BMIS – L1 – SA – Q3.2 – Organisation culture in business

Compares Hofstede's cultural dimensions in two countries based on expenditure strategies.

Question

In Country X, it is usual for the senior management of stock market companies to defer major expenditures in order to improve the reported current year profits. In Country Y, it is common for the annual report of major stock market companies to explain at length the company’s strategies and commitment to plans for capital expenditure. Which of Hofstede’s dimension of culture is being compared in this example?

A Uncertainty avoidance

B Power distance

C Individualism versus collectivism

D Long-term orientation versus short-term orientation

Answer

Explanation: The differences between business culture in Country X and Country Y can be explained by short-term orientation (in Country X) versus long-term orientation (in Country Y). Country X’s focus on deferring expenditures to boost current profits reflects a short-term orientation, prioritizing immediate results. Country Y’s emphasis on long-term strategies and capital expenditure plans indicates a long-term orientation, focusing on future growth and sustainability.

Tags: Business culture, Hofstede, Long-term orientation, Short-term orientation, Strategic planning
Level: Level 1

Topic: Organisation culture in business

Uploader: Samuel Duah