The Influence of Home Country Culture on International Organisation

The Influences of Home Culture and Institution on International Company

Introduction

Globalisation is supposed to make national cultures and institutions homogeneous. For many multinational companies, the influence of the home country’s culture and institution is weakened than before. However, since the globalization is making countries much more like each other, they still play important roles in a company’s strategies in its international business. This essay will focus on the Wal-Mart case, analyzing how the US culture and institutions influence the strategies of the company.

American National Culture

National Culture can be defined as the programming of the mind or the beliefs of a group as to what behaviour are good and bad. The analysis is based on Hofsted’s five culture dimensions. US: 91-46-62-40-29

Average: 43-64-50-55-45

1. Collectivism/Individualism

Collectivism is the extent to which important decision are made by groups. It indicates the degree to which individual are inter grated into groups. US has got the highest IDV figure of the world at 91 (average 43), which means the relationship between people is loose and everyone tend to take responsibility of its own and only looks out for itself and its family. 2. Uncertain Avoidance

Uncertain avoidance is the extent to which individuals and groups avoid taking risk. The US has a low ranking of 46, compared to the world average of 64. It indicates the US society has fewer rules and does not attempt to control all outcomes and results. People in US has a greater level of tolerance for different opinions, thoughts and beliefs. 3. Masculinity

High masculinity represents the importance given to male values such as competitiveness, measurable performance and assertiveness. US society is with a ranking of 62. This indicates the country experience a higher degree of gender differentiation of roles. The male dominates a significant portion of the society and power structure. 4. Power Distance Tolerance

Power distance tolerance is the extent to which distant authority is represented and obeyed. It suggests that a society’s level of inequity is endorsed by the followers as much as by leaders. The PDT of US is 40. This is indicative of a greater equality between societal levels, including government, organizations, and even within families. 5. Long-term Orientation

Long term orientation is the extent to which individuals and groups are prepared to forge current welfare for the future. It is the lowest dimension for US at 29, compared to world average of 45. This low LTO ranking is indicative of the societies' belief in meeting its obligations and tends to