Cultural complexities in multinational projects

Introduction

In the past 50 years, we have seen the birth of project management as a discipline in its own right; that is, outside the scope of “construction engineering” or “military and large government initiatives.” The turning point was marked by the establishment of Project Management Institute (PMI) in the United States, which promotes the discipline to all fields in both the private and public sectors.

About 50 years earlier, management consultancy was born as a discipline, and the first two firms to practice this discipline were Arthur D. Little and Booz Allen Hamilton.

Since then, management consultancy has grown rapidly and has evolved to address a wide spectrum of needs that aims at achieving higher efficiency and growth, which it had gone on to do successfully, until globalisation started and large organisations began to expand overseas when they were hit by the first lessons of cultural impact on business practices. Not only did well-established management practices in the United States fail to work in Japan and elsewhere, they also proved inimical and were detrimental to results.

The perceived virtues of “getting down to business,” “openly addressing conflicts,” and “holding responsible persons accountable for their actions” were often seen as “impolite and lacking in personal relation,” “rude and damaging to harmony,” and as “improper attempts to signal out an individual rather than the group,” respectively.

The results were astonishing: multi-million dollar joint ventures broke apart due to ill feelings, because the first management consultants did not consider the impact that a different culture could have on their (very successful at home) theories.

Following that first experience, various studies and research tried to understand this and find ways to best address the cultural complexities. One of the most notable, and by far the largest study of its time, was conducted by the social psychologist, Geert Hofstede.

Hofstede's research and findings, which are later elaborated on in this paper, have had a profound positive effect on multinational businesses. Many large organisations use it today to fine tune their management approach outside their home countries.

Today's global market has impacted projects and programmes in no lesser way than it has processes. Indeed, one can argue that multiculturalism has a more profound effect on projects simply because projects involve multiple parties or organisations, which necessitate the building of temporary working relationships with people who may come from a different corporate culture. Add to that the national (ethnic or religious) cultural aspect, and you have a real challenge.

Can we then apply our lessons learnt from studies of multiculturalism's effect on businesses and processes to projects? This is only a rhetorical question; without a doubt, the answer is yes. The effects different cultures have on various disciplines may differ; however, their effect on our values is the same. Hofstede's research identified the major cultural aspects (dimensions) and some of their effects. It is up to us to identify how they apply within the context of project and programme management.

A Word about Culture

When invoking a study involving different aspects of cultures, one must first answer the questions: What is culture? What does the term mean to us?

Such an answer or discussion could merit an entire library by itself. The meaning of culture has been much debated by many anthropologists and sociologists, and definitions vary according to the context in which the term is used.

What I will do, therefore, is present a specific definition of “culture” as it applies to this paper.

Culture is a unique aspect of mankind. It reflects how we differ from other people as well as from the animal world. Human behaviour is the product of a very complex learning process that takes place within a cultural context.

Culture is not a characteristic of an individual; it encompasses a number of people who were conditioned by the same education and life experiences. When we speak of the culture of a group, a tribe, a geographical region, a national minority, or a nation, culture refers to the collective mental programming that these people have in common; the programming that is different from other groups, tribes, regions, minorities or majorities, or nations.

Culture does not only exist in the minds of people; however, it does become crystallised in the institutions these people have built together: their family structures, educational structures, religious organisations, associations, forms of government, work organisations, law, literature, settlement patterns, buildings, and even scientific theories. All of these reflect common beliefs that derive from the common culture.

Culture, therefore, is the collection of values, norms, beliefs, customs, institutions, and forms of expression that reflects the thoughts, feelings, actions, and interests of people.

