Cultural differences in decision-making among project teams
examples from Swedish and German project teams
KONRAD SPANG AND SINAN ÖZCAN
University of Kassel, Germany
In this era of globalization, there is a need to understand how national culture influences work on multi-national projects, particularly as these influences relate to decision making. In an increasingly interdependent world, it is common for products to be designed in one culture, manufactured in another, and sold in yet another. This is why companies are increasingly using trans-national project teams to develop and implement new products, processes, and systems solutions. For example, current transportation and communication systems are enabling companies to realize international projects across national borders, such as between countries like Germany and Sweden.
Germany and Sweden – A Business Partnership
According to the Swedish Chamber of Commerce, Germany is Sweden's most important trade partner. In 2004, Sweden export business into Germany represented 10.2% of the total Swedish export. In comparison, Sweden imported 18.9% of its foreign goods from Germany. The Swedish Chamber of Commerce's annual survey on Swedish stakes in Germany indicated that 658 German subsidiaries and affiliates of Swedish companies operate in Germany. Their turnover amounted to ‡38 billion. Swedish companies employ currently about 144,000 people in Germany. Those figures imply that a number of these people work together on joint projects. To prevent the possible culturally related conflicts while implementing joint projects, Swedish and German organizations must understand the country-specific characteristics which might influence their cross-cultural cooperation.
Cultural Influences and Decision Making in Projects
To understand differences in decision-making styles, and the drivers thereof, we first need to identify the cultural differences. Numerous studies have been conducted on cultural differences and commonalities, showing the differences in values and behavior of people from different national cultures (Hofstede, 1980; Trompenaars, 1993). Project managers in different countries run similar projects in different ways, for example, by assigning different priorities to success criteria and by communicating in very different ways (Müller & Turner, 2004, 2007). The differences in decision-making style among the members of culturally diverse project teams have not been previously investigated. However, given the different leadership styles in the different cultures (Suutari, 1996), we can presume that these decision-making differences do exist. This study addresses this presumption with the following research question:
What are the cultural differences in decision-making style and processes used by project teams composed of Swedish and German nationals? What are the antecedents of these differences?
The aim of this study is to identify the different approaches used by German and Swedish nationals to make decisions while working with temporary organizations, such as project teams (Turner & Müller, 2003). This follows Trompenaars (1996) suggestion: “To minimize conflict between cultures, you must first analyse - measure even - the differences between them” (p. 51).
The unit of analysis of this study is the multicultural project team including project managers. In the first step, we identify the cultural differences between the German and Swedish team members, which may have to be bridged when executing projects.
In a second step, we identify the different styles and process used to make project-related decisions.
In a third step, we identify the antecedents of the different decision-making styles and processes. This enables us to understand the causes of these differences and can help project team members and project managers recognize these differences and develop tactics for addressing these.
In the next section, we review the literature on cultural divergence and decision making and then describe our research model. This is followed by the methodology section. We subsequently analyze the data, discuss the results, and finally, develop our conclusion.
Studies on cultural differences became popular in the 1970s and 1980, mainly through the work of Hofstede (1980). This has developed into a field of research with increasing popularity and perceived importance. Related literature can be categorized into those for cultural differences and those for cultural commonalities. This study addresses the former group.
Among the most quoted list of differences are those by Hofstede (1980), Hall (1989), and Trompenaars (1993). In agreement with many other researchers, the work of Hofstede is seen as the most influential and often cited scholarly work (Müller & Turner, 2004). Hofstede (2007) defines culture as “the collective programming of the mind, which distinguishes the member of one human group from another” (p. 413). He identified four major dimensions to explain differences among cultures and measured each on a scale from 1 to 100. These are:
Power Distance (PDI). The extent to which individuals in cultures accept the unequal distribution of power. Individuals in large power distance cultures accept hierarchical order and their position in it. In small power distance cultures, people strive for equalization and demand justification for power inequalities (Hofstede, 1984). Power distance has been found to be quite similar in Germany (G) and Sweden (S) (PDI-points by Hofstede: G: 35, S: 31).
Individualism versus Collectivism (IDV). People in individualist cultures are supposed to take care of themselves and their immediate family. In collectivist cultures, individuals can expect their relatives, clan, or other groups to look after them in exchange for unquestioning loyalty (Hofstede, 1984). On Hofstede's individualism dimension both Germany and Sweden are also quite similar (IDV-points by Hofstede: G: 67, S: 71).
Uncertainty Avoidance (UAI). The extent to which individuals in a culture feel uncomfortable with uncertainty or ambiguity. Cultures with strong uncertainty avoidance maintain rigid codes of belief and behavior and are intolerant towards aberrant persons or ideas. Weak uncertainty avoidance cultures are more tolerant towards deviants and practice counts more than principles (Hofstede, 1984). On the uncertainty avoidance scale Germany scored higher than Sweden in Hofstede's study (UAI-points by Hofstede: G: 65, S: 29).
