Cultural dimension and organizational structure: Japan vs Germany

Author: Iloka Benneth Chiemelie
Published: 31 January 2019

In recent cross-cultural organizational theory, it is widely acknowledged that the way companies behave is culturally contingent. As an example, it was hypothesized by Jung et al. (1995) that the transformational form of leadership is more eminent and effective in collectivistic society as against their individualistic counterparts (Ardichvili and Kuchinke, 2000). On the same note, companies from high uncertainty culture do places their employees on clear operational procedures, which creates an attitude of tolerating innovation and ambiguity (Lazic, 1995). Also, the more masculine cultures does seem to create companies that are more tolerate of directive and strong leaders than those from feminine culture, where the companies feature more of structures based on considerate and consultative leaders (Lengyel, 1996).

From the cultural dimensions, there are similarities to prove that home culture might have strongly influenced the organizational structures (Veiga et al., 1995) of Toyota and Mercedes. For the case of Toyota, the company’s structure has since its inception been based on the traditional Japanese business hierarchy in which the most senior executives are in charge of decision making with information flowing in one direction from top down (Hofstede, 1993). For example, it has been recorded that in the USA, the American executive are closely monitored by a stationed Japanese counterpart that ensures the American executives are strictly following defined structured protocols (as reflected in the Japanese culture of masculinity and high uncertainty avoidance). In business, this is known as centralized decision making. The link between national culture and organizational structure of Mercedes is mostly featured in the company’s business process and objectives. The German highly masculine culture is reflected in Mercedes’s business process which is based on offering the top quality products in automobile industry as showcases their class above others. It also employs a functional organizational system with clear hierarchy and processes, reflecting the high level of uncertainty avoidance featured in the German culture (Hofstede, 1994).

Although the two companies somewhat have the same management features, they are also different in terms of certain structures. This is as documented in the table 1 below.

Cultural dimension	Japan	Germany
Power distance	There is clear visible power distance with the top executives normally make decisions and subordinated mandated to follow exactly.	Decisions are normally based on consultations and the executives are more accessible than in japan.
Individualism	Employees seek collective goals and focus on company’s performance.	Employees value performance and appraisals won due to such.
Masculinity	Centralized management system where information pass from top down.	Functional management system where information flows across the company.
Uncertainty avoidance	The company’s structure accommodates continuous improvement (kaizen) and is wailing to change its processes easily for such.	High level of uncertainty avoidance means that fundamental processes are barely innovated.
Long term orientation	High level of long-term orientation puts customers in the frontline of every decision made.	This is the same as the Japanese Toyota as both countries have the same level of long-term orientation.
Indulgence	The organizational is restrained with more focus on company’s performance rather than individual work-life balance.	This is same as the Japanese Toyota because Germany is also retained.

References

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Hofstede, G. (1994). Uncommon sense about organizations: Case studies and field observations. Thousand Oaks, CA Sage.