The following selected four definitions are the closest to our present purpose:

“… the act of developing the intellectual and moral faculties especially by education” — Merriam Webster Dictionary

“… the ideas, customs, and social behaviour of a particular people or society” — Oxford Dictionary

“… the way of life, especially the general customs and beliefs, of a particular group of people at a particular time” — Cambridge Dictionary

“… the collective programming of the mind which distinguishes the members of one group or category of people to others” — Geert Hofstede

  • Culture is a collective phenomenon and not to be confused with personal traits or individual personality.
  • Culture is learnt from one's social environment. It is not inherited.
  • Culture is relative. That is, a culture has no absolute criteria for judging the activities of another culture as “low” or “noble.”

With particularly the last point in mind, it is important to note that certain efficient working practices fail to be so in another culture, which is by no means an indication that the first culture is superior to the second. Not even within the professional context. The only conclusion that can be drawn is that the approach of these working practices is not adept for the second culture. Identifying and implementing a culturally adept approach may result in the same or even better efficiency than the first culture.

One need only contemplate the following few countries in this context to grasp the sense of the above: the United States, China, Germany, Japan, Malaysia, Switzerland, and there are many more.

Culture and Value

There are various levels of culture (e.g., national, regional, religious, gender, social) and almost everyone belongs to more than one.

The very core of each layer of culture is “value”; in other words, our placing more value on one state of a cultural affair than another. The end result is often that of multiple layers interacting with each other—a rather fascinating and very complex dynamic that we will leave to the expert psychologists to continue to explore. For our own purposes, we must satisfy ourselves in considering the value effect of a culture as a whole. That is, given that we are setting up a subsidiary in the Tunisian capital in a joint venture with a local company, what cultural considerations should we be aware of to minimise conflict and maximise efficiency and cooperation?

Following are a few examples of how certain cultures may place more value on one issue over the other.

  • Family well being versus wealth and power
  • Group harmony versus individual achievement
  • Scientific development versus religious teaching
  • Democratic decision-making versus patriarchal dictation

Geert Hofstede and the Cultural Dimensions

Professor Geert Hofstede is a social psychologist who conducted one of the most comprehensive studies of how values in the workplace are influenced by culture.

In the early 1970s, Hofstede and his colleagues carried out a major systematic study of work-related attitudes based on two questionnaire surveys, which produced a total of 116,000 responses from over 70 countries around the world, making it by far the largest organisational-based study ever carried out.

The respondents were all sales and service employees of subsidiaries of IBM, including sales clerks, professional engineers, and top managers. Care was taken to ensure that the groups were similar in terms of age and education so that the only real differences were their countries of origin and cultures.

The original study revealed four main areas where the cultures varied (results by country are listed in the appendix at the end of the paper):

The Power-Distance Dimension

The power-distance dimension is concerned with how far the culture encourages superiors to exert power. In a high power-distance culture (e.g., parts of Asia and the Middle East) this is what being a boss means. Inequality is accepted: “A place for everyone and everyone in his or her place.” So, employees are frequently afraid to express disagreement with their bosses and prefer to work for managers who make the decisions (and take the responsibility) and then simply tell them what to do. This is often reflected in the country's social organisations and political structure, where a one-man autocracy (the head of the family, organisation, or state) is accepted and respected.

In a low power-distance culture (e.g., Denmark and New Zealand), superiors and subordinates consider each other to be colleagues and both believe that social inequality in society should be minimised. Employees are seldom afraid to disagree and expect to be consulted before decisions are made.

The Uncertainty Avoidance Dimension

This is the ease with which people within the culture cope with novelty. In a high-uncertainty avoidance culture, there is a history of life being threatened by factors that cannot be controlled. These cultures compensate by imposing laws and controls, wherever possible, and people feel a need for clarity and order.

The value is placed on “age old wisdom” rather than the “risky behaviour of the young and inexperienced.”

In low-uncertainty avoidance cultures, eccentrics are accepted and almost encouraged. As a result, there is a great deal of creativity and inventiveness.

The Individualism/Collectivism Dimension

Individualism is the degree to which a culture encourages people to take personal responsibility for their lives. In a collectivist country, that attitude is not encouraged. A person is not seen as an individual, but as one component of a group.