Masculinity versus Femininity (MAS). Masculinity represents a cultural preference for achievement, heroism, assertiveness, and material success. Femininity represents a preference for relationship, modesty, caring for the weak, and quality-of-life (Hofstede, 1984). Germany scored much higher than Sweden on this dimension (MASpoints by Hofstede: G: 66, S: 5) (Hofstede, 1984).
Under the influence of the Chinese culture connection, Hofstede developed a fifth dimension:
Long-Term Orientation (LTO). This is the degree to which a culture embraces long-term devotion to traditional values. High long-term oriented cultures prescribe long-term commitments and respect for traditions. In cultures ranking low on this dimension, change occurs more rapidly (Hofstede 2004). Long term orientation has been found to be quite similar in Germany and Sweden (LTO-points by Hofstede: G: 31, S: 33).
Figure 1 summarizes the cultural differences between Germany and Sweden as described above. The largest differences are in Masculinity and Uncertainty Avoidance; both dimensions are more present in the German culture. In Power Distance, Individualism, and Long-Term Orientation, the differences are minor.
Figure 1. Differences by Hofstede's five dimensions
Suutari (1996) analyzed the experiences of Finnish expatriates working in four European countries, including Germany and Sweden. This study shows a variation in manager-subordinate interaction, that is, in the leadership behavior of managers across countries. Suutari found that German managers are less active than their Swedish counterparts in matters related to decision participation and autonomy delegation.
Hall (1989) identified the cultural differences that exist between languages. He distinguished between low-context and high-context languages. In this view, low-context language is explicit in its expressions (such as in North America) and high-context language is typically implicit, referring to shared knowledge of sender and receiver (such as in Japan).
Müller and Turner (2004), using the Hall (1989) and Hofstede (1984) dimensions, examined the cultural differences that influence how project owners communicate with project managers.. They found that German nationals communicate in very detailed ways, using all possible media at pre-scheduled dates. In comparison, Swedish nationals prefer very frequent communication through verbal updates over the phone.
Müller and Turner (2007) also analyzed how a project manager's national culture affects their perception of project success criteria and project success. They found that the importance which a project manager assigns to success criteria—as well as the project success—varies by national culture.
Trompenaars (1993) argued that culture is the way in which a group of people solve problems and that it allows them to survive in their particular environment. He outlined seven dimensions to distinguish cultures:
- Universalist vs. particularist, covering ethics and personal relationships
- Specific vs. diffuse, covering legal processes and trust
- Neutral vs. affective, that is, objective vs. emotional
- Short term vs. long term, as a perspective of investment returns and results
- Achievement vs. ascription, of status, performance, assignment of rewards
- Attitudes to time, addressing emphasis on past, present, and future
- Internal vs. external, the ego versus society
Hampden-Turner and Trompenaar (1993, cited by Tylee, 2001) used seven value dilemmas to illustrate cultural differences. Figure 2 below shows five of these, depicting the largest differences between Sweden and Germany as those involving inner- versus outer-directed. This measures how an individual prefers to live in harmony with their environment (outer-directed) or use the environment to pursue their goals (inner-directed). Germany scores higher in the latter. A further difference lies in the analytical-versus-integrative approaches used in addressing complex issues, perspectives which either look at an entire system to discern its holistic, integrative functionality or analyze a system to understand its component parts. Sweden scores higher in analysis. A third area of difference is in the attitude towards status. Here Swedish nationals tend more towards achieved status (as opposed to ascribed status) than German nationals. Two further dimensions (not shown in Figure 2) identified that both cultures prefer flat hierarchies and that the perception of time varies significantly between the two cultures. While the Swedish culture perceives time in a way that the past, the present, and the future are distinct and do not overlap, the German culture perceives past, present, and future as overlapping, with the future being most significant and the past being least significant. Except for the first dimension, there are only minor differences between Germany and Sweden.
Figure 2. Differences by five of Trompenaar's (1993) seven dimensions
One focus area prevalent in Trompenaars (1996) is the link between culture and internal versus external Locus of Control. In the paper by Smith, Trompenaars, and Dugan (1995), they used a scale developed by Rotter (1966) to measure the extent to which people had an internal Locus of Control, which is typical of successful Americans, as compared to an external locus of control, which is “typical of relatively less successful Americans, disadvantaged by circumstances or shaped by the competitive efforts of their rivals” (Trompenaars, 1996, p.65). Smith et al. identified the Locus of Control scale of 43 countries, with measures of externality totaling 8.35 for Western Germany and 11.07 for Sweden. Thus, the Swedish culture allows for more external steering of the individual than in the German culture.
