International Management: Japan vs. Germany
Introduction
Business world is becoming more globalized today. As many businesses decided to go international, they need to be able to see how important it is to be able to understand the cultural differences between their home country and host country. Things are done differently around the world and there are many differences that can easily be misunderstood if the business person does not expand their understanding of the setting before beginning to conduct business in the environment. There are many cases of cross-cultural business failure that is caused by the manager’s inability to recognize the cultural differences and tackle them properly. Therefore, managers involved in the international business will have to become more sensitive to the challenges emanating from the cultural and ethnic landscape of the countries they work in. They need to understand culture well enough so that they are prepared to be successful in international business and avoid cultural gaffes. In the next few paragraphs, Japan and German will be discussed in terms of their institutional and cultural differences and how these differences would affect the managerial practices that will be done by the manager from Japan who is sent to German as the host country. This paper will seek for the differences of communication across culture, the drivers of cultural differences and how it impacts the management style and HRM, and how hierarchical structure differ across country.
Communication across culture
Communication is one of the most critical factors in the success of a business and communicating across culture has always been challenging for managers put in an unfamiliar setting abroad. One of the best way to approach this is to first understand how the culture of the host country affects its communication style. Every country has its own cultural traits. Edward T. Hall, in his 1976 book Beyond Culture, defined these traits in term of “high-context” and “low-context.” Japan has a higher-context culture. In a high-context culture, the context in which what is spoken plays a major role in communication and the behavior of individuals. The person’s status, who is speaking, and whether the person is initiating a conversation or answering a question are all matter in a high-context culture. There is a greater emphasis on the context or nonverbal cues and less emphasis in actual information. Sometimes what is being said is not necessarily what is being meant by the speaker. Also, in high-context culture, face is very important in which direct, embarrassing questions or statements are to be avoided, or asked in a very discreet way, sometimes via other people (intermediary). In the other hand, in low-context culture the primary interest is the information and the context is less important. The listener wants to get as many information as they can. There is a lack of clarity that is generally regarded as negative and interpretation should be unequivocal. Direct and embarrassing questions are often asked; face-saving is not very important. Communication between two persons from high-context culture and low-context culture can cause misunderstanding because of these differences. Manager should aware of these differences so that there will not be any misunderstanding between him and the employees in Germany.
Members of low-context cultures used solution orientations more than members of high-context cultures, while members of high-context cultures used non-confrontation more than member of low-context cultures. Ting-Toomey’s (1985) theoretical speculations argued that members of low-context cultures use rational-factual logic more than members of high-context cultures. She further suggested that members of high-context cultures utilize indirect strategies for resolving conflict more than member of low-context cultures. It means that the Japan expatriate manager is used to use the indirect strategies to resolve any conflict at the business environment.
Drivers of the cultures
Another valuable framework that can be used to identify the differences between Japan and Germany is the cultural framework created by organizational psychologist Geert Hofstede. By exploring the German culture through the lens of this framework, there will be a good overview of the deep drivers of German culture relative to other world cultures i.e. Japan and vice versa.
