expression "the buck stop here " reflect the fact that ultimately a single person hold responsibility for a specific decision. In other collective culture as Japan, Vietnam, groups make decisions; they might think it is inconvenient for a person to make a decision prior to consulting his colleagues and gain their agreement. The collective approach usually give better result but it take additional time plus some time not yet determined about the responsibility if your choice is failed. (Ohbuchi, Fukushima, & Tedeschi, 1999), (Nancy J. Adler with alidson Gundersen, 2008)
In organizations with a culture typically masculine it is noticed a strong orientation towards results, towards settled objectives achievement mainly the financial parameters, while in organizations with a culture typically feminine it is privileged the maintenance of any good organizational climate, of a host which encourages cooperation.
Still in the sphere of objectives, it could be made a distinction between organizations with a culture seen as a risk avoidance and organizations with a culture seen as a low uncertainty avoidance. Thus, the first ones have standards, norms, rules, clear, firm procedures for all those activities, actions, missions. In organizations with a culture seen as a tolerance towards risk the requirements for appreciation of decisional variants are flexible, dynamic, and circumstantial.
Another variable that affects the consideration of alternatives solutions is Power distance. In big power distance culture, only senior executive make important decisions, the low level staff contain the responsibility to implement it. Many surveys show that Indian managers prefer more directive style and up to 85 percent of these believe they are better under supervision (Nancy J. Adler with Alidson Gundersen, 2008). In contrast, in lower power distance culture, the employees/managers are expected to make their own decision in daily procedure and even they take the duties of allocating and scheduling tasks as well as allocating rewards among employees. If you ask me, the disadvantage of the top power distance culture in decision making is people are not encouraged to make decisions; they often await the command from the bigger level manager and when the senior manager have insufficient time or knowledge the ultimate decision usually inefficient or even failed.
From my point, the step of choosing alternatives is the most crucial step in decision making process, so managers should comprehend deeply about the culture variable and implement the most likely approach to it.
In a business with a culture with short distance towards power the implementation of your decision turns into a dynamic process, with many negotiated actions. The co-operation model is more ideal for this kind of culture. In organizations with a culture with high power distance it is applied the imposing model. In lots of companies that require the creative imagination such as software comp. , designing comp. etc. we see many changes can be occurred through the implementation step. But in manufacturing industry usually imposing model is employed to be sure the output will be exactly as manager's desire.
In another point collectivist type organizations also take big implication to the decision implementation step. From one side it enhance the efficiency of the decision by creating and carrying out a common vision, according to the values of the group but from the other side it can make visitors to be undecisive and do not take their own interest in doing their own work. Many issues related to project implementation in my own company now are the result of this type of behavior; if the task is settled for a group, some members in group usually feel that there are a few one else will need care about their part so by the end the project finished with a lot of missed parts or even fail.
Finally, we will analyze, briefly, the impact of national culture upon decisional processes in organizations from a certain national spirit. More studies have shown that, in a certain measure, the decisional practices vary from one country to some other. The national cultural factors can influence the attitude towards threat of the deciders, the centralization/decentralization of the decisional processes, the configuration of group decisions, the speed of adoption of the decisions etc.
In these conditions, for example in a country like India, where in fact the power distance and the potential risks avoidance are high, the decisions will be the tasks almost exclusively of top-management, which will prefer, the majority of the time, the decisional solutions less risky. On the contrary, in a country like Sweden, characterized by an extremely low level of both factors, managers won't hesitate to assume the risks also to encourage the employees' participation in adopting the decisions, in addition to those that are in their interest. In another plan, a country like Egypt, where there are many temporal compulsions, managers will assign additional time for a choice than their counterpart in the North-American, for example, where the decisional speed is often considered a determinant of organizational performance. In Italy, where in fact the tradition is highly valued, managers prefer already tested decisional solutions. In France and Germany, top-managers adapt the decisional style to the respectively culture. Thus, in France, the autocrat approaches are quite frequent, and risk assumption in decisional processes is manufactured with certain moderation. Within the German space, the decisional practices are also a reflection of national culture. They are characterized by: the preoccupation for structure, order; clear delimitation of the tasks of every decider; the existence of some norms, clear, precise rules for decisional processes within the organization.
In Japan there's a specific modality of adopting a decision, called ringisei, (Bernard S. Silberman, 1973) this is basically a strategy of your choice by consensus. Concretely, it is performed as follows: an employee finds a resolving solution for a problem of the organization and tells it to his direct boss; this organizes a gathering where he presents the problem and the proposed decisional variant; if the members of the organizational subdivision considers that the proposing deserves to be taken into account, the boss informs the department manager starting the procedure of obtaining the consensus within the business; it is obtained first the consensus of the individuals in the department directly and indirectly implicated in solving the approached problem, then demarches the action of getting the consensus at the amount of the complete organization; for this, the department manager, initiator, organizes a meeting with the representatives of the other implicated departments, where it is presented the decisional variant which is in the stage of proposal which is done a deep exchange of information upon it (if there are needed more info, there are definitely more meetings); when it is considered that the necessary information is gathered, a group of specialists from the starting section writes a document in which presents the decisional variant that is outlined, asking for the approval of all managers at medium and low level implicated; the document is handed to the superior manager of the business which gives the ultimate, official approval of the decision; it requires place the registration of your choice and proceeding to its implementation. It really is well-known as bottom-up decision-making process used in most Japanese companies.
Another important variable in companies' overall approach to decision making is autocratic versus participative leadership. In other words, who gets the authority to make what kinds of decisions? A country's orientation - weather is individualistic or collectivist - influences the level of which decisions are created. In lots of countries with hierarchical cultures - Germany, Russia and India amongst others - authorization for actions must be passed upwards through echelons of management before ultimate decision can be made. Most employees in these countries simply expect the autocrat - the boss - to do most of the decision making and can not be comfortable otherwise. Even in China, which is a highly collectivist society, employees expect autocratic leadership because their value system presuppose the more advanced than be automatically the most wise. In comparisons, decision-making authority in Sweden is much decentralized.
Arab managers have long traditions of consultative decision making, supported by the Koran and the sayings of Muhammad. However, such consultation occurs more on the person to person basis than during group meetings and so diffuses potential opposition. Although business in the Middle East is commonly transacted in a highly personalized manner, the final decisions are created by the most notable leaders, who believe that they must impose their will for the business to reach your goals.
In present conditions, marked by the effects of globalization, top-managers are, more often, in the problem to collaborate with subordinates from other cultures. In these situations, they need to know the probability of appearing of some variations among subordinates through the decisional processes where they may be implicated, distinctions inducted by cultural factors. The leader/manager, must build in cases like this, one common space, accepting and integrating components of cultural diversity in the philosophy and the practice of adopting a conclusion from the organization's perspective.