The United States and Britain are two of the most individualistic countries in the world; “I” is the most commonly used word in the language. The emphasis is on individual initiative and achievement, with everyone entitled to a private life and opinion.

Eastern countries in general are far less individualistic than their Western counterparts. The emphasis is on belonging to the extended family or tribe that offers protection in exchange for loyalty. Individual achievement, which separates the person from the group, is discouraged. For an achievement to be valued, it must reflect on the group as a whole. Even guilt is not an individual entity; it brings shame on the whole group. Collectivism is probably the strongest of all the cultural dimensions and even extends to the working group, which must operate as a family rather than a group of individuals.

The Masculinity/Femininity Dimension

In a masculine culture, success is measured in terms of power, wealth, and possessions. A feminine culture measures success in terms of quality of life, friends, relationships, placing little value on possessions.

Japan, Austria, Venezuela, and Italy score the highest on the masculinity scale, whereas Sweden, Norway, The Netherlands, and Denmark score the lowest.

These two additional cultural dimensions were later added to the research:

  • Long-term versus Short-term Orientation
  • Indulgence versus Restraint

For the purpose of this paper, I will only address the effects of the original four dimensions.

The Cultural Dimensions and Project Management

We have seen and had a feel for how the cultural dimensions may affect our work. Now, the question is: How exactly will they impact multicultural projects?

Note that, in this instance, I am using the term “multicultural” rather than “multinational.” This is because the emphasis is on the culture of the stakeholders and players and not the geographical location(s) of the project.

A project entirely based in one geographical location may be a joint venture between a number of organisations of various nationalities or a venture between various countries.

The project manager must be aware of the cultural effect on the project once two or more cultures are significantly present; that is, the stakeholder's culture.

Thankfully, project management standards and methodologies have already been globally accepted, with Project Management Institute's A Guide to the Project Management Body of Knowledge (PMBOK® Guide) and the British Office of Government and Commerce's Projects in a Controlled Environment (Prince2™) leading the way, and even local project management standards (e.g., Japan, Australia, Italy.) are in good harmony with the PMBOK® Guide and Prince2™. It seems that project management standards and methodologies, born 50 years after the management consultancies, have made good use of the lessons learned in internationalisation. What remains to be determined, however, are the softer aspects of the “how”; that is, the various cultures within the project may agree on the processes and procedures but may disagree on how to handle a conflict—Is it to be one on one or openly in a project board meeting? Should the people accountable for a problem be singled out, or should impersonal references to problems be made?

Those softer aspects of the “how” apply to the positive aspects as well. Should achievement be rewarded immediately? Should the reward be given to the person(s) or his or her team? Will personal acknowledgement result in positive motivation or embarrassment and a sense of isolation?

Think of it this way: All sponsors and key stakeholders are proficient in and have agreed to use the PMBOK® Guide as the standard. The project is: “An American Educational Centre in Morocco,” sponsored by the U.S. Government. The project manager and his immediate team are American; all others working on the project, including team members and the various suppliers, are Moroccan.

The project manager and his team have never worked with Moroccans before, but everyone is proficient in and knows the PMBOK® Guide. Is there still room for conflicts?

Assuming you have been paying attention to this article, I trust your answer will be yes.

It will be yes when we consider the following section.

Getting Down to it: An Ausmasian Project Manager in Borninia

Ausmasia and Borninia are fictional countries, each being on the opposite side of the scale of Hofstede's cultural dimensions. We can speculate the various scenarios in which an Ausmasian project manager is in charge of a Borninian project with a Borninian team.

The following observations on just a select few of the project manager's duties are a mix of my own personal experience, earlier research conducted during my MBA studies, and speculation based on the theory. I trust they will form the basis of future comprehensive research on the subject.