Recent work by Hampden-Turner and Trompenaars (2006) developed knowledge of cultural differences further into Cultural Intelligence, a needed and credible capacity of managers. They proposed a paradigm shift from absolute cultural differences, such as those proposed by dimensions of cultural differences, to a relative difference. In this relative difference, the traditional dimensions of cultural differences still exist, but in a way that a culture shows a preference for one side of a dimension (e.g., individualism) yet still maintains the opposite (e.g., collectivism) on a smaller scale. This explains, among others, the strong entrepreneurial movement in a communitarian culture like China, and the high church attendance in an individualistic culture like North America. Cultural Intelligence, then, requires that both aspects are respected simultaneously, as well as the movements between them.
The review confirms the existence of cultural differences between German and Swedish nationals. Within projects, this means that people are working differently, depending on their cultural background, and that they potentially expect others to work in accordance with their own culture. This can be a cause of conflict and friction.
In traditional Judgment and Decision Making (J/DM) literature, a decision is treated mainly as a cognitive phenomenon and conceptualized as the goal or end point for a more or less complex process of deliberation, which includes an assessment of consequences and uncertainties. Parkin (1996) defined the variables of a personal decision process consisting of five stages: Problem definition; thought; judgment; decision; and action. Parkin identified the influences which typically affect this process, influences such as behavioral history, situational beliefs, personal values, social and occupational norms, personality, and environmental constraints.
Svenson (1996) distinguished four levels of decision making. The first level of decision processes includes the many quick and largely automatic and unconscious decisions. Decisions made with reference to one or a few attributes favoring the chosen candidate belong to second-level decisions. The third level implies that decision making is a process referring to one's choices between alternatives in relation to goal conflicts. Most of the existing decision research literature treats problems at this level. In real-life decision making, the search and creation of decision alternatives plays a significant role. The fourth level of decision processes—or the set of decision alternatives—is not fixed. At this level, problem solving constitutes an important sub-process in decision making. It is important to point out that decision-makers often use processes at different levels in the same decision process.
Tyszka (1998) argued that decision making consists of resolving two conflicts. One is the conflict between the desire to make an accurate decision and the desire to minimize the effort of decision making. The second conflict is between the desire to make an accurate decision and the desire for a decision that is unequivocal.
The literature on decision making can be divided into three broad categories. The first is a body of knowledge that describes axiomatically based decision theories from operations research, welfare economies, decision analysis, and the various forms of multi-attribute utility theory. The second group includes models of real human judgment and decision behavior derived from psychological research. Because of the nature of psychological research these models are usually restricted to explanations of individual or sometimes small group behavior. Decision making in organizations, the third category, is mainly described by sociologists (Parkin, 1996).
A central theme in organization theory is the attempt to understand the decision-making processes used by individuals, groups, and organizations. For example, group frequently make important decisions with far-reaching consequences that affect businesses, projects, politics, or public administration. Because of this, much research deals with the question of which factors determine the quality of group decision making and how to improve it. Along with that, Davis (1973, cited by Parks & Kerr, 1999) addressed the question of how individuals, with disparate sets of personal preferences, reach consensus. Hart (1998) pointed out that quality in decision making depends on the underlying assumptions about the role which decision-making groups play in organizations. Considering conflict management and social support as the main functions of the decision making group obviously leads to different criteria for good group decision processes than seeing the group as an agent for organizational action (Schulz-Hardt, Jochims, & Frey, 2002). Often decisions are made by individuals after consulting with, and being influenced by, others. In order to model such decision-making structures, research on advice-giving and advice-taking during decisions was launched. In general, using advice has been found to increase decision accuracy (Bonaccio & Dalal, 2006). Social factors can also play a role in a variety of personal decisions, but it is the collective, coordinated action by a group of individuals that generates a choice, judgment, and opinion (Davis, 1992).
Technological changes help people cross physical, social, and psychological boundaries; these also have secondary effects on group behavior and decision making. Experiments show that compared with a face-to-face meeting, a computer-mediated discussion leads to delays, more explicit and outspoken advocacy, flaming more equal participation among group members, and in extreme situations, unconventional or risky decisions. People in organizations spend much time attending in meetings and contributing to group decision making. Managers spend most of their time in this way. If a decision is necessary, people converge on it, discarding options through discussion. People prefer options that have obvious popularity. Often, one can predict the decision just by knowing who dominates the discussion. Five decades of research on group behavior have addressed why and how group decision making is predictable (Kiesler & Sproull, 1992).
