Cultural dimensions identified by Hofstede

The Cultural Context of IH RM Establishing a branch of a family business in China A family—owned carbon steel company from Germany has extended its business to Hong Kong. The owners bought a small traditional Chinese firm and decided to copy the successful structure they had developed at home. This structure was headed by three general managers who equally shared the responsibilities for the business activities of the firm. The consequences were as follows: 1. The Chinese employees were assigned tasks by people they had never seen before and whom they did not understand. Many misunderstandings occurred, and some were quite costly. 2. The employees back in Europe were only concerned with whether the assigned tasks were completed and did not consider any other obligations to the Chinese employees, such as ta king care of the relationship with the Chinese government, banks, etc. 3. Eventually, the local employees became frustrated and were ready to leave the company. The result was that the management model was changed again and a single managing director of the subsidiary was accountable for all business activities in Hong Kong. Discussion Questions Relate the described situation to one of the cultural dimensions identified by Hofstede. How can you explain it? How does this situation compare to comparable situations in your home country? What are the limits of cultural explanation?