Project Planning and Scheduling

An agile project management approach favours high-level planning that leaves the low-level tasks to the work package owners to plan (should they wish to plan). The logic is: let us coordinate at a high level, spend less time and effort on detailed planning, and get down to speedy implementation. Furthermore, this allows us the flexibility to change approach without having to re-plan each and every step. It is an agile approach most adept to a ‘not-so-certain’ an outcome. We are, after all, working towards an objective and not an output.

On the other hand, should we have certainty (or at least perceive to have that certainty) of what we want to produce as an output, then we would do well to intricately plan and make sure we do not deviate from this most desired result. Detailed planning down to individual tasks seems reasonable. It is better to spend good time planning rather than longer time repairing. Let's get it right first time!

Can you see how the above approaches can reflect themselves in high and low uncertainty avoidance cultures? Regardless of the type of project and clarity of outcome, these attitudes are imbedded in high and low uncertainty avoidance cultures respectively, probably because the former always aims for what is sure and certain, whereas the latter, aims for something new, even if it means a good risk of failure.

The above two sides of the spectrum would strongly influence how much planning details can one get down to, and how much of them would actually be useful or appreciated. It is no use to have detailed plans in a low uncertainty avoidance culture just to have them changed every time a seemingly (correct or incorrect) better approach is tried. Better stay agile and flexible to change. The opposite is just as true.

Acknowledging Achievements

In the western world, we are often told of the virtues of acknowledging good achievements. I once read in a management book the following advice: “Acknowledge achievement and acknowledge it loudly. Send an email to the achiever thanking and detailing his or her achievement, and make sure to copy all of his/her team and bosses.”

In a collectivist culture, this is how you can re-define “disaster:” The individual's embarrassment at being singled out; the group's anger at not being part of the acknowledgement; and the harmony of a once efficiently working group is broken.

This is dramatic, isn't it? Well, it could be.

We can speculate on the other dimensions and how they can effect acknowledgement:

  • In a high power-distance culture, bosses are seen as superiors and respected as such. An eager acknowledgment could easily be translated as a weakness, resulting in loss of authority of the project manager.
  • In a high uncertainty avoidance culture, there would be a tendency to avoid taking direct responsibility for a work package. If, however one does so and delivers well, should a reward be expected? An acknowledgement? Would the rule of “no-pain, no-gain” apply?
  • Would a more masculine culture be inclined to appreciate individual acknowledgement as a form of gratification?

Delegation

By delegation, I refer to the project manager delegating “objectives” rather than assigning “tasks”; in other words, he or she will trust that the person being delegated to, is proficient enough to choose the most appropriate way (e.g., tasks, team, suppliers, etc.) to reach those objectives.

In a high uncertainty avoidance culture, delegation is likely to be resisted or even rejected. It is a risk, so a team member is unlikely to see why he or she should accept it. The project team would expect the project manager to know what the best approach is and tell them exactly what to do.

Would this be paralleled in a high power-distance culture? Would an authoritarian boss be more likely to delegate or order tasks? What about masculine cultures and collective cultures? Do they have an influence on delegation?

Governance and Control

No project management approach can function without some form of governance and control, regardless of the environment or culture. Doing without this is dooming the project to failure.

The question is: How much governance and control? Do we go down to each task resource to verify progress weekly (asking to see some evidence), or do we verify with the work package owners at the end of each product delivery?

A logical answer would be: “depends”…. It depends on the nature of the project, its deliverables, the team proficiency, the corporate culture, and so forth.

Let us now consider the cultural dimensions:

In a high uncertainty avoidance culture, the tendency would be towards minimum responsibility. No one wants to take the risk of failure and would be happy to be governed and controlled routinely because this would move the responsibility to the project manager (the project manager was fully aware of my progress and never said anything…). Indeed, in my experience as project manager in a high uncertainty avoidance culture, I often had team members updating me at least “daily” on their detailed progress. I had to make an effort to assure them of my confidence in their work and that, for updating purposes, the weekly project team meeting would suffice.

Power-distance often parallels uncertainty avoidance and in this instance, it is no exception. A masculine culture, on the other hand, is likely to be the opposite. “You do not trust me?” would be the silent protest of the person being so regularly governed, whereas a feminine culture has no issue with the matter. No hurt feelings. “My work is here and you may review its progress whenever you wish.”

In a collective culture, the norm is for the individual to be one small part of the big team's machinery and, for this to work, regular governance and controls are expected, which isn't true in a high individualism culture.

Accountability

One of the touchiest areas a project manager has to address is accountability, even in culturally homogenous projects. It is never pleasant to point the finger and/or put the responsible people on the spot. Yet, in certain cultures (e.g., the United States and United Kingdom), it must be done and is expected and even appreciated. Our being able to develop and grow is strongly connected to being accountable. The prevailing attitude is: we all are professionals and should be fully aware of our duties and responsibilities.

This is not the case in a collective culture in which the same rule as that of acknowledgement applies. Both achievement and failure are attributed to the group and not the individual.

The cultural dimensions do not operate independently on the above responsibilities. Just as in social behaviour, cultural values and their effects are very interdependent. A high individualism culture would promote higher work delegation and less detailed planning, resulting in less direct governance and control (updates sent by email from the work package owner would suffice), and as such, personal acknowledgement and accountability are appropriate.

On the other hand, a collectivist culture would promote the assigning of clear tasks, detailed planning, regular direct governance and control (allowing any individual deviation to be identified before it becomes an issue), and as such, acknowledgement and accountability are attributed to the team as a whole.

What Next?

This paper is meant to highlight the cultural issues impacting projects and to “stir the waters” towards further comprehensive research with the goal of achieving findings similar to those of Geert Hofstede, which the multicultural project manager and his or her team can use to best achieve results.

The research would make full use of existing findings from previous works and build on them using targeted questionnaires, multicultural project managers’ experiences, and academic research.

Conclusion

Research into the cultural impact on multinational businesses was, and still is, the key to the success of global businesses. Much of Geert Hofstede's findings can be directly applied to multicultural project management, because many of the principles are universal (e.g., delegation, acknowledgement, etc.); however, the approach and context may differ.

Today, business activities are becoming more and more project based rather than process based; that is, there are more projects and less processes due to the continuously changing markets, rapidly developing technology, shorter product life cycles, updated services, increased global competition, and so forth, which renders the life spans of most processes much shorter than they were a few decades years ago.

It has been approximately 40 years since Hofstede's initial findings on the cultural dimensions and, although they remain valid indicators to a certain extent, of new research to update them, especially in light of globalisation rapidly evolving and changing world cultures, would add significant benefits to multicultural management. This time, the research would extend the findings and their effects to project and programme management. This paper is a first step towards such research.

References

Adler, N.J. & Gunderson, A.(2007), International dimensions of Organizational Behavior—Fifth Edition, Mason OH: South-Western College Publication.

Downes, J. F. (1971). Culture in crises. Glencoe, IL: Glencoe Press.

Hofstede, G. (1980). Motivation, leadership and organisation: Do American theories apply abroad? Organisational Dynamics, Summer 1980.

Hofstede, G., Hofsteded, G.J., & Minkov, M. (2010). Cultures and organizations: Software of the mind—Third Edition. New York, NY: McGraw-Hill Professional.

McClelland, D.C. (2010). The achieving society, Eastford, CT: Martino Fine Books.

Zein, O, (1994). British organisations in Saudi Arabia: A cultural/managerial conflict (Thesis: International Management MBA, University of Exeter, United Kingdom).