In international projects, decisions could be more critical than in national projects, because of the often higher amounts that are at stake compared with those in national projects. On such project, project managers are critical to project success and have a significant impact on the performance of their project teams (Müller & Turner 2007; Parker & Skitmore, 2005). Managers often need to make decisions in loosely structured situations where there may be an absence of relevant information (leading to uncertainty) or where time is compelling them to act quickly. In such situations, managers may call upon their intuitive decision making skills and improvisatory capabilities. Improvisation has been identified as a combination of intuition and creativity that is driven by time pressures. In a project context, improvisation involves moving away from an agreed plan in order to accelerate the implementation of actions. Intuition may be defined as a cognitive conclusion, where the decision maker's previous experiences and emotional inputs are used as the basis for decisions (Leybourne & Sadler-Smith, 2006).
Connecting culture to projects, Henrie and Souza-Poza (2005) found that the most popular project management topics in researched journals and books were project management, in general, and time scheduling and phasing. They found only eight articles about decision making.
The literature review shows a gap in the knowledge about the impact of German or Swedish national culture on the decision making in project teams. The literature does indicate, however, differences in other contexts. But missing are cases showing clear guidance and insight for managing mixed project teams of German and Swedish nationals.
The next section describes our research model, which we derived from our literature review.
Figure 1 shows the research model with national culture as independent variable, decision making style as dependent variable
Independent variable—National Culture: This variable indicates the cultural origin of the actors investigated. It is assessed at the level of the unit of analysis, which is the project team, including the project manager. It allows identification of project teams as either of German or of Swedish national culture, or as mixed German-Swedish teams.
Dependent variable—Decision Making Style: This variable indicates the way decisions are made and implemented within the two cultures. It is assessed at the level of differences in decision making styles. Therefore, we assessed only those decision making styles that are different between the two cultures.
Figure 3. Research model
The underlying propositions of the study are:
P1: There are differences in decision making styles between teams of German and Swedish national culture.
P2: These differences are observable by project team members and are perceived as impacting project work in joint German - Swedish teams.
The following section outlines the methodology and analyses used for the study.
Methodology and Analysis
We used a sequential mixed-method approach, starting with an inductive study to develop hypotheses, which were tested deductively in subsequent quantitative study.
The Qualitative Study Methodology
The qualitative study followed Yin's (1994) four design tests for construct validity, internal validity, external validity, and reliability. Construct validity was achieved through the use of different sources of evidence, such as respondents from different national cultures (not only German and Swedish nationals, but also others), different industries, and different types of projects, as well as open-ended questions during the interviews. Questions about the interviewees’ observed decision-making style in working with teams of German or Swedish nationals provided the context in terms of cultural perspective.
Internal validity was achieved through pattern matching techniques and subsequent explanation building. Reliability was achieved through use of protocols in semi structured interviews with pre-determined questions, use of interview notes, as well as a common filing system for the interviews. Three researchers, acting as a two person team in Germany and a single researcher in Sweden performed the interviews. Underlying assumption was that each interview would create new knowledge and improved understanding towards answering the research question. The process continued until theoretical saturation was reached.
External validity was achieved through cross-industry sampling and by selecting companies and interviews with diverse national cultures so as to filter out any possible bias related to ethnocentrism, as well as influences from specific company and industry cultures.
We conducted twelve interviews, using a self-developed set of open ended questions. We asked interviewees about real incidents or situations they had encountered on their projects. The questions included:
• Six questions on experiences with German and Swedish teams and on observed differences in their work and behavior. These covered observable differences, extent of impact of these differences on project work, positive and negative examples for German-Swedish collaboration, possible advice to new project managers, and differences in management styles.
• Nine questions on experiences on the differences in decision-making style. Interviewees perceived best practices in decision making processes and structures, as well as interviewees’ advice to new project managers. These questions covered such differences as:
▪ Working on teams of just one national culture versus working in mixed teams.
▪ Decision-making processes, decision-making criteria, and decision acceptance.
▪ Critical cultural factors to consider during decision making in cross cultural projects.
• Six questions on interviewee demographics, covering the interviewees industry, company, type of projects, international experience working abroad and working with German and Swedish teams, as well as with team from their own national culture.
Table 1 shows the industry, country, role, and nationality of the interviewees. Of the 12 interviews, five worked in the automotive industry, five in information and communications technology (ICT), and two in engineering. Six of the companies interviewed were of German origin, of which five were interviewed in Germany and one in Sweden. Five companies were of Swedish origin, whereof three were interviewed in Germany and two in Sweden, one company of Canadian origin was interviewed in Germany.