Power distance is defined as the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. Germany is counted as countries with low-power distance index. It is highly decentralized and there are more direct and looser communication. People there are not used of being controlled by others and are like to be challenged to show their abilities . In the other hand, Japan is a borderline hierarchical society. Japanese are always conscious of their hierarchical position in any social setting and act accordingly. However, it is not as hierarchical as many other Asian countries. Japanese tends to make slower decision making process because of those hierarchical layers from bottom to the very top management. Individualism addresses the degree of interdependence a society maintains among its members. In individualist countries, people are supposed to look after only themselves and their related families. In collectivist society, people tend to be more group-oriented and having sense of togetherness between one another. Germany is one of the countries with quite high individualism. There is a strong drivers of self-actualization. Also, people tend to be loyal according to personal preferences and the responsibility and duties they hold to other parties. Communication among them is quite direct with no concern of getting the other parties hurt by what is being said. In the other hand, Japan has the character of collectivist society. It can be seen as how they put harmony of group above the expression of individual opinions and people have a strong shame for losing face. Japanese are famous for their loyalty to their companies. However, such loyalty is usually done by people from collectivist culture. Therefore, Japanese is seen as a collectivist by Western people but is seen as individualist by Asian people. It is not as collectivist as many other Asian countries, but can’t be counted as an individualist as well. Masculinity level shows what motivates people, and whether they want to be the best (masculine) or liking what they are doing (feminine). Masculine societies emphasize competitiveness, assertiveness, and excelling, while feminine societies focus on quality of life and caring for the weak. Germany is considered a masculine society. Performance is highly valued. People rather “live in order to work” and draw a lot of self-esteem from their tasks. Managers are expected to have the power or quality of deciding and putting an end to controversy as well as confidently aggressive or self-assured. Status is also matter as people there show their cars, gadgets, watches and so on to show their social status in a society. Japan is one of the most masculine societies in the world. There are a strong competitiveness between people in group level. This is something that is common in Japanese society. They strive for excellence in anything they do. Uncertainty avoidance deals with a society’s tolerance for uncertainty and ambiguity. It indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations. Unstructured situations are novel, unknown, surprising, and different from usual. Germany has a high uncertainty avoidance. It means that they are not used to being uncertain in terms of planning and many other things. They prefer to plan everything carefully in order to get the results they want. They have the society that rules, laws, and regulations are well followed. Changes are expected to be done slowly
and step by step. Japan has a high degree of uncertainty avoidance as well. In conclusion, Germany is a low-power distance, individualistic, and masculine country with a quite high uncertainty avoidance. Japan in the other hand is a moderate-power distance, moderate individualism, and very masculine country with very high uncertainty avoidance. It can be seen that Japanese and Germany have some kind of similarity in several aspects. Both of them are masculine countries and have a relatively high uncertainty avoidance.
Impact of the cultural context and on HRM practices
By seeing the differences between Japan and Germany, the expatriate manager must have known that those differences would bring several impacts on how he will be doing the HRM practices in the new workplace which is Germany. First, recruitment and selection process would be done differently in individualistic society and collectivist society. Since, Germany is an individualistic society, individual achievements would represent important selection criteria. The emphasis in the recruiting process is more on individual competencies that on team-related skills. The reputation of educational institutions such as public and private universities varies in different countries. Which one is well-known, which one is not, an expatriate manager should be aware of these kind of things as well. Second, compensation based on high or low uncertainty avoidance. In a high uncertainty avoidance, people are more risk averse which means they prefer something such fixed compensation. In the other hand, countries with low uncertainty avoidance like to take risk and ready to accept any outcomes that might affect the compensation get. By taking risk, it means that there are two chances which are getting higher compensation or lower compensation. It is because, the compensation would be lean towards the performance based pay. Germany has societies with high-uncertainty avoidance. Therefore, employees in Germany would be more reluctant in taking risk and prefer fixed compensation. Third, task distribution based on whether a country is an individualist or collectivist. Germany is an individualist society. Societies high on individualist rather attribute individual responsibilities in the work system. The emphasize is more into individual responsibility rather than group work. Last, rewarding an employee in an individualist culture, it is perfectly normal to reward an individual’s effort with public praise or rapid promotion. It is different from the group-oriented cultures where one will often feel embarrassed to be treated differently from their peers.
