Avdelningen för ekonomi Different Countries – Different Cultures Germany vs Sweden Cecilia Jensen och Changiz Saadat Beheshti December 2012 Examensarbete 15 hp C-nivå Examensarbete Akmal Hyder/Lars Ekstrand 1 ABSTRACT Title: Different countries – different cultures Level: Thesis for Bachelor Degree in Business Administration Authors: Cecilia Jensen and Changiz Saadat Behesthi Supervisor: Lars Ekstrand Date: 2011 – 12 Our study is based on two countries, Sweden and Germany, and is aiming to find out if the cultural differences between the two countries have a major impact when doing business together or not. Cross-cultural management is a modern topic and can help transnational companies deal with problems that occur due to different cultures in the organization, but is it really necessary to spend huge amount on intercultural training? We used a qualitative method and did a survey through a convenience sampling among six managers in the two countries. We analyzed the answers sorted by country and then compared them to each other. The result of the survey was that Swedish managers inform and include their staff in decisions to a bigger extend than German managers. Other than the preferences of a more democratic leadership the differences were, according to us, insignificant to perform any cultural training between the two countries. For further studies we suggest a deeper research method with a field study at every workplace, to conclude that the manager‟s answers concurred to the actual outcome. We also think that interviewing more managers, and within the same branch, would increase the creditability of the study. The result indicates that the money spent on intercultural training between Sweden and Germany is quite unnecessary and that the differences are smoothing out. Key Words: Culture, Differences, Companies, Sweden, Germany 2 Table of Contents 1. INTRODUCTION ............................................................................................................................. 7 1.1 Problem Discussion ................................................................................................................................ 8 1.2 Purpose .................................................................................................................................................. 9 1.3 Limitation and Definition...................................................................................................................... 10 2. METHODOLOGY ........................................................................................................................... 11 2.1 Sample Selection ................................................................................................................................. 11 2.2 Collection of Data ................................................................................................................................. 12 2.3 Sources of Error .................................................................................................................................... 12 3. DESCRIPTION OF THE COUNTRIES ........................................................................................ 13 3.1 Sweden ................................................................................................................................................ 13 3.2 Germany .............................................................................................................................................. 14 4. STEREOTYPES .............................................................................................................................. 16 5. GLOBALIZATION .......................................................................................................................... 19 6. MANAGEMENT ............................................................................................................................. 22 6.1 Culture ................................................................................................................................................ 23 6.1.1 Power Distance Index (PDI) ...................................................................................................................... 25 6.1.2 Individualism (IDV) ................................................................................................................................... 27 6.1.3 Masculinity (MAS) .................................................................................................................................... 27 6.1.4 Uncertainty Avoidance Index (UAI) .......................................................................................................... 29 6.1.5 Long-Term Orientation (LTO) ................................................................................................................... 30 3 6.1.6 Criticism Against Hofstede’s Cultural Dimensions ................................................................................... 30 7. INTERCULTURAL TRAINING .................................................................................................... 32 8. EMPIRIC ......................................................................................................................................... 33 8.1 Sweden ................................................................................................................................................ 33 8.1.1 General Information ................................................................................................................................ 33 8.1.2 Leadership Information ............................................................................................................................ 33 8.1.3 Social Information .................................................................................................................................... 34 8.1.4 Efficiency Information .............................................................................................................................. 34 8.2 Germany .............................................................................................................................................. 35 8.2.1 General Information ................................................................................................................................ 35 8.2.2 Leadership Information ............................................................................................................................ 35 8.2.3 Social Information .................................................................................................................................... 36 8.2.4 Efficiency Information .............................................................................................................................. 36 9. ANALYSIS ...................................................................................................................................... 37 9.1 Theoretical Analysis ............................................................................................................................. 37 9.1.1 Description of the Countries .................................................................................................................... 37 9.1.2 Stereotypes .............................................................................................................................................. 37 9.1.3 Globalization ............................................................................................................................................ 38 9.1.4 Management ............................................................................................................................................ 38 9.1.5 Culture ..................................................................................................................................................... 39 9.1.6 Power Distance Index (PDI) ...................................................................................................................... 39 9.1.7 Masculinity (MAS) ..................................................................................................................................... 40 4 9.1.8 Uncertainty Avoidance Index (UAI) .......................................................................................................... 40 9.1.9 Cultural Training ....................................................................................................................................... 40 9.2 Empirical Analysis ................................................................................................................................ 40 9.2.1 General Information ................................................................................................................................ 41 9.2.2 Leadership Information ............................................................................................................................ 41 9.2.3 Social Information .................................................................................................................................... 42 9.2.4 Efficiency Information .............................................................................................................................. 43 9.3 Validity and Reliability of the Analysis ................................................................................................