Table 1. Interviews
|Interview||Industry||Company's origin and interview location||Role of interviewee||National culture of interviewee|
|1||Automotive||German in Germany||Project Manager||German|
|2||Automotive||German in Germany||Project Manager||German|
|3||Automotive||German in Germany||Project Consultant||German|
|4||Engineering||Canadian in Germany||Engineering Manager||German|
|5||ICT||German in Germany||Project Manager||German|
|6||ICT||Swedish in Germany||Project Manager||Danish|
|7||ICT||German in Germany||Consultant||English|
|8||ICT||Swedish in Germany||Project Manager||Dutch|
|9||ICT||Swedish in Germany||Project Manager||German|
|10||Automotive||German in Sweden||Engineer||Swedish|
|11||Automotive||Swedish in Sweden||Engineer||Swedish|
|12||Engineering||Swedish in Sweden||Project Manager||English|
We held our interviews between August and November 2006; each interview lasted between 30 minutes and one hour. Five of the interviews were conducted as face-to-face meetings at the interviewees’ location; the others were conducted as phone interviews. For all of our interviews, we took notes, which we used during our subsequent analysis.
Qualitative Study Analysis
Together as a team, we coded and classified the interview. We indentified the culture-specific behaviors and decision-making styles through a continuous comparison of the interview results. Our work of data collection and analysis was guided by the questions “What are the differences in teams of German and Swedish national culture?” and “What are the differences in decision making styles between German and Swedish teams?”
General cultural differences
We clustered twelve identified categories of cultural differences into three main categories.
• Team and Consensus Orientation. This includes consensus-orientation, individualism vs. team-orientation, and partnership collaboration. We found differences in a higher consensus and partnership orientation of the Swedish team members. Higher consensus orientation is expressed in the preference of Swedish members for more meetings and communication and for joint decision making. That includes a longer decision-making process.
• Organization. This comprises leadership with or without authority, flexibility in executing work, confident appearance, structured working, and consequence-orientation. The interviewees described German organizations as generally more mechanistic than Swedish organizations. Mechanistic structures focus on efficiency, achieved through work specialization in a hierarchical relationship. They execute more control over the members of an organization and are generally less flexible than organic structures (Burns & Stalker, 1994).
• Individualism includes such factors as significance of private life, open-minded communication orientation, identification with project results, and finally, solution and problem-orientation. Differences here were mainly in:
▪ Open mindedness: Here Swedish team members are perceived as being more open minded during discussions, compared with their German counterparts. This includes an open self-critique and a questioning of the approach and status-quo in general, as well as a relaxed and less formal communication style and a greater willingness to communicate in English.
▪ Value of outside-work life: Swedish team members are perceived as placing a higher value on outsidework activities, as compared with the German members. Deadlines and appointments of outside work activities are kept up by Swedish team members, while their counterparts frequently sacrifice outside work activities in order to complete work. The interviews indicated that this is caused by a greater consequence orientation among German team members. German members are more worried about the consequences arising from their behavior, for example, of not finishing a task by a deadline. This includes consequences at various levels, such as the impact on the individual's position, the project, and the wider organization. This, in turn, leads German team members to possess a stronger focus on delivering the project outcome exactly as planned.
These outcomes are supported by Turner and Müller's (2006) research on project manager personalities. Their study showed that the ability to find a good balance between work-life and private-life is a major factor in Swedish companies. Swedish managers assign project managers to projects based on their ability to balance their project workload with their private life.
This section shows a major difference in orientation between German and Swedish team members. While German team members are consequence-oriented, their Swedish colleagues are consensus-oriented. It supports Trompenaars (1996) argument of the differences in Locus of Control: While the German culture relates to a stronger internal Locus of Control, which involves using the environment to achieve personal goals, the Swedish culture relates to an external Locus of Control, which involves a higher adaptation to the environment. This also explains the differences in preferences for group decisions in Sweden and expert decisions in Germany.
Decision making style differences
Categories on decision-making style were clustered into two main categories:
1. Decision-making process. This includes three sub-categories:
• Speed in decision making. Decisions involving Swedish teams take generally longer than decisions within German teams, due to the consensus-orientation of the Swedish members.
• Group versus expert decision. Here Swedish teams prefer consensus among the entire team, while German teams prefer decisions to be made by experts in the decision-related subject area.
• Decision process formalism. Swedish teams prefer pragmatic and transparent decision making, based on open communication. German teams prefer a more formal decision-making style, based on formal authority and clear roles.
2. Decision making style, includes the sub-categories for:
• Decision acceptance. German teams find it easier to accept decisions made in the hierarchy (outside the team). They are also more committed to a decision and their implementation, which links back to the consequence-orientation mentioned earlier. Swedish teams accept decisions easier when they are made within the team. The team decisions lead to higher acceptance of decisions made, but to a lesser acceptance of unpopular decisions.
• Decision changes. German team members accept unpopular decisions more easily
The identified categories were hypothesized as the differences in decision-making styles and processes between German and Swedish culture. These hypotheses were tested in the quantitative study.
