Communication Christopher SmithMarch 17, 2021

How Can the Geert Hofstede Model Be Applied in Business?

How Can the Geert Hofstede Model Be Applied in Business?

For years, the Geert Hofstede model has been a valuable tool for understanding how culture affects business. The theory posits that there are six dimensions to culture and that those dimensions influence how people interact.

In this post, we’ll learn what the Geert Hofstede Model is, how managers can use it to better understand human dynamics, and how it can help improve certain types of business initiatives, such as organizational transformation initiatives.

What Is the Geert Hofstede Model?

The Geert Hofstede model – or Hofstede’s cultural dimensions theory – describes the relationship between culture, society, and individuals.

This model was originally developed during the 1960s and 1970s, after Hofstede interviewed IBM employees scattered around the globe.

Since its creation, this model has been used in a wide range of fields, including business.

Once the model was refined, it embraced six categories that define national culture:

Power Distance Index (PDI). The PDI is defined as “the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally.” Higher values indicate that people accept hierarchies in society, while lower values indicate the opposite.

Collectivism vs. Individualism (IDV). This dimension describes how cohesively people are integrated into groups. Individualistic societies focus more on the individual and immediate family. Collectivist societies, on the other hand, include extended families and in-groups.

Uncertainty Avoidance (UA). This index outlines how much people tolerate ambiguity. Those societies with a high UA are averse to the unknown and the unexpected. As a result, they often have stricter behavioral guidelines and laws. 

Femininity vs. Masculinity (MAS). According to Hofstede’s model, masculinity prizes “achievement, heroism, assertiveness, and material rewards for success.” Femininity, in contrast, prefers “cooperation, modesty, caring for the weak and quality of life.”

Short-Term vs. Long-Term Orientation (LTO). Countries oriented towards the long-term value adaptation and problem-solving, while those with a short-term focus value steadfastness and tradition.

Restraint vs. Indulgence (IND). This index refers to how strictly a society regulates the fulfillment of “human desires.” Those that allow indulgence give individuals the freedom to gratify those desires, while their counterparts tend to restrict that behavior.

Since this model offers insight into people’s cultural values, it can significantly benefit anyone involved in cross-cultural communication – and, since today’s workplace is so diverse, it can be beneficial for managers and business leaders as well, regardless of where they are working.

How Can the Geert Hofstede Model Be Applied in Business?

As with any other academic research or framework, this model has its criticisms. It should therefore be taken with a grain of salt – it is not the absolute truth.

That being said, it does offer a perspective on how culture affects communication styles, behaviors, and attitudes, among other things.

In a business context, managers and leaders can use this model to:

Communicate more effectively with their employees. Cultural values are inherent to each group of people and help determine how they think and behave. Understanding cultural values, in turn, can help managers reduce miscommunications and workplace friction, while also improving teamwork and camaraderie.

Better understand employees’ behavior. Culture not only determines how people communicate, it also impacts employee productivity, their actions, their behavior, their social conduct, and more. By providing a top-down overview of culture, the Geert Hofstede model can shed light on certain types of behavior and, in consequence, reduce miscommunications.

Gain insight into the interplay between organizational culture and structure. One dimension, as mentioned, gauges how people relate to authority. Since every business has its own hierarchy and structure, that can impact the way people interact with supervisors and business leaders.

Improve the performance of organizational change initiatives. Another dimension covered above, uncertainty avoidance, describes how averse people are to risk, uncertainty, and change. This measure can in turn affect people’s reactions to organizational change initiatives – for instance, whether they resist change or engage with change initiatives.

Develop ideas for improving the organization. Understanding the Geert Hofstede model can help managers identify problems within the organization that stem from cultural issues. They can then use those insights to design performance improvement initiatives, such as communication strategies designed to minimize conflict.

Work more effectively in international settings. Business professionals who work in international offices are often faced with new cultural environments. In many cases, the differences can be challenging and can result in miscommunication, friction, and so on. This model can help illuminate the values of a culture and, as a result, help professionals learn to work in different cultures more successfully.

In summary, Hofstede’s model of cultural dimensions can improve business communications in a wide variety of settings, whether operating in one’s own country or internationally.

Key Points

The Geert Hofstede model – Hofstede’s theories of cultural dimensions – describes six dimensions that paint a “big picture” of cultural values across the globe.

Understanding this model can help business professionals at any level become better communicators and better understand their peers’ behaviors and attitudes. 

In turn, that understanding can lead to fewer communication problems and better working relationships.

If you liked this article, you may also like: