Intercultural Analysis of Shangri-La Thanks to Hofstede's Dimensions

Shangri-La is a Hong-Kong-based deluxe hotel group which owns a lot of hotels in Asia and Middle East.

As part of a global expansion strategy, Shangri-La decided to enter a non-Asian market which is why in 2003, the group has opened a new hotel in Sydney, Australia. But as we will see later on, entering a market which has a totally different culture is not an easy task.

Geert Hofstede has established 5 dimensions of national culture which will enable us to compare Asia an Australia in terms of culture and values. This comparison will also be vey useful to bring to light  what adaptations were needed to enter the Australian market.

The first dimension that we will study is power distance:

Power distance is the extend to which a country accept that power is distributed unequally. In Asia , power distance is very high because people accept that there are inequalities and that is why employees do not consider themselves as equal to guests (in terms of age or social status).

On the other hand, power distance in Australia is low › equality + empowerment  

Australians do not tend to treat other people in a different way even if they do not have the same age of the same social status. If Shangri-La group did not adapt its expectations, the Australian staff would feel awkward because employees would be expected to look up to the guests in a way they would feel uncomfortable about. Australians do not think they are lower that anyone.

The second dimension is about individualism or collectivism:

People in Asia are collectivists while in Australia people are individualists. Asian people act in the interests of the group and not necessarily of themselves. This difference would have had an impact on the provision of after-work social activities that are generally poorly attended by Australian employees which is why Shangri-La group had to adapt its training contents.

The next dimension concerns masculinity and feminity:

Asia is a masculine society while Australia is a more feminine society. Indeed, a masculine society is driven by competition, achievement and success. In China, for example, success is so important that a lot of people would sacrifice their family and leisures priorities to work which is why they work full-time. Unlike Chinese people, Australians are more sensitive to values such as caring for others and their quality of life (therefore, it can be defined as a feminine society) which can explain why the staff is either working part-time or casual - because people want to keep some time for their family and for leisure. So Shangri-La had to adapt itself to do the same amount of work as in Asia but with half of the staff.