Differences by industry
Interviewees came from three different industries, namely automobile, ICT, and engineering. The results show that the differences identified above are not equally perceived across the industries. The perceived cultural differences in decision making in the automobile industry are mostly related to the decision-making process. The ICT industry shows more concern for differences at the level of individuals and their behavior. Here the consensus finding is once again a major differentiator between cultures, but also the people's appearance and identification with the project results, together with the transparency of decisions. A possible impact of an industry's specific ontology on the perception of cultural differences may be indicated. This is in line with Müller, Geraldi and Turner (2007), who identified differences in perceived project complexity, based on industry specific ontology. This warrants further investigation.
The Quantitative Study Methodology
The quantitative study used the same set of questions in both countries, with a Web-based questionnaire in Sweden and paper-based questionnaire in Germany. Questions with five-point Likert scales were used to assess respondents’ opinion on the hypotheses drawn from the qualitative study and provided entry fields for free text to add new factors or opinions. The questions covered:
- Differences in decision-making style
- Differences in decision-making process
- Possible antecedents for these differences
The questionnaire was tested with nine respondents. No changes were made.
The sampling frame was taken from the member list of the German Chamber in Commerce in Sweden (406 names) and the Swedish Chamber of Commerce in Germany (300 names). The sampling frame in Sweden was reduced to 371, due to 35 non reachable email addresses; 42 responses were obtained, of which 22 (6%) were from Sweden and 20 (7%) were from Germany.
Of the respondents, one (2.4%) came from the ICT industry, fifteen (38%) from engineering, two (5%) from automobile, three (7%) from construction, and nineteen (45%) from other industries. Two (5%) did not answer this question. Nationality distribution was 17 (41%) Swedes, 23 (55%) Germans, and 2 (5%) from other backgrounds. Gender distribution was 39 (93%) male and 3 (7%) female. Age distribution showed 2 (5%) were 30 years or younger, 14 (33%) were between 31 and 40, 13 (31%) between 41 and 50, 9 (21%) between 51 and 60, and 4 (10%) older than 60.
The Quantitative Study Analysis
Analysis was done in three steps
- Examination of data and identification of differences by respondent demographics.
- Identification of the underlying psychological patterns of responses, that is, the groupings of variables using factor analysis.
- Identification of the antecedents of differences in decision-making style and process, using regression analyses.
That allowed for confirmation of the underlying assumption of differences in decision-making style and processes, as well as the identification of the impact of possible causes for these differences.
Table 2 shows the descriptive statistics of the data collected. Examination of the data showed eligibility of the data for the planned analysis techniques. A number of t-tests were done to identify differences in the responses based on demographics, no differences were found.
Table 2. Descriptive statistics
|Statistic||Statistic||Statistic||Statistic||Statistic||Statistic||Std. Error||Statistic||Std. Error|
|Valid N (listwise)||41|
In step two, we completed a Varimax rotated confirmatory factor analysis to examine the variables for differences in decision-making style and decision-making process. A KMO of .627 showed adequacy of the data for factor analysis.
Table 3. Rotated component matrix for decision making style and process
Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 6 iterations.
Three factors were extracted before Eigenvalue reached 1, which explained 63% of the variance. Factor loadings under .5 were ignored. Table 3 shows the factors and their loadings. The factors components are:
- Decision-making style: Consisting of the variables for decisions made faster in Germany, decision changes easier to implement in Germany, commitment to a decision higher in Germany, unpopular decisions are easier accepted in Germany.
- Decision process: Consisting of decision process not transparent in Germany, decision process more formal in Germany, individual's responsibilities clearer in Sweden, decision made by experts in Germany
- Involvement in decision making: Consisting of the variable for decisions made by groups in Sweden.
A similar factor analysis was done on the possible reasons for these differences. KMO of .508 and acceptable antiimage correlations allowed for this technique. Two factors were extracted, explaining 62% of the variance. Table 4 shows the factors and loadings, with loading under .5 suppressed. The factors are:
- Person: Consisting of variables for differences in personalities and differences in attitudes towards work.
- Work: Consisting of variables for different demands from home organization and different work processes.
Table 4. Rotated component matrix for antecedents
Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 3 iterations.
The factor analyses (from the quantitative study) confirmed, for the most part, the assumed structural difference in decision-making style and process (from the qualitative study), and added Involvement as a further stand-alone structural difference. It also identified personality and work-habits as the two factors representing the possible antecedents for differences in decision-making style and process.
Step three of the quantitative analysis was a multivariate regression analysis with the two antecedent factors (person, work) as independent variables and the three decision making factors (style, process, involvement) as dependent variables.
A significant multivariate model at p = .036 with a power of 63% was found. The significant positive correlation was between person as independent variable and decision making style as dependent variable (R2 = .160; Adj. R2 = .116, Constant 1.111E-16, B = .398, Beta = .398). The model indicates that increasing personality differences are correlated (antecedent) to increasing differences in decision-making style. Simultaneously, it indicates that differences in cultural-specific work processes and demands from a person's home organization do not impact decision-making style, process, or involvement in the decision. Furthermore it shows that neither the differences in the decision-making process nor involvement are impacted by any of the independent variables.