Appendix

Cultural Dimensions by Country

Country Power-Distance Individualism/ Collectivism Masculinity/ Femininity Uncertainty Avoidance
Africa, East 64 27 41 52
Africa, West 77 20 46 54
Arab countries 80 38 53 68
Argentina 49 46 56 86
Australia 36 90 61 51
Austria 11 55 79 70
Bangladesh 80 20 55 60
Belgium 65 75 54 94
Belgium, French 67 72 60 93
Belgium, Netherlands 61 78 43 97
Brazil 69 38 49 76
Bulgaria 70 30 40 85
Canada 39 80 52 48
Canada, French 54 73 45 60
Chile 63 23 28 86
China 80 20 66 30
Colombia 67 13 64 80
Costa Rica 35 15 21 86
Croatia 73 33 40 80
Czech Republic 57 58 57 74
Denmark 18 74 16 23
Ecuador 78 8 63 67
El Salvador 66 19 40 94
Estonia 40 60 30 60
Finland 33 63 26 59
France 68 71 43 86
Germany 35 67 66 65
Great Britain 35 89 66 35
Greece 60 35 57 112
Guatemala 95 6 37 101
Hong Kong 68 25 57 29
Hungary 46 80 88 82
India 77 48 56 40
Indonesia 78 14 46 48
Iran 58 41 43 59
Ireland 28 70 68 35
Israel 13 54 47 81
Italy 50 76 70 75
Jamaica 45 39 68 13
Japan 54 46 95 92
Korea, South 60 18 39 85
Latvia 44 70 9 63
Lithuania 42 60 19 65
Luxembourg 40 60 50 70
Malaysia 104 26 50 36
Malta 56 59 47 96
Mexico 81 30 69 82
Morocco 70 46 53 68
Netherlands 38 80 14 53
New Zealand 22 79 58 49
Norway 31 69 8 50
Pakistan 55 14 50 70
Panama 95 11 44 86
Peru 64 16 42 87
Philippines 94 32 64 44
Poland 68 60 64 93
Portugal 63 27 31 104
Romania 90 30 42 90
Russia 93 39 36 95
Serbia 86 25 43 92
Singapore 74 20 48 8
Slovak Republic 104 52 110 51
Slovenia 71 27 19 88
South Africa, white 49 65 83 49
Spain 57 51 42 86
Suriname 85 47 37 92
Sweden 31 71 5 29
Switzerland 34 68 70 58
Switzerland, French 70 64 58 70
Switzerland, German 26 69 72 56
Taiwan 58 17 45 69
Thailand 64 20 34 64
Trinidad and Tobago 47 16 58 55
Turkey 66 37 45 85
United States 40 91 62 46
Uruguay 61 36 38 100
Venezuela 81 12 73 76
Vietnam 70 20 40 30
This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

© 2012, Omar Zein
Originally published as a part of 2012 PMI Global Congress Proceedings – Marseille, France.

Advertisement

Advertisement

Related Content

  • Benefits Realization Management

    Benefits Realization Management

    This guide will help you drive more successful outcomes and better strategic alignment in your organization. Available for free download for a limited time.

  • PM Network

    Team Rework member content locked

    By Bryant, James The performance of the core project team might be the most critical success element of a project. It's also one of the most overlooked. Although competency gaps or disengagement among a team will…

  • PM Network

    Permit Power member content locked

    Permits can stall or accelerate a construction megaproject. A permit issue is even affecting a century-old project—the Sagrada Familia in Barcelona, Spain. The project launched in 1882, though less…

  • PM Network

    How to Get Hired in the Age of AI member content locked

    By Thomas, Jen From self-driving cars to search engines, artificial intelligence (AI) is slowly transforming the world around us. Now, it's starting to play a role in how project professionals land new gigs.…

  • PM Network

    Cleaning Spree member content locked

    By Parsi, Novid India is building roughly 62,000 toilets a day. As part of the US$29 billion Clean India program, the government's toilet-building project—the largest such effort ever--aims to build 111 million…

Advertisement

Publishing or acceptance of an advertisement is neither a guarantee nor endorsement of the advertiser's product or service. View advertising policy.