Hierarchical structure: Flat vs. Vertical
Hierarchical order will show who is responsible for what, and who report to who. Sometimes organizations decide to make an organization chart which will explain the hierarchical order for the employees. However, it doesn’t really tell how decisions are made, where an individual’s loyalty lie, who the employees should talk to when they want to get things done, and how they expect to be treated. When someone is on his home territory, he or she would know what the employees are expecting and how things are should be done. However, when he or she is put outside the home territory, adjustment should be made based on the cultural environment. There will be people with different expectations and behavior. Attitudes toward handling the hierarchy, taking responsibility, monitoring performance and getting colleagues to cooperate will vary from culture to culture (Carté & Fox, 2008). There are two kinds of hierarchy system which are flat hierarchy and vertical hierarchy. Flat hierarchy is where the leaders are expected to hold rather than share their power. People are used to challenge the decisions made by their leaders. The expectation is that the boss is more into consulting them rather than just giving order from top level management to the lower level management. In terms of any problems happened in the workplace, people tend to handle them directly and not running to the boss every time such problems happened. It is because in flatter business structure, going to the boss too often can be socially unacceptable. Flat business cultures/hierarchical order are usually used by countries with low-power distance culture which make Germany one of them. In the other hand, in Japan it is important to bear in mind that a group inevitably and eventually develops the vertical type of organizational structure (Nakane, 1972). Vertical structured organization have a chain of management, usually with a CEO at the top making decision and delegating authority to lower-level managers. The Japanese expatriate manager is used to this kind of situation in his home-country. Therefore, by going to Germany, he has to be aware of the organizational structure in Germany and try to make some adjustment there.
The impact of how people relate to their bosses and peers should not be underestimated. The Japanese definition of leadership is not the same as it is in Germany. According to some research, managers in Japan have a series of one-to-one consultations with their team members. These often take the form of informal chats in the bar or spontaneous conversations in the office. So, by the time the decision is finally taken, everyone’s commitment to it is guaranteed. The way in which more individualist cultures i.e. Germany challenge and disagree with on another during the round table meeting would be a terrible shock for the expatriate manager if he wasn’t aware of it. For Japanese, a round table meeting or the so-called decision-making meetings are some sort of formality to what has actually been agreed during the one-to-one consultation.
Avoiding cultural blunders
Put in an unfamiliar environment with several cultural difference will not be easy for anyone. Even though there is already careful approach being done, there will always be some cultural gaps. One of the thing that can be done to avoid the cultural blunders is that empathy. Empathy is the ability to put yourself in someone else’s position; to see the world through their eyes; to imagine how they’re feeling (Carté & Fox, 2008). If the manager wants to succeed in the new environment which in this case is Germany, he would have to be able to develop the ability to empathize with everyone – even people who seem to look at the world from a completely different perspective. For example, asking plenty of questions about the employees (who, what, why, where, how), really listen to the answers, having more closed questions to get more information, acknowledge the other person’s position and answers other people’s concerns calmly and reasonably.
Conclusion
In conclusion, business has become more globalized and people are starting to exchange for staffs and sending them abroad to the host-country. However, it has never been easy for people going outside their home-country because of some cultural differences that might appear later between their home-country and their host-country. Communication is crucial in doing business and people from different culture would have different styles of communication. In this case, as a Japanese manager, he would have been used to the communication styles in a high-context culture. Things such as indirectness in communicating should be adjusted. Communication should be changed to be more direct and not camouflaging the real intention as well as information. Furthermore, in terms of making decisions, the Japanese manager should be more rational-factual oriented rather than using the indirect strategies. Cultures differ from one country to another because of several drivers such as power distance, masculinity, individualism, masculinity, and uncertainty avoidance. Germany is a low-power distance, individualistic, and masculine country with a quite high uncertainty avoidance. It means that the Japanese manager should change some of the management practices he used to do in Japan and do some adjustment in Germany. H
e has to be ready to omit the slow decision making process done in Japan and ready to have more responsive and participative meetings. Also, since Germany is an individualist country, the manager has to be aware that communication will be quite direct. However, Japan and Germany are quite similar in terms of the masculinity level with both societies’ strong competitiveness. Therefore, the Japanese manager should have been able to adjust well in terms of making an end to controversy and giving motivation in such masculine society. Cultural differences would also impact on the HRM practices such as recruitment process, compensation, task distribution, and rewards giving. The manager should be aware of the less group-oriented condition in Germany that would affected the recruitment and task distribution process as well as in rewarding people. Germany also has a flatter hierarchical structure which make it different from the Japan styles in terms of making decision, having meetings, and how people relate to their boss and peers. Besides all of these adjustment that might be kind of hard at first for the manager, one thing he could do to avoid many cultural blunders is that empathy with other people. Try to look things through their perspective and as the time goes by, he can do some closed questions asking for more information and be adjusted in no time.