This study investigated the cultural differences in decision-making style in German and Swedish teams. A sequential mixed methods approach with 12 interviews for a qualitative study and 42 responses to a web-based questionnaire in a quantitative study was applied. The results supported the initial research propositions that
- There are differences in decision-making styles between teams of German and Swedish national culture.
- These differences are observable by project team members and are perceived as impacting project work in joint German - Swedish teams.
The research question asked about the differences in decision-making style and processes in teams of Swedish and German nationals, and the antecedents thereof. Findings can be grouped into three categories:
General cultural differences: In terms of higher team orientation, flatter organizational hierarchies, and more open-minded and informal work attitudes among Swedish teams.
Decision-making style differences: The German team members were perceived as being faster in decision making and more committed and willing to accept a changed or unpopular decision.
Decision-making process differences: On Swedish team, the decision-making process seems more transparent, less formal, and associated with clearer responsibilities for the individual. On German teams, the process is largely dominated by the decision authority of an expert in the field. This is in contrast to the group decision-making style used in Swedish teams.
The differences in decision-making style were attributed to differences in the personality of individuals. Here differences in personality and attitude towards work cause different decision-making styles in terms of decision-making speed and acceptance of changes and unpopular decisions, as well as a level of commitment for implementing a decision. Figure 4 shows the final model.
Figure 4. Final model
The results support a number of previous studies, for example, those on top management styles in Europe (Myers, Kakabadse, McMahon, & Spony, 1995) which showed that there is no European management style and that significant differences between German and Swedish management styles exist. The researchers identified four management style categories in Europe, of which Sweden belonged to the Consensus category (team driven) and Germany to the Towards a Common Goal category (expert driven). Furthermore, the results support Suutari's (1996) findings of lower participation in meetings and less autonomy delegation in German teams.
The results of the present study provide further insight into the complexity of cultural differences in teams of different national cultures. Here the cultural differences in decision making were addressed and showed that different underlying cultural values lead to different decision-making styles in projects. Project team members, project managers, and managers assigning project managers to projects should be aware of these differences in order to avoid cultural clashes and other conflicts arising from these differences.
Training programs for project managers should address the cultural differences and prepare managers and team members alike on ways to deal with decision making in teams of mixed cultural background.
The following general recommendations for project managers in projects with mixed-cultural team can be drawn from the results:
- Recognize the cultural differences and openly discuss these within the team.
- Make sure the mutual cultural values are respected.
- Create ground rules for the group which are acceptable for both cultures.
- Build awareness of—and prioritize—consensus- or consequence-orientation.
- Create a project culture that allows open discussion of cultural differences and allows people to indicate violations of values or ground rules without fear of repercussions.
- Build awareness in the project's environment as to the cultural differences and the ground rules established for the joint team of different national cultures.
- Be patient and value the contributions of the other culture
Teams with mixed German and Swedish nationals can use the following recommendations:
• German project managers:
▪ Ensure involvement of Swedish team members in the decisions.
▪ Appreciate the high value of outside work activities.
▪ Clarify people's roles unequivocally of their Swedish team members.
• Swedish project managers:
▪ Accept and integrate the expert power valued by the German team members.
▪ Accept the need for a more formal decision-making process among the German team members.
▪ Understand that some decisions are made outside the project team.
The strength of the study lies in its mixed-methods approach and the involvement of interviewees from within and outside of the national culture assessed. That adds to the objectivity of the findings. The results, however, have to be interpreted in the context of a small sample size of 12 interviews and 42 responses to a questionnaire. Care should be taken in generalizing the results. Future research should, therefore, aim for further quantitative validation of this study's results in order to build a more robust and generalizable theory. Another area of future research may be the impact of industry type on the perception of cultural differences. The current study indicated the possible decision-making differences by industry, which should be further investigated.
The value of the present study lies in better understanding the main cultural differences in the decision-making style and process used by German and Swedish project teams. It also identified the associated antecedents of the differences in decision-making style. Applying these results will provide for smoother collaboration and better project results, thus helping project managers better serve individuals, organizations, and the society at-large.
Bonaccio, S., & Dalal, R. S. (2006). Advice taking and decision-making: An integrative literature review, and implications for the organizational sciences. Organizational Behavior and Human Decision Processes, 101(2), 127 – 151.
Burns, T. & Stalker, G. M. (1994). The Management of Innovation, 2nd edn, Oxford University Press, USA.
Davis, J. H. (1973). Group decision and social interaction: A theory of social decision schemes. Psychological Review, 80(2), 97 – 125.
Davis, J. H. (1992). Introduction to the special issue on group decision making. Organizational Behavior and Human Decision Processes, 52(1), 1 – 2.
Hall, E. T. (1989). Beyond culture. New York: Anchor Books.
Hampden-Turner, C., & Trompenaars, F. (1993). The seven cultures of capitalism. London: Piatkus.
Hampden-Turner, C., & Trompenaars, F. (2006). Cultural intelligence: Is such a capacity credible? Group & Organization Management, 31(1), 56 – 63.
Hart, P. (1998). Preventing groupthink revisited: Evaluating and reforming groups in government. Organizational Behavior and Human Decision Processes, 73(2-3), 306 – 326.
Henrie, M., & Sousa-Poza, A. (2005). Project management. A cultural literature review. Project Management Journal, 36(3), 5 – 14.
Hofstede, G. (1980). Cultures consequences. Thousand Oaks, CA: Sage Publications.
Hofstede, G. (1984). Cultural dimensions in management and planning. Asia Pacific Journal of Management, 1(2), 81 – 99.
Hofstede, G. (2004). Geert Hofstede Cultural Dimensions. Retrieved March 3, 2004, from http://www.geert–hofstede.com.
Hofstede, G. (2007). Asian management in the 21 century. Asia Pacific Journal of Management, 24(4), 411-420.
Kiesler, S., & Sproull, L. (1992). Group decision making and communication technology. Organizational Behavior and Human Decision Processes, 52(1), 96 – 123.
Leybourne, S., & Sadler-Smith, E. (2006). The role of intuition and improvisation in project management. International Journal of Project Management, 24(6), 483 – 492.
Müller, R., Geraldi, J., & Turner, J. R. (2007). Linking complexity and leadership competences of project managers. Proceedings of IRNOP VIII (International Research Network for Organizing by Projects) Conference, Brighton, UK, CD-ROM.
Müller, R., & Turner, J. R. (2004). Cultural differences in project owner-project manager communications. In D. P. Slevin, D. I. Cleland, & J. K. Pinto, (Eds.), Innovations: Project Management Research 2004 (chap. 24, pp. 403 – 417). Newtown Square, PA: Project Management Institute.
Müller, R., & Turner, J. R., (2007). The influence of project managers on project success criteria and project success by type of project. European Management Journal, 25(4), 289 – 309.
Myers, A., Kakabadse, A., McMahon, T., & Spony, G. (1995). Top management styles in Europe: Implications for business and cross-national teams. European Business Journal, 1(7), 17 – 27.
Parker, S. K., & Skitmore, M. (2005). Project management turnover: Causes and effects on project performance. International Journal of Project Management, 23(3), 205 – 214.
Parkin, J. (1996). Organizational decision making and the project manager. International Journal of Project Management, 14(5), 257 – 263.
Parks, C. D., & Kerr, N. L. (1999). Twenty-five years of social decision scheme theory. Organizational Behavior and Human Decision Processes, 80(1), 1 – 2.
Rotter, J. B. (1966). Generalized expectancies for internal versus external control of reinforcement. Psychological Monographs, 80(609), 1 – 28.
Schulz-Hardt, S., Jochims, M., & Frey, D. (2002). Productive conflict in group decision making: Genuine and contrived dissent as strategies to counteract biased information seeking. Organizational Behavior and Human Decision Processes, 88(2), 563 – 586.
Smith, P. B., Trompenaars, F., & Dugan, S. (1995). The rotter locus of control scale in 43 countries: A test of cultural relativity. International Journal of Psychology, 30(3), 377 – 400.
Suutari, V. (1996). Variation in the average leadership behaviour of managers across countries: Finnish expatriates’ experiences from Germany, Sweden, France and Great Britain. The International Journal of Human Resource Management, 7(3), 677 – 707.
Svenson, O. (1996). Decision making and the search for fundamental psychological regularities: What can be learned from a process perspective? Organizational Behavior and Human Decision Processes, 65(3), 252 – 267.
Trompenaars, F. (1993). Riding the waves of culture. London: Nicholas Brealey Publishing.
Trompenaars, F. (1996). Resolving international conflict: Culture and business strategy. Business Strategy Review, 7(3), 51 – 68.
Turner, J. R., & Müller, R. (2003). On the nature of the project as a temporary organization. International Journal of Project Management, 21(1), 1 – 7.
Turner, J. R., & Müller, R. (2006). Choosing appropriate project managers: Matching their leadership style to the type of project. Newton Square, PA: Project Management Institute.
Tylee, J. (2001). Cultural issues relating to access perceptions and learning styles in the online environment. Retrieved October 24, 2007, from http://www.education4skills.com/jtylee/culture.html#Apendix2
Tyszka, T. (1998). Two pairs of conflicting motives in decision making. Organizational Behavior and Human Decision Processes,74(3), 189 – 211.
Yin, R. K. (1994). Case study research: Design and methods (2nd ed.). London: Sage Publications.
© 2008 Project Management Institute